Millions of Americans run their own small business. Whether that business is the primary source of income for the family or just a side job to help provide supplemental income, business owners are all well aware that there are many regulations surrounding formation and running a business. In addition, many people choose to employ other individuals for help around the house, including nannies and handymen. Whether you have a small business or you employ others to help you around the house, it is important that you understand your rights and responsibilities regarding workers’ compensation.
California labor code provides that employers are obligated to carry workers’ compensation insurance. This is true even if the business has only one employee. This is also true of businesses which are located outside the state of California but still do business in this state. In other words, if your business is located in Oregon but you sometimes do business in California, you are stills subject to the California requirement that you carry workers’ compensation insurance. For a sole proprietorship, the law does not usually require workers; compensation if the business has no employees. The important exception to this is for roofing contractors. All C-39 roofing contractors in California are required to carry workers’ compensation insurance and file a valid certification with the state.
It is also important to understand your obligation regarding workers’ compensation insurance if you use the services of a nanny or a handyman. Under California labor code 3352(h), “any person employed by the owner or occupant of a residential dwelling whose duties are incidental to the ownership, maintenance, or use of the dwelling, including the care and supervision of children, or whose duties are personal and not in the course of the trade, business, profession, or occupation of the owner or occupant” is classified as an employee. This means that you may be required to carry workers’ compensation insurance for your nanny or handyman. California law goes on to state that if the person has worked less than 52 hours in the 90 days before the injury was sustained or earned less than $100 in wages during that time, the person is not an employee for worker’s compensation purposes.
We have extensive experience helping our clients understand the rights and responsibilities concerning workers’ compensation insurance. Contact us today to talk about your options.