SLS 12RS-844 ORIGINAL
Page 1 of 3
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2012
SENATE BILL NO. 511
BY SENATOR DONAHUE
WORKERS' COMPENSATION. Provides for exceptions to workers' compensation
coverage for certain persons who have an ownership interest in the business that employs
the person. (8/1/12)
AN ACT1
To amend and reenact R.S. 23:1035(A) and enact R.S. 23:1035.3, relative to workers'2
compensation; to provide for exceptions for workers' compensation coverage; to3
require workers' compensation coverage for certain individuals; to provide for a4
waiver of coverage in certain circumstances; and to provide for related matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 23:1035(A) is hereby amended and reenacted and R.S. 23:1035.3 is7
hereby enacted to read as follows: 8
§1035. Employees covered9
A. The provisions of this Chapter shall also apply to every person performing10
services arising out of and incidental to his employment in the course of his own11
trade, business, or occupation, or in the course of his employer's trade, business, or12
occupation, except that the bona fide president, vice president, secretary, or treasurer13
of a corporation who owns not less than ten percent of the stock therein, or a partner14
with respect to a partnership employing him, or a member of a limited liability15
company as defined in R.S. 12:1301(A)(13) who owns not less than a ten percent16
membership interest therein, or a sole proprietor with respect to such sole17 SB NO. 511
SLS 12RS-844 ORIGINAL
Page 2 of 3
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
proprietorship may by written agreement with his insurer or group self-insurance1
fund elect not to be covered by the provisions of this Chapter. Such election shall not2
be limited, but shall apply to all trades, businesses, or occupations conducted by said3
corporation, partnership, limited liability company, or sole proprietorship. Such an4
election shall be binding upon the employing corporation, partnership, limited5
liability company, and sole proprietor and the surviving spouse, relatives, personal6
representative, heirs, or dependents of the officer, partner, member, or sole proprietor7
so electing. No salary or compensation received by any such bona fide corporate8
officer, partner, member, or sole proprietor so electing shall be used in computing9
the premium rate for workers' compensation insurance.10
* * *11
§1035.3. Coverage waived12
When a bona fide president, vice president, secretary, or treasurer of a13
corporation who owns not less than ten percent of the stock therein, or a14
partner with respect to a partnership employing him, or a member of a limited15
liability company as defined in R.S. 12:1301(A)(13) who owns not less than a ten16
percent membership interest therein, or a sole proprietor with respect to such17
sole proprietorship elects not to be covered by the provisions of this Chapter,18
such individual waives any right that the individual may have for any claim for19
workers' compensation or in tort against any other corporation, partnership,20
limited liability company or business as well as the insurance carrier or self21
insured fund for that corporation, partnership, limited liability company or22
business.23
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Carla S. Roberts.
DIGEST
Present law provides that workers' compensation coverage shall apply to every person
performing services arising out of and incidental to his employment in the course of his own
trade, business, or occupation, or in the course of his employer's trade, business, or
occupation except coverage is not required on any of the following:
1. The bona fide president, vice president, secretary, or treasurer of a corporation who SB NO. 511
SLS 12RS-844 ORIGINAL
Page 3 of 3
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
owns not less than ten percent of the stock therein.
2. A partner with respect to a partnership employing him.
3. A member of a limited liability company who owns 10% or more in the company.
4. A sole proprietor. Present law provides that such parties may by written agreement
with his insurer or group self-insurance fund elect not to be covered by workers'
compensation insurance.
Present law provides that the election to exclude workers' compensation coverage on
business executives, who have an ownership interest in the business, is not limited and
applies to all trades, businesses, or occupations.
Present law provides that the election to exclude coverage will be binding upon the
employing corporation, partnership, limited liability company, and sole proprietor and the
surviving spouse, relatives, personal representative, heirs, or dependents of the officer,
partner, member, or sole proprietor so electing.
Present law provides that no salary or compensation received by any such bona fide
corporate officer, partner, member, or sole proprietor electing to exclude themselves from
coverage shall be used in computing the premium rate for workers' compensation insurance.
Proposed law removes the exemptions from workers' compensation coverage.
Proposed law provides that when a bona fide president, vice president, secretary, or treasurer
of a corporation who owns at least 10% of the stock therein, or a partner with respect to a
partnership employing him, or a member of a limited liability company who owns at least
10% membership interest therein, or a sole proprietor elects not to provide for their own
workers' compensation coverage, such individual waives any right that the employee may
have for any claim for workers' compensation or in tort against any other corporation,
partnership, limited liability company or business as well as the insurance carrier or self
insured fund for that corporation, partnership, limited liability company or business.
Effective August 1, 2012.
(Amends R.S. 23:1035(A); adds R.S. 23:1035.3)