Workers' Comp

Make sure you pay it or risk $250/day fine

[ember]

I have one part-time employee, a relative, who works at her home. It never occured to me to buy workers' comp for her. Yesterday, the state sent me a notice threatening to close my business and fine me up to $250 per day for the last year ($91,250). Talked to my attorney and will I be okay as long as I get the insurance ASAP. In the US, WC is apparently mandated in most states. Just a heads up!

[sugarrae]

One of the reasons I only deal with contractors - you don't have to deal with WC, insurance, etc.

[Lex_Luther]

You should label her a sub contractor, it will save you a mountian of grieve. The criteria is: You tell her the job, but not how to do the job, or at least make it sound that way. It will save you on taxes too.

[leadegroot]

Were you in Australia, I beleive there is an exemption when you have relatives working for you (originally targetted at family businesses, obviously)

[criznach]

I just filed for an exemption certificate in Montana. They required me to submit various documents worth points toward proving that I am an independent contractor. In return, they (hopefully) send me a certificate saying that I am exempt and don't have to pay. It's good for 2 years.

I don't know about other states or countries, but in Montana I think your part timer would need to do the same. If she can't prove that she's independent, then she's an employee and you'd need to pay.

Check with your lawyer, but if you call her an employee, she's an employee...

[criznach]

Lex_Luther: Again, it probably depends on the state. In Montana, it's up to him/her to certify that she's a contractor - and they don't make it easy. It's up to you to make sure that she's either covered or exempt. Regardless, if you call him/her a contractor, you should have a legal contract that says that he/she's covered or not covered.

[ember]

She's an employee (I take taxes out). I am a corporate officer so I am exempt (Colorado). My lawyer said to be proactive, tell the state that it was an honest mistake and to get the insurance, which I have done. So, now just waiting to see if the state lets it go or shuts me down.