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Confused on paying laborers with regard to the level of worker Comp I carry as a new GC

New YorkConstruction Accounting Licenses

I just hit my GC license in NY. I have a construction project I am taking over and need to higher laborers. Generally I hire licensed sub contractors that have their own policies. Do I need to increase my insurance levels or who should I talk with about this issue? Accountant? Lawyer? Insurance Broker?

4 replies

Jan 2, 2020

That's an excellent question, and unfortunately, I'm not sure of the answer. However, reaching out to someone familiar with construction accounting/ running a construction back office or consulting an insurance broker should be helpful in determining what actions may be necessary. Seemingly, though, if laborers were hired as employees - that'd directly affect workers comp insurance limits. Though, laborers hired and (properly) classified as independent contractors might not have that same impact. But again - consulting with someone more familiar with construction insurance in New York would be helpful here. This resource might be helpful, to some degree, too: New York Workers' Compensation Coverage.

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Jan 6, 2020

if they have their own workers comp and general liability insurance and you 1099 them you should be fine, if they work for you and you pay them weekly that is consider an employee whether is on the books or not. Check with your accountant and your insurance broker. If you hire a sub that has no workers comp at audit time 95% of the payments will be consider payroll and you will be responsible for the amount due. You can check below to see if your wc insurance is valid in NYS https://www.wcb.ny.gov/icpocinq/icpocdisclaimer.jsp?xsubmit=Employer+Coverage+Search you can check also the class codes based on the work you do it gives you an idea what will cost the actual amount is usually highgher https://www.nycirb.org/classSearch.php You also need to have disability insurance form db-120.1 it is all based if you work with municipalities or residential

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Jan 6, 2020

If you are hiring laborers that have their own general liability, workers comp and disability insurance and you 1099 them they you will be OK You can check and see if they have a valid workers comp insurance here https://www.wcb.ny.gov/icpocinq/icpocdisclaimer.jsp?xsubmit=Employer+Coverage+Search if you hire anyone that you pay weekly whether they are on the books or not they are consider your employee and therefore you are responsible for the cost of the workers comp. If you hire a subcontractor that has only the general liability and no workers comp be aware that 95% of the contract will be consider payroll on your end and you will have to pay when your audit is done, the same will be for who ever you pay that does not have insurance. You can check the rates and codes for workers comp here https://www.nycirb.org/classSearch.php that will give you an idea but the actual prices are usually higher. You also need to have disability insurance - form db-120.1 You must talk to your insurance broker ASAP, and your accountant.

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Jan 6, 2020

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