2010 OGS State Purchasing Forum Navigating Proof of Coverage May 19-20, 2010 Required Proof of NYS Workers' Compensation and Disability Benefits Insurance for Government Permits, Licenses and/or Contracts Steve Carbone NYS Workers’ Compensation Board

May 19-20, 2010 What is Workers’ Compensation Insurance? Why Is It Important?

May 19-20, 2010 Key NYS Workers’ Compensation Organizations NYS Insurance Department NYS Insurance Department Compensation Insurance Rating Board Compensation Insurance Rating Board NYS Workers’ Compensation Board NYS Workers’ Compensation Board Insurers -- Insurance Carriers Insurers -- Insurance Carriers Self-Insurers Self-Insurers Group Self-Insurers Group Self-Insurers

May 19-20, 2010 Strategy for Enforcing Compensation Compliance WCB Insurance Compliance Database WCB Insurance Compliance Database Automated Penalty Process Automated Penalty Process Appeal Process Appeal Process Outside Collection Agencies Outside Collection Agencies Judgments Judgments Investigators Investigators Educational Outreach Educational Outreach External Enforcement (Section 57 of WCL) External Enforcement (Section 57 of WCL)

May 19-20, 2010 NONCOMPLIANCE PENALTIES $2,000 for each 10 days of noncompliance $2,000 for each 10 days of noncompliance Misdemeanor – 5 or less employees – Up to $5,000. Misdemeanor – 5 or less employees – Up to $5,000. Felony – More than 5 employees – Up to $50,000. Felony – More than 5 employees – Up to $50,000. Felony – for filing false documents -- up to 4 years in prison. Felony – for filing false documents -- up to 4 years in prison. $1,000 to $2,000 fine for each 10 days for failure to keep accurate payroll records and/or correctly classifying employees. $1,000 to $2,000 fine for each 10 days for failure to keep accurate payroll records and/or correctly classifying employees.

May 19-20, 2010 NONCOMPLIANCE PENALTIES Stop Work Orders Stop Work Orders Inability to Bid on Public Works Projects Inability to Bid on Public Works Projects (ONLY Projects Under Article 8 of the Labor Law!) Liability for any claims that occur while uninsured – Sole proprietor, partner, or president, secretary and treasurer personally liable for penalties, claims, medical payments and assessments; or can be directly sued. Liability for any claims that occur while uninsured – Sole proprietor, partner, or president, secretary and treasurer personally liable for penalties, claims, medical payments and assessments; or can be directly sued.

May 19-20, 2010 Who Needs to Be Covered?

May 19-20, 2010 Employee Definition ▀ ▀ Basically anyone providing any services to a for-profit business can be determined to be an employee of that business. ▀ ▀ Basically any compensated individuals providing services to a nonprofit. (Exception clergy, and teachers in a 501(c)(3) nonprofit).

May 19-20, 2010 Who Isn’t Required to Carry Workers’ Compensation Insurance Sole proprietors with no employees; Sole proprietors with no employees; Partners in partnerships with no employees; and Partners in partnerships with no employees; and One/two person owned corporations with no employees. One/two person owned corporations with no employees.BUT……

May 19-20, 2010 WCL Section 56 General contractors are liable for the workers’ compensation claims of all uninsured subcontractors. General contractors are liable for the workers’ compensation claims of all uninsured subcontractors. General contractors MUST obtain a workers’ compensation insurance policy if they have any subcontractors working on a job site and they are getting a government permit, license or contract. General contractors MUST obtain a workers’ compensation insurance policy if they have any subcontractors working on a job site and they are getting a government permit, license or contract.

May 19-20, 2010 Out-of-state Companies Working in NYS Effective September 9, 2007, any out-of-state employer with employees working in NYS needs a full NYS workers’ compensation insurance policy. (NY must appear on Item 3A on the information page of a policy.) Effective September 9, 2007, any out-of-state employer with employees working in NYS needs a full NYS workers’ compensation insurance policy. (NY must appear on Item 3A on the information page of a policy.)

May 19-20, 2010 Independent Contractors The following are the indicators used to identify if an individual is an independent contractor, and thus not an employee: 1. Obtain a Federal Employer Identification Number from the Federal Internal Revenue Service (IRS) or have filed business or self-employment income tax returns with the IRS based on work or service performed the previous calendar year; 2. Maintain a separate business establishment from the hiring business; 3. Perform work that is different than the primary work of the hiring business and perform work for other businesses; 4. Operate under a specific contract, and is responsible for satisfactory performance of work and is subject to profit or loss in performing the specific work under such contract, and be in a position to succeed or fail if the business’s expenses exceed income. 5. Obtain a liability insurance policy (and if appropriate, workers’ compensation and disability benefits insurance policies) under its own legal business name and federal employer identification number; 6. Have recurring business liabilities and obligations; 7. If it has business cards or advertises, the materials must publicize itself, not another entity; 8. Provide all equipment and materials necessary to fulfill the contract; 9. Control the time and manner in which the work is to be done; and 10. The individual works under his/her own operating permit, contract or authority.

May 19-20, 2010

What Is A Legal Name Of An Employer And Why Is It Important?

May 19-20, 2010

Title

Proof of Workers’ Compensation Compliance (For Businesses) CE-200 Business Does Not Require Workers’ Compensation and/or Disability Benefits Coverage C Certificate of Workers’ Compensation Insurance Coverage U-26.3 State Insurance Fund Version of Certificate of Workers’ Compensation Insurance Coverage SI-12 Certificate of Workers’ Compensation Self- Insurance or GSI Certificate of Workers’ Compensation Group Self-Insurance

May 19-20, 2010

Proof of Workers’ Compensation Compliance (For Homeowners) BP-1 Homeowner Does Not Require Workers’ Compensation Coverage CE-200 Business Does Not Require Workers’ Compensation and/or Disability Benefits Coverage C Certificate of Workers’ Compensation Insurance Coverage U-26.3 State Insurance Fund Version of Certificate of Workers’ Compensation Insurance Coverage

May 19-20, 2010Title

Proof of Disability Benefits Compliance CE-200 Applicant Does Not Require Workers’ Compensation and/or Disability Benefits Coverage DB Certificate of Disability Benefits Insurance Coverage DB-155 Certificate of Disability Benefits Self- Insurance

May 19-20, 2010

Verifying Workers’ Compensation Insurance Proof of Coverage Ensure coverage is on Board’s website. Ensure coverage is on Board’s website. Go to Go to

May 19-20, 2010

Filing of Workers’ Compensation Insurance Proof of Coverage Accept only the approved forms. Accept only the approved forms. Make sure legal name on the approved form matches the legal name on the permit, license or contract. Make sure legal name on the approved form matches the legal name on the permit, license or contract. FEIN numbers — make sure FEIN on the approved form matches FEIN on the permit, license or contract. FEIN numbers — make sure FEIN on the approved form matches FEIN on the permit, license or contract. Ensure coverage is on Board’s website. Ensure coverage is on Board’s website.

May 19-20, 2010 Presenter Contact Information Steve Carbone Regulatory Affairs NYS Workers’ Compensation Board 20 Park Street – Room 200 Albany, New York Phone: (518) Workers’ Compensation Board’s Website: