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NO. 19. AN ACT RELATING TO TIMELY PAYMENT OF WORKERS’ COMPENSATION AWARDS.

(H.32)

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1. 21 V.S.A. 618 is amended to read:

618. COMPENSATION FOR PERSONAL INJURY

(a) If a worker receives a personal injury by accident arising out of and in the course of *[his]* employment by an employer subject to this chapter, *[his]* the employer or the insurance carrier shall pay compensation in the amounts and to the person hereinafter specified. The compensation of a person who is *[insane]* under guardianship shall be paid to his guardian.

(b) A worker who receives a personal injury by accident arising out of and in the course of employment with an employer who has failed to comply with section 687 of this title may elect to claim compensation under this chapter or to bring a civil action against the employer for full damages resulting from the work injury. In the civil action the employer has the burden of proving that the injury did not result from the employer’s negligence and that the employer’s negligence was not the proximate cause of the injury. The employer may not plead as a defense any of the following:

(1) The injury was caused by the negligence of a fellow-employee.

(2) The defense provided under 12 V.S.A. 1036 unless the negligence was willful and with the intent of causing an injury.

(3) The employee assumed any risk in the employment.

(c) A worker shall commence a civil action within the three year limitation period as provided in 12 V.S.A. 512(4).

(d) The acceptance of any payment by an employee for a work injury shall not bar a subsequent election to pursue a civil suit unless the employee, with knowledge of his or her rights, signs a written agreement waiving the right to pursue a civil action. The agreement shall be filed with and approved by the commissioner. If the employer fails to pay any amount due and owing under the workers’ compensation act the waiver agreement shall be void and the employee may pursue a civil action.

Sec. 2. 21 V.S.A. 622 is amended to read:

622. RIGHT TO COMPENSATION EXCLUSIVE

*[The]* Except as provided in subsection 618(b) and section 624 of this title, the rights and remedies granted by the provisions of this chapter to an employee on account of a personal injury for which he is entitled to compensation under the provisions of this chapter shall exclude all other rights and remedies of *[such]* the employee, *[his]* the employee’s personal representatives, dependents or next of kin, at common law or otherwise on account of such injury.

Sec. 3. 21 V.S.A. 643a is amended to read:

643a. DISCONTINUANCE OF BENEFITS

Unless an injured worker has successfully returned to work, an employer shall notify both the commissioner and the employee prior to terminating benefits under either section 642 or section 646 of this title. The notice of intention to discontinue payments shall be filed on forms prescribed by the commissioner and shall include the date of the proposed discontinuance and the reasons for it. *[Until the notice is received by the commissioner and the employee, the]* The liability for the payments*[, within statutory limits,]* shall continue *[until]* for 7 days after the notice is received by the commissioner and the employee. Those payments shall be made without prejudice to the employer and may be deducted from any amounts due pursuant to section 648 of this title if the commissioner determines that the discontinuance is warranted or if otherwise ordered by the commissioner. Every notice shall be reviewed by the commissioner to determine the sufficiency of the basis for the proposed discontinuance. If, upon review, the commissioner finds that the evidence does not reasonably support the proposed discontinuance, the commissioner may order that payments continue until a hearing is held and a decision is rendered.

Sec. 4. 21 V.S.A. 664 is amended to read:

664. TRIAL AND AWARD

*[At such hearing a trial shall be had.]* Within sixty days *[thereafter]* after a hearing is held, the commissioner shall make *[his]* an award *[setting forth his]* supported by findings of fact and the applicable law *[applicable thereto]* and shall *[forthwith]* send *[to each of the parties]* acopy of *[such]* the award to the parties. If the employee prevails at the hearing, the commissioner’s findings shall include the date on which the employer’s obligation to pay compensation under this chapter began. The award shall include interest at the statutory rate computed from that date on the total amount of unpaid compensation.

Sec. 5. 21 V.S.A. 675 is amended to read:

675. ENFORCEMENT OF AWARD

(a) If an award is made under the provisions of this chapter, including interim orders, issued pursuant to sections 643a and 662 of this title, or an agreement is approved by the commissioner, and the employer or insurance carrier fails to comply with the award or agreement, the employee, subject to the stay provisions of subsection (b) *[herein]* of this section, may proceed to collect all or any part of past due installments in any court of law having jurisdiction of the amount involved. If the employee prevails, interest, reasonable attorney fees and costs shall be allowed.

* * *

(c) An employer who fails to make payment due to an employee under this chapter pursuant to an executed agreement under sections 642, 644, 646 or 648 of this title or pursuant to an interim order of the commissioner within 15 days after the payment is due shall also pay the employee interest on the unpaid compensation at the statutory rate.

Sec. 6. 21 V.S.A. 680 is amended to read:

680. PREFERENCES

All rights of compensation granted by the provisions of this chapter shall have the same preference or priority against the assets of the employer or the property of any persons described in subsection 687(b) of this title as is allowed by section 1972 of Title 9.

Sec. 7. 21 V.S.A. 687 is amended to read:

687. SECURITY FOR COMPENSATION

(a) Employers, not including state, county or municipal bodies, shall secure compensation for their employees in one or more of the following ways:

* * *

(b) In the event an employer fails to secure workers’ compensation as required by thissection and an employee reasonably believes that he or she has received a personal injury by accident arising out of and in course of employment with that employer, then:

(1) If the employer is a corporation the officers and majority stockholders of the corporation shall be personally liable for any benefits owed to the injured employee under this chapter.

(2) If the employer is a partnership, the partners shall be personally liable for any benefits owed to the injured employee under this chapter.

(3) If the employer is neither a corporation nor a partnership, the principals, executive officers or controlling parties of the business, or all of these, shall be personally liable for any benefits owed to the injured employee under this chapter.

(c) Upon filing a claim for benefits under this chapter or if the employee elects to bring a civil action pursuant to subsection 618(b) of this title, the employee may obtain a lien against the property of the employer or the personal property of any persons described in subsection (b) of this section.

(d) The remedies provided in this section shall be in addition to any other remedies and penalties available under law.

Sec. 8. 21 V.S.A. 692(b) is amended to read:

(b) Additionally, an employer who fails to comply with the provisions of section 687 of this title for a period of *[thirty]* five days after notice *[to him or her by]* from the commissioner shall be assessed an administrative penalty of not more than $150.00 for every day after *[thirty]* five days *[he or she neglects to secure his or her liability]* that the employer fails to secure workers’ compensation coverage as required in section 687 of this title. The commissioner may, after giving notice *[of his or her intention to do so]* and after the expiration of the *[thirty-day]* five-day period, post a notice at a conspicuous place on the premises of the employer *[or at his or her place of work]* informing the employees that their employer has failed to comply with the provisions of section 687 of this title and ordering the premises closed until workers’ compensation insurance is secured.

Sec. 9. 21 V.S.A. 692(c) is added to read:

(c) If any employer fails to secure or retain workers’ compensation insurance within two years after receiving an order to obtain insurance or a notice that the commissionerintends to order the premises closed as described in subsection (b) of this section, without further notice the commissioner shall order the premises of that employer closed and that all business operations cease until the employer has secured workers’ compensation insurance.

Sec. 10. 13 V.S.A. 2025 is added to read:

2025. EMPLOYERS WITHOUT WORKERS’ COMPENSATION INSURANCE;

CRIMINAL SANCTION

Any employer who fails to comply with the provisions of 21 V.S.A. 687 shall be fined not more than $2,500.00 or imprisoned for up to one year, or both. For the purposes of this section, the term employer includes the owner or operator of a business, the officers of a corporation and the partners in a partnership.

Approved: May 8, 1997