(NASHVILLE, TN), May 23, 2012 — Legislation that decreases by 50 percent the registration and renewal fees associated with the Worker’s Compensation Exemption Registry for construction contractors has been signed into law. Governor Bill Haslam signed the legislation on Monday after approval by the General Assembly during the final days of the legislative session which ended May 1.
The reduction in fees was part of Senate bill 2923, sponsored by Senators Doug Overbey (R-Maryville) and Bill Ketron (R-Murfreesboro), which also clarifies that either party in a worker’s compensation dispute may bring suit in the county in which the employee resided at the time of the injury rather than where the employee resides at the time of filing suit. The bill, as amended, reduces the registration and renewal fee because of the fund balance in the Registry after the first year of implementation.
Before, the law allowed worker’s compensation cases to be filed in the chancery or circuit court in the county where the employee resides or the county where the alleged injury occurred. This bill changes that to the county where the employee resided at the time of the alleged injury or the county where the alleged injury occurred.
“This new law simply changes the venue from where the employee resides at the time suit is brought to where the employee resided at the time of the injury. The purpose of the bill is to discourage forum shopping,” said Senator Overbey. “At the same time, the legislation decreases by one-half for contractors to place themselves on the Worker’s Compensation Exemption Registry. Fees are currently double the amount needed for proper regulation.”
The fee reduction comes after the state’s financial experts predicted that $712,500 would be generated from licensed and non-licensed contractors every two years through registration with the Worker’s Compensation Exemption Registry. The assumption was well below what actually occurred as renewal fees will still yield $1,341,550 after the 50 percent reduction is implemented. The exemption allows a business owner to exempt him or herself from the requirement to carry workers’ compensation insurance on him or herself.
The Registry is composed of individuals who are sole proprietors and own 100% of the assets of the business, or an officer of a corporation, or a member of a limited liability company with at least a 20% ownership interest, or a partner in a partnership with at least a 20% ownership interest. Registration is only available to individual business owners engaged in the construction services industry.
In addition, an applicant may qualify for the exemption if the applicant and members of the same family of the applicant hold at least 95% ownership of the business. Each corporation, Limited Liability Company, Limited Liability Partnership, Limited Partnership, General Partnership and family owned business may have up to 5 individuals who can qualify to be exempt. A sole proprietor can only have 1 exemption.
“When a business is overcharged for regulation, those fees need to be returned to them,” added Ketron. “There is no need to overburden them with excess fees. At the same time, it provides adequate funding to ensure our law is working as envisioned to protect workers. I am pleased this legislation has been approved and signed into law.”