As an employer in the states of NY, NJ or CT, you’re responsible for adhering to the workers’ compensation laws that impact your operations. Here are some general rules and provisions that apply in each state.
- CT Law on Workers’ Compensation: Companies with at least one employee are required to carry workers’ compensation insurance, with the exception of businesses that self-insure. Exemptions exist for household employees who work 26 or fewer hours per week, sole proprietors, multiple member LLC’s, corporate officers and partnerships; these entities must always provide workers’ compensation coverage for their employees, but may elect not to carry it for themselves.
- NJ Workers’ Compensation: New Jersey law requires employers who are not covered by Federal programs to carry workers’ compensation coverage or be approved to self-insure. Out-of-state employers must adhere to workers’ compensation requirements when they enter into a contract of employment in the state or if work is performed within NJ.
- NY Workers’ Compensation Issues: Workers’ compensation laws in NY cover a wide range of employees, regardless of whether they’re considered part time, full time or a contract worker. The laws specifically mention that certain occupations qualify for occupational injury compensation benefits, including public school teachers, county employees working under hazardous conditions and some volunteer workers.
Workers’ Compensation Insurance
From the above, you can see that employers have a number of obligations under each state’s laws, but the primary responsibility is to carry proper workers’ compensation. Failure to do so can subject a company to fines or other consequences:
- When a CT employer fails to comply with workers’ compensation injuries, it can be fined up to $250 per incident, plus a $1,000 per day fine for other misconduct. Continued violations can increase the fine to $50,000.
- NJ law requires payment of a $5,000 fine per day over a 10-day period if an employer fails to carry workers’ compensation insurance.
- In NY, an employer must pay a penalty of $2,000 per day for each 10-day period of non-compliance with insurance requirements. The state agency in charge of levying fines does have discretion to increase the penalty in severe cases.
Despite the fines, the cost of not maintaining proper workers’ compensation can be outrageous if an employee is injured on the job. Litigation for workplace injuries is likely and, without insurance, you’d be forced to pay from company assets.
So workers’ compensation insurance is clearly an investment you must make to do business, but payment is quite unlike most expenses you face. Most insurance companies require employers to pay upfront for an estimated premium, which is based on projected year-end payroll. Clearly, this ties up the cash flow you rely upon to operate your business.
At Paypro, we feature a revolutionary way to comply with state law requirements on workers’ compensation and protect your company from expensive litigation. Our Pay as You Go Workers’ Comp solution utilizes actual payroll figures to establish insurance premiums. This frees up your cash flow and eliminates the need for intrusive audits. Seamless integration between your payroll data and the insurance company reduces administrative strains that result in miscalculations and reporting errors. Your workers’ compensation premium payments are no longer an estimate; they’re concrete figures. Contact us for more information.