Being a small business owner often means juggling limited resources, and that can make meeting all the different legal obligations a bit challenging.
This is especially true in the state of Florida, where they take worker safety seriously, requiring all businesses with four or more employees and all construction businesses, regardless of their number of employees, to purchase workers' comp. Remember, it's always wise to put safety first, even when you're in paradise!
Having workers' comp coverage means that if an employee has a work-related injury or illness, their medical bills, disability benefits, and a portion of their wages will be covered by the insurance policy. It also prevents employees from suing businesses if they get hurt.
While this is comforting news for employees and employers alike, especially in higher-risk professions, navigating the ins and outs of Florida's workers' compensation laws can be confusing for everyone involved. So let's dive in!
State law requires any non-construction business with four or more employees (part-time or full-time) to carry workers' comp.
All construction businesses, contractors, and subcontractors with one or more employees (including the business owner) must have workers' comp coverage.
Be sure to verify that every subcontractor you work with has a certificate of insurance. If you hire a subcontractor and they do not have coverage, your business may be liable to cover any medical expenses related to injuries or illnesses incurred on the job.
If you have an agricultural business with 6 or more regular employees and/or 12 or more seasonal employees who work for more than 30 days in a calendar year, you will need to obtain workers' comp to cover them as well.
In the Sunshine State, workers' comp pays two-thirds of an employee's average weekly wage, up to the statewide average weekly wage, which is $1,197 in 2023.
The simplest and most common way to get workers' comp insurance coverage is through an agent or broker. You can get a quote from our team here at Hourly for easy, pay-as-you-go workers' comp.
In the case that you cannot obtain coverage through the standard workers' compensation market, you may contact the Florida Workers' Compensation Joint Underwriting Association (FWCJUA).
Note: The workers' compensation rates in the FWCJUA will be higher than the rates in the standard market.
If your business is on the larger side, you may even have the option to self-insure. You can apply for permission to self-insure through the Florida Self-Insurers Guaranty Association.
In order to qualify, your company needs to have a minimum net worth of $10 million, make a down payment of $100,000, and submit financial documents from the last three years so they can determine whether you have the financial strength necessary to ensure timely payment of all current and future claims.
If none of these options is a good fit for you, try contacting the Division of Workers' Compensation (DWC) Coverage Assistance Program at: https://minimarket.fldfs.com
Hourly offers workers comp policies for small businesses in Florida. We have a pay-as-you-go system with premiums based on your actual payroll, so you can skip those nasty audit surprises. Try it out today.
There are some businesses and workers who are exempt from workers' comp coverage:
If you fit the profile and want to apply for an exemption, you can do so through The Florida Department of Financial Services. Even if it's not mandatory for you to have workers' compensation coverage, it's a wise decision to have it in place as it not only covers medical care but also lost wages and other expenses that may not be covered by a regular medical insurance policy.
Different accidents call for different benefits, depending on the circumstances. The following is a list of the various types of wage compensation benefits covered by workers' comp.
If an injured employee cannot work at all, it is considered Temporary Total Disability (TTD), and they are eligible for 66.6% of their lost wages for up to 104 weeks–up to the state max.
If an injured employee can do some work but isn't able to make 80% of what they were earning before, that would be considered Temporary Partial Disability (TPD), in which case they would be eligible for benefits that would partially make up the difference, also for up to 104 weeks.
If a doctor determines that an injured employee is at maximum medical recovery and is not expected to improve, they may receive Impairment Income Benefits (IIB), which are based on a rating system.
Should an employee's injuries be so severe that they cannot work again, they will receive Permanent Total Disability benefits, PTD, which pay 66.6% of their wages up to the state max, for the rest of their lifetime.
In addition to lost wage benefits, workers' comp covers the cost of treating a number of work-related injuries and illnesses. Some of the more common afflictions are listed below:
Additional expenses covered by workers' comp may take the form of the following:
As you can see, workers' comp goes well beyond basic employee assistance, offering peace of mind for everyone involved.
Workers' comp insurance premiums are calculated based on your industry, the type of work your employees do and the risks they carry, and the number of prior claims your business has had (expressed through your experience modifier or X-mod).
There may be other factors that go into your premium depending on your carrier and state. Get in touch with your agent to find out more.
At Hourly, we price policies based on your actual payroll, so there are no averages or estimates, and you avoid getting slammed with a big bill after your annual audit.
According to the Florida Bureau of Monitoring and Audit Statistics, the maximum amount an ill or injured employee can receive is $1,197 per week for 2023.
Depending on the severity of the injury, your employee may be able to collect two-thirds of their lost wages for up to 104 weeks, up to the state max.
Florida statutes require contractors to make certain that all subcontractors have workers' compensation insurance before they begin work on a project. You can do this by checking the public record of Proof of Coverage from the Department of Workers' Comp (DWC) database.
If a subcontractor doesn't have workers' compensation insurance for their employees, those workers are then treated as employees of the contractor.
In the event of an injury, illness, or fatality, it becomes the contractor's responsibility to provide benefits for the work-related incident.
The average workers' compensation settlement in the Sunshine State is around $20,000, but the amount of a settlement can be well above or below average. Here are some factors that can affect the amount of a workers' compensation settlement:
Should an employee pass away due to a work-related accident, their surviving family members may be eligible for death benefits. The specific entitlements for the deceased employee's family include:
Out-of-state employers must notify their insurance carrier that they have employees working in Florida.
If the current policy does not cover work performed in the state, the employer is required to obtain a Florida workers' compensation insurance policy with an approved insurance carrier that meets the requirements of the state statutes and insurance code.
Failure to have workers' compensation coverage in the Sunshine State carries significant penalties. The Florida Division of Workers' Compensation can charge you a minimum fine for non-compliance of $1,000 per employee or up to double what you would have paid in workers' compensation premiums during the previous two years, whichever is greater.
Not having workers' comp for your employees can lead to some serious consequences. You could even get hit with a "stop-work order," or SWO, which basically forces your business to close until you get the required workers' compensation coverage.
If the state feels you intentionally fudged your records in order to avoid paying workers' comp premiums, you might even be looking at potential jail time and extra fines. As you can see, it's definitely not worth the risk.
Need an easier, more affordable way to provide workers' compensation benefits to your employees?
Hourly is here to help. We offer a pay-as-you-go system with premiums based on your actual payroll in real-time, so you don't have to waste precious hours running the numbers yourself.
Try it out today!
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