Regular Session 2023-2024 Senate Bill 1232 P.N. 1812

PRIOR PRINTER'S NOS. 1667, 1809

PRINTER'S NO. 1812

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

No.

1232

Session of

2024

INTRODUCED BY PENNYCUICK, FARRY, BROWN, KANE, COSTA, SCHWANK,

LANGERHOLC, MUTH, SANTARSIERO, TARTAGLIONE, DILLON AND

FONTANA, MAY 31, 2024

AS AMENDED ON THIRD CONSIDERATION, JULY 9, 2024

AN ACT

Amending the act of June 2, 1915 (P.L.736, No.338), entitled "An

act defining the liability of an employer to pay damages for

injuries received by an employe in the course of employment;

establishing an elective schedule of compensation; providing

procedure for the determination of liability and compensation

thereunder; and prescribing penalties," in liability and

compensation, further providing for payment of compensation.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 308 of the act of June 2, 1915 (P.L.736,

No.338), known as the Workers' Compensation Act, is amended to

read:

Section 308. (a) Except as hereinafter provided, all

compensation payable under this article shall be payable in

periodical installments, as the wages of the employe were

payable before the injury.

(b) Compensation payable under this article shall be paid by

direct deposit to the account of the person entitled to the

compensation. The person entitled to compensation who does not

have an account with a financial institution capable of

accepting a direct deposit may request payment be made by paper

check in lieu of direct deposit. The following shall apply:

(1) Installments of compensation payable under this article

paid by direct deposit shall be subject to the following:

(i) After the effective date of this subparagraph, an

insurer or self-insured employer may permit or require payment

of compensation by direct deposit. If the insurer or self-

insured employer permits payment by direct deposit, the option

shall be available to all persons entitled to compensation from

the insurer or self-insured employer.

(ii) No later than one year after the effective date of this

subparagraph, all insurers and self-insured employers shall

permit payment of compensation by direct deposit.

(2) The insurer or self-insured employer shall notify the

persons entitled to compensation of the option or requirement to

receive compensation by direct deposit. Notification shall be

made immediately upon the availability or requirement of direct

deposit by the insurer or self-insured employer or concurrently

with a notice of compensation payable.

(3) The insurer or self-insured employer shall provide the

person entitled to compensation with a payment authorization

form or may direct the person entitled to compensation to an

online authorization form.

(4) A person entitled to compensation who requests to

receive compensation by direct deposit shall submit an accurate

and valid payment authorization form or a valid online

authorization form to the insurer or self-insured employer. The

following shall apply:

(i) The payment authorization form may be submitted

electronically if the insurer or self-insured employer has

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agreed to accept the form electronically.

(ii) The insurer or self-insured employer shall not be

required to pay compensation by direct deposit unless the person

entitled to compensation has submitted a valid payment

authorization form or a valid online authorization form.

(iii) If the insurer or self-insured employer requires

payment by direct deposit and the person entitled to

compensation does not submit a valid payment authorization form

or valid online authorization form within thirty days of

receiving notification of the requirement, the insurer or self-

insured employer may, at the discretion of the insurer or self-

insured employer , temporarily pay compensation by paper check.

(5) A person entitled to compensation shall have the right

to choose the deposit account to which payment of compensation

is made and may request to change the deposit account designated

to receive compensation or discontinue direct deposit by

submitting a revised payment authorization form or a revised

online authorization form to the insurer or self-insured

employer. The deposit account shall be subject to the following

requirements:

(i) The person entitled to compensation shall have control

and signatory access to the chosen deposit account.

(ii) The deposit account shall be with a bank as defined

under 12 U.S.C. § 1813(a)(1) (relating to definitions) on the

effective date of this subparagraph or a credit union.

(iii) A deposit account may be changed no more than two

times in any calendar year, unless otherwise ordered by a

workers' compensation judge or a court of competent

jurisdiction.

(6) For a person entitled to compensation under section 307 ,

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payments of compensation may not be split between multiple

payment methods, and payments of compensation made by direct

deposit may not be split between multiple deposit accounts.

(7) A request to initiate direct deposit, change deposit

accounts or discontinue direct deposit shall be implemented

within forty-five days of receipt, provided that the payment

authorization form or online authorization form is valid.

(8) An insurer or a self-insured employer shall not be

responsible for repaying any money deposited into an incorrect

account if the sole reason for the error is incorrect

information provided by the person entitled to receive

compensation . An insurer or a self-insured employer shall take

reasonable actions to attempt to recover the money and any money

later recovered by the insurer or self-insured employer shall

promptly be credited to the person entitled to receive

compensation .

(9) Lump sum settlement payments made as a result of a

compromise and release agreement may be made by paper check

unless the insurer or self-insured employer agrees to make

payment by direct deposit.

(10) A payment made on a claim with an expected duration of

sixty days or less may be made by paper check unless:

(i) The insurer or self-insured employer agrees to make

payment by direct deposit.

(ii) The person entitled to compensation previously received

compensation by direct deposit and verifies that the direct

deposit account previously used is still valid.

payment authorization form for use by all insurers and self-

insured employers under this section. The form shall include,

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but not be limited to, the following information:

(1) The name, telephone number, mailing address and email

address of the person entitled to compensation.

(2) The workers' compensation claim number.

(3) Whether the person entitled to compensation is

requesting to initiate direct deposit, change deposit accounts,

discontinue direct deposit or elects payment by paper check in

lieu of direct deposit.

(4) The name and address of the financial institution and

the account and routing numbers to which compensation shall be

sent.

(5) Acknowledgment that failure to notify the insurer or

self-insured employer of any change in financial institution or

account may delay receipt of compensation or settlement

proceeds.

(6) Acknowledgment that a false statement or failure to

disclose a material fact to obtain or increase compensation may

result in criminal prosecution, disqualification of benefits and

repayment of money deposited into the account.

(7) Acknowledgment that the person entitled to compensation

shall notify the insurer or self-insured employer of changes in

circumstance that affect entitlement to compensation payable

under this article.

(d) As used in this section:

"Credit union" shall mean any of the following:

(1) A cooperative corporation incorporated under any of the

following:

(i) The former act of May 26, 1933 (P.L.1076, No.260),

referred to as the Credit Union Act.

(ii) The former act of September 20, 1961 (P.L.1548,

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No.658), known as the "Credit Union Act."

(iii) The act of December 19, 1990 (P.L.834, No.198), known

as the "GAA Amendments Act of 1990."

(2) A credit union organized in accordance with the

provisions of 12 U.S.C. Ch. 14 (relating to Federal credit

unions).

"Direct deposit" shall mean a credit to a deposit account in

a financial institution made by electronic fund transfer . The

term does not include money loaded onto a debit card associated

with a financial institution.

"Electronic fund transfer" as defined in 15 U.S.C. § 1693a

(relating to definitions).

"Online authorization form" shall mean a form on a publicly

accessible Internet website or electronic service, including a

mobile application, which is prescribed by an insurer or self-

insured employer and which contains the same information as the

payment authorization form under subsection (c).

"Payment authorization form" shall mean the payment

authorization form published under subsection (c).

"Person entitled to compensation" shall mean an employe, a

person entitled to compensation or the person's legal

representative under this article.

"Valid online authorization form" shall mean a completed

online authorization form that contains all information

necessary for the insurer or self-insured employer to initiate

direct deposit, change deposit accounts or discontinue direct

deposit.

"Valid payment authorization form" shall mean a completed

payment authorization form that contains the information

necessary for an insurer or self-insured employer to initiate

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direct deposit, change deposit accounts or discontinue direct

deposit.

Section 2. This act shall apply to installments of

compensation paid on or after the effective date of this

section.

Section 3. This act shall take effect in 60 days.

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