Let’s talk about a resolution for the business owners, especially for contractors. That industry has more than their share of challenges and cost efficiency can be a top priority for any artisan. This is to say that carrying Workers Compensation is very important and cannot be emphasized enough. The Workers Compensation Act of PA, which has been in force since 1915, mandates coverage as soon as the first employee is hired, with very few exceptions. In 2011, the Department of Labor passed the Workers Compensation Missclassification Act, which established parameters for defining a true independent contractor, and put in place hefty penalties for non-compliance.Also, keep in mind that the Workers Compensation is protection for both the employer and employee. It’s considered Sole Remedy insurance and prevents the employee from suing for injuries in the Commonwealth. Take Workers Compensation out of the picture and all bets are off. And you can’t fall back on General Liability coverage, because that excludes injuries to employees.
Lastly, if you are a business owner and you haven’t spoken to your agent lately, ask to do a coverage review. It never hurts to include your lawyer and accountant as well. Coverage needs can change, as well as the law. It will be a wrong time to find out that your coverage isn’t adequate after a claim is made.