WHO IS COVERED BY WORKERS’ COMPENSATION?
With a few exceptions, all employers in New York State are required to provide Workers Compensation coverage for their employees. The cost of the coverage must be paid solely by the employer, and it is against the law for the employer to ask a worker to pay any part of the cost of the workers’ compensation insurance policy. In addition, employers are required to post a notice of coverage in the workplace in a location that is accessible to the employees. The notice must include the name and policy number of the insurer.
There are some types of workers who are not covered by workers’ compensation. A short list includes:
1. Public school teachers employed by New York City.
2. Domestic Workers employed less than 40 hours per week.
3. Volunteer workers for non-profit organizations that receive no compensation. (Note: Volunteer Ambulance Workers and Firefighters are covered by a separate law).
4. Ministers, priests, rabbis, sextons, Christian Science readers and members of religious orders; as well as other teaching or “non-manual” employees of religious and charitable institutions.
5. Workers who are covered under other workers’ compensation systems such as maritime, federal, and certain railroad employees.
6. Uniformed New York City firefighters, police officers and sanitation workers, as well as some uniformed firefighters in some cities.
Some employers try to avoid responsibility for workers’ compensation by paying workers “off the books” or by claiming that they are independent contractors. The law provides for coverage regardless of whether a worker is being paid “on the books” or “off the books.” In addition, there is no “waiting period” for workers’ compensation coverage – a worker is covered by the law as soon as they are hired.
Whether a worker is an employee or an independent contractor is decided by the Workers’ Compensation Board on a case-by-case basis. The fact that the employer characterized the worker as an independent contractor, issued a 1099 form instead of a W-2, or even had the worker sign an agreement saying that they are an independent contractor is not binding on the Board. Instead, the Board will look to the true nature of the relationship – whether the employer had the right to hire and fire the worker, the type of work that was involved, the degree of control that the employer exercised, the method of payment, and other factors.
In recent years, New York has passed new laws to help prevent workers from being mischaracterized as independent contractors. For example, the 2010 Construction Fair Play Act created a presumption that construction workers are employees and not independent contractors unless the employer can prove otherwise by meeting very specific criteria.
Workers’ compensation benefits can be paid even if the employer has no insurance. Although the employer is liable for the claim, there is an Uninsured Employers Fund that will pay benefits to the injured worker and then seek reimbursement (plus fines and penalties) from the employer. Needless to say, cases that involve uninsured employers are almost always contested and take much longer to be decided, but in the end the benefits will be paid if the Board decides in favor of the worker.