Do I need workers compensation insurance? So as it relates to New York State So if you have a business in another state, all this information may not completely apply to you, but I think some of the larger concepts so, but remember, everything is specific to NY state. In a general sense, if you have employees, if you pay to do work on a job, you need workers compensation insurance, okay You need workers compensation insurance if you have employees, or your paying someone to do work for you on a job Period Where people tend to get into trouble, where businesses tend to get into trouble, is when they thing they are using an independent contractor, the way that the tax department looks at independent contractor is different from the way that the workers compensation department of New York State looks at independent contractors So many people think because they are paying someone with a W9, that they don’t need a workers compensation on them, because they are an independent contractor And unfortunately, that’s not necessarily the case.
The worker compensation department actually has a ten-point list which is used as the guideline for determining whether someone is an independent contractor or not and basically there’s ten points that you have to walk through and in order for someone to be an independent contractor they have to meet every single one of those ten points. So, it is very easy to get tripped up by independent contractors If you have an employee and you are paying them a salary, you absolutely need workers compensation If you have independent contractors working for you that can be very tricky They need to have their own business they need to be doing a completely different function you do the majority of the work cant come from you Ten points, go to the state workers compensation department and you can find that list there Just assume that if you are paying someone to do work, you need workers compensation, unless they need that point checklist and then they can be considered an independent contractor But be very careful with independent contractors and make sure that if you are paying someone to do work for you but its just very, very important if you are paying someone to do work for you there’s a very good chance workers compensation insurance If you have additional questions call your independent insurance agent and ask them specifically and they should be able sit down with you and determine whether or not you need workers compensation