Workers’ compensation insurance protects employers and employees against financial loss in event of injury. Employers must continuously provide for workers’ compensation benefits to all employees. For workers’ compensation purposes, an employee can include day labor, leased and borrowed staff, volunteers, part-timers and family members, as well as most subcontractors.
It is unlawful for an employer to discriminate against an employee who files or testifies in a workers’ compensation case.
Sole proprietors, individuals in partnerships (including LP, LLC, LLP, PLLC, PLLP or RLLP) and one/two-person corporations where they own all stock (a share or more each) and hold all corporate offices, do not require coverage for themselves if they do not have any employees.
Business owners can always include themselves on a policy. For more complete information, including requirements for business owners serving as subcontractors, see Chapter 3 of the Employers’ Handbook, on the Board’s website.
Workers under your direct supervision are probably considered your employees for workers’ compensation purposes, regardless of their tax status. There is a perception that so-called independent contractors do not need workers’ compensation insurance coverage; that is often false. A worker’s tax status does not determine if workers’ compensation insurance is required: you may need coverage even for 1099 employees.
Private Insurance. Hundreds of private insurance carriers are authorized to write workers’ compensation insurance policies in New York.
State Insurance Fund. The New York State Insurance Fund, a quasi-public carrier, also writes workers’ compensation insurance.
Individual Self-Insurance. Large employers can set aside reserves for self-insurance, in a formal, regulated process.
Group Self-Insurance. Joining a group self-insurance program may be a viable option.
There is a $2,000 penalty for every 10 days a worker is without insurance, and penalties for misrepresenting payroll, employees, and record-keeping failures.
Not carrying workers’ compensation insurance is a felony (if a company has more than five employees), or a misdemeanor.
The Board actively pursues scofflaws, and has issued 5,000 stop-work orders.
Workers and businesses who are penalized cannot win public work jobs.
Business owners must pay lost wages and medical care for uninsured workers. Permanent total disability and death benefits are not capped.
Employees generally cannot sue you for a work-related injury or illness when you are insured.
Insurers notify the Board when they write, modify or cancel insurance. If coverage is canceled without a replacement policy, the Board will contact you. Your insurance status is public information, available at the Board’s website.
If your business is not in compliance with the above and / or you have failed to file tax returns or owe taxes, then please attend our FREE Seminar on Workers’ Compensation and Tax Audits. For seminar registration, click here.