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Home My WebLink About06 - Adopting a Resolution Pursuant to Labor Code Section 3600.2; Workers' CompensationTO: FROM: CITY OF NEWPORT BEACH City Council Staff Report June 11, 2019 Agenda Item No. 6 HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL Barbara J. Salvini, Human Resources Director - 949-644-3300, bsalvini@newportbeachca.gov PREPARED BY: Barbara J. Salvini, Human Resources Director, bsalvini newportbeachca.gov PHONE: 949-644-3300 TITLE: Resolution No. 2019-50: Adopting a Resolution Pursuant to Labor Code Section 3600.2; Workers' Compensation ABSTRACT: California employers are legally required to provide workers' compensation benefits to their employees to cover work-related injuries. The City of Newport Beach offers coverage for this benefit through a combination of a self-insured retention and excess workers' compensation insurance through California State Association of Counties (CSAC) Excess Insurance Authority (EIA). Due to recent amendments to the California Labor Code involving workers' compensation coverage, the EIA has modified its Memorandum of Coverage (MOC) and requires its covered employers to adopt a resolution in order to maintain excess coverage by the EIA. RECOMMENDATION: a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) Adopt Resolution 2019-50, A Resolution of the City Council of the City of Newport Beach, California, Made Pursuant to California Labor Code Section 3600.2. FUNDING REQUIREMENTS: There is no fiscal impact related to this item. DISCUSSION: State law requires employers to pay for workers' compensation benefits. During the 2018 legislative session, Assembly Bill 1749 was introduced to amend California Labor Code Section 3600.2. Governor Brown signed the bill into law effective January 1, 2019. 6-1 Resolution No. 2019-50: Adopting a Resolution Pursuant to Labor Code Section 3600.2; Workers' Compensation June 11, 2019 Page 2 The amendment to Labor Code Section 3600.2(b) allows an entity to decide whether to accept a workers' compensation claim filed by a peace officer who, while out-of-state, is injured while engaging in the apprehension or attempted apprehension of law violators or suspected law violators, or protection or preservation of life or property, or the preservation of the peace, if providing compensation serves the public purposes of the employer. The City currently maintains excess workers' compensation insurance through CSAC EIA. If the City accepts a claim which falls within the parameters identified in Labor Code Section 3600.2(b), the City Council must adopt a resolution prior to the injury occurring in order for the EIA to provide excess coverage for the claim. The attached resolution is presented for City Council adoption and provides that the City will determine at its discretion whether to accept or deny such claims. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A — Resolution No. 2019-50 6-2 ATTACHMENT A RESOLUTION NO. 2019- 50 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, MADE PURSUANT TO CALIFORNIA LABOR CODE SECTION 3600.2 WHEREAS, California employers are legally required to provide workers' compensation benefits to their employees to cover work-related injuries; WHEREAS, the City of Newport Beach offers coverage for this worker's compensation benefit through a combination of a self-insured retention and excess workers' compensation insurance through the California State Association of Counties ("CSAC") Excess Insurance Authority ("EIA"); WHEREAS, a recent legislative amendment to Labor Code Section 3600.2(b) allows an employer to exercise its discretion on whether to accept a workers' compensation claim filed by a peace officer who, while out-of-state, is injured while engaging in the apprehension or attempted apprehension of law violators or suspected law violators, or protection or preservation of life or property, or the preservation of the peace if the employer determines that providing compensation serves the public purposes of the employer; WHEREAS, based on the amendment to Labor Code Section 3600.2, the EIA has modified its Memorandum of Coverage ("MOC") and requires its covered employers to adopt a resolution indicating the City's intent to exercise its discretion on whether to accept a worker's compensation claim filed by a peace officer in accordance with Labor Code Section 3600.2 in order for the City to maintain excess coverage provided by the EIA; WHEREAS, in the event the City chooses to accept a claim which falls within the parameters identified above, the City Council must adopt a resolution prior to the injury occurring in order for the EIA to provide excess coverage for the claim; WHEREAS, the City Council wishes to be in conformance with the CSAC EIA requirements that it adopt a resolution pursuant to Labor Code Section 3600.2(b)(4); and WHEREAS, the City Council will determine at its discretion, on a case by case basis, whether to accept or deny a claim that falls within the parameters of Labor Code Section 3600.2. NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows.. 6-3 Resolution No. 2019 - Page 2 of 2 Section 1: The City Council does hereby adopt Resolution No. 2019 in conformance with CSAC EIA requirements that it adopt a resolution pursuant to Labor Code Section 3600.2. The City Council will determine at its discretion, on a case by case basis, whether to accept or deny a claim that falls within the parameters of Labor Code Section 3600.2. Section 2: The recitals provided in this resolution are true and correct and are incorporated into the operative part of this resolution. Section 3: If any section, subsection, sentence, clause or phrase of this resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this resolution. The City Council hereby declares that it would have passed this resolution, and each section, subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. Section 4: The City Council finds the adoption of this resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Section 5: This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting the resolution. ADOPTED this 11th day of June, 2019. Diane B. Dixon Mayor ATTEST: Leilani I. Brown City Clerk APPROVED AS TO FORM: CIT ATTORNEY'S OFFICE C . ff t�— Aaron C. Harp City Attorney