Current through Register Vol. 51, No. 3, September 1, 2024
RELATES TO:
KRS
342.615
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
342.260 requires the executive director to
promulgate administrative regulations necessary to implement the provisions of
KRS Chapter 342.
KRS
342.615 requires the executive director to
promulgate an administrative regulation to establish the manner of registration
for an employee leasing company with the executive director. This
administrative regulation establishes the manner in which an employee leasing
company shall register with the executive director.
Section 1. Registration.
(1) To be eligible to conduct business in
Kentucky, a corporation, partnership, sole proprietorship, or other business
entity which provides staff, personnel or an employee to be employed in this
state to a business pursuant to a lease arrangement or agreement shall register
with the executive director in the manner established in this section of the
administrative regulation. The registration shall:
(a) Be on form EL-1, Employee Leasing Company
Registration Form;
(b) Be filed
with the Division of Security and Compliance, Kentucky Office of Workers'
Claims; and
(c) Include:
1. The name of the lessor;
2. The address of the principal place of
business of the lessor and the address of each office it maintains within this
state;
3. The lessor's taxpayer or
employer identification number;
4.
A list by jurisdiction of each name that the lessor has operated under in the
preceding five (5) years including an alternative name, name of a predecessor
and, if known, name of successor business entity;
5. A list of each person or entity who owns a
five (5) percent or greater interest in the employee leasing business at the
time of application and a list of each person or entity who formerly owned a
five (5) percent or greater interest in the employee leasing company or a
predecessor, successor, or alter ego in the preceding five (5) years;
6.
a. If
coverage has been cancelled or nonrenewed, a list of each cancellation or
nonrenewal of workers' compensation insurance which has been issued to the
lessor or a predecessor in the preceding five (5) years. The list shall include
the:
(i) Policy or certificate
number;
(ii) Name of insurer or
other provider of coverage;
(iii)
Rate of cancellation; and
(iv)
Reason for cancellation; or
b. If coverage has not been cancelled or
nonrenewed, a sworn affidavit signed by the chief executive officer of the
lessor attesting to that fact.
7. The name of the carrier of the current
workers' compensation insurance, its policy number, policy period, and the name
of the insured as it appears on the policy; and
8. A signed certification that states that
the:
a. Person signing is the duly authorized
agent for the employee leasing company;
b. Information contained in the registration
form is true; and
c. Applicant
shall:
(i) Notify the executive director of a
change in the information provided in the registration; and
(ii) Provide information regarding workers'
compensation coverage of a leased employee within ninety (90) days of approval
on Form EL-2.
(2) A person filing a registration statement
pursuant to this section shall immediately notify the executive director as to
a change in the information provided pursuant to this section.
(3) The executive director shall maintain a
list of those lessors who are satisfactorily registered with the executive
director.
(4) A lessor which was
doing business in this state prior to effective date of this administrative
regulation shall register with the executive director within thirty (30) days
of the effective date of this administrative regulation.
Section 2. Lessee Information Form. An
employee leasing company shall file a Lessee Information Form, Form EL-2, for
each Kentucky lessee for whom the company or a related entity provides the
workers' compensation insurance coverage. The form shall:
(1) Be:
(a)
Filed within ninety (90) days of the initial registration of the employee
leasing company;
(b) Updated every
six (6) months; and
(c) Considered
filed upon receipt of the form at the Division of Security and Compliance,
Kentucky Office of Workers' Claims; and
(2) Include the:
(a) Name of the employee leasing company and
the lessee;
(b) Address of the
principal place of business of the lessor and the address of each office it
maintains within this state;
(c)
Lessor's taxpayer or employer identification number;
(d) Effective date of the workers'
compensation coverage, the policy number, and the name of the issuer of the
policy; and
(e) Termination of
coverage date.
Section
3. Advertising Prohibition. An organization registered under
KRS
342.615 shall not reference the registration
orally or in an advertisement, marketing material, or publication.
Section 4. Coverage. If the employee leasing
company applies for coverage under the provisions of
KRS
342.615(4), it shall
maintain and furnish to the insurer sufficient information to permit the
calculation of an experience modification factor for each lessee. The
information shall include:
(1) The lessee's
corporate name;
(2) The lessee's
taxpayer or employer identification number;
(3) The lessee's risk identification
number;
(4) A listing of the leased
employees associated with each lessee, the applicable classification code and
payroll;
(5) Claims information
grouped by lessee; and
(6) Other
information necessary to permit the calculation of an experience modification
factor for each lessee.
Section
5. Experience Modification Factor Following Termination.
(1) If the employee leasing arrangement with
the lessee is terminated and the experience of the lessee is commingled with
that of another client on the lessor's master policy, the experience of the
lessee shall be developed and reported by the insurer for use in development of
an experience modification for the lessee.
(2) The employee leasing company shall notify
the insurer thirty (30) days prior to the effective date of termination or
immediately upon notification of cancellation by the lessee of an employee
leasing arrangement with a lessee in order to allow sufficient time to
calculate an experience modification factor for the lessee.
Section 6. Incorporation by
Reference.
(1) The following material is
incorporated by reference:
(a) EL-1, "Employee
Leasing Company Registration Form" (April 1, 1997 edition), Office of Workers'
Claims; and
(b) EL-2, "Lessee
Information Form" (April 1, 1997 edition), Office of Workers' Claims.
(2) The material may be inspected,
copied, or obtained at the Office of Workers' Claims, Monday through Friday, 9
a.m. to 4 p.m., at the following locations:
(a) Frankfort - Prevention Park, 657
Chamberlin Avenue, Frankfort, Kentucky 40601;
(b) Paducah - 220 B North 8th Street,
Paducah, Kentucky 42001; and
(c)
Pikeville - 107 Coal Hollow Road, Pikeville, Kentucky 41501.
STATUTORY AUTHORITY:
KRS
342.260,
342.615
