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Winter 2017  Volume 13, Number 4        
 

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Do You Need Workers’ Compensation for Household Employees?

Every day, an estimated 2.5 million individuals—mostly women—work in others’ homes, cleaning, cooking and caring for children and the elderly. Although many people treat them as independent contractors, the IRS and workers’ compensation laws may consider these domestic workers “household employees.” If they are injured while working for you, you may be liable for lost-time claims as well as medical payments.

Household employees include the following workers:

  • Babysitters
  • Caretakers
  • Cleaning people
  • Domestic workers
  • Drivers
  • Health aides
  • Housekeepers
  • Maids
  • Nannies
  • Private nurses
  • Yard workers

The IRS considers these people “household employees” if you can control not only what work is done, but how it is done. It does not matter whether the work is full-time or part-time or that you hired the worker through an agency or from a list provided by an agency or association. It also does not matter whether you pay the worker on an hourly, daily, or weekly basis, or by the job.

If only the worker can control how the work is done, the worker is not your employee but is self-employed. A self-employed worker usually provides his/her own tools and offers services to the general public in an independent business.

Coverage Requirements Vary by State

Although IRS regulations govern tax withholding requirements throughout the U.S., workers’ compensation requirements vary by state. Some states require employers of domestic workers to provide workers’ compensation, which provides payments to employees for injuries that occur on the job. In addition to covering an injured worker’s medical payments, it will also provide “lost time” benefits when a worker cannot work and collect a paycheck because of a work-related injury or illness.

These states require workers’ compensation coverage for full- and part-time domestic help:

Alaska, California, Colorado, Connecticut, Delaware, Hawaii, , Iowa, Kansas, Maryland, Massachusetts, Michigan, Minnesota, New Hampshire, New Jersey, Ohio, Oklahoma, Puerto Rico, South Dakota, and the District of Columbia. These states require coverage for full-time workers only: Illinois, New York, Utah.

Kentuckey requires workers comp coverage if there are 2 or more full or part time household employees. Other states may also have special stipulations. Please see the HomeWork Solutions website for a complete summary of requirements by state: https://www.homeworksolutions.com/knowledge-center/about-workers-compensation-insurance/

Please contact us if you have questions or think you need workers compensation coverage for household employees.

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In this issue:

This Just In...

Five Lessons from Recent Hurricane Losses

Five Ways You Could Accidentally Lose Your Car Insurance

Do You Need Workers’ Compensation for Household Employees?

Does Homeowners Insurance Cover Domestic Workers?

 

 


The information presented and conclusions within are based upon our best judgment and analysis. It is not guaranteed information and does not necessarily reflect all available data. Web addresses are current at time of publication but subject to change. SmartsPro Marketing and The Insurance 411 do not engage in the solicitation, sale or management of securities or investments, nor does it make any recommendations on securities or investments. This material may not be quoted or reproduced in any form without publisher’s permission. All rights reserved. ©2015 The Insurance 411. Tel. 877-762-7877. www.theinsurance411.com