Bill Aims to Tighten Exemption Loopholes Exploited by Creative Employers

Employer fraud typically involves misclassifying workers as contractors to avoid the requirement to carry workers’ compensation coverage, or underreporting payroll to reduce premiums. But some businesses have exploited a loophole in the coverage exemption for officers and directors of private corporations by giving frontline workers executive-level titles, according to the Association of California Insurance Companies. ACIC is sponsoring Assembly Bill 2883, which was recently amended to require a corporate executive own at least 15% of the issued and outstanding stock to qualify for...