Worker’s Compensation

Workers’ compensation covers employers and employees against financial loss following an injury. The injury must prevent the workers from performing their job. Any employer that has at least one part-time employee must have this coverage. Most states, such as New York, will impose fines if a business fails to have workers’ compensation. In some cases, failing to have workers’ compensation is considered a felony or misdemeanor.

Who Needs Workers’ Compensation?

All employees must have access to workers’ compensation. This includes people who work for non-profit and for-profit businesses. Any person employed 40 hours per week, even if it’s in a home, must legally have workers’ compensation. If a farm worker performed at least $1200 worth of labor, then that employer is required by law to have workers’ compensation coverage.

Freelance workers or independent contractors also mean coverage is required. The tax status of a worker doesn’t determine whether or not the employer needs coverage.

How to Get Workers Compensation for Employees

Estimate the yearly payroll for all employees. This is important because premiums are based on the total annual payroll. After your business has had the policy for a year, your insurer will audit your business records. This will allow them to obtain the actual payroll. If the payroll is higher than the estimate, then you’ll get charged the difference. If the actual payroll is less, then you’ll receive a refund or credit towards the policy.