Pass The Labor Rate Bill

The Auto Body Labor Rate Bill S122

BILL SUMMARY

NOTE: The legislation amends Chapter 100A of the General Laws.

Section 11. (a)

Establishes an advisory commission on auto body labor rates.
Commission is comprised of eleven members, including:

- Undersecretary of Consumer Affairs and Business Regulation (or designee) as Chairperson

- One Senate member of the Joint Committee on Financial Services appointed by the Senate President

- One Senate member appointed by the Senate Minority Leader

- One House member of the Joint Committee on Financial Services appointed by the Speaker of the House

- One House member appointed by the House Minority Leader

- Three members from the auto insurance industry appointed by the Automobile Insurers Bureau (AIB)

- Three members from the collision industry appointed by the AASP (industry trade organization)

All members serve on a voluntary, unpaid basis.

Section 11. (b)

Commission is authorized to adopt regulations by a two-thirds majority vote.

Commission may amend regulations at anytime by a two-thirds majority vote.

Commission collects fees to pay for staffing and administrative costs.

Each registered repair shop shall pay $100 annually (approximately $170,000).

Each insurer writing in Massachusetts shall pay $1,000 annually (approximately $20,000).

Funds shall be deposited in a separate account with the State Treasurer.

Funds shall be expended by the commission in accordance with law.

Section 11. (c)

Commission shall develop and implement procedures to establish the average national labor rate, and a multiplier based on information released by the US Bureau of Labor Statistics, relative to other states.

Commission shall determine minimum rates for body, paint, unibody/frame, and mechanical labor.

Commission shall update each category of rates at least every three years.

Commission shall define three levels of qualifications to designate shops as "A," "B," and "C."

Commission shall define an application process and inspection requirements for each classification.

Applying shops must be inspected within ninety days of application and informed of results within thirty days.

Level "C" shops must be paid a labor rates that is fair and reasonable.

Level "B" shops must be paid an amount not less than ninety percent of the indexed hourly rate in force.

Level "A" shops must be paid an amount not less than one hundred percent of the indexed hourly rate in force.

Commission shall develop a formal complaint process for non-compliance by collision shops and insurers.

Section 11. (d)

Commission shall meet in public not less than eight times per calendar year.

Commission shall appoint inspection teams of at least one person from the collision and insurance industry.

Commission shall set the compensation rate for each inspection filed, paid from the commission's fund.

Each member of inspections teams must be compensated at an equal amount.

The total amount paid for each inspection may not exceed seventy-five percent of the application fee in force.

Section 11. (e)

Commission shall report annually its indexed labor rates to the division of insurance and the attorney general not later than June 1.

Indexed rates shall become effective on January 1 of the next following calendar year.

NOTE: For additional information, please contact Peter Abdelmaseh, AASP Executive Director, at (617) 484-0205.