workers compensation

Do small businesses need workers’ compensation?

Connecticut Workers Compensation Act requires businesses with one or more employees to carry workers’ compensation insurance. Worker’s compensation provides benefits to both part-time and full-time employees in case they suffer a workplace injury or illness. It also safeguards businesses against lawsuits their employees may file in case they get injured or sick from their job. For example,

  • A waiter slips on the wet floor in the restaurant and sustains a fracture. In this case, workers’ compensation insurance would pay the medical bills.
  • A worker develops respiratory illness due to prolonged exposure to certain fumes or pollutants at the workplace. Worker’s compensation will pay for the medical expenses of the sick worker.

Are all businesses required to have workers’ compensation in CT?

All Connecticut businesses with at least one employee are required to have workers’ compensation insurance. This may include sole proprietors, seasonal employees, part-time employees, family members on the payroll, and even business partners. However, there are some exceptions as to who is considered an employee under Connecticut law. Workers’ compensation benefits are not available to casual employees, corporate workers who choose not to have coverage, or employees working in residences for less than 26 hours a week.

Why do small businesses need workers’ compensation?

As we said earlier, all businesses are legally required to have workers’ compensation coverage even if they have a single employee. They must have coverage from the moment they hire their first employee. This is regardless of your industry. Some small business owners think that the benefit is necessary only for businesses that involve high-risk work. However, this is not true.

Quite often, small businesses, especially the ones whose employees mainly work desk jobs, try to avoid taking workers’ compensation coverage because they assume that job-related injury or illness is unlikely. However, this can invite penalties and fines. Also, if an employee suffers a workplace injury, it will prove very expensive and may land you in a lawsuit. So, it is not worth risking so much just to avoid paying for workers’ compensation coverage. Having adequate coverage protects both you and your employees.

A PEO can help find the best workman’s compensation insurance

For a small business, workman’s compensation is a big investment of money, time, and effort. The rates are often too high for small businesses and it is difficult for them to find affordable rates even if they are low-risk businesses. Thankfully, there are ways in which small business owners can have affordable workers’ compensation coverage in a hassle-free manner.

PEOs are one such option. A professional employer organization (PEO) is an organization that helps businesses streamline internal processes by entering into a joint-employment relationship with an employer by leasing employees to them. The PEO shares and manages many employee-related responsibilities. Among other things, a PEO can also help find affordable workers’ compensation coverage with affordable rates and better terms.

In fact, you can enjoy the rates that are usually available to large employers because PEOs enjoy economies of scale owing to the large number of employees they work with across different employers. Apart from getting lower rates, you also save yourself from the hassles of shopping around and the paperwork. Moreover, all the claims and settlements are also handled by the PEO leaving you with ample time and energy to focus on your core business activities.

Want to know more about how working with a PEO can benefit your business? Get in touch with our team now.

Leave a Comment

Your email address will not be published. Required fields are marked *