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New York Workers' Compensation Blog For Small Business Owners

What are the criteria for independent contractors?

As a New York small business owner and employer, one of the most important things you must understand is the difference between your actual employees that you hire and the independent contractors you engage to do various pieces of work for you.

The New York State Department of Labor provides a comprehensive list of the differences between employees and independent contractors, and reminds you that you must provide unemployment insurance and workers’ compensation benefits to your employees, as well as pay the employer’s share of FICA taxes. You need not do any of these things for independent contractors you engage.

Independent medical exams and your injured employee

Do you know how an Independent Medical Exam (IME) can affect your employee's workers' compensation claim? If you are a self-insured small-business owner, you have a right to request that an injured employee is examined by a board-certified doctor of your choosing for a second opinion. 

Misclassification can lead to workers' compensation issues

Workers' compensation insurance premiums depend on employee classifications and payroll.

In the past, this fact led many New York small business owners to classify employees falsely as independent contractors. It was a tactic to avoid high premiums and save money. Or make no insurance payments at all.

Minimum Compensation Rate

Workers' Compensation Law § 15 [6] [a] sets the minimum rate of compensation for disability - $150 per week since May 1, 2013. There are three scenarios, however when payments may be made at less than the minimum rate.

First, if the claimant's average weekly wage is less than the minimum rate of compensation the claimant's total disability rate will be equal to the average weekly wage - even if that is less than the minimum rate.

Tips on Pursuing a Workers' Compensation Fraud Defense:

Do You Have Reason to Believe a Claimant is Defrauding the Workers' Compensation System in Order to Secure or Maintain Benefits?

In New York, the statute governing workers' compensation fraud committed by claimants is found at N.Y. W.C.L. § 114-a(1). Added to the law in 1996, the statute provides that a claimant will be disqualified from receiving future compensation if such person provides a false statement or misrepresentation of truth as to a material fact for the purposes of obtaining wage replacement benefits.

Light Duty Job Offer - What Employers Need to Know

In New York, a partially disabled workers' compensation claimant is obligated to look for work within his restrictions or otherwise demonstrate an attachment to the labor market in accord with Matter of American Axle. But, if a claimant is still employed and has a reasonable expectation of returning to work for their employer after their disability ends, then such claimant does not need to search for alternative work or otherwise demonstrate attachment. 

Calculating the Average Weekly Wage of Seasonal Workers

One of the more contentious arguments held at workers' compensation hearings involves the calculation and establishment of a claimant's average weekly wage (AWW). Establishing a high AWW will result in increased weekly indemnity benefits. On the other hand, setting the AWW at a lower rate will decrease indemnity exposure. What is clear is that a claimant's AWW is governed by Section 14 of the N.Y. Workers' Compensation Law. However, what is not always clear is how to properly calculate the AWW of a seasonal worker.

Independent Contractors - The 1099 Myth

There is a myth about IRS Form 1099. It is a creation myth of sorts that fools otherwise honest, hardworking business people into believing that they have no employees. The myth is that if you pay a worker without withholding employment taxes and report payments with IRS Form 1099, the worker is an independent contractor. It's not true - even if the worker is in full agreement with the payment arrangement. 

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