Source: https://www.shelterpoint.com/broker/dblfaqs.aspx??p=1.1.4.3
Timestamp: 2018-02-20 13:40:23
Document Index: 94988008

Matched Legal Cases: ['§202', '§355', '§201', '§355', '§212', '§211', '§220', '§220']

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As a service to our producers, ShelterPoint compiled a list of frequently asked questions you might encounter from your clients. For easy navigation, we’ve sorted them by questions from employers and questions from employees.
FAQs from Employers/Policyholders
On April 13, 1949, Governor Thomas E. Dewey signed the Mailler-Condon Bill which became Article 9 of the Workers' Compensation Law. This Article constitutes the Disability Benefits Law (short DBL) in New York. While Workers' Comp mandates benefits for on-the-job injuries and work-related illnesses, DBL provides temporary cash payments for eligible wage earners who are incapacitated by an illness or disability from a non-occupational injury. Currently, only five other U.S. states and territories have mandatory disability insurance programs in place: California, Hawaii, New Jersey, Rhode Island, and Puerto Rico.
Your business becomes a "covered employer" 4 weeks after it has employed at least one person for any 30-day or longer period in New York in a calendar year (WCL §202).
You must cover all eligible employees. Any person providing services to your for-profit business can be deemed an employee and must be covered under DBL if they are eligible (see Who is not covered under DBL? for exceptions). If your business meets any of the criteria listed below and the person you are hiring does not fall in the category of an Independent Contractor or in the list of ineligible individuals, you must provide them with DBL coverage: Non-public sector non-profit employers must provide DBL coverage for employees but not for religious leaders; i.e., non-profits such as churches must provide DBL coverage for custodial and office staff but not for priests, ministers, rabbis, etc.
Right to Control (The degree of direction and control you have over the time/way in which the work is performed): If you control those elements, it indicates an employer-employee relationship.
Character of the individual’s work is the same as the type of work your business performs (the individual’s work must be consistent with the primary work performed by your business). Example from the WCB: someone installing shingles for a roofer is generally considered the employee of that roofer. Conversely, a plumber hired on a one time basis to fix a broken pipe for a retail store owner is generally considered an independent contractor.
Method of Payment: Whether the labor is paid using a W2 or 1099 Form for tax purposes does not matter in determining an employer-employee relationship for DBL (workers' compensation purposes). Any payments (including cash payments) that are not rendered on a per-project basis indicate that the individual is an employee! If you pay wages on an hourly, daily. weekly, or monthly basis, this tends to indicate actual employment.
Furnishing Equipment/Materials: If you provide the equipment, tools, and/or materials for their work, this tends to indicate an employer-employee relationship.
Right to Hire/Fire: You retain the authority to hire and fire individuals and can fire them because of the time/method they choose to perform their work.
Employees or recent employees of another covered employer, who have worked at least 4 consecutive weeks for one or both of the employers.
Part-time employees, i.e. persons who work fewer hours than constitute your normal workweek. (Any part of a day worked is counted as a day of employment, and the employee becomes eligible on the 25th day of such regular, part-time employment.)(see Who is not covered under DBL? for exceptions)
For coverage regulations regarding business owners see Are business owners covered under NY DBL?.
Chauffeurs, nannies, home health aides, nurses, babysitters, maids/live-in maids, cooks, housekeepers, laundry workers, butlers, companions, and gardeners who work in a private household (12 NYCRR §355.2).
Note: You are not required to provide DBL if the only people who work for your household are private domestic workers who each work less than 40 hours per week for you and do not live on premises.
How soon are my new employees covered?
Whether you are a covered employer or not, your new employees are generally protected immediately (from the first day on the new job) if they
move from one covered employer to another - as long as the gap in employment isn't more than 4 weeks; or
If you are not a covered employer and your employee doesn’t meet the requirements for immediate coverage, their DBL protection becomes effective once you qualify as a covered employer.
Employees who change to jobs in an exempt employment environment or with a "non-covered" employer, and work there for more than 4 weeks, lose protection until they work 4 consecutive weeks for a "covered" employer.
Volunteers in nonprofit organizations who don’t receive any compensation (compensation includes stipends, room and board or any other perks of monetary value)
Recipients of aid from a religious or charitable institution who perform work for the institution in return for the aid
You may elect to provide benefits to certain excluded employees by filing an "Application for Voluntary Coverage." See Can I provide voluntary DBL coverage for employees who would otherwise not be covered? for details.
True independent contractors and subcontractors are not considered employees under the NYS Disability Benefits Law and are therefore not covered under DBL. However, whether the labor is paid using a W2 or 1099 Form for tax purposes does not matter in determining an employer-employee relationship for DBL(Workers' Compensation Law) purposes.
Identifying an Independent Contractor (as explained on the Workers’ Comp Board’s website)
Have a FEIN (Federal Employer Identification Number) or have filed a self-employment income tax return;
Operate under a specific contract, be responsible for satisfactory performance of work and be subject to profit or loss in performing the specific work under such contract, and be in a position to succeed or fail if the business's expenses exceed income;
Obtain a liability insurance policy (and if appropriate, workers' compensation and disability benefits insurance policies) under its own legal business name and FEIN;
Have its own advertising such as commercials, phone book listing, or business cards;
Work under his/her own operating permit, contract or authority.
Drivers are considered Independent Contractors if – in addition to the above conditions – they also transport goods under their own bill of lading and DOT Number.
Licensed Insurance Agents/Brokers and Licensed Real Estate Brokers/Sales Associates are Independent Contractors if they:
are not treated as an employee for State and Federal tax purposes (other than FICA which is required for full-time life insurance agents). [WCL §201(5), 12 NYCRR §355.2]
1. Owners/shareholders of Corporations (C-Corps, S-Corps, and Professional Corporations, for example) are considered employees of the corporation and are automatically covered under NY DBL at the same rates as other employees if they are:
one or two officers (each owning at least one share of stock) with employee(s) (they may choose to exclude themselves from coverage by filing form DB-212.3 ).
Can I provide voluntary DBL coverage for employees who would otherwise not be covered?
Yes, based on WCL §212, you can provide voluntary coverage for compensated employees in New York by completing an application for voluntary coverage: form DB-135 (for non-contributory groups) or DB-136 (for contributory groups). If you are not a covered employer yet and the application gets approved, you become a covered employer.
If you provide voluntary coverage you must maintain it for at least one year. You can cover the following persons on a voluntary basis if they receive compensation:
A minor child of the employer
Domestic or personal workers in a private home who are employed for less than 40 hours/week by any one employer
Recipients of charitable aid from a religious or charitable institution (if they perform work for the institution in return for the aid and are not under a contract of hire).
Someone performing services for a public authority or political subdivision (e.g., municipal corporation or fire district)
For voluntary coverage regulations regarding business owners, see Are business owners covered under NY DBL?
If you want to discontinue voluntary coverage, you must provide a written notice to the Chair of the Workers’ Comp Board and to the employees within 90 days before coverage will end. You must include provisions made for the payment of obligations incurred on and prior to the effective termination date.
Premiums can be paid entirely by the employer or jointly by employer and employee. An employee's share cannot be more than 1/2 of 1% of the first $120 of weekly wages, to a maximum of 60 cents per week for each employee.
Why should we choose the contributory option?
It has advantages both for you and your employees:
With the money you save, enhanced benefits are more easily affordable
Your employees will not get taxed on the percentage of their benefit equivalent to the percentage of the contribution of the rate.
The maximum weekly contribution remains 60 cents even if the employee has more than one job. In that case, the employee may request that each employer adjust contributions in proportion to earnings so that the total contribution does not exceed the maximum allowable 60 cents.
Can we increase the employee contribution proportionally if higher benefits are provided?
Pursuant to §211 of the Workers Compensation Law, an employer may be able to increase the employees’ contribution only by agreement and provided the contribution is reasonably related to the value of the benefits as determined by the Chairman of the Workers’ Comp Board. In other words, you have to have the approval of the Chair at the WCB.
If the DBL premium is paid jointly – what if the premium is lower than the maximum contribution?
An employer is never supposed to profit from providing NY State DBL to their employees. Therefore, the contribution you deduct should not exceed the premium. If an employee's contribution is equal to the premium, the benefit is 0% taxable.
They may still file for DBL benefits: if their disability occurs within 4 weeks after their employment is terminated, benefits are paid by your insurance carrier. If they become disabled in the period between 4 and 26 weeks after termination, they receive benefits from the Special Fund for Disability Benefits, which is administered by the Workers' Compensation Board (see How do I apply for DBL benefits? for details).
Pregnancy disabilities are treated the same as any other disability
Pregnancy disability is not maternity leave! Maternity leave itself is not covered under DBL. But a pregnancy-related disability that occurs during maternity leave is covered. If the employee becomes disabled while on unpaid maternity leave, she is eligible only within the 4-week period following her last day of employment. If her disability begins more than 4 weeks after the last day of her employment and she is claiming/receiving Unemployment Benefits, she is entitled to DBL benefits from the Special Fund for Disability Benefits (if otherwise eligible).
New York State sets the maximum benefit for statutory policies to $170/week. Statutory benefits are calculated as follows:
Your employees receive 50% of their average weekly wage (based on their last 8 weeks of employment, not counting the week in which the disability began – if its inclusion would lower your benefit rate) to a maximum benefit of $170 a week.
If your employee returns to work and becomes disabled again within 3 months from the date of returning to work due to the same or a related condition, no waiting period applies. If the disability is due to a different condition or more than 90 days has passed, the waiting period is applicable!
Can we request reimbursement for DBL benefits due if the employee continues to receive salary while on disability?
Generally yes. If you continue an employee’s salary while the employee is out on disability, it is considered advancing the employee’s disability benefit. You have the right to request reimbursement for the DBL payment due. If the money you pay to a disabled employee is vacation pay, you cannot request reimbursement from the DBL carrier.
Under NY Workers’ Compensation Law, vacation and severance pay are not considered remuneration! Therefore, your employees may receive DBL benefits simultaneously with vacation or severance pay!
A note on DBL with in-hospital benefits:
Even if you continue your disabled employee’s wages, your employee is still eligible to receive the in-hospital portion of the benefits! (see our DBL product page for details about enhanced benefits). The in-hospital portion is also not taxable whether you have a contributory or noncontributory policy.
Yes. And as such, payments must be reported to employers by third-party payers (such as insurance companies). Therefore, we provide you with quarterly and annual Third-Party Sick-Pay Reports. Please Note: Payments are subject to FICA (Social Security and Medicare) withholding (under Public Law 97-123). Only the portion of the DBL benefit attributable to the employee's contribution (up to 60 cents a week) is exempt from withholding.
§220(2): The Board has the right to impose a penalty based on the amount of the employer’s payroll during the time the employer does not have required DBL coverage (0.5% of payroll during that period). An additinoal fine for each period of noncompliance may also be imposed.
§220(1): If you do not have the reqruied DBL coverage, you may be subject to a monetary fine and/or imprisonment for up to 1 year. Subsequent violations may result in increased fines.
Obtaining Government-issued permits, licenses and contracts in New York :
If you are an out-of-state businesses requesting a permit/license or if you are seeking to enter into contracts In New York State, you must provide a DB-120.1 (Certificate of Insurance) to the government entity you are dealing with in.
FAQs from Employees/Claimants