State Senate
FOR IMMEDIATE RELEASE
Wednesday, January 2, 2008
Contact: Senator Maggie Hassan (603) 271-4153
SENATE PASSES WORKERS COMPENSATION FIX
CONCORD - The Senate voted 23-0 today to fix a workers' compensation law from last year to protect small contracting businesses from unintended consequences triggered by the original legislation.
"The bill was intended to crack down on construction contractors who have been abusing the workers' compensation system. It is now clear that the bill cast too wide a net and inadvertently imposed significant cost increases on legitimate small construction and construction-related businesses," said Senator Maggie Hassan (D-Exeter) chairwoman of the Senate Municipal and Public Affairs Committee which recommended passage today of House Bill 692 containing the fix.
House Bill 471 passed last year with broad bipartisan support in both the House and Senate. It sought to address a problem with certain contractors who were gaining an unfair competitive advantage by requiring their workers to form their own corporations and claim themselves as officers to avoid paying workers' compensation. It was only after the law went into effect in September that lawmakers learned it was causing unexpected hardship for many small companies.
Leading lawmakers from both parties reached agreement last month on today's approach to fixing the problem and agreed to pass the measure at the first meeting of the 2008 session. House Bill 692 repeals one problematic section that eliminated an exemption from workers comp for up to three officers or directors of a corporation. It also addresses contract workers who do tasks such as snow plowing or grass cutting for the State and allows businesses that have already paid their workers compensation policy under the new rules to collect the maximum refund possible.
Senate Republicans today proposed an alternative amendment that would have repealed House Bill 471 in its entirety, but Democrats rejected that with a Senate vote of 13-10 along party lines.
"Our focus today is to expedite the repeal of the harmful part of this bill. A full repeal would allow contractor abuses of the workers' compensation system to continue. We can address any further concerns with a full hearing during the session," Hassan said.
The House was expected to pass the bill today so it can go to Governor John Lynch, who has agreed to sign it.
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