Workers Comp Concern = Three Areas
I have been out of action for about a week, as this is the end of our tax season. Three areas that raised the most concern in my presentation at the North Carolina Mid-State Safety Council. I will go over each of them over the next few days.
Those were:
- Subcontractors
- Temporary Agencies
- Subrogation
The first area, Subcontractors, has three areas of concern from what I have seen –
- The Ladder of Workers Comp Insurance – Workers Compensation courts will move up the ladder of contractors until a company is found to have insurance. If your subcontractor does not have insurance for their employees, you may be stuck for a claim. If your subcontractor subcontracts out their work, if the 2nd level subcontractor and your primary subcontractor do not have insurance coverage, then your company may have to pay benefits to an employee you have never met. This happens more than one might think. Workers Compensation Judges are going to find the responsible party by going up the ladder of insurance until coverage for the injured employee is located.
- Certificates of Insurance – A subcontractor may provide you with a Workers Comp Certificate of Insurance. Many companies just take the Certificate of Insurance at its face value. If for some reason the cert is no good, you may be stuck with a claim.
- Who is a subcontractor? The IRS has some great rules on who is a subcontractor and who is not. You may want to review them for your Workers Comp subcontractor situation. The link is here This is a good place to start. Each state’s Workers Comp laws have a set of rules for contractors. The IRS website is a good overall guide.
Next time – Temporary Agencies
©J&L Risk Management Inc Copyright Notice
