SENATE BILL REPORT

SB 6354

BYSenators Lee, Smitherman and McMullen; by request of Department of Labor and Industries

Changing the definition of wages for industrial insurance purposes.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 2, 1988; February 4, 1988

Majority Report:  Do pass.

      Signed by Senators Lee, Chairman; Anderson, Vice Chairman; Cantu, Conner, McMullen, Saling, Smitherman, Warnke, West.

Senate Staff:Dave Cheal (786-7576)

                  February 16, 1988 1988

AS PASSED SENATE, FEBRUARY 15, 1988

BACKGROUND:

Currently, tips and gratuities are not included in the definition of wages for industrial insurance purposes.  This means that benefits for temporary total disability (time loss) are calculated by excluding tips and gratuities.  This significantly deflates the benefit received by injured workers who normally receive a substantial part of their compensation as tips and gratuities.

Conversely, tips must be reported by workers as income for federal income tax purposes. 

SUMMARY:

The definition of wages for workers' compensation purposes, including the computation of benefits, is amended to include tips to the extent they are reported for federal income tax purposes.

Appropriation:    none

Revenue:    none

Fiscal Note:      requested January 28, 1988

Senate Committee - Testified: Betty Buckley, Dept. of Labor and Industries (for)