Who must carry it
New York requires most employers to carry workers' compensation insurance for their employees, and the obligation can apply even to small operations and part-time staff. Coverage can come from the New York State Insurance Fund, a private carrier, or, for qualifying employers, an approved self-insurance arrangement. New York separately requires most employers to provide disability benefits and paid family leave coverage, which are different policies with different purposes. Calling workers contractors does not remove the obligation if they are employees in practice. A general contractor can end up responsible for injured workers of a subcontractor who had no coverage, so certificates from subcontractors are worth checking.
Premiums, classes, and audits
Premiums usually depend on payroll and on the classification codes assigned to the type of work, adjusted by the employer's claims history. Carriers commonly audit payroll after the policy period, and audits often add premium for workers the carrier treats as employees, including uninsured subcontractors. Misclassifying the work, or underreporting payroll, can lead to large adjustments and can create separate legal problems. Keeping clean payroll records and contractor documentation makes audits much easier to answer. If an audit result looks wrong, carriers usually have a dispute process with its own deadlines.
When there is a gap
Going without required coverage in New York can lead to penalties from the Workers' Compensation Board and, in some circumstances, an order to stop work. If an employee is hurt during a gap, the worker may still receive benefits through a state fund, and the employer can then be pursued for what was paid. The employer may also face a lawsuit from the worker that coverage would normally have prevented. Workers who want to know whether an employer has coverage can usually check through the Board. We review the policy, how workers are classified, and any notice from the Board or a carrier, and help put the coverage on a sound footing.
