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Bill Seeks to Reform Cali Worker’s Comp Rate Structure

March 29, 2005
Filed under Uncategorized

Senator Dennis Hollingsworth (R-Murrieta) has introduced Senate Bill 510 in the California Senate, a move to require the Workers’ Compensation Insurance Rating Bureau to establish separate worker’s compensation rates for employees of powersports dealerships.
Sen. Hollingsworth acted on SB 510 at the request of the Off-Road Business Association (ORBA), a Santee, California-based trade association comprised of off-road related businesses united to promote common goals that support the prosperity and growth of the off-road industry.
ORBA says motorized recreational vehicle dealers take a double hit in doling out compensation because of a rate structure known as “all inclusive” rates. Employers must pay the same worker’s compensation rates for their parts, apparel, cashier, and other similar employees that they pay on their mechanics.
Currently, California dealers have only two options when classifying employees: clerical and mechanic. Employers pay a higher worker’s compensation rate for mechanics due to the higher risk for injury for that job classification, so “all inclusive” rates cause motorcycle dealers to pay the highest rate for all their employees regardless of their job.
ORBA says one particular motorcycle dealer is paying around $15,000 per month for worker’s compensation premiums for its 75 employees. Everyone working in the parts department or rider apparel section falls under the mechanic class.
The Automotive sales industry has four classifications for their employees. “We want the same worker compensation rate structure as the major motor vehicle dealers,” says Roy Denner, President and CEO of ORBA. “This is a matter of simple fairness.”

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