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Archive for the ‘Workers Compensation’ Category

Insurance and Employment Law – Outsourcing

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What happens when you outsource jobs?  There are benefits to outsourcing in the right circumstances.  But what problems can come up and what should you do to protect your business?

  1. If the workers are not your employees, they can escape the Workers Compensation system and pursue law suits against you.   If you don’t set it up correctly, you may violate State and Federal labor laws.  See the link below for Colin Page’s blog page laying out a real case of a problem blowing up in the employer’s face.
  2. If you create a 1099 relationship, making someone an “independent contractor”, you have to be very careful to make sure the relationship truly qualifies as an independent.  If you want detailed advice on those rules to observe, on how to stay out of trouble with your State Board of Workers Compensation and Department of Labor, and lawsuits, click on the link below to William Barrett for legal advice.
  3. Employees are generally entitled to Workers Compensation benefits if injured; in New Jersey there are very few exceptions.  Non-employees can sue outside the controlled environment of Workers Compensation.  Make sure you have someone else’s insurance in front of yours; if you have a contract with someone who doesn’t have Workers Compensation, you are probably going to be providing it.
  4. You should follow basic risk management procedures.  If you contract jobs out to another company, get their certificates of insurance for Workers Compensation and General Liability.  Have them name you as an “additional insured” on their policies.  Make sure you have your own Workers Compensation, General Liability, and Employment Practices Liability insurance policies.

For more detail or to kick ideas around, we’ve given you links below to some intelligent lawyers and to our own contact information.

Here’s a link to the Chair of Corporate Law at a large NJ law firm.  Bright lawyer, William Barrett, who has been very solid for us.

Here’s a link to a Colin M. Page & Associates blog with comments on problems with outsourcing work.

Here’s a link to information on Employment Practices Liability Insurance.  GBW Insurance, 3 Gold Mine Road, Flanders, NJ  07836.  1-800-548-2329

Insurance Company Financial Stability

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Insurance companies are rated for financial strength.  Why does that matter?

Insurance is a promise to pay future losses.  If the company does not have a future, no payments.  And some losses are going to happen years down the line.

Property losses tend to be settled shortly after they occur.  You owned a building, it burned, the value is usually relatively easy to establish, you are paid for the loss.  The solvency of your insurance company is not of concern because of time, but because property is exposed to catastrophic threats such as hurricanes, which might bankrupt a small insurance carrier which has not prepared properly.

Liability losses, especially large losses, are usually litigated.  That can take years.  If an insurance company becomes insolvent, that will at a minimum complicate and delay settlement and payment.  An insurance company which misestimates its average losses far in the future will be in trouble.

So, how do you assess the strength of your insurance company?  While states review the strength of insurance companies within their supervision, day to day the best measurement is available from private companies that specialize in rating insurance carriers.

Without getting into a long discussion of the relative merits of the rating companies, one of the best is A.M. Best.  Ratings run from A++ to F, with additional notes for the future (stable, negative, favorable).  Here’s a link to Best’s explanation of their financial strength ratings.    You can sign into Best for free to get basic rating information on most insurance carriers.  (Some decline to submit their results for rating.  Not a great sign about the company.)

Or call GBW Insurance at 1-800-548-2329 and we can give you the information.  We are also paid subscribers and are therefore able to access detailed information as well.  www.GBWinsurance.com

Changes in new employee forms required by the Department of Homeland Security

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Effective today 5/7/2013, employers must use the current I9 Employment Eligibility Verification form.  You can get a copy of the current form at at the USCIS website. The US Citizenship and Immigration enforces this.

Every employer must complete a Form I-9 when they hire new employees. You have to retain it, with possible fines if the form is not complete or if you do not keep it.   Some of the new fields call for email addresses and employees’ foreign passport information.  

The employer must certify that ” I attest, under penalty of perjury, that 1) I have examined the document(s) presented by the above named employee, 2) the above-listed document(s) appear to be genuine and to relate to the employee named, and 3) to the best of my knowledge the employee is authorized to work in the United States.”

It’s interesting that the employer has more fields to fill out than does the employee.  And it must be completed no later than the first day of employment.  (Bold print in the original form.)  But never before the employee has accepted a job offer. 

“Reverification applies if evidence of employment authorization (List A or List C document) presented in Section 2 expires.”

Are you getting the idea of why there are 7 pages of explanation for a two page form?

Anyway, if you have questions about on-boarding a new employee, give us a call at 1-800-548-2329.  If we can’t answer a question for you, we may be able to recommend a consultant, or a labor attorney.

Responding to Slip and Fall Incidents

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Our thanks to CNA Insurance Risk Control for much of this advice.  You can call us at 1-800-548-2329 for more information or skip to the bottom of this page for CNA’s web site.

BE PREPARED FOR A SLIP-AND-FALL INCIDENT
It might be a visitor.
It might be a customer.
It might be your own employee.
But, chances are, you won’t be there to see it should someone slip and fall in a building you maintain.
Sound Planning Can Help
A well thought out plan ensures that injured persons will be treated promptly and puts you in control of the process. CNA has developed these guidelines to help you efficiently manage slip and fall accidents. When a slip and fall happens…
Immediately
1. Offer medical attention.
• Administer first aid at the scene.
• Call for emergency service if needed.
• Suggest a medical provider for follow-up care.
(For employee injuries, refer or suggest a medical provider if doing so is allowed by your state.)
2. Gather and document information.
• Name, address, phone number of injured person.
• Names, addresses, phone numbers of witnesses.
• Injured person’s description of what happened.
• Pictures of accident (floor, spill, etc.).
3. Report the accident.
• Ask your customers to notify you immediately of any slip and falls on floor surfaces you maintain.
• Notify your insurance company of all losses, even if the information you have is incomplete.
Within 24 Hours
1. Contact the injured person (or parent of minor).
• Communicate your concern and verify whether treatment was received.
• In all cases, avoid discussion of “blame.” Assure the injured person that the accident will be investigated.
• Be alert for claimant’s “expectations.” Communicate them to your insurance company.
• Make sure injured employees understand that a claim will be processed for Workers’ Compensation benefits with regard to medical bills and time off from work (if applicable).
2. For injured employees, work closely with the claim department at your insurance company.
• To provide the physician with the injury report that includes all the information you reported.
• To provide the physician with a detailed description of the injured employee’s current job duties.
• To communicate your support in returning the injured employee to work, and to light duty as necessary.
3. For all accidents, determine facts and circumstances.
• Identify specific materials, equipment, or tools involved in the accident and keep evidence in a safe place.
• Do not discard damaged or broken equipment involved in an accident. Keep it in a secure place where it will not be inadvertently put into use or destroyed. Altering, destroying, or discarding it could lead to an adverse finding.
• Develop a plan of action to prevent similar incidents.
• Notify customers of potentially hazardous conditions, which require action on their part for accident prevention.
After the Accident Occurs
1. Maintain an accident injury management record (Call us at 1-800-548-2329 for more information).
Whatever format you choose – a paper filing system or a computer database – your records should include:
• Injury report – include all information reported to the insurance company.
• Log of all communication related to claim
• Dates
• Contacts
• Documentation of discussion
• For employees, information on return-to-work status
2. Notify your insurance company of any new information you may receive or develop.
• About the accident
• About the injury
• About employee work status
• About legal representation or suit filings
Don’t let claims “slip and fall” between the cracks!
Loss Reporting Tips
• These same slip and fall guidelines apply to your customers – you can help by educating them on reporting slips and falls.
• Ask customers to notify you immediately of any incident involving a fall, no matter how minor.
• Make sure your employees know what to do when a fall occurs or if they themselves are injured.
• When an employee does not report for work due to illness, always inquire to see if the absence may be work related.
• Make sure one person is responsible for reporting all losses to your insurance company. Cross train a back-up for that person.
A Note About Fraud

Slip and fall scams take advantage of existing hazards and it’s been proven that they can be staged to collect benefits. These claims require careful management and scrutiny. It can be difficult to disprove allegations of a fraudulent slip and fall.
You can help your insurance company get a jump on fraudulent claims by consistently following these steps:
• Immediate notice of all accidents will help identify and deny fraudulent claims.
• Gathering and documenting evidence and facts while they are fresh will help to successfully defend fraudulent claims.
• Having a plan for medical care will help in getting an immediate, objective evaluation and serve as documentation of the alleged injury.
• Following consistent slip and fall management guidelines will help to accurately identify claims that have merit and those that do not.

Go to www.cna.com/riskcontrol for more information.

Workers Compensation basics

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This is aimed as a very basic explanation of Workers Comp. For more details or quotes click on the links in the text or call GBW Insurance at 1-800-548-2329.

What drives Workers Compensation costs?

For individual companies: costs = rate (what codes are you in?) X payroll X experience mod (what losses have you had?)

Rate: There are more than 600 codes with rates for each.

New Jersey Workers Comp classification codes start as low as an Office Workers rate of $0.26 for every $100 of payroll.

Some of the more expensive examples are:  5069 for some kinds of iron erection and more than $29 for $100 of payroll, or high building window washing at more than $56 for $100 of payroll. Getting the right code for each job is important.

Payroll: The employer provides an estimate for expected payroll. Insurance companies audit companies’ payroll after the policy expires, to make sure they get the right premium. And they have the right under New Jersey Workers Comp regulations to go back to prior years to recover premium for incorrect rates or payroll.

Premium modification: If your business has fewer losses and less money paid out than the average for your kind of work, over time you get a premium mod that reduces your cost. If you have more losses and/or large losses, you will pay more.

For more info or to start a quote, click here. Or just call 1-800-548-2329 to talk with us.

Do I need Workers Compensation Insurance in New Jersey and New York?

Yes. In almost all cases you must provide Workers Comp for employees.

As an owner in a partnership or LLC, you must officially “opt in” under New Jersey Workers Compensation law if you wish to have coverage. And New York has specific laws that affect even businesses whose employees enter New York only occasionally. Call Gerrity, Baker, Williams (1-800-548-2329) to discuss your concerns, or for advice. Or click here to start the process for more information or a free quote.

In New Jersey the NJ Compensation Rating and Inspection Bureau (NJCRIB) collects statistics, administers the system, and sets general rates and rules to implement the Workers Compensation laws of the state.

Why does Workers Compensation Insurance exist?

By the end of the 19th century there was general agreement that employers have a legal responsibility to their employees to make the workplace safe. However, accidents happen even when every reasonable safety measure has been taken. Workers were gaining the right to sue employers but that process could take years, it was often unsuccessful, and it was damaging to the companies that were sued.

To protect employers from lawsuits resulting from workplace accidents and to provide quick medical care and compensation for lost income to employees hurt in workplace accidents, most states passed Workers Compensation statutes. Now, in almost every state, most businesses are required to buy workers compensation insurance.

New Jersey passed its first Workers Compensation Act in 1911. Sponsored by a Republican State Senator, it passed the legislature by unanimous vote.

How does Workers Compensation Insurance work for an injured employee?

Workers compensation insurance covers workers injured on the job, whether they’re hurt on the workplace premises or elsewhere, or in auto accidents while on business. It also covers work-related illnesses to some extent.

Workers compensation provides payments to injured workers, without regard to who was at fault in the accident, for time lost from work and for medical and rehabilitation services. It also provides death benefits to surviving spouses and dependents.

Each state has different laws governing the amount and duration of lost income benefits, the provision of medical and rehabilitation services and how the system is administered. For example, in most states there are regulations that cover whether the worker or employer can choose the doctor who treats the injuries and how disputes about benefits are resolved.

Workers compensation insurance must be bought as a separate policy. Although in-home business and business owners policies (BOPs) are sold as package policies, they don’t include coverage for workers’ injuries.

Is a worker an employee or an independent contractor?

For small businesses, this affects your WC Insurance, your tax exposure, and can draw fines from the NJ Department of Labor.

Declaring someone an independent contractor doesn’t make him or her an independent contractor for Workers Comp.  In most states, if someone is working on your projects, and has an injury covered by Workers Compensation, and doesn’t have WC Insurance of his or her own, you can wind up paying for the loss.

For more discussion of how to protect yourself when considering whether someone is an independent contractor or an employee, click here to go to our blog post on that topic.

For more information on how Workers Compensation pricing works, click here for the NJCRIB explanation.

7 Steps to help an injured worker return to work…

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When someone is injured in the workplace, both the worker and the employer will be better off if there is a plan in place to get the worker the best care and rehab, both sides know what the plan is, and they follow it. You are aiming for fewer lost days, less wage loss, better employee morale, and a better quality of life for the employee.

If you have more questions after looking at the list below, please give us a call at 1-800-548-2329.

Our thanks to CNA Insurance for this list. While they’re not the only company in the Workers Compensation business, they’re a good company.

Seven Key Steps
1. Ensure prompt access to treatment. This includes making
sure the appropriate first-aid kits are available to the injured
worker; promptly referring the injured worker to your
preferred medical provider; or, in the event of an emergency,
quickly placing a 911 call to the local emergency dispatch.

2. Report the loss immediately by calling, e-mailing or
reporting the injury online through http://www.cna.com.

3. Establish a return-to-work record, which includes: a copy
of the accident report, a job description, initial treatment
documentation, copies of medical bills, progress reports
from the physician and a log of your conversations with
your employee and the physician. This will assist you in
tracking the current claim, and establishes a model for
handling future claims.

4. Provide information to the treating physician about the
work-related injury, including details about the incident and
the employee’s job description, and briefly discuss your
company’s return-to-work policy.

5. Follow up with your injured employee within 24 hours of
the injury. Assure him or her of your company’s commitment
to their well-being. Assess the worker’s understanding of
the treatment he or she received, and respond quickly and
appropriately to questions about future treatment plans
or other general questions. Always be considerate of the
employee’s rights of privacy and confidentiality.

6. Contact the physician within 24 hours of the initial
treatment to obtain information about the extent of the
injury and recommended treatment plans. Also determine
timing for returning the employee to work as appropriate.
Where necessary, the goal is to provide temporary modified
jobs that will take into account your employee’s physical
abilities, skill and interests.

7. Maintain contact with your employee at least bi-monthly
to ensure his or her recovery is progressing as anticipated.
Collaborate with the treating physician for updates on your
employee’s recovery, and to facilitate a smooth transition to
the appropriate job duties.

Social media policies and the NLRB…

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The Acting General Counsel of the National Labor Relations Board recently issued guidance on Social Media Policies in relation to the National Labor Relations Act.  You will find the link to the actual document by clicking here to go to the NLRB site and going to document OM 12-59.

Sadly, the guidance appears to be that employers can not restrict employees’ behavior on social media or in disclosing confidential information. 

Presumably you can carve out a safe policy by making it clear that your restrictions don’t apply to issues subject to the National Labor Relations Act.   You should see your labor legal counsel if you have one, making sure your employee handbook and any other documents are in compliance.  But employers are on the spot with this since the NLRB (especially recently) takes the path of the negative Socratic dialectic in issuing guidance.  That is, you advance an idea and I tell you what’s wrong with it, but I never tell you what would be right.  (Many philosophers have argued that there were some good reasons to kill Socrates.)  

We’re not going to give you labor law advice.  There’s an excellent legal summary of this mess, available through the link at the bottom of this article.  But you should also take a look at your employment practices liability insurance (EPLI) and talk with your insurance advisor about what’s covered.  Or call us at 1-800-548-2329.

Here is the link to an alert from Bressler, Amery, & Ross. Excellent write-up of the problem.  Bressler Social Media and NLRB