BY REPRESENTATIVES Tate, Chavez, Nichol, Reeser, Takis;
also SENATORS Chlouber, Tanner, Norton, and Perlmutter.
CONCERNING ALTERNATIVE PENALTIES FOR EMPLOYERS NOT
MAINTAINING REQUIRED WORKERS' COMPENSATION COVERAGE.
Be it enacted by the General Assembly of the State
of Colorado:
SECTION 1. 843409
(1), (2), and (4), Colorado Revised Statutes, are amended, and
the said 843409 is further amended BY THE ADDITION
OF THE FOLLOWING NEW SUBSECTIONS, to read:
843409. Defaulting employers
penalties enjoined from continuing business
fines procedure. (1) Any
employer subject to the terms and provisions of articles 40 to
47 of this title who fails to insure or to keep the insurance
required by said articles in force or who allows the same to lapse
or fails to effect a renewal thereof shall not continue any business
operations while such default in effective insurance continues.
Upon receiving information from any person or entity that an
employer is in default of its insurance obligations, the director
shall forthwith investigate and, if the information can be substantiated,
the director shall notify the employer of the opportunity to request
a prehearing conference on the issue of default. Thereafter,
if necessary, the director shall set the issue of the employer's
default for hearing in accordance with hearing time schedule and
procedures set forth in articles 40 to 47 of this title and rules
promulgated by the director. Upon a finding that the employer
is in default of its insurance obligations, the director shall
EITHER:
(a) Order the employer in default to cease
and desist immediately from continuing its business operations
during any period such default continues; OR
(b) (I) IMPOSE A FINE OF NOT MORE
THAN FIVE HUNDRED DOLLARS FOR EVERY DAY THAT THE EMPLOYER FAILS
OR HAS FAILED TO INSURE OR TO KEEP THE INSURANCE REQUIRED BY ARTICLES
40 TO 47 OF THIS TITLE IN FORCE, OR ALLOWS OR HAS ALLOWED THE
INSURANCE TO LAPSE, OR FAILS OR HAS FAILED TO EFFECT A RENEWAL
OF SUCH COVERAGE; EXCEPT THAT THE DIRECTOR SHALL NOT IMPOSE A
FINE THAT EXCEEDS THE ANNUAL COST OF THE INSURANCE PREMIUM THAT
WOULD HAVE BEEN CHARGED FOR SUCH EMPLOYER.
(II) ANY FINE IMPOSED PURSUANT TO SUBPARAGRAPH
(I) OF THIS SUBSECTION (1) SHALL BE IMPOSED ONLY FOR THOSE DAYS
THAT OCCUR AFTER THE EMPLOYER RECEIVES A NOTICE FROM THE DIRECTOR
THAT THE EMPLOYER HAS FAILED TO INSURE OR TO KEEP IN FORCE THE
INSURANCE REQUIRED BY ARTICLES 40 TO 47 OF THIS TITLE, OR HAS
ALLOWED THE INSURANCE TO LAPSE, OR HAS FAILED TO EFFECT A RENEWAL
OF SUCH COVERAGE.
(III) THE DIRECTOR SHALL SUSPEND ANY FINE
IMPOSED PURSUANT TO THIS PARAGRAPH (b) IF THE EMPLOYER PROVIDES
PROOF SUITABLE TO THE DIRECTOR THAT THE EMPLOYER HAS IN FORCE
INSURANCE FOR SO LONG AS THE EMPLOYER HAS ANY OBLIGATION UNDER
ARTICLES 40 TO 47 OF THIS TITLE, AND IS NOT OTHERWISE IN VIOLATION
OF ARTICLES 40 TO 47.
(2) Any cease and desist order issued
OR FINE IMPOSED by the director under subsection (1) of this section
shall include specific findings of fact that are based upon evidence
that:
(a) The employer received notice of the
hearing;
(b) The employer employs employees for
whom it must carry workers' compensation insurance under the provisions
of articles 40 to 47 of this title;
(c) The employer does not have a policy of workers' compensation insurance in effect; and
(d) The employer continues to operate
its business in the absence of such coverage.
(4) The issuance of an order to cease
and desist, THE IMPOSITION OF A FINE PURSUANT TO SUBSECTION (1)
OF THIS SECTION, or the issuance of an order for injunctive relief
against an employer for failure to insure or to keep insurance
in force as required by articles 40 to 47 of this title shall
be the penalty for such failure within the meaning of section
843304 (1) and such penalty shall be in addition to
the increase in benefits that section 843408 requires.
(5) THE DIRECTOR OR ADMINISTRATIVE LAW
JUDGE SHALL REPORT TO THE DIVISION EACH TIME A FINE IS IMPOSED
PURSUANT TO SUBSECTION (1) OF THIS SECTION. EACH SUCH REPORT
SHALL INCLUDE THE AMOUNT OF THE FINE AND THE NAME OF THE OFFENDING
PARTY.
(6) A CERTIFIED COPY OF ANY FINAL ORDER
OF THE DIRECTOR ORDERING THE PAYMENT OF A FINE IMPOSED PURSUANT
TO SUBSECTION (1) OF THIS SECTION MAY BE FILED WITH THE CLERK
OF THE DISTRICT COURT OF ANY COUNTY IN THIS STATE AT ANY TIME
AFTER THE PERIOD OF TIME PROVIDED BY ARTICLES 40 TO 47 OF THIS
TITLE FOR APPEAL OR SEEKING REVIEW OF THE ORDER HAS PASSED WITHOUT
APPEAL OR REVIEW BEING SOUGHT OR, IF APPEAL OR REVIEW IS SOUGHT,
AFTER THE ORDER HAS BEEN FINALLY AFFIRMED AND ALL APPELLATE REMEDIES
AND ALL OPPORTUNITIES FOR REVIEW HAVE BEEN EXHAUSTED. THE PARTY
FILING THE ORDER SHALL AT THE SAME TIME FILE A CERTIFICATE TO
THE EFFECT THAT THE TIME FOR APPEAL OR REVIEW HAS PASSED WITHOUT
APPEAL OR REVIEW BEING UNDERTAKEN OR THAT THE ORDER HAS BEEN FINALLY
AFFIRMED WITH ALL APPELLATE REMEDIES AND ALL OPPORTUNITIES FOR
REVIEW HAVING BEEN EXHAUSTED. THE CLERK OF THE DISTRICT COURT
SHALL RECORD THE ORDER AND THE FILING PARTY'S CERTIFICATE IN THE
JUDGMENT BOOK OF THE COURT AND ENTRY THEREOF MADE IN THE JUDGMENT
DOCKET, AND IT SHALL THEREAFTER HAVE ALL THE EFFECT OF AND CONSTITUTE
A JUDGMENT OF THE DISTRICT COURT, AND EXECUTION MAY ISSUE THEREON
FROM SAID COURT AS IN OTHER CASES. ANY SUCH ORDER MAY BE FILED
BY AND IN THE NAME OF THE DIRECTOR.
(7) FINES COLLECTED PURSUANT TO THIS SECTION
SHALL BE TRANSMITTED TO THE STATE TREASURER, WHO SHALL CREDIT
SUCH FINE TO THE WORKERS' COMPENSATION CASH FUND, CREATED IN SECTION
844112, WHICH SHALL BE USED TO OFFSET THE PREMIUM
SURCHARGE.
SECTION 2. Effective
date applicability. This act shall take
effect upon passage and shall apply to acts committed on or after
said date.
SECTION 3. Safety
clause. The general assembly hereby finds, determines, and
declares that this act is necessary for the immediate preservation
of the public peace, health, and safety.
____________________________ ____________________________
Charles E. Berry Tom Norton
SPEAKER OF THE HOUSE PRESIDENT OF
OF REPRESENTATIVES THE SENATE
____________________________ ____________________________
Judith M. Rodrigue Patricia K. Dicks
CHIEF CLERK OF THE HOUSE ASSISTANT SECRETARY OF
OF REPRESENTATIVES THE SENATE
APPROVED________________________________________
_________________________________________
Roy Romer
GOVERNOR OF THE STATE
OF COLORADO