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Is it Necessary for Every Miami-Based Business to Carry Workers’ Compensation Insurance?

pexels-photo-544966-300x200Almost every state requires employers to carry some form of worker’s compensation insurance, but is it necessary for every business in Florida to carry this type of insurance? The answer will depend on the type of industry you’re in and the number of people you employ.

Workers’ compensation insurance is a fund that pays for an injured employee’s medical bills and a portion of their lost wages, as well as rehabilitation or physiotherapy in some cases, or death benefits for the family of a worker killed on the job.

With a few exceptions, it is illegal for business owners in Florida to operate without this type of insurance. Some of the state’s requirements include:

  • Construction contractors must have insurance if they have one or more employees.
  • Contractors who use subcontractors must make sure the subcontractor is insured before beginning a project. If a subcontractor doesn’t have insurance, it will be the responsibility of the contractor to pay for benefits related to worker injuries, illness, or death.
  • Non-construction businesses must have insurance if they employ four or more people.
  • Agricultural businesses must have insurance if there are six or more regular employees and/or a dozen seasonal workers who work more than 30 days in a calendar year.
  • Out-of-state workers have specific requirements based on the type of work they will perform in the state. If they already have insurance, they must notify their home state insurer, who may use an extraterritorial reciprocity clause to cover them while they work in Florida. If they have no insurance, then they must apply for one in Florida.

Workers’ compensation premium rates are based on a company’s payroll. The higher your payroll, the more you will have to pay. The cost also varies depending on employee job classification. For example, the rate for a roofer is much higher than that of a cleric. State law has established the rates insurers are allowed to charge, so benefits won’t vary from company to company within the state.

Penalties for lack of coverage

If a business is inspected by the state and can’t show proof of worker’s compensation coverage, the owner will be subject to a penalty equal to 1.5 times the amount the business should have paid in premiums. The fine is required to be paid within 90 days.

The state may also issue a stop-work order to shut down business operations if an employer is found to have understated payroll, misrepresented worker duties, or otherwise attempted to avoid paying premiums. These actions can result in criminal and civil charges.

Employers suspected of committing workers’ compensation fraud should immediately consult an experienced attorney who can evaluate the situation and plan the best course of action.

South Florida Workers’ Comp Fraud Attorney

Is your business accused of workers’ compensation fraud? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced workers’ compensation fraud attorneys.

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