Is Workers’ Compensation Making Your Business’s Bottom Line Ill?
Years ago, in the early days of worker’s compensation, New Jersey was a leader in the workers’ compensation movement. At the time, New Jersey was one of the key manufacturing states. Injured employees had to sue their employers under common law, and it was a long and difficult process. This resulted in New Jersey having its first workers’ compensation law enacted in 1911.
Today, New Jersey continues to be one of the leaders in workers’ compensation, however not in the way you might think.
Rather, today New Jersey is a leader in terms of its 2014 workers’ compensation premium rate ranking. It now ranks # 3 out of all 50 states and the District of Columbia. New Jersey’s dubious distinction is even more troublesome to New Jersey business owners when you factor in the information that New Jersey’s premiums ranked #7 only 2 years prior. In short, New Jersey’s workers’ compensation rates are among the worst in the country, and there are no immediate signs of improvement.
The top three ranked states for 2014 on the list of workers’ compensation premium rate ranking list are:
- – New Jersey — #3
- – Connecticut — #2
- – California — #1.
New York is not far behind, listed as #4 on the ranking list.
Delaware occupies the #9 spot on the list, but business owners there can’t be happy either, knowing that they just moved up 21 places from their #30 ranking in 2012. Link
While workers’ compensation laws do vary from state to state, every state does have some provisions for workers’ comp in their statutes. In New Jersey, workers’ compensation is a “no-fault” program that covers workplace-related illness or accidents. The employee does not have to prove that the employer is at fault for the injury. However, the employee does lose his or her right to sue their employer regarding any damages relating to the worker’s comp filing.
All New Jersey employers must carry workers’ comp insurance or meet the qualifications of being self-insured. If a business does not maintain insurance, they can be fined or even be charged with criminal violations. In New Jersey, all businesses including small businesses must carry workers’ comp unless they are sole proprietorships or an LLC.
The cost your business has to pay for workers’ compensation insurance depends on many factors. Some of these variables include: the state(s) where you do business; the number of people your business employees; and, the type of business you are, and what risks are associated with it.