Workplace injuries happen all the time. They range from minor injuries that heal in a matter of days, to serious injuries that require months of recovery. It can be hard to pay your bills, get proper medical attention and to continue living your normal quality of life without your regular income.
You probably have questions regarding Louisiana Workers Compensation Benefits and this guide will help you answer them. Louisiana Workers’ Compensation Laws are complex and you may need to speak with an attorney if you’ve been injured at work.
Do All Businesses Have to Carry Workers Compensation Coverage?
Nearly all businesses that employ workers must purchase workers’ compensation insurance. You may be surprised to hear that employers in Louisiana are required by the state to carry workers’ compensation coverage even if they just have a single employee. This is also true if they have one part-time worker or a seasonal worker that comes in sporadically.
Which Louisiana Businesses Don’t Have to Purchase Workers’ Compensation Insurance?
As always, there are a few exceptions to the rule and some Louisiana businesses are exempt from the requirement. While the Louisiana workers’ compensation laws require nearly every business to carry insurance, there is a small subset of employers that do not. These include:
- Some private residence workers;
- Some musicians
- Some private unincorporated farm employees
- Those employees covered by certain federal laws
- Board members who are uncompensated at non-profit organizations
- Airplane crews for crop dusting
- Railroad employees
Where Can Louisiana Employers Purchase Workers’ Compensation Insurance?
There are 3 ways a business can obtain workers’ compensation insurance:
- Businesses can purchase the required insurance through a private insurer of their choice as long as the insurance company has authorization to operate in Louisiana. The list is extensive and can be found HERE.
- A business can get membership in a Group Self-Insurance Fund. It must be a state approved fund.
- An employer can submit an application to the OWC to become a Self-Insured business.
How Much Does Workers’ Compensation Insurance Cost in Louisiana?
You may be wondering how much worker’s compensation insurance will cost your business. It’s a valid concern with the rising cost of other types of insurance in Louisiana. Workers’ compensation insurance premiums work similar to other insurance and are determined by your business. Your insurance rates will depend on multiple factors such as the amount of your total payroll, the type of work your business performs and any past incidents or accidents.
The amount you will have to pay for workers’ compensation insurance is largely determined by the amount of risk that the job entails. For example, a company may pay more premiums for a worker who has a dangerous profession than an office worker who sits behind a desk. If the company has a wide range of job types such as construction workers and office workers, then the cost of workers’ comp insurance will be averaged across the board for all of your employees.
What Happens in a Workers’ Comp Settlement in Louisiana?
There’s a chance a workers’ comp claim will reach a settlement. When this happens, the insurer pays a lump sum settlement to the injured worker. The agreement will include all claims such as disability payments, medical coverages and physical therapy. Once an agreement is reached, the injured worker cannot make further claims against the employer based on that same injury or illness.
Do Louisiana Businesses That Have Zero Employees Have to Purchase Workers’ Compensation Insurance?
Example: I’m a Solo Business Owner:
There are many situations where you would not be required to carry coverage with no employees. Here are a couple that are common:
- You own and run the business by yourself and have no employees of any type. You also have no subcontractors and your business type is not a corporation.
- You have a business partnership with zero employees, no volunteers and no subcontractors.
Do Independent Contractors Fall Under the Workers’ Compensation Exemption?
All employees must be provided with workers’ compensation in Louisiana. Often, those who are classified as independent contractors are in fact considered employees under the Louisiana workers’ compensation laws. You need to be sure your independent contractors who work with you are not considered employees or you will have to provide them with workers’ compensation insurance.
You can take a test to determine if your independent contractors should be classified as employees under Louisiana workers’ compensation guidelines right HERE.
Remember, misclassifying employees is considered fraud even if it was unintentional. “”The Fair Play Act,” took effect July 1, 2013, setting stiffer penalties for employers who misclassify workers, whether intentional or not.”
Will I Be Penalized If I Do Not Purchase Louisiana Workers’ Compensation Insurance?
You absolutely can face strict penalties for not carrying workers’ compensation insurance when you’re required to do so. The state may fine your business up to $250 per employee and that’s just for a first violation. Subsequent violations can range from $500 per employee all the way up to $10,000. It can be a costly mistake.
A business that purposely fails to provide their employees with workers’ compensation insurance can also be charged with criminal violations. In fact, a business that is found to be in violation of the Louisiana workers’ compensation laws can be served with an injunction that prevents them from conducting business until they obtain a policy and proof is given to the Office of Workers’ Compensation.
This is the type of mistake a business does not want to make.
Are Employers from Other States Required to Purchase Workers’ Compensation Insurance in Louisiana?
There are two possible situations that out-of-state employers may encounter:
- The out-of-state employer operates in this state, but with employees in their state; and
- The out-of-state employer hires employees from Louisiana.
In the first situation, the out-of-state employer must give workers’ compensation coverage that satisfies the laws of their state as long as their coverage is valid in Louisiana. In the second example, the employer is required to provide a workers’ compensation policy from an insurance provider that is able to write policies in Louisiana.
Louisiana workers’ compensation is required for nearly all businesses in Louisiana. While there may be a few exemptions, employers must take care and comply with Louisiana workers’ compensation guidelines and ensure they remain compliant by speaking with a Louisiana workers’ compensation attorney.
This article about Louisiana workers’ compensation for employers should not be considered legal advice. You must speak with an attorney for legal advice as this website cannot give legal advice.