According to the US Bureau of Labor Statistics (BLS), in 2015, Georgia reported 78,000 nonfatal workplace injuries and illnesses within the private sector alone. All states require some level of workers’ compensation insurance for nearly all employees. If you have a business, regardless of size, chances are you are required by Georgia law to provide workers’ compensation (comp) insurance.
What is Workers’ Compensation?
Workers’ compensation is a benefit to employees who become injured, ill or die whilst on the job. This could be anything from falling off a ladder or being exposed to hazardous chemicals to a cabinet collapsing on someone’s foot or tripping down the stairs. When any of such incidents occur, workers’ comp insurance is in place to protect the employee. Some circumstances may require medical attention, rehabilitation and time off work. The insurance covers these bills and a portion of their lost time at work. This type of insurance will also cover any transfers or work restrictions required due to the injury or illness.
In addition to the employees being protected, the employer is also protected by such insurance. In exchange for employment with your organization, if you have the proper insurance, employers are protected with limited liability. You will be required to pay for the insurance, however you are protected from additional legal concerns, if you are up-to-date on your insurance, you have the appropriate coverage and you or the insurance carrier pay claims in a timely manner.
State Requirements?
The state of Georgia is slightly different from most other states in the requirements to provide workers compensation insurance. One of such differences is that, in Georgia, you only must provide these benefits when you have three or more employees who are regularly employed. Keep in mind that employees who qualify are both part-time employees, full-time employees and minors. And, both written and implied contracts are required to provide comp insurance to such employees. These requirements apply to nonprofit organizations and public corporations alike.
Another distinctive note is that with any incorporated organization or limited liability company (LLC), the organization is considered the employer rather than an individual owner or owners; therefore, officers of the corporation or LLC are also considered employees. Up to five officers can waive their personal coverage by the company. However, they will have to file the appropriate paperwork with the insurance provider. Even if you waive the right to coverage, you are still considered an employee within the organization.
If you are a sole proprietor, you do not count as an employee unless you wish to be considered as such. The same is true of your business partners. If you or your business partners do prefer to be considered an employee and covered by compensation benefits, you must send written confirmation to your insurance provider. And, the following are a few examples of workers who are exempt from workers’ comp insurance:
- Domestic Servants
- Farmers
- Farm Laborers
- Federal Government Employees
- Railroad Employees
Company Liability
Some circumstances may arise when an employee believes they are entitled to more or that they have been a victim of wrongdoing. The same can be true of an employer that may believe a fraudulent claim has been filed or that an employee may have had a preexisting condition that would not be privy to an entire workers’ compliance claim. In these situations, the employer or the insurance provider on behalf of the employer or the employee will file a claim with the Appellate Division and the Administrative Law Judges. Through these channels, they will determine appropriate courses of action and any potential settlement awards.
Where to Buy
The state of Georgia permits employers to either become self-insured or to purchase commercial workers’ compensation insurance through a specialized insurance agency. As part of the self-insured process, approval must be granted to your company to become a member of the Georgia Self-Insurers Guaranty Trust Fund. You must also become certified by the State Board of Workers’ Compensation. You will have to complete an application and the process costs $500 of which is non-refundable. Once approved, a letter of credit or a surety bond will then be required to complete the process.
If you choose the option of an approved insurance agency, a few stipulations do apply. The insurance agency must represent a company that is licensed in the state of Georgia to write workers’ compensation insurance. Also, if you have any employees who reside outside of the state or employees who travel, you must have insurance for each state in which they conduct business to be compliant in both Georgia and additional applicable states.
Fraud and Noncompliance
It is important to note that failure to provide adequate comp insurance and fraudulent claims both have severe financial consequences in the state of Georgia. As an employer, if you elect to not provide workers’ comp insurance to your employees, several consequences could occur. You will still be held liable to pay for the medical bills, rehabilitation and time lost from work just as if you provided the insurance in the first place.
You could also be responsible for an additional 10 percent to the employee as compensation. You could be assessed civil penalties and attorney’s fees by the Board. Civil penalties could vary from $100 to $1,000 for not voluntarily filing a report and the proper forms to the Board. You could be fined between $1,000 and $10,000 for any instance you make a misleading or false statement regarding an attempt to deny or obtain payments or benefits. An additional $500 to $5,000 could be incurred by not providing the proper coverage.
Also, criminal misdemeanor provisions could apply from $1,000 to $10,000 for not providing lawfully required workers’ compensation insurance to your employees. This penalty could also lead to imprisonment of up to 12 months. The state has an Enforcement Division to investigate any workers’ compensation reports of non-compliance and fraud.
Additional Information and Resources
The state law also requires employers to publicly post a notice that states you comply and include the insurance company’s name. If you are self-insured, you are required to post your self-insurance certificate. These notices must be placed in a prominent location. All employers, regardless of the way you are insured, must also post a Panel of Physicians and the State Board of Workers’ Compensation Bill of Rights.
For additional information about workers’ compensation insurance, the following resources can be helpful:
- Georgia State Board of Workers’ Compensation
- Georgia Office of Insurance and Fire Safety Commission
- Georgia Self-Insurers Guaranty Trust Fund
- State Board of Workers’ Compensation Bill of Rights
- Licensure and Quality Assurance Division of the State Board
- The Enforcement Division
Workers’ compensation insurance will convey to your team that their personal health and safety is of the greatest importance to you. Such results can lead to an overall increase in job satisfaction and productivity. Both results contribute positively toward your bottom line; therefore, workers’ compensation is absolutely worth your time and money.
Sources:
- https://www.oci.ga.gov/
- https://www.bls.gov/regions/southeast/news-release/workplaceinjuriesandillnesses_georgia.htm
- https://sbwc.georgia.gov/insurance