Section R20-5-721. Admission of Employers into an Existing Work- ers’ Compensation Pool

A.      An employer that meets the requirements of A.R.S. § 23-

961.01 and this Article that seeks to join an existing pool shall submit an application for membership to the board of trustees of the pool, or the board’s designee, on a form approved by the Commission.

B.       Consideration of application by a board.

1.        A board shall approve or deny admission in the pool according to the bylaws of the pool and other applicable statutes and rules.

2.        Upon approval of admission of an employer by a board, the board shall transmit the original application of the employer and board resolution approving membership to the Commission for consideration and approval.

C.      Commission Approval.

1.        Except as provided in subsection (C)(2), within seven days after receiving an employer application described in subsection (B)(2), the Division shall advise the pool whether the employer application is complete. Within 45 days after receiving a complete employer application described   in  subsection  (B)(2),  the  Commission  shall

consider the application and shall approve the admission of an employer into a pool if each of the following requirements are met:

a.        The employer meets the requirements of A.R.S. § 23-961.01 and this Article;

b.        Admission of the employer into the pool does not impair the ability of the pool to meet the require- ments of A.R.S. § 23-961.01 and this Article;

c.        Admission of the employer into the pool does not impair the ability of the pool to meets its financial obligations under the Arizona Workers’ Compensa- tion Act.

2.        After a pool has completed one year of operation, the pool may request Commission authorization to admit new members without Commission approval. Within 30 days after receiving such a request, the Commission shall con- sider and approve the request to add members to a pool without Commission approval if the pool meets the fol- lowing:

a.        The pool uses the similar industry requirement set forth in R20-5-710 and provides a list or description of businesses that the pool will consider as being similar; and

b.        The pool adopts as its own criteria for admission of new employers the criteria set forth in subsection (C)(1) and provides financial standards that the pool shall apply to employers seeking admission into the pool.

3.        The Commission shall issue written findings and an order either approving or denying admission of an employer into a pool under subsection (C)(1) or approving or deny- ing authorization to add members without Commission approval under subsection (C)(2). The Commission shall mail the findings and order upon the interested parties. The written findings and order is final unless a party files a request for hearing with the Administration Division within 10 days after the findings and order is issued. Hearing rights and procedure are governed by R20-5- 736, R20-5-737, and R20-5-738.

D.      Admission of an employer under subsection (C)(2).

1.        A pool shall require an employer applying for member- ship in the pool to provide a financial report that is either a certified audited financial statement or an internally reviewed and signed financial statement certified by an officer or representative of the employer applying for membership.

2.        If a pool approves admission of a new employer into the pool, the pool shall send written notice to the Commis- sion, on a form approved by the Commission, within 10 days and prior to the effective date of membership, con- firming that the pool has admitted a new member.

3.        In addition to the notice required under subsection (D)(2), the pool shall also provide to the Commission, the board resolution approving membership and a copy of the employer’s application for admission into the pool.

Historical Note

Adopted effective September 9, 1998 (Supp. 98-3).