Do I Need Workers’ Comp For Remote Employees?

remote workers comp

If businesses have learned anything from the pandemic, it is that many jobs can be performed just as effectively, if not more so, by employees who are working remotely. Hybrid, as well as fully remote work arrangements are becoming more and more common as the workforce is adopting and increasingly seeking out remote work privileges. In addition to the improvements in productivity and employee satisfaction that comes from remote work arrangements, businesses may also be benefiting from the lower overhead costs. With fewer employees reporting to a physical office, a business might opt to move to a smaller space, resulting in less rent and utilities.

Not having employees in a traditional office could also mean lower expenses for workers’ compensation insurance – or does it?

Workers’ compensation insurance covers costs related to an employee’s job-related illness or injury that “arises out of and in the course of employment.” If an incident happens while an employee is doing a work-related activity, they may be eligible to file a claim for workers’ compensation, even if they are working from home. This means that the employer is required to have the minimum level of workers’ compensation insurance in place, even if the business is 100% remote and all employees work from home.

Workers’ compensation is one of many business insurance policies that can protect your business against unexpected costs, and is no different for remote employers. The requirement to have workers’ compensation coverage for all employees is important to keep in mind as companies start to allow more employees to work from home, and many even beginning to hire remote employees from other states. If a business already has a location and/or employees in a state, chances are, the company already has the appropriate workers’ compensation coverage in place. However, hiring an employee from a new state or an existing remote employee deciding to move to a different state where the company does not currently have any presence can create some issues for the business.

 

How do I make sure we’re covered?

Researching the workers’ compensation coverage requirements and obtaining the necessary coverage should be a part of every company’s checklist when establishing a presence in a new state. The increase of fully-remote and hybrid work arrangements can cause a lot of confusion when it comes to determining whether an injury qualifies as work-related or not, and it is recommended that employers consult with their insurance carriers as well as their legal counsel to ensure adequate coverage is obtained to keep in compliance with state laws.

Understanding workers’ compensation insurance requirements is critical in protecting your business and its employees. Unfortunately, these requirements can vary from state to state and the ever-changing regulations can be complicated and overwhelming – not to mention time-consuming and stressful to manage. The team of experts at Valor Payroll Solutions can help by taking care of workers’ compensation coverage and compliance with our Pay-as-you-go solution, saving you time and stress so you can focus on what’s important to your business. Contact us to get started today!

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