An Act To Improve the Workers' Compensation System
Maine Legislature, Session 127, LD 1553
Committee Amendment CA_A_S399 (Senate)
Amends: 39-A MRSA §324

COMMITTEE AMENDMENT " A" to S.P. 608, L.D. 1553, Bill, "An Act To 
Improve the Workers' Compensation System" 
Amend the bill by striking out all of sections 1 and 2. 
Amend the bill in section 3 in paragraph A in the 5th line (page 3, line 1 in L.D.) by 
striking out the following: "2016-17" and inserting the following: '2017-18' 
Amend the bill by inserting after section 4 the following: 
'Sec. 5. 39-A MRSA §324, sub-§3, as amended by PL 2011, c. 113, Pt. B, §20, is 
further amended to read: 
3. Failure to secure payment. If any employer who is required to secure the 
payment to that employer's employees of the compensation provided for by this Act fails 
to do so, the employer is subject to the penalties set out in paragraphs A, B and C. The 
failure of any employer to procure insurance coverage for the payment of compensation 
and other benefits to the employer's employees in compliance with sections 401 and 403 
constitutes a failure to secure payment of compensation within the meaning of this 
subsection. 
A. The employer is guilty of a Class D crime. This paragraph applies only to cases 
in which the employer has committed a knowing violation. 
B. The employer is liable to pay a civil penalty of up to $10,000 or up to an amount 
equal to 108% of the premium, calculated using Maine Employers' Mutual Insurance 
Company's standard discounted standard premium, that should have been paid during 
the period the employer failed to secure coverage, whichever is larger, payable to the 
Employment Rehabilitation Fund. In determining the amount of the penalty to be 
assessed under this paragraph, the board shall take into consideration the employer's 
effort to comply with sections 401 and 403. 
C. 
The employer, if organized as a corporation, is subject to administrative 
dissolution as provided in Title 13-C, section 1421 or revocation of its authority to do 
business in this State as provided in Title 13-C, section 1532. The employer, if 
COMMITTEE AMENDMENT 
t:,i, (j 
COMMITTEE AMENDMENT" A" to S.P. 608, L.D. 1553 
organized as a limited liability company, is subject to administrative dissolution as 
provided in Title 31, section 1592. The employer, if licensed, certified, registered or 
regulated by any board authorized by Title 5, section 12004-A or whose license may 
be revoked or suspended by proceedings in the District Court or by the Secretary of 
State, is subject to revocation or suspension of the license, certification or 
registration. 
This paragraph applies only to cases in which the employer has 
committed a knowing violation, has failed to pay a penalty assessed pursuant to this 
subsection or continues to operate without required coverage after a penalty has been 
assessed pursuant to this subsection. 
For purposes of this subsection, a violation is considered a knowing violation if the 
employer has previously obtained workers' compensation insurance and that insurance 
has been cancelled or that insurance has not been continued or renewed, unless the 
cancellation. failure to continue or nonrenewal is due to a substantial change in the 
employer's operations that is unrelated to the classification of individuals as employees or 
independent contractors; the employer has been notified in writing by the board of the 
need for workers' compensation insurance; the employer has had one or more previous 
violations of the requirement to secure the payment of the compensation provided for by 
this Act; or the employer misclassifies an employee as an independent contractor despite 
a contrary determination by the board. 
Prosecution under paragraph A does not preclude action under paragraph B or C. 
If the employer is a corporation, partnership, limited liability company, professional 
corporation or any other legal business entity recognized under the laws of the State, any 
agent of the corporation or legal business entity having primary responsibility for 
obtaining insurance coverage is liable for punishment under this section. Criminal 
liability must be determined in conformity with Title 17-A, sections 60 and 61.' 
Amend the bill in section 5 in subsection 1 in the first paragraph in the first and 2nd 
lines (page 3, lines 19 and 20 in L.D.) by striking out the following: ", ineh1ding an 
iadependent eontraetor 'HflO hires and pays employees," and inserting the following: ' 
including an independent contractor who hires and pays employees,' 
Amend the bill by striking out all of section 8. 
Amend the bill in section 9 in §407 in the first paragraph in the 5th line (page 6, line 
in L.D.) by striking out the following: "intentionally" 
Amend the bill in section 9 in §407 in the first paragraph in the last 4 lines (page 6, 
lines 16 to 19 in L.D.) by striking out the following: "Notwithstanding this section. all 
workers' compensation policies and self-insured workers' compensation policies must 
include a provision requiring payment of benefits under this Act to an employee even if 
the employee was misclassified on the date of injury or death." 
Amend the bill by inserting after section 9 the following: 
'Sec. 10. Report. By January 15, 2017, the Workers' Compensation Board shall 
study the independent contractor predetermination provisions of the Maine Revised 
Statutes, Title 39-A and report to the joint standing committee of the Legislature having 
jurisdiction over labor matters any recommended legislation related to those provisions. 
COMMITTEE AMENDMENT 
' 
;t; 
COMMITTEE AMENDMENT" A"to S.P. 608, L.D. 1553 
The committee may report out a bill relating to the report to the First Regular Session of 
the I 28th Legislature.' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or 
section number to read consecutively. 
SUMMARY 
This amendment changes the bill by eliminating the sections affecting independent 
contractor 
predeterminations. 
The 
amendment 
instead 
requires 
the 
Workers' 
Compensation Board to study the current system for independent contractor 
predeterminations and report any recommended legislation to the joint standing 
committee of the Legislature having jurisdiction over labor matters. 
It also requires the Workers' Compensation Board to consider an employer's efforts to 
comply with the coverage requirements of the Maine Workers' Compensation Act of 
1992 when imposing a monetary penalty, establishes that criminal prosecution may be 
pursued only if the employer has committed a knowing violation and establishes that 
revocation of authority to operate pursuant to the Maine Revised Statutes, Title 39-A, 
section 324, subsection 3, paragraph C may be pursued only if the employer has 
committed a knowing violation, has failed to pay a penalty assessed pursuant to that 
subsection or continues to operate without required workers' compensation insurance 
coverage after a penalty has been assessed pursuant to that subsection. Additionally, the 
amendment delays the increase to the Workers' Compensation Board assessment cap 
from fiscal year 2016-17 to fiscal year 2017-18. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Revised: 03/14/16 
;t;Pac. 
LD 1553 
LR 2581(02) 
An Act To Improve the Workers' Compensation System 
Fiscal Note for Bill as Amended by Committee Amendment ",4' (5- '3<'.l.C\ \ 
Committee: Labor, Commerce, Research and Economic Development 
) 
Fiscal Note Required: Yes 
Fiscal Note 
Undetermined future biennium cost increase - All Funds 
Appropriations/ Allocations 
Other Special Revenue Funds 
Revenue 
Other Special Revenue Funds 
Correctional and Judicial Impact Statements 
Eliminates Class D crimes. 
FY 2015-16 
FY 2016-17 
$0 
$0 
$0 
$0 
A reduction in fines will decrease General Fund revenue by minor amounts. 
Fiscal Detail and Notes 
Projections 
FY 2017-18 
$1,800,000 
$1,800,000 
Projections 
FY 2018-19 
$1,800,000 
$1,800,000 
Increasing the cap on the dollar ammmt that may be assessed by the Workers' Compensation Board on insurance 
companies and self-insured employers from $11.2 million to $13.0 million beginning in fiscal year 2017-18 may 
increase the cost to all state government agencies for the workers' compensation portion of personal services expense. 
The fiscal impact on the State's self-insured program can not be determined at this time and will depend on the actual 
amount assessed. 
Additional costs to the Workers' Compensation Board to conduct the required study and submit the required report 
can be absorbed within existing budgeted resources. 
LR2581(02) - Fiscal Note - Page 1 of 1