Page 33 - ATR 2 2013

Two Pass — one to Go

Arkansas legislators approve two of three trucking-endorsed bills

by lane kidd & kelly cargill crow “Our legislation wasn’t written to sional practice by Arkansas agencies
Executive Editor Managing Editor define an owner-operator other than a that would reclassify owner-operators
reference to having an exclusive lease as employees if they either had workers’
The Arkansas Legislature wrapped agreement,” said Kidd. “We took the compensation insurance or if they were
up its longest session in 82 years, end- approach that an independent contrac- awarded workers’ compensation ben-
ing with the approval of a $4.9 bil- tor should be able to have the same efits in a claim for benefits even though
lion budget on votes of 77 to 15 in workers’ compensation insurance as an they had never paid any premium.
the House and 28 to 6 in the Senate. employee without jeopardizing indepen- “This law will remove those factors
Legislators passed a number of hotly dent status.” from the equation,” said Sanders. “Now
debated issues, from tighter laws on Conversely, trucking companies an owner-operator can enjoy the same
when an abortion may occur to lighter will no longer be exposed to the risk workers’ compensation insurance as an
restrictions on the licensing, carrying they currently have of being held liable employee without jeopardizing his inde-
and possession of firearms. for the actions of an owner-operator pendent status and trucking companies
But along the way, they also passed driving outside of the agreement. Under will have an extra layer of protection
two bills critically important to the current regulations, owner-operators when an owner-operator that refuses
trucking industry, both endorsed and may sign a ‘certificate of non-coverage’ coverage later files a claim for workers
strongly advocated by the Arkansas when executing a lease agreement, comp benefits.”
Trucking Association (ATA). One new forms that must be signed each year. It’s Under the new law, trucking com-
law will ensure equal treatment for a process that is increasingly at risk to panies will be required to offer workers’
owner-operators who want workers’ court challenge. compensation insurance to all owner-
compensation insurance while the other Owner-operators routinely sign the operators that execute an exclusive lease
will allow the trucking industry to con- form but when they get injured, some agreement. The carrier may choose
tinue to enjoy a full sales tax exemption will choose to file a claim against the to offer the coverage through its self-
on the purchase of new and used trucks trucking company anyway, hoping the insured structure or with a separate
and semi-trailers. state will grant benefits. Administrative policy or rider. If the owner-operator
law judges rely on six ‘control’ factors, pays the premium or if the carrier
owNEr-oPEraTorS aNd essentially to determine how much con- chooses to provide coverage as part of
workErS’ comP trol the trucking company has over the the lease agreement, the owner-operator
According to Lane Kidd, ATA presi- owner-operator in a typical work day. will enjoy the same benefits afforded an
dent, Act 1166 of 2013 will change the Typically, the ruling goes against the employee if injured on the job and not
way owner-operators are treated when trucking company and in favor of the lose his independent status.
they’re injured. “We called it ‘per- injured truck driver and the driver is However, if the owner-operator
fect world legislation’ meaning that it reclassified as an employee for workers’ chooses to remain outside coverage, he
applied a heavy dose of common logic compensation purposes. These decisions will verify that he denied coverage on
to a situation that never really made a leave the trucking company vulnerable the lease agreement. This active denial
whole lot of sense,” Kidd said. to visits by other state agencies that check-off system should provide the
Kidd said most states have attempt- can use that decision to reclassify all trucking company added protection if
ed to clearly define an owner-operator owner-operators leased to the trucking the owner-operator later gets injured
to prevent the driver from being reclas- company for unemployment and with- and files a claim for benefits.
sified as an employee for workers’ holding taxes. Steve Carter, a specialist in workers’
compensation and unemployment tax State Senator David Sanders compensation and a general counsel
purposes. But that’s a difficult chal- (R-Little Rock), who introduced the bill,
lenge. said the legislation confronted occa- 

arkansas Trucking rePorT | issue 2 2013 33