Several states have considered bills that would deny workers compensation benefits to illegal aliens who are injured on the job.  Federal law prohibits knowingly hiring illegal immigrants.  However, once hired, most states do provide workers compensation benefits without regard to immigration status.  Most courts have held that such workers are entitled to benefits once injured.

In general, insurance companies oppose denying benefits to illegal aliens. 1) They generally feel it runs counter to public policy. Workers compensation laws serve a humanitarian purpose. 2) Denial of benefits could encourage unscrupulous employers to seek out illegal aliens.  They might avoid the cost of workers compensation coverage and gain a marketplace advantage over their law-abiding competitors.  3)  The workers compensation’s exclusive remedy provision protects employers from lawsuits charging them with negligence in the workplace. Without this protection, when workers are injured, whether or not they are illegal aliens, employers are exposed to civil litigation.

This is a case of conflicting social policy.  It will be interesting to see the outcome of these laws.  But there will be years of litigation before the issue is resolved.

I only have a couple of employees; am I still bound by OSHA regulations?
Regardless of the size of your business; if you have employees, you are required to comply with OSHA regulations.

What are my basic responsibilities as an employer?
One basic OSHA requirement states the following: “The employer shall instruct each employee in the recognition and avoidance of unsafe conditions … to control or eliminate any hazards or other exposure to illness or injury.” In short, OSHA wants to see proof that employees have been trained.
Most training is required on a yearly basis.
Furthermore, OSHA requires a competent person on every job site. A competent person, according to OSHA, is one who “is capable of identifying existing and predictable hazards in the surroundings or working conditions which are unsanitary, hazardous or dangerous to employees, and who has authorization to take prompt corrective measures to eliminate them.” OSHA continues to state that “It shall be the responsibility of the employer to initiate and maintain [a written health and safety] program … which provides for frequent and regular inspections of the job sites, materials and equipment to be made by competent persons designated by the employers.”

Do I have to keep records to show my compliance?
Yes. One aspect of the OSHA recordkeeping requirements is the 300 form (replaces the OSHA 200 form). Recordable injuries and illnesses must be recorded on the OSHA 300 form or equivalent. In addition, this form must be posted from Feb. 1 to April 1 for the previous year.
The only exception to this rule is employers with 10 or fewer employees. In addition, any death or workplace incident sending three or more employees to the hospital overnight must be reported to your local OSHA office within eight hours, regardless of the number of people you employ.

How do I handle inspections?
How are violations handled?
There are several basic facts important to contractors:

OSHA prioritizes inspections based on the following:
work sites on which OSHA believes an imminent danger to employees exists;
work sites where reportable death or catastrophe has occurred; and
work sites that are the subject of complaints.
Employers have the right to refuse access to an OSHA inspector, however, this does not limit OSHA’s ability to observe the site from a remote location. In addition, OSHA can return with a compulsory process to mandate an inspection. If you force OSHA to use this legal process, it may not be as lenient on minor violations.
Allowing OSHA on-site does not mean that an employer waives all rights of defending himself in either an informal conference or a formal hearing.
Upon being issued a notice of violation, contractors always should respond in writing within 15 working days and request an informal conference with the area director. This is your best chance to reduce citations and fines.
Citations must be posted where all employees can see them for a period of three working days, or until the violation is corrected, whichever is longer.
Employers should correct violations. A common misconception is that once you’re caught, there’s nothing you can do. When attending the informal conference, being able to prove violations were corrected as soon as they were discovered can help you tremendously in reducing citations and fines.
What if my employees are conducting business off-site?
Employers are responsible for their employees whenever they’re on company time. If you send your employees to a job site, you are responsible for anticipating any hazards that employee may encounter, as well as preparing that employee for such hazards. In other words, a plumbing contractor is responsible for electrical hazards his or her employees may encounter when working next to an electrician.

Who can I turn to for help?
For further information on how to comply with OSHA regulations, contact either your local OSHA office or Alpine Environmental Services Inc.

Information in this posting was provided by Craig Petreikis, PE, CIH, president, Alpine Environmental Services Inc., Albany, N.Y. He can be reached at (518) 453-0146.
Your Professional Insurance Agent … We want you to know about the insurance you’re buying.

A National Council on Compensation Insurance study on the cost of claims filed by workers who are obese had findings similar to those to a 2007 Duke University study. From the Duke study:

* Workers who were morbidly obese filed 45 percent more claims and their medical costs were more than five times higher than those of nonobese workers.

* Workers who were overweight filed 9 percent more claims. Their costs were 1.5 times as high as people with “normal weights”. (I’m in trouble.)

Workplace injuries and death were down in 2009 vs 2008.  The drops are significant enough that many experts attribute them to economic change rather than entirely to safety improvement.

For much more detail, follow this link to the III.   Insurance Information Institute

Classifications have descriptions. States set basic rates and adopt descriptions, most commonly using data and wording from the National Council on Compensation Insurance (NCCI).

But how do you classify, for example, a glass recycler, if a state only offers reasonably relevant codes for recyclers, glass bottle dealers, and garbage haulers? The difference between those codes is significant. In that example, suppose the recycler has drivers who go to business sites, pick up waste light bulbs, and return to the recycling plant. Are they drivers or garbage collectors? They had better not be loading or unloading the truck, just taking the pallets or they will be in the higher classification.

More on this to come.

The determinants of Workers Compensation Insurance premium are payroll times rate based on classification times premium modification. It’s important to get all three right. We’ll focus on classification now.

Classifications are set from a list of hundreds of occupations. The list is basically national, with some state variation. The rate for each classification is set state by state. You can’t modify the rate for the classification; you can get the classification right for each kind of work your company does.
There are small common mistakes that can cost almost any company, in addition to the occasional whopper of a mistake.

If you are large enough to have a couple of layers of management, you can keep manager payroll out of high cost classifications.  But if the insurance carrier sees any evidence that the manager ever touches a tool on a job site or spends any time working in a hands on capacity, the carrier is going to dump all that payroll into the highest classification it can.

Call us if you have questions: 1-800-548-2329.  Or go to our Workers Compensation page.

Line 3C provides “all other states” coverage for incidental exposures. Line 3A lists specific states. NY began demanding Line 3A listing for truly incidental exposure and fining companies when the State caught that exposure. The current change, though still more restrictive than most states, reduces some of the pressure. Our thanks to the Professional Insurance Agents of New Jersey (www.PIA.org ) for much of this information and for working with NY State to get this improvement. 

Please note that routine deliveries or other activity in NY by a company based in New Jersey could still require Line 3A coverage and trigger fines for all the time there was activity without Line 3A coverage.  Go to our website (www.GBWinsurance.com) or our Workers Compensation page (http://www.gbwinsurance.com/workers_compensation ) for more info or call us at 1-800-548-2329 .

On Nov. 22, 2010, the New York Workers’ Compensation Board (WCB) issued Subject No. 046-454, which carves out some Item 3.A. coverage exemptions for out-of-state employers having incidental or temporary work in New York. This is a significant change from the rigid Item 3.A. coverage requirement adopted by the WCB following the 2007 Workers’ Compensation Reform legislation.

Out-of-state employers who have Item 3.C. coverage will now be in compliance with insurance requirements (and not subject to enforcement penalties) as long as the employer:
1) is not required to register with the state Department of Labor and pay unemployment insurance for any period in question (see http://www.labor.ny.gov/ui/dande/covered1.shtm for details);
2) has no permanent physical location in New York or has no employees whose primary work location is in New York;
3) is not operating in New York under a permit, contract or license granted by the state of New York, its counties or any municipality as defined under Section 57 of the Workers’ Compensation Law;
4) is not working as a contractor/general contractor/subcontractor on a construction project in New York; and
5) had no employees physically in New York the previous year for at least 40 hours of every week for a period longer than two consecutive weeks, or had no employees present in New York for 25 or more individual days (e.g., five employees working for five days in New York equals 25 individual employee days). Note that when employees travel through the state without stopping for deliveries, pick-ups or other work, it is not considered a work day.

If the insurer providing Item 3.C. coverage is not authorized in New York, new Form C-105.11 will be required to be completed by the insurer. The WCB will post on its website a list of all carriers that have filed the Form C-105.11, and will provide periodic updates to such listing.
While more restrictive than many surrounding states, this change in enforcement standards is a welcome improvement for employers conducting incidental and temporary work in New York.

An issue for employers: Why would an employee not take Workers Compensation if injured on the job?
Employers should keep an eye on situations where injuries occur on the job but no claim is filed. For a number of reasons those claims can pop back up.

A) An injured employee may think that it is in his or her best interest to pursue a tort claim against a third party.
Particularly in states, like New Jersey, where Workers Compensation treatment is under control of the employer/carrier, an employee may perceive it to be better (or be advised by an attorney that it is better) to seek treatment that may increase the chance of a lawsuit against someone other than the employee. Or in a state where the WC carrier can recover medical and compensation losses from successful third party claims, employees may perceive a value in staying out of the WC system. In small claims, a manipulative attorney and compliant physician can generate a lot more evidence and expense than they could under the controls of many WC systems. Then, if the claim does not progress or looks like it may not be successful, it may be possible to open a WC claim instead.

As a real-life example of a case where an employee might avoid WC to pursue third party claims, consider the following.
A laborer is working on a large construction site. He works for Subcontractor A and is covered by WC. He is putting in supports for a trench. Subcontractor B is responsible for the machine digging the trench.
Our laborer example is severely injured by the trenching machine. He can stay in the WC system, or try for a claim against Subcontractor B, or even a claim against the manufacturer of the trenching machine. (This is a real case.) The WC system is good for the medical costs but not necessarily for the lost wages, and certainly not for the pain, suffering, and loss of consortium issues available under the tort system. For truly severe cases, the employee may want to take a dual track, pursuing both WC and tort. The employer and carrier will want to keep an eye on progress in both cases, and any awards in the tort system.

B) In a less threatening situation, an employee may not be an eligible employee for Workers Compensation.
In some states some employers do not have to take Workers Compensation because they have too few employees. Then a Comp claim would not be covered.
Generally, Sole Proprietors and LLC members are not automatically covered and must elect coverage. Most small business owners do not elect coverage when it is not mandatory for their business structure.
In some states some specific classes of employees are not mandated for coverage. However, your insurance advisor should be able to tell you if those excluded classes can still sue the employer for injury.

For more background, Rebecca Shafer has an excellent blog dealing with WC cost reduction.
www.reduceyourworkerscomp.com

To get the lowest rates and the best coverage you need to acquire your business insurance from a local independent insurance agent rather than dealing directly with an internet based insurance company. It is not true that that dealing directly with an insurance company is the best method to get the lowest rates. In fact, there are many reasons why you should be using an independent insurance agent to provide your business liability and property insurance.

Reason #1: Local Independent Agents Save You Money

When you are dealing directly with an insurance company, you don’t have some one making sure you are getting the lowest possible rates as well as the correct coverage. This is important because your business insurance rates are not only based upon your type of business, sales, loss experience and other information about your business, but are also based on the operating costs of the insurance company. An independent agent will make sure you are dealing with the a low cost company.

When you work with a local independent insurance agent, they will look at multiple companies to make sure you are getting low premiums and the correct coverage. Local independent insurance agents are in business to provide their customers with the best possible coverage at the lowest possible rates, so in the end you normally pay less for commercial insurance.

Reason #2: Local Independent Agents Give You Better Service

A local independent agent offers you one-on-one service. You can call them directly without having to deal with annoying 800 phone directory options or computerized assistants. You can visit your agent in person or have them visit you as they are located in your local area. When it comes to business insurance, business owners need that attention. They need to know that if something happens that they can get immediate attention. It is very frustrating to need your insurance agent and not be able to get in contact with them.

Having your own insurance agent is important. When you choose to deal with a local agent, you get your own agent. Dealing directly with the company may mean you never have your own agent. You calls are answered by a call center and you speak to someone different every time you call. If you want focused attention and an agent that really knows your business then you want to deal with a local independent insurance agent.

Reason #3: Local Independent Agents Have Knowledge About Your Business

One part of liability insurance business owners may not think about is that insurance rates are based on where you live. When you get business insurance a local agents will know the area and your business insurance requirements. They will know what types of coverage you need and how much coverage you should get. They know from experience, not just from looking at charts that give averages. You can actually get a more detailed insurance policy when you work with an independent agent because the agent knows the area and what is needed in insurance coverage for your specific business.

The local independent insurance agent will provide many valuable services. They will visit your company, do a risk analysis and learn about your business so they can determine what are your specific insurance requirements. More important, when you have a local independent agent as your representative you you will have someone to represent your interests and fight for your rights in case of a claim or a conflict with the insurance company. If you are dealing with a website you will most likely wonder – “Who should I speak to when I am in trouble?”

As you can see, there is a huge difference between buying business insurance, commercial insurance or liability insurance from a local independent insurance agent versus directly from the insurance company. You will get a better insurance product and better service if you choose to do business with a local independent insurance agent.

Things you should be looking for:

Can your business fit into a BOP?  It can cut prices and expand automatic coverage; check with us.

What limit does the policy give you for all products claims in a year?

If you have to include your landlord under your insurance, is that automatic and does it cost you more?

Does your policy cover your loss of income while it’s closed after a fire or other damage?  For how long?

What discounts does the policy offer?  Which are you getting?

If you would like to go over these, and many other questions for small and mid-size businesses, call us at 973-426-1500 for Morris County, New Jersey insurance and 1-800-548-2329 for other locations.  For Workers Compensation Insurance call or check www.gbwinsurance.com/workers_compensation.

Your association sent a letter to the DIA outlining concerns over the new Form 154 requirements. PIA is pleased to report that most of these concerns have been favorably addressed in the newly revised Circular #335 and Form 154.

• Form 154 will only be required when requested by the DIA; not when applying for a license or permit, or when conducting work for a general contractor.
• The insurer’s 10-day advance notice of policy cancellation or modification has been removed from Form 154.
• The insurer’s representative now affirms that “The information contained herein is true to the best of my knowledge and belief,” allowing for mistaken representations.
It is hoped that insurers will be more inclined to complete Form 154 for their policyholders and avoid the unnecessary penalties imposed upon lawfully insured out-of-state employers. Remember, this form is not required if the employer has 3.A. coverage in Massachusetts or when the DIA has not requested it.”

For more questions on Workers Compensation for small and mid-size businesses in New Jersey and New York, call us or go to http://www.gbwinsurance.com/workers_compensation