New Jersey – Four New Workers’ Compensation Laws Passed on October 1, 2008

A package of new workers’ compensation laws were passed into law on October 1, 2008, each of which took effect immediately. 

P.L. 2008 Chapter 93 allows workers’ compensation judges to impose upon employers, insurers, claimants or their counsel, the following additional remedies/penalties for failure to comply with the judge’s order: costs; interest; an additional assessment not to exceed 25% of the money due for unreasonable delay in payment; legal fees; additional fines not exceeding $5,000 for unreasonable delay; dismissal of claims; suppression of a party’s defenses; exclusion of evidence or witnesses; or any other action the judge deems appropriate.  Any penalty or fine imposed on an insurer will not be included in the expense base of the insurer for the purpose of determining rates. 

P.L. 2008 Chapter 94 increases the penalties for employers and insurers that fail to comply with the workers’ compensation laws.  The law increases from a disorderly persons offense to a crime of the fourth degree, the criminal magnitude of a knowing failure to provide workers’ compensation protection.  The law establishes a rebuttable presumption that the employer is not insured if the employer fails to provide proof of coverage when requested by the Division in writing. 
 
Chapter 94 also creates a rebuttable presumption that an employer has established a successor firm, corporation or partnership if the two entities share at least three of the following nine characteristics: (1) perform similar work; (2) occupy the same premises; (3) have the same telephone or fax number; (4) have the same email address or internet website; (5) perform work in the same geographical area; (6) employ substantially the same work force; (7) utilize the same tools and equipment; (8) employ or engage the services of any person(s) involved in the direction or control of the other; or (9) list substantially the same work experience. 

Chapter 94 also adds vice presidents to the list of officers of the corporation who are liable for failure to provide coverage, without regard to whether any of the officers or directors are actively engaged in corporate business.  Finally, the law imposes a $1,000 fine against any insurer that fails to provide required employer identification numbers when filing policies with the state. 

P.L. 2008 Chapter 95 requires all businesses required to submit an annual report to include within that report valid proof of workers’ compensation coverage.  Valid proof may take the form of documentation of a current order from the Commissioner of Banking and Insurance authorizing the employer to be self-insured, a letter from an insurance carrier, or verification from the employer that includes the name of the carrier, insurance policy number, and date of commencement of coverage under the policy.  This law will take effect on December 30, 2008 (90 days from the date of enactment).

P.L. 2008 Chapter 96 allows an employee in need of physician-certified emergent medical care to file a motion for emergent medical treatment along with or after the filing of a workers’ compensation claim petition.  The motion must be served on the employer and its carrier, or their attorneys, at time of filing, and an answer must be filed within five calendar days of service.  An initial conference must occur within five days of filing of the answer, after which the judge of compensation must schedule a hearing.  The law also gives the respondent 15 calendar days from service of the motion to secure a medical examination if it requires one.

On a related note, a new bill (S2189) introduced on October 6, 2008 would allow the establishment of alternative workers’ compensation through collective bargaining, so long as such alternate programs fulfill the requirements of the New Jersey Workers’ Compensation law and do not diminish an employee’s entitlement to workers’ compensation or temporary disability benefits or diminish any rights regarding the obtaining of compensation or benefits.  Such alternative plans may provide for alternative dispute resolution systems for workers’ compensation claims, lists of providers for medical treatment, and light-duty and transitional return-to-work programs.  The Commissioner of Labor and Workforce Development would be responsible for monitoring any such alternate agreements, issuing annual reports regarding the alternate  agreements, and setting standards regarding procedures for alternative dispute resolution and other programs provided under the agreements.  Employers that participate in Taft-Hartley trust funds may apply to the Commissioner of Banking and Insurance for approval to enter into agreements to pool their workers’ compensation liabilities in order to qualify as members of a group plan for self-insurance.