Hiring subcontractors may increase your workers compensation premium

A subcontractor is an individual or in many cases a business that signs a contract to perform part or all of the obligations of another’s contract. In simple terms it an individual or a business hired by you to perform the complete job or a part of it for you.

Even though a subcontractor may share a part of your work load, sometimes hiring subcontractors may increase your workers compensation premium. Consider the situation in which you hired a subcontractor to perform a job for you. He performed the job successfully and on completion presented you the invoice. After careful analysis, you pay him the due amount. At the end of the year the workers compensation auditor audits your payroll and discovers that you hired a subcontractor for a job. The auditor asks you about the certificate of insurance the subcontractor provided you but you do not have one as your subcontractor had not provided you. Now considering the fact that the subcontractor had once been on your payroll, the auditor demands that you should pay for the workers compensation insurance of the subcontractor.

To avoid this unwanted cost, make sure that you have all the insurance certificates of you subcontractor and these certificates also cover workers compensation. Also they should cover the period in which the subcontractor worked for you.  Many small subcontractors do not even carry workers compensation insurance coverage.

With a little tactful consideration before hiring a subcontractor to perform the job, the cost of hiring the one without proper insurance coverage can be avoided.

Professionals at Lyle B. Masnikoff and Associates, P.A will fight to get you the medical or wage benefits you are entitled to under the law. Employers and Insurance Companies have professionals working for them and there are no fees or costs until you recover. It‘s time for you to hire us to protect your rights.