PA WC Coverage Requirements
The requirement to insure workers’ compensation liability is mandatory for any employer who: • employs at least one employee who could be injured or develop a work-related disease in this state, or • could be injured outside the state if the employment is principally localized in Pennsylvania, or • could be injured outside the state, while under a contract of hire made in Pennsylvania, if the employment is not principally localized in any state, if the employment is principally localized in a state whose workers’ compensation laws do not apply, or the employment is outside the United States and Canada, UNLESS all employees are excluded from the provisions of Pennsylvania’s workers’ compensation laws. Exclusions to the Coverage Requirements: In Pennsylvania, an employer may be excluded from the requirement to insure its workers’ compensation liability only if ALL workers employed by it fall into one or more of the following categories: • Federal Workers • Longshoremen • Railroad Worker • Casual workers whose employment is casual in character AND not in the regular course of the business of the employer. • Persons who work out of their own homes or other premises not under the control or management of the enterprise AND make up, clean, wash, alter, ornament, finish, repair, or adapt articles or materials for sale that are given to them. • Agricultural laborers earning under $1200 per person per calendar year AND no one agricultural laborer works 30 days or more per calendar year AND/OR the agricultural labor is provided by the employer’s spouse or child(ren) under the age of 18 who have not sought inclusion under Pennsylvania’s workers’ compensation laws by filing an express written contract of hire with the Department of Labor & Industry. • Domestic workers who have not elected with the Department of Labor & Industry to come under the provisions of the Workers’ Compensation Act. • Sole proprietor or general partners. • Persons granted exemption due to their religious beliefs by the Department of Labor & Industry. • Executive officers who have been granted exclusion by the Department of Labor & Industry. • Licensed real estate salespersons or associate real estate brokers affiliated with a licensed real estate broker or licensed insurance agents affiliated with a licensed insurance agency, under a written agreement, remunerated on a commission-only basis and qualifying as independent contractors for state tax purposes or for federal tax purposes under the Internal Revenue Code of 1986. |
NOTE: Unless ALL employees meet one or more of the above exclusions, the employer must insure its workers’ compensation liability, even if the employees are working limited part-time hours or are family members such as a spouse or children.
Questions as to how categories would apply to specific workers should be directed to your personal attorney for interpretation. Failure to Carry WC Coverage: In the event an employer is uninsured at the time an employee suffers a compensable work-related injury, the department will pursue reimbursement from the employer of monies paid from the Uninsured Employers Guaranty Fund in relation to the claim. Reimbursement will include costs, interest, penalties, fees under section 440 of the Worker’s Compensation Act and attorneys fees. The department will also pursue prosecution against the uninsured employer under section 305 of the Act. In addition, an uninsured employer faces grave civil and criminal risks for failing to maintain continuous workers’ compensation coverage. Not only can the employee sue the employer in tort for work-related injuries or diseases, in which suit the employee may recover amounts in excess of those allowed under workers’ compensation, but the employer and those individuals responsible to act on its behalf may each be criminally charged for each day’s failure to maintain continuous workers’ compensation coverage. Misdemeanor convictions can result in the potential imposition of a $2,500 fine and up to one year imprisonment for each day the employer is in violation of the requirement to maintain worker’s compensation coverage. Felony convictions can result in the potential imposition of a $15,000 fine and up to seven years imprisonment for each day the employer intentionally violated this requirement. Further, the employer and those individuals responsible to act on its behalf may be required to pay all benefits awarded by a workers’ compensation judge. The Bureau of Workers’ Compensation investigates employer compliance with workers’ compensation laws and may initiate the filing of charges against employers and individuals responsible to act on its behalf if workers’ compensation coverage is not continuously maintained. Further, any individual, including competitors, may seek county district attorney approval to file a private criminal complaint against an employer who fails to maintain worker’s compensation coverage when required to do so. For more information, please visit: http://www.portal.state.pa.us/portal/server.pt?open=514&objID=552712&mode=2 |