South Carolina General Assembly
111th Session, 1995-1996

Bill 3838


                    Current Status

Bill Number:                    3838
Ratification Number:            511
Act Number:                     424
Type of Legislation:            General Bill GB
Introducing Body:               House
Introduced Date:                19950322
Primary Sponsor:                Labor, Commerce and Industry
                                Committee HLCI 26
All Sponsors:                   Labor, Commerce and Industry
                                Committee
Drafted Document Number:        pt\1842jm.95
Companion Bill Number:          3562, 727
Date Bill Passed both Bodies:   19960530
Date of Last Amendment:         19960530
Governor's Action:              S
Date of Governor's Action:      19960618
Subject:                        Workers' compensation

History



Body    Date      Action Description                       Com     Leg Involved
______  ________  _______________________________________  _______ ____________

------  19960626  Act No. A424
------  19960618  Signed by Governor
------  19960613  Ratified R511
Senate  19960530  Concurred in House amendment, 
                  enrolled for ratification
House   19960530  Senate amendments amended,
                  returned to Senate with amendment
House   19960529  Debate adjourned on Senate
                  amendments until Thursday, 
                  19960530
Senate  19960523  Read third time, returned to House
                  with amendment
Senate  19960522  Debate interrupted by adjournment
Senate  19960516  Debate adjourned
Senate  19960502  Made Special Order
Senate  19960425  Amended, read second time, 
                  ordered to third reading 
                  with notice of general amendments
Senate  19960424  Committee report: Favorable with         11 SJ
                  amendment
Senate  19950504  Introduced, read first time,             11 SJ
                  referred to Committee
House   19950427  Read third time, sent to Senate
House   19950426  Read second time
House   19950405  Debate interrupted by adjournment
House   19950328  Objection by Representative                      Cato
                                                                   Clyburn
                                                                   Anderson
                                                                   Davenport
                                                                   L. Whipper
                                                                   A. Young
                                                                   Cooper
                                                                   Mason
                                                                   Huff
                                                                   Neilson
                                                                   Howard
                                                                   Govan
                                                                   Cobb-Hunter
                                                                   Harvin
                                                                   McElveen
                                                                   Delleney
House   19950322  Introduced, read first time

View additional legislative information at the LPITS web site.


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A424, R511, H3838)

AN ACT TO AMEND SECTION 42-1-40, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE DEFINITION OF "AVERAGE WEEKLY WAGES", SO AS TO REVISE THE DEFINITION; TO AMEND SECTION 42-1-160, RELATING TO THE DEFINITIONS OF "INJURY" AND "PERSONAL INJURY", SO AS TO REVISE THE DEFINITIONS; TO AMEND SECTIONS 42-1-310 AND 42-1-320, RELATING TO THE APPLICATION AND EFFECT OF WORKERS' COMPENSATION PROVISIONS, SO AS TO PROVIDE THAT AN EMPLOYER OR EMPLOYEE MAY NOT ELECT TO NOT BE BOUND BY CERTAIN WORKERS' COMPENSATION PROVISIONS AND THAT THE STATE, ITS POLITICAL SUBDIVISIONS, ITS EMPLOYEES AND THE EMPLOYEES OF ITS SUBDIVISIONS ARE SUBJECT TO THE WORKERS' COMPENSATION PROVISIONS; TO AMEND SECTION 42-1-460, RELATING TO CONTRACTS SUBJECT TO THE WORKERS' COMPENSATION PROVISIONS, SO AS TO REVISE THE CONDITIONS UPON WHICH A CONTRACT IS SUBJECT TO THESE PROVISIONS; TO AMEND SECTION 42-9-260, AS AMENDED, RELATING TO THE NOTICE AN EMPLOYER MUST PROVIDE THE WORKERS' COMPENSATION COMMISSION WHEN CERTAIN PAYMENTS HAVE BEGUN AND THE SUSPENSION OR TERMINATION OF PAYMENTS, SO AS TO PROVIDE FOR THE CONDITIONS UPON WHICH TEMPORARY DISABILITY PAYMENTS MAY BE GRANTED; TO AMEND SECTION 42-9-360, RELATING TO ASSIGNMENTS OF COMPENSATION, SO AS TO PROVIDE THAT IT IS UNLAWFUL FOR AN AUTHORIZED HEALTH CARE PROVIDER TO PURSUE COLLECTION PROCEDURES AGAINST A WORKERS' COMPENSATION CLAIMANT UNDER CERTAIN CIRCUMSTANCES, PROVIDE PENALTIES FOR PERSONS RECEIVING CERTAIN ILLEGAL PAYMENTS AND THE PROCEDURE IN WHICH A HEALTH CARE PROVIDER MUST BE PAID; TO AMEND SECTION 42-19-10, AS AMENDED, RELATING TO EMPLOYERS' RECORDS AND REPORTS OF INJURIES, SO AS TO REVISE THE RECORDKEEPING PROCEDURE; BY ADDING SECTION 38-73-515 SO AS TO PROVIDE THAT AN INSURER ISSUING WORKERS' COMPENSATION INSURANCE SHALL OFFER DEDUCTIBLES OPTIONAL TO THE POLICYHOLDER FOR CERTAIN BENEFITS PAYABLE; TO REPEAL SECTIONS 42-1-330, 42-1-340, 42-1-510, AND 42-1-530, RELATING TO THE WAIVER OF CERTAIN EXEMPTIONS, THE EFFECTIVE DATE OF AND MANNER OF GIVING NOTICE OF NONACCEPTANCE OR WAIVER DEFENSES THAT ARE NOT AVAILABLE TO AN EMPLOYER UNDER THE WORKERS' COMPENSATION PROVISIONS, AND DEFENSES THAT ARE NOT AVAILABLE TO AN EMPLOYER WHEN NEITHER HE NOR AN EMPLOYEE IS COVERED BY THE WORKERS' COMPENSATION PROVISIONS; AND TO AMEND SECTION 42-1-520, RELATING TO DEFENSES AVAILABLE TO AN EMPLOYER OPERATING UNDER THE WORKERS' COMPENSATION PROVISIONS WHEN AN EMPLOYEE IS NOT OPERATING UNDER THESE PROVISIONS, SO AS TO SUBSTITUTE "OFFICER OF A CORPORATION" FOR "EMPLOYEE".

Be it enacted by the General Assembly of the State of South Carolina:

Average weekly wages

SECTION 1. The first paragraph of Section 42-1-40 of the 1976 Code is amended to read:

"`Average weekly wages' means the earnings of the injured employee in the employment in which he was working at the time of the injury during the period of fifty-two weeks immediately preceding the date of the injury, including the subsistence allowance paid to veteran trainees by the United States Government if the amount of the allowance is reported monthly by the trainee to his employer. `Average weekly wage' must be calculated by taking the total wages paid for the last four quarters immediately preceding the quarter in which the injury occurred as reported on the Employment Security Commission's Employer Contribution Reports divided by fifty-two or by the actual number of weeks for which wages were paid, whichever is less. When the employment, prior to the injury, extended over a period of less than fifty-two weeks, the method of dividing the earnings during that period by the number of weeks and parts thereof during which the employee earned wages shall be followed, as long as results fair and just to both parties will be obtained. Where, by reason of a shortness of time during which the employee has been in the employment of his employer or the casual nature or terms of his employment, it is impracticable to compute the average weekly wages as defined in this section, regard is to be had to the average weekly amount which during the fifty-two weeks previous to the injury was being earned by a person of the same grade and character employed in the same class of employment in the same locality or community."

Injury and personal injury

SECTION 2. Section 42-1-160 of the 1976 Code is amended to read:

"Section 42-1-160. `Injury' and `personal injury' shall mean only injury by accident arising out of and in the course of the employment and shall not include a disease in any form, except when it results naturally and unavoidably from the accident and except such diseases as are compensable under the provisions of Chapter 11 of this title. In construing this section an accident arising out of and in the course of employment shall include employment of an employee of a municipality outside the corporate limits of the municipality when the employment was ordered by a duly authorized employee of the municipality.

Stress arising out of and in the course of employment unaccompanied by physical injury and resulting in mental illness or injury is not a personal injury unless it is established that the stressful employment conditions causing the mental injury were extraordinary and unusual in comparison to the normal conditions of the employment.

Stress arising out of and in the course of employment unaccompanied by physical injury is not considered compensable if it results from any event or series of events which is incidental to normal employer/employee relations including, but not limited to, personnel actions by the employer such as disciplinary actions, work evaluations, transfers, promotions, demotions, salary reviews, or terminations, except when these actions are taken in an extraordinary and unusual manner."

Compensation for personal injury or death

SECTION 3. Section 42-1-310 of the 1976 Code is amended to read:

"Section 42-1-310. Every employer and employee, except as stated in this chapter, shall be presumed to have accepted the provisions of this title respectively to pay and accept compensation for personal injury or death by accident arising out of and in the course of the employment and shall be bound thereby."

Scope of title

SECTION 4. Section 42-1-320 of the 1976 Code is amended to read:

"Section 42-1-320. The State, its municipal corporations and political subdivisions thereof, and the employees of the State or its municipal corporations and political subdivisions are subject to this title."

Contract of service

SECTION 5. Section 42-1-460 of the 1976 Code is amended to read:

"Section 42-1-460. Every contract of service between any employer and employee covered by this title, written or implied, in operation or made or implied prior to July 17, 1936, shall be presumed to continue, subject to the provisions of this title; and every such contract made subsequent to said date shall be presumed to have been made subject to the provisions of this title.

A like presumption shall exist equally in the case of all minors, unless notice of the same character be given by or to the parent or guardian of the minor."

Temporary disability

SECTION 6. Section 42-9-260 of the 1976 Code, as last amended by Act 410 of 1988, is further amended to read:

"Section 42-9-260. (A) When an employee has been out of work due to a reported work-related injury or occupational disease for eight days, an employer may start temporary disability payments immediately and may continue these payments for up to one hundred fifty days from the date the injury or disease is reported without waiver of any grounds for good faith denial. Upon making the first payment, the employer immediately shall notify the commission, in accordance with a form prescribed by the commission, that payment of compensation has begun.

(B) Once temporary disability payments are commenced, the payments may be terminated or suspended immediately at any time within the one hundred fifty days if:

(1) the employee has returned to work; however, if the employee does not remain at work for a minimum of fifteen days, temporary disability payments must be resumed immediately; or

(2) the employee agrees that he is able to return to work and executes the proper commission form indicating that he is able to return to work; or

(3) a good faith investigation by the employer reveals grounds for denial of the claim; or

(4) the employee has been released by the treating physician to work without restriction and the employer offers comparable employment; or

(5) the employee has been released by the treating physician to limited duty work and the employer provides limited duty work consistent with the terms upon which the employee has been released; or

(6) the employee refuses medical treatment, as provided in Section 42-15-60, or refuses an examination or evaluation, as provided in Section 42-15-80, and the termination or suspension of benefits continues until the refusal ceases or the commission determines the refusal is justified pursuant to either Section 42-15-60 or 42-15-80.

(C) An employee whose disability payments have been terminated or suspended pursuant to this section may request a hearing to have the payments reinstituted. The hearing must be held within sixty days of the date of the employee's request for a hearing.

(D) If an employee has been declared as having reached maximum medical improvement, the employer may request a hearing to address the termination of temporary disability payments. The hearing must be held within sixty days of the date of the employer's request for a hearing.

(E) An employer may request a hearing at any time to address termination or reduction of temporary disability payments.

(F) After the one-hundred-fifty-day period has expired, the commission shall provide by regulation the method and procedure by which benefits may be suspended or terminated for any cause, but the regulation must provide for an evidentiary hearing and commission approval prior to termination or suspension unless such prior hearing is expressly waived in writing by the recipient or the circumstances identified in Section 42-9-260(B)(1) or (B)(2) are present. Further, the commission may not entertain any application to terminate or suspend benefits unless and until the employer or carrier is current with all payments due.

(G) Failure to comply with this section shall result in a twenty-five percent penalty imposed upon the carrier or employer computed on the amount of benefits withheld in violation of this section, and the amount of the penalty must be paid to the employee in addition to the amount of benefits withheld. However, the penalty does not apply if the employer or carrier has terminated or suspended benefits when the employee has returned to any employment at the same or similar wage."

Assignments or compensation

SECTION 7. Section 42-9-360 of the 1976 Code is amended to read:

"Section 42-9-360. (A) No claim for compensation under this title shall be assignable and all compensation and claims therefor shall be exempt from all claims of creditors and from taxes.

(B) It shall be unlawful for an authorized health care provider to actively pursue collection procedures against a workers' compensation claimant prior to the final adjudication of the claimant's claim. Nothing in this section shall be construed to prohibit the collection from and demand for collection from a workers' compensation insurance carrier or self-insured employer. Violation of this section, after written notice to the provider from the claimant or his representative that adjudication is ongoing, shall result in a penalty of five hundred dollars payable to the workers' compensation claimant.

(C) Any person who receives any fee or other consideration or any gratuity on account of services so rendered, unless the consideration or gratuity is approved by the commission or the court, or who makes it a business to solicit employment for a lawyer or for himself in respect of any claim or award for compensation is guilty of a misdemeanor and, upon conviction, must, for each offense, be fined not more than five hundred dollars or imprisoned not more than one year, or both.

(D) Payment to an authorized health care provider for services shall be made in a timely manner but no later than thirty days from the date the authorized health care provider tenders request for payment to the employer's representative, unless the commission has received a request to review the medical bill."

Employers' records and reports of injuries

SECTION 8. Section 42-19-10 of the 1976 Code, as last amended by Section 15, Part II of Act 612 of 1990, is further amended to read:

"Section 42-19-10. Every employer shall keep a record of all injuries, fatal or otherwise, received by his employees in the course of their employment on forms approved by the commission.

If the injury requires minimal medical attention at a cost not to exceed an amount specified by regulation of the Workers' Compensation Commission, and does not cause more than one lost workday or permanency, the employer is not required to make a written report to the commission or the employer's insurance carrier, provided the employer maintains a record as prescribed by the commission and pays directly the incurred cost of the resulting medical attention.

All other injuries must be reported in writing to the commission according to the following guidelines:

(1) An injury for which there is no compensable lost time or permanency and the medical treatment does not exceed an amount specified by regulation of the Workers' Compensation Commission must be reported annually on a form and at a time prescribed by the commission.

(2) An injury involving compensable lost time, medical attention in excess of the limit established by commission regulation in (1) above, or the possibility of permanency must be reported within ten business days after the occurrence and knowledge of it, as provided in Section 42-15-20, on a form or in an electronic format prescribed by the commission.

However, for the injury of a South Carolina National Guard member as provided for in Section 42-7-67, the reporting periods must be counted from the date the employer, the South Carolina National Guard, has knowledge that the federal government has denied benefits to the injured guard member or that benefits or additional benefits may be due under the provisions of Title 42."

Deductibles

SECTION 9. The 1976 Code is amended by adding:

"Section 38-73-515. (A) Each insurer issuing a policy of workers' compensation insurance shall offer, as a part of the policy or as an optional endorsement to the policy, deductibles optional to the policyholder for benefits payable under Title 42. Deductible amounts offered must be disclosed fully to the prospective policyholder in writing in the amount of one hundred dollars, two hundred dollars, three hundred dollars, four hundred dollars, five hundred dollars, or increments of five hundred dollars up to a maximum of two thousand five hundred dollars for each compensable claim. The policyholder exercising the deductible option shall choose only one deductible amount.

(B) If the policyholder exercises the option and chooses a deductible, the insured employer is liable for the amount of the deductible for benefits paid for each compensable claim of work injury suffered by an employee. The insurer shall pay all or part of the deductible amount, whichever is applicable to a compensable claim, to the person or provider entitled to the benefits conferred by this chapter and then seek reimbursement from the insured employer for the applicable deductible amount. The payment or nonpayment of deductible amounts by the insured employer to the insurer must be treated under the policy insuring the liability for workers' compensation in the same manner as payment or nonpayment of premiums.

(C) Optional deductibles must be offered in each policy insuring liability for workers' compensation which is issued, delivered, issued for delivery, or renewed after June 30, 1996, unless an insured employer and insurer agree to renegotiate a workers' compensation insurance policy in effect on July 1, 1996, so as to include a provision allowing for a deductible.

(D) Premium reduction for deductibles must be determined before the application of any experience modification, premium surcharge, or premium discounts. To the extent that an employer's experience rating or safety record is based on benefits paid, money paid by the insured employer under a deductible as provided in this section must not be included as benefits paid so as to harm the experience rating of the employer.

(E) This section does not apply to employers who are approved to self-insure against liability for workers' compensation or group self-insurance funds for workers' compensation established pursuant to the laws of this State."

Repeal

SECTION 10. Sections 42-1-330 and 42-1-340 of the 1976 Code are repealed.

Repeal

SECTION 11. Sections 42-1-510 and 42-1-530 of the 1976 Code are repealed on July 1, 1997.

Defenses

SECTION 12. Section 42-1-520 of the 1976 Code is amended to read:

"Section 42-1-520. An officer of a corporation who elects not to operate under this title, shall, in any action to recover damages for personal injury or death brought against an employer accepting the compensation provisions of this title, proceed at common law and the employer may avail himself of the defenses of contributory negligence, negligence of a fellow servant, and assumption of risk, as such defenses exist at common law."

Time effective

SECTION 13. Except as may otherwise be provided in this act, this act takes effect upon approval by the Governor. Employers who have filed with the Workers' Compensation Commission a notice to reject the provisions of Title 42 before the effective date of this act will have until July 1, 1997, to comply with the provisions of this act relating to insuring their workers' compensation liabilities. Any employer who has rejected the terms of this title prior to approval of this act and has procured another form of employee benefits insurance shall comply, not later than July 1, 1997, with the provisions of this act relating to the insuring of its workers' compensation liabilities. Furthermore, nothing in this act shall affect or alter any cause of action, right, or claim accruing before the effective date of this act; however, any such cause of action, remedy, or claim accruing before the effective date of this act shall be governed by the law prior to the effective date of this act.

Approved the 18th day of June, 1996.