1. (a)

   1. (1) Any third party making a payment on account of sickness or accident disability which payment is not excluded from the term "wages" under Arkansas Code § 11-10-215(2)(B) shall be treated as the employer with respect to such wages, except as may be provided in subsections (b) and (c) below.
   2. (2) Accordingly, such third party must pay the contributions or make payments in lieu of contributions as imposed on employers by and in accordance with the provisions of Arkansas Code §§ 11-10-701 – 11-10-715(a).

2. (b)

   1. (1) If any third party that is treated as the employer solely by reason of its having made a payment on account of sickness or accident disability which payment is not excluded from the term "wages" under Arkansas Code § 11-10-215(2)(B) notifies the employer for which services are normally rendered of the amount of the payment made on account of sickness or accident, then the employer for which services are normally rendered (and not the third party) shall be required to:

      1. (A) Pay the contributions; or
      2. (B) Make payments in lieu of contributions as imposed on the employer by, and accordance with, the provisions of Arkansas Code §§ 11-10-701 – 11-10-715(a).
   2. (2) Such notification must be made or postmarked on or before the seventh day following the last day of the calendar quarter in which the payment was made.

3. (c)

   1. (1) Any third party making a payment on account of sickness or accident disability to an employee as agent for the employer or making such a payment directly to the employer shall not be treated as the employer with respect to such payment unless the agency agreement so provides.
   2. (2) An agency relationship is established if the third party bears an insurance risk, or is reimbursed on a cost plus fee basis, even if the third party is responsible for making determinations of the eligibility of individual employees of the employer for whom services are normally rendered for payments on account of sickness or disability.

Codification Notes: This section as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "Rule No. 26" "The following Rule is hereby promulgated and adopted by the Director, Arkansas Department of Workforce Services, pursuant to Arkansas Code 11-10-215):" "This Rule shall take effect and be in full force on and after July 1, 1987."