Workers' comp for Florida contractors

When Florida requires coverage

Florida's rules depend on whether your work counts as construction.

Part-time workers count. So do family members on payroll. A worker you pay on a 1099 can still count as your employee if you control how and when they do the work.

Owner exemptions

Owners can file with the state to be exempt, which keeps their own pay out of the premium. In construction the rules are tight:

• Only corporate officers or LLC members can be exempt, not sole proprietors.
• No more than three per company, and each must own at least 10%.
• The certificate is issued by the Division of Workers' Compensation and has to be renewed every two years.
• An exempt owner who gets hurt can't collect comp benefits.

An exemption covers only the owner who files it. Your crew still needs coverage.

What happens if you're not covered

State investigators visit job sites and check coverage against permits. When coverage is missing:

• Stop-work order. Business operations at the site have to stop until the order is lifted.
• Penalty. Twice the premium you would have paid over the past 12 months, with a $1,000 minimum. Repeat offenders get a 24-month lookback.
• $1,000 a day for any day you keep working in violation of the order.

Building departments also ask for proof of coverage or an exemption before they issue a permit.

Subcontractors

When you sub out part of a job, Florida treats your workers and the sub's workers as one business. If the sub doesn't carry comp, you're responsible for covering their workers on that job. At audit, a carrier can add an uninsured sub's labor to your payroll and bill you for it. Collect a certificate of insurance or an exemption from every sub before they start.

How comp works through a PEO

A PEO (professional employer organization; Florida law calls it an employee leasing company) becomes the co-employer of your crew. It runs payroll and carries workers' comp under its own master policy, so your crew is covered under that policy.

• Billed with each payroll. Premium is figured on the wages you actually pay, every pay period. You usually skip the large deposit a standalone policy asks for.
• Fewer audit surprises. Because premium tracks real payroll, there's less room for a big bill at year end when you hired more than you planned.
• Certificates on request. The PEO issues certificates of insurance for GCs and permits.
• Claims handled. Injury reporting and claims go through the PEO and its carrier.

PEOs operating in Florida have to be licensed by the Board of Employee Leasing Companies, part of the Department of Business and Professional Regulation, and have to show proof of comp coverage to keep that license.

Class codes and your rate

Comp premium is a rate per $100 of payroll, set by your class code. Codes follow the work: an HVAC installer and a janitor carry very different rates. Your experience modification factor (mod) moves the rate up or down based on your claims history compared with similar businesses.

Office staff who never go to job sites usually carry a much lower clerical code, so it pays to keep their payroll separate. The carrier assigns your final codes.

What we need to quote you

• Headcount and yearly payroll, split by type of work if you can
• Your current declarations page, if you have a policy
• Loss runs for the last 3 to 5 years
• A list of subs you use and whether they carry comp

You don't need any of that to start a quote. We'll ask once we've talked.

Trades we don't place

We don't quote roofing or tree-service accounts, or any crew that regularly works on roofs or in trees. Our PEO partners don't write that work.

Questions