Getting Started: Essential Workers’ Compensation Guide for New California Employers
Introduction
If you’re hiring employees in California, securing Workers’ Compensation insurance isn’t just a best practice—it’s the law. This guide will walk you through the basics and help you protect both your business and your team from day one.
1. What Is Workers’ Compensation?
Workers’ Compensation (often called Workers’ Comp) is insurance that provides wage replacement and medical benefits to employees injured on the job. In California, it also protects employers from lawsuits stemming from workplace injuries.
2. Who Needs Workers’ Compensation Insurance?
All California employers must carry Workers’ Compensation insurance—even if you only have one part-time employee.
Sole proprietors with no employees are typically exempt, but contractors may require proof of coverage for certain jobs.
3. How Do You Get Workers’ Comp Insurance?
Private Insurance Carrier: Purchase a policy from any insurance company licensed to sell Workers’ Comp in California.
State Fund: If you can’t obtain coverage elsewhere, the California State Compensation Insurance Fund offers policies to all businesses.
Self-Insurance: Large, financially secure employers may apply to self-insure, but this involves strict qualifications and ongoing reporting.
4. What Does It Cover?
Workers’ Comp covers:
Medical expenses for work-related injuries and illnesses
Disability payments (temporary or permanent)
Rehabilitation costs\
Death benefits for surviving dependents
5. Your Legal Requirements as an Employer
Post Required Notices: Display the official “Notice to Employees” poster (DWC 7) in a visible workplace location.
Provide New Hire Pamphlets: Give each new employee a Workers’ Comp information pamphlet at the time of hire.
Report Injuries Promptly: File a claim with your insurance company within one working day of learning about an employee injury or illness.
Keep Records: Maintain records of all workplace injuries and provide reports as required by the Division of Workers’ Compensation (DWC).
6. Penalties for Non-Compliance
Operating without Workers’ Comp insurance is a criminal offense in California.
Penalties can include substantial fines, stop orders, and even jail time.
You may also be liable for all costs of an employee’s injury or illness if you’re uninsured.
7. Best Practices for New Employers
Review Your Policy Annually: As your business grows or changes, your coverage needs may change too.
Train Your Team: Educate employees on safe workplace practices and how to report injuries.
Keep Open Communication: Make sure employees know their rights and feel comfortable reporting workplace injuries.
Conclusion
Workers’ Compensation insurance is a critical part of running a business in California. Getting started the right way protects your business, your employees, and ensures compliance with state law. Have more questions? Reach out to Sixth Man Workers’ Comp.
California's premier workers' compensation solutions provider, serving employers since 2005.
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