New York is one of the most popular destinations in the country. Many people settle here due to the availability of work in multiple industries. More than 8 million people live in the city alone, making this the most populous place in the country. With such a population, all types of businesses have cropped up in the city and beyond.

While New York conjures the images of glamor and glitz, things are different in the workplace. Things can quickly take a turn for the worst in case of workplace injury. Fortunately, New York’s Workers’ Compensation Law requires employers to provide workers’ compensation coverage for all employees.  This coverage provides financial benefits, including medical care, for employees injured on the job.

New York Workers’ Compensation Law

New York law requires employers to carry workers’ comp insurance coverage. Employers can only obtain workers compensation NY insurance with an insurance provider authorized by the New York State Workers’ Compensation Board. An employer can also apply to the NYs workers compensation board to be self-insured either individually or as part of a group. The New York State workers compensation is a form of no-fault insurance. This means while every Employee has a right to workers’ compensation benefits, they cannot sue their employer for negligence.

The cost of the insurance should be paid entirely by the employer. According to the Workers Compensation Board, employees should not pay any amount. When the employer buys workers compensation insurance NY, the insurance carrier assumes the employer’s statutory obligation to pay workers compensation benefits. These include medical, indemnity, and death benefits under the law.

NYs workers compensation covers:

  1. Some of an employee’s lost wages
  2. Medical care expenses related to the work-related injury or illness.
  • Death benefits if an employee dies from a work-related cause in New York.
  1. Cost of related legal fees if the worker’s family files a compensation suit against a business.

Who Needs Workers’ Comp Insurance in New York?

For the purpose of workers’ compensation, New York law includes the following as employees:

  • Part-time employees
  • Unpaid volunteers (including family members)
  • Day labor
  • Leased or borrowed employees
  • Most subcontractors

There’s an exception for independent contractors in the workers’ compensation law.

  1. An independent contractor who’s not under the employer’s control or direction does not require a cover.
  2. The contractor should also be performing duties different from those the company normally does.
  • The contractor should also have an independently established operation related to the services they offer an employer in NYC.

Some of the limited instances when an employer would be exempt from this requirement include:

  • In a business owned by one individual and there are no employees of any kind (including borrowed employees, unpaid volunteers, or subcontractors, part-time employees, and leased employees).
  • A partnership or corporation and has no employees
  • A business venture owned by one or two people who own all stock and offices. There should be no additional employees.
  • Self-employed individuals or sole proprietors of a business fall under these exceptions as long as they don’t have employees.

A business must show proof of the policy when getting business permits.

Penalties for Not Carrying Workers’ Comp Insurance in New York

The New York workers compensation law requires employers to:

  1. Carry workers’ compensation coverage for their employees, with limited exceptions.
  2. Keep in effect the workers’ compensation coverage for all employees. This means an employer should not allow the coverage to lapse by failing to pay premiums.

Failure to adhere to this law will lead to penalties. The New York workers compensation board monitors compliance and administers the penalties for violation. Failure to comply with the New York workers compensation law can lead to serious civil and criminal penalties as follows:

  • A fine of between $1,000 and $5,000 for failing to secure coverage for five or fewer employees within a year. (This is a misdemeanor).
  • $5,000 and $50,000 for failing to secure coverage for more than five employees (This is a felony).
  • $10,000 and $50,000 and other penalties and fines for a subsequent conviction within five years for failing to provide coverage for employees.
  • For an employer who fails to make a provision for payment of compensation within ten days or more, the Workers Compensation Board can open civil action. The board can also slap the employer with a $2,000 penalty for every ten days or a sum up to twice the cost of compensation.
  • Misrepresentation concerning the number of workers classification, wages, and accidentscan lead to criminal and civil prosecution. The Workers Compensation Board can impose a fine of $2,000 for every ten days of noncompliance. Alternatively, the fine can be twice the cost of compensation. An employer charged in court and found guilty of misrepresentation will pay a fine of $1,000 to $50,000.
  • An employer who fails to maintain an accurate payroll will face criminal charges. This is a misdemeanor and, if found guilty, the employer is liable to a fine of $5,000 and $10,000. For a repeat offense, this changes to a felony with the fine rising to $10,000 to $25,000.

Average Cost for Workers’ Compensation Insurance in New York

The New York Compensation Insurance Rating Board (NYCIRB) provides an employee code to sort out compensation claims. This rating helps classify different levels of risk for various occupations. Employees in higher-risk occupations such as construction will require more coverage.

According to the National Academy of Social Insurance, the estimated employer cost for workers compensation NYC is $0.98 per $100 in covered payroll.

How Workers’ Compensation Works In New York

When an employee suffers a workplace injury, they must immediately inform their employer or supervisor. The employee should obtain the necessary medical treatment from a hospital authorized by the New York workers compensation board. The exception is when treatment is in the form of an emergency.  The employee has a right to choose their preferred health provider as long as the Workers Compensation Board authorizes this.

The employer on learning about the accident must notify the insurance provider through the workers’ compensation claim process by filling the relevant workers compensation NY forms. The employer should also provide the employee with the appropriate paperwork and guidance. This is in compliance with state law for reporting work injuries.

The employee will then file a formal workers’ comp claim with the Board on Form Employee Claim (C-3) and other NYs workers compensation forms. They should mail this to the appropriate Board District Office.

The insurer will approve or deny the claim. In case of approval, the insurer contacts the employee with payment details. The employee can accept or decline the payment offer and opt to file a case for a larger settlement. At this point, the employee will need a New York workers compensation lawyer to guide them through the complex process of filing a lawsuit.

Death Benefits under New York Workers’ Compensation Law

NYs workers compensation also includes death benefits in case an employee dies as a result of a work-related injury or illness. These benefits cover funeral expenses (up to $6,000 for funeral expenses) and financial support to the family of the deceased. A spouse and minor children are the primary dependents under the NYs workers compensation law.

The spouse receives benefits for the remainder of his or her life but if they remarry, this changes into a lump sum equal to two years of benefits. In case the deceased had no children, the spouse is entitled to 66.67% of the deceased worker’s average weekly wage up to the statutory maximum.

In the case of surviving children, 36.6% of the weekly rate goes to the spouse with the children splitting the remaining 30%. The children only get the benefits until age 18 years (if they are not students) or 23 years (if they are students).

Workers’ Comp Settlements in New York

Workers compensation NY settlements fall into:

  1. Stipulated agreements: When an injured employee and the insurer agree on how much the worker will need in benefits. The injured worker receives payments on a set schedule. This agreement is open to modification if the worker’s condition deteriorates.
  2. Section 32 settlement: Both parties agree on a lump payment to close the claim. There’s no room for modifying this agreement in the future.

Limitations for Workers’ Compensation Claims in New York

The statute of limitations for filing workers’ compensation in New York is two years. The date starts from:

  1. The date of injury
  2. The date that the worker should have learned about their work-related injury.
  • For work-related hearing loss, an employee can’t file a claim until 90 days after the loss occurs.

Where Can You Get Workers’ Comp Insurance?

Employers in NYC can workers comp insurance from any insurance provider authorized by the New York State Workers’ Compensation Board. You can check from the board’s website to identify the insurers and get as many quotes as you can.

Final Thoughts

While businesses will try their best to provide a safe work environment, accidents still happen. As an employer in New York State, a sound workers’ compensation policy will go a long way to protect your company and your workers. Running a business in New York is tough, but it can get even tougher if you don’t have workers compensation insurance. Your NYs workers compensation will protect both your business and the employees. It is a win-win for every employer.