How to Comply with NYS Workers' Comp Law
As an owner, you are required by federal and state laws to provide a reasonably safe workplace for your employees. Unfortunately, even if you provide proper equipment to your employees and implement safety policies, accidents still occur. To protect your building staff—and yourself, as an owner—you are required under New York State law to buy a workers' compensation insurance policy—even if you have only one employee.
Workers' compensation provides replacement income and pays medical expenses for your employees who are injured or become ill as a result of their job. It's a no-fault system, which means that an injured employee is entitled to receive benefits whether or not his own carelessness contributed to the injury. The owner is protected, too, within this system. An injured employee is limited to fixed types of compensation—wage replacement and payment of medical bills. As a result, your employee cannot sue you for pain and suffering, or mental anguish.
Even if you have contracted with a management company to provide, for example, a superintendent for your building, you are still required to obtain workers' compensation coverage for him. The superintendent can be considered the employee of either the owner or the management company, or both, because each controls the superintendent's activities.
What Does Workers' Compensation Insurance Buy?
When you purchase workers' compensation insurance, you are buying the following protections:
Medical services needed to treat the job injury or illness;
Temporary disability payments to the employee to help replace lost wages;
Permanent disability payments to the employee to compensate for permanent effects of the injury;
A death benefit for the employee's survivors in the event of a fatal injury;
Legal representation for the employer by the insurance carrier; and
Protection for the employer against most lawsuits for on-the-job injuries/illnesses.
Determining if Injury Qualifies
An employee isn't entitled to workers' compensation for every injury that occurs at work. To qualify, an employee must suffer an illness or injury that occurred in the course of employment and arose out of the circumstances of employment. In other words, if someone gets injured at work, but the injury didn't come from doing the actual work, workers' compensation will not apply.
For example, horseplay could be involved, potentially excluding the injury from workers' compensation coverage. In other instances, an injury may need more investigation. If an employee has a heart attack at work, the injury does not necessarily arise out of the circumstances of employment.
If the heart attack is caused by a personal condition, rather than a work-related condition, the employee may not be entitled to workers' compensation. However, if the heart attack occurred at work because of a heavy workload, the injury might be considered to have arisen out of employment, and the employee might therefore be eligible for workers' comp benefits.
Beyond obtaining workers' compensation coverage for your employees, state law imposes record-keeping and reporting duties on owners.
Post notice. According to Section 51 of the Workers' Compensation Law, employers must post a notice of workers' compensation coverage. You can obtain this form from your workers' compensation carrier. The form includes the name, address, and phone number of the insurer, and your policy number. It must be posted in a conspicuous place in your building, and violations of this requirement can result in a fine of up to $250 per violation.
Keep accurate employment records. You must keep accurate records of the number of employees, classification, wages, and accidents at your building for four years. Some owners may try to pay lower workers' compensation premiums by paying workers off the books or misclassifying employees as independent contractors. Under workers' compensation law, failure to keep adequate and accurate records may result in a fine of $1,000 per every 10-day period of noncompliance or two times the cost of compensation.
Record and report injuries. You must report most injuries to the Workers' Compensation Board and the insurance company, if insured, on Employer's Report of Work-Related Injury/Illness (Form C-2) within 10 days after an accident. Failure to file a C-2 or failure to file it on time may result in a penalty of up to $2,500. C-2 forms are available from the insurance carrier, or online at http://www.wcb.state.ny.us.
If an injury is minor, requiring two or fewer treatments by a person rendering first aid, and with lost time of less than one day beyond the end of the working shift on which the accident occurred, you may choose to pay for the first-aid treatments directly. In this instance, you will complete a C-2 Form, but you do not send it to the Workers' Compensation Board or the insurance carrier. Instead, you will keep the form in your employee files for a statutorily required 18-year period.
When completing a C-2 form, it is important to remember that statements may be legally binding. As the owner, you should note on the C-2 if you believe the claim to be questionable or fraudulent. The insurance carrier can also be contacted for assistance with completing the form. The C-2 can be filed by a third party designated by you, but you are ultimately responsible for ensuring that it is filed.
Filing the C-2 form is not necessarily an admission that you agree with the facts of an accident. It is a statement that an employee reported a work-related injury or illness to you.
Obtaining Workers' Compensation Insurance
You may obtain workers' compensation insurance coverage from one of the more than 200 private insurance carriers authorized by the New York State Insurance Department to provide workers' compensation insurance to employers. You can also purchase a workers' compensation insurance policy from the State Insurance Fund, a public insurance carrier in New York State, by calling 1-888-875-5790.
If you hire a management company, it is practical for you to require the management company to have a workers' compensation insurance policy. This will help ensure that your own premiums are as low as possible, and can help shield you from any workers' compensation liability.
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