TITLE 11 LABOR AND WORKERS' COMPENSATION
CHAPTER 4 WORKERS' COMPENSATION
PART 13 CONTROLLED INSURANCE PLANS
11.4.13.1 ISSUING AGENCY: New
Mexico Workers' Compensation Administration (WCA).
[11.4.13.1 NMAC - N, 11/15/2004]
11.4.13.2 SCOPE: These
rules cover all parties regulated pursuant to NMSA 1978, Section 52-1-4.2 and
all parties seeking to establish a "controlled insurance plan" or a
"wrap-up " insurance plan, as defined below, for the purpose of
insuring workers' compensation liability.
[11.4.13.2 NMAC - N, 11/15/2004]
11.4.13.3 STATUTORY AUTHORITY: The director
is authorized by NMSA 1978, Section 52-5-4 to adopt reasonable rules and
regulations to implement the legislative purposes of the Workers' Compensation
Act (Act). The director is empowered to
seek administrative penalties pursuant to NMSA 1978, Section 52-1-61. Regulatory authority over controlled
insurance plans is set forth at NMSA 1978, Section 52-1-4.2.
[11.4.13.3 NMAC - N, 11/15/2004]
11.4.13.4 DURATION: Permanent.
[11.4.13.4 NMAC - N, 11/15/2004]
11.4.13.5 EFFECTIVE DATE: November 15, 2004 unless a later date is cited at the end of a section.
[11.4.13.5 NMAC - N, 11/15/2004]
11.4.13.6 OBJECTIVE: This part sets
forth the requirements and processes for application and regulation of
controlled insurance plans, enumerates prohibited acts and sets forth
enforcement procedures.
[11.4.13.6 NMAC - N, 11/15/2004]
11.4.13.7 DEFINITIONS:
A. "Unit
statistical data” means the detailed exposure, premium, and loss (claim)
information at the classification code level.
Data providers submit unit statistical data to the designated rate
service organization for use in ratemaking and experience rating.
B. "Single
construction site" means the defined contiguous geographical area in which
all accidents that occurred during the duration of the controlled insurance
plan shall be covered by the controlled insurance plan.
C. "Noncontiguous
construction site" means an area, or areas, in which construction is
taking place that is not described on the official application, or amended
application, as being within the controlled insurance plan by both a narrative
description and a map designation which shows the construction site outlined by
a single, non intersecting, boundary line.
D. “Controlled
insurance plan,” "OCIP," "CCIP," "wrap-up,"
"owner controlled insurance plan," and "contractor controlled
insurance plan" individually and collectively mean the controlled
insurance plan subject to regulation under this rule.
E. "Same
project" means a construction project on a single construction site
defined and funded at the time of the application required by these rules.
F. "Director"
means the director of the workers' compensation administration or his designee.
G. "WCA"
or "agency" means the workers' compensation administration of the
state of New Mexico.
H. “Applicant”
means the person or entity that sought approval of a controlled insurance plan,
any person designated by the applicant as their agent for interaction with the
WCA and any substituted applicant approved as a substitute in writing by the
director.
I. "Equipment
and furnishings" means any item that is shown in, or specified on,
construction documents for the single construction site.
[11.4.13.7 NMAC - N, 11/15/2004]
11.4.13.8 APPLICATIONS:
A. Any party proposing a controlled
insurance plan pursuant to Section 52-1-4.2 NMSA 1978, shall submit
an application for approval to the director on a form provided for that
purpose not less than 30 days prior to the commencement of bidding procedures
for the primary contractor.
(1) A provisional or contingent
application for approval shall be allowed, provided that neither final approval
nor permission to break ground may be given to any provisional or contingent
application.
(2) Approvals of provisional or
contingent applications are advisory only and no approval that is not
designated as a final approval and that does not bear the signature of the
director shall be deemed final.
(3) Every
application for approval of a controlled insurance plan shall contain a
detailed financial statement demonstrating that the aggregate construction
cost, as statutorily defined, has been satisfied, and further showing that the
sources of funding for the project conform with the definition of the term,
“same project” contained in these rules.
The financial statement shall be supported by an affidavit executed by
the signatory to the application attesting to the accuracy and completeness of
the financial statement.
B. No controlled insurance plan
construction project shall break ground until final written approval of the
controlled insurance plan, subject to amendment, is provided by the
director. The director is authorized to
seek injunctive relief to prohibit construction at a site until final approval
of an application for a controlled insurance plan is given or the construction
project is operated under a non-controlled insurance plan otherwise complying
with the act, in addition to any other relief sought.
C. Failure to provide and maintain
current information on the application form on file with the director, and to
update any change information within ten calendar days of the change shall
constitute a violation of these rules.
The applicant shall have a continuing duty to maintain the currency and
correctness of the application on file with the director.
D. Amendments to an application to
conform with any modifications to the job, modifications to the safety plan or
modifications to the designated single construction site and all other
information required by this rule or the application for approval of a controlled
insurance plan are required prior to the commencement of work pursuant to the
amended provisions.
(1) The insurance policy for a controlled insurance plan must be conformed
to any revisions in the application prior to commencement of work pursuant to
the revisions.
(2) All contractors and
subcontractors shall be notified in writing upon any request for amendment or
revision to the application, and shall be separately notified of the approved
amendments or revisions prior to the commencement of work pursuant to any approved
amendments or revisions.
E. The director or his designee shall
be available to applicants for controlled insurance plans to provide counseling
in aid of the development of acceptable applications, but in no event shall
such assistance be construed as the director’s approval of the application or
as a promise that the director will approve an application.
F. The director or his designee shall
attempt to complete the application review process within 30 days of submission
of the final application, and shall inform the applicants in writing of the
reasons for, and expected duration of, any delay beyond the 30 day period.
G. The applicants shall specify the
names of at least two individuals authorized to accept notices and service of
process applicable to the controlled insurance plan. For each named individual, both street and
mailing addresses shall be specified, and the applicant shall notify the WCA of
any changes in the authorized representatives for receipt of notices and
process or the applicable addresses for such representatives within 10 business
days of any such change.
H. The applicant shall specify the name
of at least one person, who may also be designated to perform other functions
under this part, who is knowledgeable concerning the handling of workers’
compensation claims under the act. The
director shall approve the designated claims management professional after
submission of credentials and resume, prior to the commencement of the
work. The designated claims management
professional shall be available within 24 hours of any accident at the single
construction site and shall consult with the injured worker’s employer within
72 hours of any accident at the single construction site, concerning the
handling of the claim and return to work issues.
[11.4.13.8 NMAC - N, 11/15/2004;
A, 1/1/2023]
11.4.13.9 CONTROLLED INSURANCE PLAN
CONSIDERATION UNDER THE EXTRA-HAZARDOUS EMPLOYER PROVISIONS OF THE WORKERS'
COMPENSATION ACT: The controlled insurance plan shall be
considered a single employer for purposes of WCA regulations concerning
extra-hazardous employers, promulgated pursuant to Subsection E of Section 52-1-6.2
NMSA 1978. The North American industrial
classification system (NAICS) code applicable to the general contractor shall
be the industry code utilized for comparison of the controlled insurance plan
loss record to its industry standard.
The controlled insurance plan project shall be examined every 90 days,
while construction is ongoing, for purposes of determining extra- hazardous
employer status.
[11.4.13.9 NMAC - N, 11/15/2004;
A, 1/1/2023]
11.4.13.10 SAFETY PLANS:
A. Criteria for approval. The following
requirements must be met for initial approval of a safety plan and for final
approval of an application for a controlled insurance plan. Failure to maintain continuous compliance
with each of these requirements shall be considered a violation of these rules
and the director shall be authorized to seek injunctive action to prohibit
construction work until such failure is corrected.
(1) New
Mexico OSHA compliance;
(2) Appointment
of a site safety manager acceptable to the director;
(a) The
site safety manager shall have a minimum of three-year's experience in programs
covered by 29 CFR part 1910 or 29 CFR part 1926, as applicable.
(b) An applicant
shall submit a resume and credentials of the proposed site safety manager not
less than 14 days before commencement of work on the project. The director, or his designee, shall review
the resume credentials within 14 days.
Work on the project shall not commence until the director or his
designee has approved a site safety manager.
(c) An applicant
shall submit a resume and credentials for any proposed substitute or standby
site safety manager prior to any construction activities at the single
construction site overseen by the substitute or standby site safety manager.
(d) In no
event shall the applicant allow work at the single construction site to proceed
for more than eight continuous hours without the approved site safety manager,
or approved substitute or backup site safety manager being physically present
at the single construction site.
(e) All
approved safety plans must provide that the approved site safety manager, or
approved standby or substitute site safety manager shall have plenary authority
to close down the construction project in whole or in
part, in the event that hazards to health or safety of workers present an
imminent danger to worker health or safety.
The approved site safety manager, backup site safety manager or
substitute site safety manager has a duty to close down
the construction project, in whole or in part, upon discovery of an imminent
danger to worker health or safety that cannot be immediately rectified.
(3) A plan
for coordination of site safety programs among all contractors and
subcontractors by the site safety manager, including access for contractor and
subcontractor safety personnel.
(a) The
plan shall provide for review of the controlled insurance plan safety plan and
drug and alcohol testing provisions by safety personnel employed by, or
contracted to, individual contractors and subcontractors.
(b) The
plan shall provide that any safety provisions, and drug and alcohol testing
programs required by the contractor or subcontractor that are more stringent in
the safety provisions or drug and alcohol testing programs required by the
approved safety plan shall be enforceable against the employees and working
conditions of the contractor or subcontractor and shall not be superseded by
the approved controlled insurance plan safety plan or the approved controlled
insurance plan drug and alcohol screening program.
(4) Third party safety consultant
(a) The applicant
shall engage the services of an independently contracted safety consultant
("third party safety consultant") to provide independent inspections
and oversight on safety issues to assist the site safety manager and the WCA.
(i) The third party safety consultant
shall conduct work environment evaluation inspections of the single
construction site at least twice per month during construction activities.
(ii) The
third party safety consultant shall notify the site safety manager immediately
of any hazardous condition disclosed by the third party safety consultant's
inspection
(iii) The
third party safety consultant shall not be terminated in response to making a good-faith finding that a safety hazard exists or in
response to reporting such safety violations as provided by these rules.
(b) The
third party safety consultant shall have credentials at least equal to those
required of the site safety manager.
(c) The third party
safety consultant shall not be the backup site safety manager.
(d) The credentials
of the third party safety consultant shall be presented to, and approved in
writing by, the WCA prior to the commencement of construction
(e) In the
event that the third party safety consultant is replaced during construction
activities, the credentials of the replacement third party safety consultant
shall be presented to the WCA within no more than 10 working days of the
earlier of the termination of the contract or the cessation of work by the
prior third party safety consultant.
(f) The
third party safety consultant shall prepare written reports at least every 30
days from the date of commencement of construction detailing any safety issues
or hazards discovered during the inspections that occurred during the prior
month. Said reports shall be provided to
the WCA, all contractors and all sub-contractors.
(g) The third party
safety consultant shall also generate a written report in the
event that he or she discovers any condition or hazards that constitute
an imminent danger to worker health or safety that the independent safety
consultant believes would justify closure of the construction site in whole or
in part by the site safety manager. Said
report shall be provided to the WCA, all contractors and all subcontractors
within 2 days of the discovery of the condition or hazard.
(5) Drug
and alcohol screening, complying with provisions of Section 52-1-12.1 NMSA 1978. Compliance with the drug and alcohol
screening plan shall be the responsibility of the applicant provided that the
applicant shall implement any more stringent plan incorporated pursuant to
Subparagraph (a) of Paragraph (3) of Subsection A of 11.4.13.10 NMAC.
(6) Continuous coverage of the
construction site shall be provided by an on-site registered nurse, who shall
have demonstrated experience in the treatment of workers’ compensation
claimants, during all working hours.
(a) Credentials
and resume for the registered nurse must be presented to the WCA and approved
prior to the beginning of construction.
(b) Credentials
for any registered nurse serving in a backup capacity or as a substitute for
the original approved registered nurse must be presented to the WCA and
approved prior to the first instance of coverage by that nurse.
(c) Should
the retention of a registered nurse constitute a hardship on the applicant
because of location or any other circumstance, the applicant may petition the
director for a waiver of this requirement pursuant to 11.4.13.11 NMAC and the substitution
of a certified, full-time, emergency medical
technician (EMT). The applicant must
demonstrate compliance.
(7) Emergency
medical services plan
(a) The plan must
include a provision requiring prominent display at the work site giving notice
to workers of emergency facilities to be used in the event of an accident,
including a map directing workers to the appropriate emergency facilities.
(b) The
plan must include a provision requiring prominent display at the work site of
notices concerning any contracted physicians or medical facilities.
(c) The
plan must contain a provision for providing notice of initial choice of health
care providers to workers, in compliance with WCA regulations.
(d) The
plan must contain evidence of planning and contractual preparation for
emergency medical evacuation by air, when medically appropriate.
(8) Evidence of a plan for facilitating
return to work of injured employees.
(a) The plan must
provide for appropriate communication to workers to ensure to the extent
possible they are fully apprised concerning return to work policies.
(b) The
plan must provide for the direct involvement of the employer of the injured
worker in return to work planning and implementation commencing as soon as
possible after the injury to the worker.
(c) The plan must
provide for continued communication concerning return to work between the
insurer, the worker and employer for all injuries persisting beyond the
completion of the project.
(9) The
site safety manager must certify to the owner of the property upon which the
controlled insurance plan project is being built, all contractors and
subcontractors and to the independent safety consultant, and to the WCA, that
each worker on the single construction site has been specifically safety
trained for each job function that they perform, within 10 days of the
commencement, or change, of the workers job duties on the single construction
site. The certification shall be on a
form approved by the director.
(10) The plan must provide for
communications provided to the applicant regarding substance abuse testing,
medical treatment and medical conditions, or injury reports to be promptly and
specifically communicated to the workers employer within four calendar days of
the communication to the applicant. The
applicant is solely responsible for this requirement. The applicant shall specify, to the WCA and
to each contractor and subcontractor, before the commencement of work at the
single construction site, the names of at least two persons working full time
at the single construction site who are authorized to assist the applicant in
fulfilling this responsibility.
B. Failure to obtain approval for a
safety plan or to maintain compliance with an approved safety plan is a serious
violation of these rules and the director is authorized to seek injunctive
relief to prevent commencement or continuation of construction until such
situation is remedied in addition to any other relief sought.
[11.4.13.10 NMAC - N, 11/15/2004;
A, 12/29/2006; A, 1/1/2023]
11.4.13.11 WAIVERS. A waiver of
any non-statutory requirement in this part may be sought by the applicant. No waiver of any requirement of this part
shall be effective unless documented in writing, signed by the director. No waiver shall be granted under
circumstances where the waiver has the effect of increasing the risk of injury
or accident to any worker on the project, or increasing the impact or effect of
any accidental injury or occupational disease upon any worker on the
project. The director may consult with
in-house or independent safety experts in making a
determination under this section, but his determination shall not be
overturned unless it is arbitrary, capricious, abusive of discretion or
otherwise not in compliance with law.
[11.4.13.11 NMAC - N, 11/15/2004]
11.4.13.12 BID NOTICES TO CONTRACTORS AND
SUBCONTRACTORS
A. All
bid notices to contractors and subcontractors shall include specification of
the single construction site proposed, and shall include a copy of the proposed
controlled insurance safety plan.
B. The
bid procedure utilized by the applicant must include a mechanism for
contractors and subcontractors to have questions concerning the controlled
insurance plan answered before the bid is due.
[11.4.13.12 NMAC - N, 11/15/2004]
11.4.13.13 REPORTS AND OFFICIAL VISITS.
A. The controlled insurance plan shall submit a report on a
quarterly basis or as otherwise determined by the director.
B. The director may require an official visit to the
controlled insurance plan site to keep apprised of the progress of the
controlled insurance plan and its compliance with the Workers’ Compensation Act
and WCA rules.
[11.4.13.13 NMAC - N, 11/15/2004;
11.4.13.13 NMAC - N, 12/31/2013]
11.4.13.14 DISPUTES CONCERNING APPROVAL OF THE
APPLICATION FOR APPROVAL OF A CONTROLLED INSURANCE PLAN AND FOR THE REQUIRED
SAFETY PLAN
A. All
application materials, and safety plan materials shall be submitted to the
director at least 30 days before the planned commencement of construction.
B. Amendments
to the application or safety plan, and any waivers of requirements, that are
negotiated between the WCA and the applicant shall
only be effective if reduced to writing and signed by both parties.
C. In the event that an impasse develops in negotiations or
disputes arising from the application process, the safety plan or request for
waivers of requirements, the director shall designate an informal dispute
resolution coordinator to attempt to bring the parties together to help them
reach a mutually agreeable solution.
D. In
the event the informal dispute resolution fails to resolve the dispute, either
the applicant or the WCA can request a formal hearing before the director.
E. The
director, or his hearing officer, shall hear the positions of both sides and
render an initial ruling within 15 days of the hearing. Motions practice and discovery procedures
shall not be allowed. The rules of
evidence are relaxed to the extent possible, consistent with the need to
maintain order in the hearing and reach a fair decision.
F. Appeal
from the ruling the director or his hearing officer after a formal hearing
shall be by writ of certiorari to the district court, pursuant to SCRA 01-075.
[11.4.13.14 NMAC - N, 11/15/2004;
11.4.13.14 NMAC - Rn, 11.4.13.13 NMAC, 12/31/2013]
11.4.13.15 PROHIBITED ACTS. The
following acts are prohibited:
A. The
establishment of the controlled insurance plan for projects that do not have an
aggregate construction value in excess of $150
million, including equipment and furnishings, expended within a five-year
period as provided in NMSA 1978, Section 52-1-4.2 (A) and Section 11.4.7.9 of
these rules.
B. The
establishment of a rolling wrap-up plan or establishment of a construction
project insured under a rolling wrap-up plan.
C. Establishment
of a controlled insurance plan on a site other than the single construction
site, or establishment of the controlled insurance plan on a noncontiguous
construction site.
D. Failure
to include appropriate notice of the controlled insurance plan in request for
bids or request for proposals to construction contractors and subcontractors,
and failure to include an accurate description of the single construction site
or failure to include a copy of the proposed controlled insurance safety plan
with the request for bids or request for proposals.
E. Failure
to include copies of specifications for the controlled insurance plan with
request for bids or request for proposals to construction contractors and
subcontractors and failure to provide a mechanism for contractors and
subcontractors to have their questions concerning the controlled insurance plan
answered before the bid or proposal is due.
F. Failure
to timely file the contract for a controlled insurance plan and evidence of
compliance with NMSA 1978, Section 52-1-4.2 (A-E) with the WCA and the
superintendent insurance at least 30 days before the date on which the
applicant is to begin receiving bids or proposals on the project.
G. Failure
to request and obtain written approval from the WCA of the application for
approval and the site safety plan for the controlled insurance project, prior
to the commencement of work on the project.
H. Failure
to distribute project performance based refunded premiums or dividends to each
participating contractor or subcontractor on a proportional basis,
if such refunded premiums or dividends are provided for in the contract.
I. Failure
to establish a method for timely reporting of job related injuries to employees
of the contractor and subcontractors to their specific employer, the controlled
insurance plan insurer and the WCA.
J. Failure
to maintain and report unit statistical data to the insurance company writing
the workers' compensation insurance policies for the contractors and
subcontractors participating in the controlled insurance plan project within
the time frame required by the insurance company.
K. Failure
by contractors and subcontractors participating in the controlled insurance
plan project to allow access to payroll records for payroll auditing purposes.
L. Failure
to provide contractors and subcontractors with actual specific payroll audit
data following the end of the annual policy period.
M. Failure
to provide information to contractors and subcontractors concerning injuries to
their workers in a form and format designed to quickly and
accurately inform the contractors and subcontractors concerning the nature and
extent of injuries and the circumstances in which the injury occurred.
N. Failure
to cover the injury to an employee of any contractor or subcontractor that
occurs within the physical confines of the single construction site.
O. Failure
to update and keep current the application, safety plan, narrative description
of the single construction site and visual diagram of the single construction
site.
P. Failure
to take steps to conform the controlled insurance plan policy to the single
construction site definition before work is done, or knowingly allowing work to
be commenced in any area intended to be covered by the controlled insurance
plan, without ensuring that the controlled insurance plan policy is written to
conform its geographic scope of coverage to the single construction site.
Q. Failure
to comply with any provision of these rules, or to knowingly allow any
contractor, subcontractor or employee or independent contractor of the general
contractor to violate any provision of these rules.
[11.4.13.15 NMAC - N, 11/15/2004;
11.4.13.15 NMAC - Rn, 11.4.13.14 NMAC, 12/31/2013]
11.4.13.16 ENFORCEMENT
A. In
the event of violation of any of these rules, or in the event of the occurrence
of any prohibited acts specified in these rules, the WCA may seek any or all of the following penalties singly or in combination,
against the applicant, any individual responsible for the performance or
non-performance of any duty or prohibited act and, with respect to injunctive
relief, against the continuation of the controlled insurance project:
(1) A fine of up to $1000 for each violation pursuant to NMSA
1978, Section 52-1-61.
(2) A fine of up to $1000 for each day of the continuing
violation, after notice is served upon the designated representative of the
applicant that the director has made a finding of probable cause that a
continuing violation of these rules has occurred.
(3) Injunctive relief for the cessation of construction
activities at the single construction site for the noncontiguous construction
site until full compliance with these rules is achieved, as specifically
authorized in these rules.
B. The
procedures to be utilized in enforcement proceedings pursuant to this section
as set forth in 11 NMAC 4.5.
[11.4.13.16 NMAC - N, 11/15/2004;
11.4.13.16 NMAC - Rn, 11.4.13.15 NMAC, 12/31/2013]
HISTORY OF 11.4.13 NMAC:
[Reserved]