342.012 Business owners -- Election to be included as employees -- Qualified
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/ky/342-012A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
partners and members, nonqualified partners and members, and limited
liability company defined -- Provision of partnership agreement or articles of
organization upon request.
(1)For the purposes of this chapter, an owner or owners of a business, including
qualified partners of a partnership owning a business, or qualified members of a
limited liability company, whether or not employing any other person to perform a
service for hire, shall be included within the meaning of the term employee if the
owner, owners, qualified partners, or qualified members of a limited liability
company elect to come under the provisions of this chapter and provide the
insurance required thereunder. Nothing in this section shall be construed to limit the
responsibilities of the owners, partners, or members of a limited liability company
to provide coverage for their employees, nonqualified partners, or nonqualified
members, if any, required under this chapter.
(2)When an owner, owners, qualified partners, or qualified members of a limited
liability company have elected to be included as employees, this inclusion shall be
accomplished by the issuance of an appropriate endorsement to a workers'
compensation insurance policy.
(3)For the purpose of this section, "qualified partner" or "qualified member or
members" means, respectively, a partner who has entered into a meaningful
partnership agreement or a member who has entered into meaningful articles of
organization or a meaningful operating agreement of a limited liability company,
which document shows on its face that the partner will substantially participate in
the profit or loss of the business engaged in by the partnership or limited liability
company and that the partner or member has made some contribution to the
partnership or limited liability company which entitles him or her to participate in
the profits of the business as well as to participate in the decision-making process of
the partnership or limited liability company.
(4)For the purposes of this section, "nonqualified partner" or "nonqualified member"
means, respectively, a person who has entered into a partnership agreement, or
articles of organization or operating agreement of a limited liability company, which
document shows on its face that this person will receive regular payments in
exchange for work for the business engaged in by the partnership or limited liability
company; that the person will not participate in the decision-making of the
partnership or limited liability company and will not participate in the profits and
losses of the business engaged in by the partnership or limited liability company.
(5)Every partnership and limited liability company shall provide, upon the request of
the commissioner or his or her representative, a copy of its partnership agreement or
articles of organization for purposes of demonstrating compliance with this section
and KRS 342.340. With particular reference to employers engaged in coal mining,
the commissioner shall promptly report the failure to comply with the provisions of
this subsection to the Energy and Environment Cabinet, Department for Natural
Resources, Division of Mine Safety, so that appropriate action may be undertaken
pursuant to KRS 351.175.
(6)For purposes of this section, a "limited liability company" means an entity defined
in KRS 275.015 and organized under the provisions of KRS Chapter 275.