The Scope of Workers’ Comp Obligations in California

The obligations that come with being an employer can be especially complicated for temporary staffing firms. A staffing business needs to juggle numerous employees working in many different work environments. Developing a risk-management program across a diverse and scattered workforce begins with a consideration of the company’s core compliance requirements. California’s workers’ compensation system, like those in many states, presents employers with hurdles and opportunities.

Most employers in California, including employers located outside California that have employees who regularly work here, are required to carry workers’ compensation insurance. For a staffing firm, this requirement presents a challenge as well as an opportunity. On the one hand, few insurance companies understand the staffing industry. Many of them construct insurance programs that do not fit the practical or financial needs of a staffing business. On the other hand, workers’ compensation also protects the employer against being liable for many types of employee injury. The right program can be an opportunity to save money.

California workers’ compensation programs insure employees in the event of an injury or illness that arises in the course of employment. The scope of covered injuries is quite broad. It includes injuries from single accidents, like a broken arm suffered in a fall, as well as certain types of injuries that arise through repeated stress, like carpal tunnel syndrome. Diseases can be an especially important source of risk for employers in certain industries, like construction, where unsafe exposure to chemicals or dust could give rise to respiratory problems.

A key question in California’s workers’ compensation system is who qualifies as an employee. If an individual is considered an independent contractor, they do not qualify, which leads some employers to try to characterize as many workers as possible as independent contractors. Employers following California labor laws will already know that last year the California Supreme Court introduced a significant change to the way the state defines independent contractors and employees. For a staffing firm, knowing when someone is a qualified employee is an important component of developing the right risk management policies.

Many employers struggle to find a workers’ compensation program that works well for their business. This is especially true of temporary staffing firms. Gunnin Insurance specializes in serving the insurance and risk management needs of the temporary staffing industry. Our experienced team can help your firm meet its compliance obligations while also reducing costs and improving overall financial performance. Call us today to find out more.