New York State Workers’

Employers' Handbook to Workers' Compensation in New York State

New York State Workers' Compensation Board

Employers' Handbook

A Guide to the Workers' Compensation and the Disability Benefits Systems for the New York State Business Owner

December, 2011

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Employers' Handbook to Workers' Compensation in New York State

Table of Contents

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0BTable of Contents ............................................................................................................................ 2 Introduction..................................................................................................................................... 8 Message from Advocate for Business Neil Gilberg ....................................................................... 9 4BChapter One .................................................................................................................................. 10

17BHow the Workers' Compensation System Began..................................................................... 10 50BThe Triangle Shirtwaist Factory Fire.................................................................................... 10 51BWorkers' Compensation - The Historic Agreement ............................................................. 10

5BChapter Two.................................................................................................................................. 11 18BThe Players in the System......................................................................................................... 11 52BWorkers' Compensation Board ............................................................................................ 11 53BNew York State Department of Financial Services (Formerly the Insurance Department) . 12 54BNew York Compensation Insurance Rating Board............................................................... 12 5BInsurance Carriers ................................................................................................................. 13 18BUPrivate Insurance Carriers................................................................................................. 13 189BUState Insurance Fund......................................................................................................... 13 56BSelf-Insurers.......................................................................................................................... 13 190BUIndividual Self-Insurance.................................................................................................. 13 19BUGroup Self-Insurance ........................................................................................................ 14 192BULocal Government Self-Insurance .................................................................................... 14 57BNew York State Department of Labor .................................................................................. 15

6BChapter Three................................................................................................................................ 16 19BWho is Covered by the Workers' Compensation Law?............................................................ 16 20BWho is Not Covered by the Workers' Compensation Law?..................................................... 17 21BWho Is An Employee Under the Workers' Compensation Law? ............................................. 18 58BEmployees in For-profit Businesses ..................................................................................... 18 59BEmployees in Nonprofit Organizations ................................................................................ 19 2BIdentifying an Independent Contractor ..................................................................................... 19 60B2010 Construction Industry Fair Play Act ............................................................................ 19 193BUOverview........................................................................................................................... 19 194BUApplication........................................................................................................................ 20 195BUPenalties ............................................................................................................................ 21 61BIdentifying Independent Contractors in Non Construction Industries.................................. 21 23BExamples Where Workers' Compensation Insurance Coverage is Generally Required .......... 23 24BExamples Where Workers' Compensation Insurance Coverage is Generally Not Required Because the Worker is Not an Employee Under the Law ........................................................ 25 25BAdditional New York State Workers' Compensation Coverage Situations ............................. 26 62BAthletic Leagues/Teams/Businesses ..................................................................................... 26 196BUFor-profit athletic leagues/teams/businesses..................................................................... 26 197BUNonprofit athletic leagues/teams/businesses..................................................................... 26 63BBlack Car Operators.............................................................................................................. 26 64BBorrowed Employees............................................................................................................ 27 65BCorporate Officer Coverage Requirements .......................................................................... 27

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Employers' Handbook to Workers' Compensation in New York State

198BUFor-profit Corporate Officers with Employees: Coverage Requirements for Penalty Purposes ............................................................................................................................ 27 19BUFor-profit Corporate Officers with No Employees ? Coverage Requirements for Penalty Purposes ............................................................................................................................ 28 20BUFor-profit Corporate Officers ? Coverage Requirements for Subcontractors .................. 28 201BUNonprofit Executive Officer Coverage Requirements...................................................... 28 6BDomestic Workers Hired by Individuals .............................................................................. 29 67BDomestic Workers Provided by Agencies or Government Programs .................................. 29 68BFamily Members ................................................................................................................... 30 69BFarms .................................................................................................................................... 30 70BForeign Government Employees .......................................................................................... 30 71BHomeowners Workers' Compensation Insurance Rider ...................................................... 31 72BIndependent Contractors and Subcontractors ....................................................................... 32 73BInsurance Agents -- Certain Licensed Insurance Agents Are Independent Contractors ...... 32 74BJockey Fund .......................................................................................................................... 33 75BLeased Employees: Professional Employer Organization.................................................... 33 20BUWorkers' Compensation Coverage Requirements for Clients of Leasing Firms ............. 33 203BUWorkers' Compensation Coverage Requirements for the Leasing Firm.......................... 34 76BLLCs & LLPs........................................................................................................................ 34 7BMedia Sales Representatives ................................................................................................ 34 78BModels .................................................................................................................................. 35 79BNative American Enterprises ................................................................................................ 35 80BNonprofit Organizations ....................................................................................................... 36 204BUNonprofit Executive Officer Exclusions........................................................................... 37 81BOther States' Government Employees.................................................................................. 37 82BOut-of-state Employers with Employees UJUST LIVINGU in New York State ...................... 37 83BOut-of-state Employers with Employees UWORKINGU in New York State........................... 38 84BPartnerships........................................................................................................................... 39 85BPayroll Companies ................................................................................................................ 40 86BPerforming Artists................................................................................................................. 40 87BReal Estate Brokers............................................................................................................... 40 8BReligious Organizations........................................................................................................ 41 89BSole Proprietorships .............................................................................................................. 41 90BSpouses ................................................................................................................................. 42 91BStudent Interns ...................................................................................................................... 42 92BTaxi Cabs - Most Taxi Cab Operators Are Considered Employees ..................................... 42 93BTemporary Service Agencies................................................................................................ 43 94BUnions ................................................................................................................................... 43 95BVolunteers ............................................................................................................................. 43 96BWrap-Up Workers' Compensation Insurance Policies for Construction Projects................ 44 26BBusiness Permits/Licenses/Contracts and the Workers' Compensation Law........................... 45

97BWCL ?57 -- Restriction on Issue of Permits and the Entering of Contracts Unless Compensation Is Secured...................................................................................................... 45 98BOut-of-State Companies Working in New York State ......................................................... 46

205BUWorkers' Compensation Insurance Requirements............................................................ 46

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Employers' Handbook to Workers' Compensation in New York State

206BUWorkers' Compensation Restriction on Issuance of Government Issued Permits, Licenses and Contracts .................................................................................................................... 46 207BUDisability Insurance Requirements ................................................................................... 47 208BUDisability Benefits Restriction on Issuance of Government Issued Permits, Licenses and Contracts ........................................................................................................................... 47 9BDebarment Lists .................................................................................................................... 48 TFailure to Maintain Accurate Payroll RecordsT ..................................................................... 48 10BMisrepresentation.................................................................................................................. 48 10BStop Work Orders ................................................................................................................. 49 7BChapter Four ................................................................................................................................. 50 27BEmployers' Responsibilities ..................................................................................................... 50 28BEmployers' Rights .................................................................................................................... 52 8BChapter Five.................................................................................................................................. 53 29BComplying with New York's Workers' Compensation Law ................................................... 53 102BAre Any For-Profit Businesses Exempt?.............................................................................. 53 103BWhat Does Workers' Compensation Insurance Buy? .......................................................... 53 30BObtaining Workers' Compensation Insurance Coverage ......................................................... 54 104BInsurance Carriers ................................................................................................................. 54 209BUPrivate Insurance............................................................................................................... 54 TUState Insurance Fund (SIF)UT ............................................................................................... 55 210BUSafety Group Plans ........................................................................................................... 55 105BSelf-Insurers.......................................................................................................................... 55 21BUIndividual Self-Insurance.................................................................................................. 55 21BUGroup Self-Insurance ........................................................................................................ 56 213BULocal Government Self-Insurance .................................................................................... 56 106BGetting the Right Coverage .................................................................................................. 56 107BPosting of Notice of Workers' Compensation Insurance Coverage ..................................... 57 31BPenalties and Liabilities for Not Carrying Workers' Compensation Coverage........................ 58 108BAscertaining Violations of the Law ...................................................................................... 58 109BPersonal Accountability........................................................................................................ 58 10BLiability for Claims Incurred by an Uninsured Employer .................................................... 58 1BPenalties for Noncompliance ................................................................................................ 58 214BUAdditional Liability for Uninsured Employers ................................................................. 60 12BDebarment Lists .................................................................................................................... 60 TFailure to Maintain Accurate Payroll RecordsT ..................................................................... 61 13BMisrepresentation.................................................................................................................. 61 14BStop Work Orders ................................................................................................................. 61 Coverage Search Application ................................................................................................... 62 32BThe Workers' Compensation Noncompliance Process............................................................. 62 15BImportant Note for Employers Regarding FEINs................................................................. 63 9BChapter Six.................................................................................................................................... 64 3BUnderstanding Insurance .......................................................................................................... 64 16BRates...................................................................................................................................... 64 17BLost Costs ............................................................................................................................. 64 18BExperience Modification Factor ........................................................................................... 65 19BAssessments .......................................................................................................................... 66

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Employers' Handbook to Workers' Compensation in New York State

120BTerrorism .............................................................................................................................. 67 12BPayroll ................................................................................................................................... 67 12BPayrolls of Executive Officers/Sole Proprietors/Partners/Members .................................... 68

EXECUTIVE OFFICERS ................................................................................................ 68 SOLE PROPRIETORS AND PARTNERS/MEMBERS ................................................. 70 123BDeductibles ........................................................................................................................... 71 215BUDeductibles Under the NYS Workers' Compensation Law ............................................. 71 TUDeductibles Under the NYS Insurance Law ..................................................................... 72 124BMisrepresentation.................................................................................................................. 72 125BNew York Construction Employment Payroll Limitation .................................................... 73 126BNew York State Loss Prevention Programs -- Surcharge and Credits ................................ 73 216BUCompulsory Workplace Safety and Loss Consultation Program ..................................... 73 217BUWorkplace Safety and Loss Prevention Incentive Program ............................................. 73 127BAudit ..................................................................................................................................... 74 128BPayroll Audits ....................................................................................................................... 74 218BUAuditing of Payroll ? Independent Contractors ................................................................ 74 219BUClassifying Independent Contractors and Employees ...................................................... 75 20BUAuditing of Payroll ? Remuneration................................................................................. 75 21BUExceptions......................................................................................................................... 75 2BUWages Paid for Time Not Worked.................................................................................... 77

129BTips for Employers to Potentially Reduce Their Workers' Compensation Insurance Premiums .............................................................................................................................. 78 130BPolicy Cancellations ............................................................................................................. 79 13BThe High Cost of Going Without Workers' Compensation Insurance................................. 80 132BUninsured Employers Fund .................................................................................................. 80 13BIllegal Forms of Coverage and How to Avoid Them ........................................................... 80 10BChapter Seven ............................................................................................................................... 82 34BWhat to Do When an Accident Happens .................................................................................. 82 134BThe First Steps ...................................................................................................................... 82

23BUObtaining Medical Treatment ........................................................................................... 82 24BUInvestigation and Communication .................................................................................... 82 25BUMinor Injuries ................................................................................................................... 82 26BUReporting Injuries ............................................................................................................. 83 135BContinued Payment of an Injured Employee's Wages ......................................................... 83 27BUThe Path of a Claim .......................................................................................................... 83 28BUResponsibilities of the Insurance Carrier .......................................................................... 85 136BControverting a Claim .......................................................................................................... 85 137BSettling a Claim .................................................................................................................... 85 138BAdministrative Review of a WCLJ Decision ....................................................................... 86 139BKeeping a Claim Moving...................................................................................................... 86 140BAvoiding Future Accidents ................................................................................................... 87 14BEmployer's Rights During a Claim ...................................................................................... 87 142BPrivacy of Case Records ....................................................................................................... 88 143B...................................................................................................................................... 88 Discrimination ...................................................................................................................... 88 1BChapter Eight ................................................................................................................................ 90

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