An Employer's Guide to Workers’ Compensation in New York

Most New York businesses with employees are required to pay for workers' compensation insurance (WC or workers' comp insurance). The insurance provides compensation to employees who suffer work-related injuries. Here are some basic facts that you need to know about workers' comp insurance in New York as a business owner and employer.

Who is Required to Have Workers' Comp Insurance?

If your New York business has just one employee, you're generally required to carry workers' compensation insurance. Exceptions apply in limited cases, such as:

• people working for no pay in certain non-profit situations
• clergy and members of religious orders
• people who are covered under an alternative workers' compensation system, such as through the federal government
• certain family members who work for an employer who is a farmer; and
• certain people who do yard work or casual chores for a one-family, owner-occupied residence.

This list is not exhaustive. For more details, check the Who is Covered page of the Workers' Compensation Board website and Section 2 of New York's Workers' Compensation Law. In addition to the above listed items, certain business owners, such as sole proprietors, partners in partnerships, and corporate officers in very small corporations, are not required to be covered by workers' compensation insurance.

Who Administers Workers' Comp Insurance in New York?

The New York Workers' Compensation Board (Board) is the primary state agency that handles workers' comp claims. Most of the law for WC insurance is contained in New York's Workers' Compensation Law. In addition to the Act, there are also administrative regulations that cover workers' compensation in New York.

Where Can You Get Workers' Comp Insurance?

In New York, workers' compensation insurance is available through private insurance companies. If your business is unable to obtain coverage through a private insurer, you can get coverage through the New York Insurance Department. There is also an option to self-insure, but this may not be advisable for smaller businesses, in part because it requires that a lot of money be set aside to cover potential claims.

What Steps Should You Take if an Employee Gets Hurt?

The injured employee should immediately inform you of the injury and, in any case, should do so within 30 days of the injury. The employee also should obtain medical treatment. In most cases, the employee can choose who provides treatment. Except in emergencies, the medical provider must be authorized by the Board. As the employer, you should contact your WC insurance carrier as soon as you learn about the injury and then continue to communicate with the carrier throughout the claims process. If you communicate with the employee's health care provider, do so only in writing and make sure to copy the employee and the employee's legal representative, if any.

For minor injuries — those requiring no more than two treatments and less than one day of lost time — you should complete a Form C-2F, Employer's First Report of Work-Related Injury/Illness, and simply retain it in your files for eighteen years. For any more serious injuries, complete Form C-2F and file it both with the Board and your insurance carrier. You must file within 10 days of the injury or risk being subject to a fine or penalty.

Beyond these initial steps, there are subsequent steps to the WC claims process, not covered here.

What If You Don't Believe Your Employee Has a Valid Claim?

Filing the Form C-2F noted above is not necessarily an admission that you agree with the employee's claim. However, if you believe the claim is questionable or fraudulent, you should make that clear on the form. You should also communicate your concern to your insurer.

You can request that your insurance carrier contest a claim. In general, it is up to your insurance carrier to make the final decision. If your carrier does contest — controvert — a claim, a Pre-Hearing Conference (hearing) is scheduled. The hearing is held before a Workers' Compensation Law Judge (WCLJ) or the Board. No hearing will take place until the Board receives both a copy of Form C-7, Notice That Right to Compensation is Controverted, and a medical report. Form C-7 usually must be submitted within 10 days of your learning of the injury.

If you are not happy with the results of the WCLJ or Board hearing, you have additional options, such as requesting that the Board approve a reduction or discontinuance of benefits. Most disputes are handled and resolved by the Board. However, there is an option to appeal to the New York State Appellate Division for the Third Judicial Department.

What If You Don't Have Workers' Compensation Insurance?

You can be subject to an array of penalties if you don't carry workers' required compensation insurance. Key examples include:

• a penalty of $2,000 per day, plus actual compensation and medical costs for the employee — which could be hundreds of thousands of dollars
• criminal fines for non-coverage ranging from $1,000 to $5,000 for smaller businesses (five or less employees) and $5,000 to $50,000 for larger businesses
• being held personally liable as a sole proprietor, partner, or corporate officer for the failure to have required WC insurance
• paying for your own legal representation to defend against a workers' comp claim
• being sued directly by the injured employee; and
• paying all wage and medical benefits awarded to the injured employee — for which there is no cap in New York.

Various penalties are described in several different webpages on the Board website.

Additional Information

There are many other workers' compensation requirements for New York employers that are not covered here, such as putting up posters about workers' compensation coverage where employees can see them. For more information, see the Nolo website section on workers' compensation and the New York Workers' Compensation Board website.