Properly complying with Florida’s workers’ compensation regulations is crucial for construction contractors aiming to protect their workforce and avoid costly construction litigation. Understanding these requirements not only protects your employees but also shields your business from potential legal and financial repercussions.
What Coverages Are Required in Florida?
In Florida, any employer engaged in the construction industry and employing one or more individuals must secure workers’ compensation insurance. This mandate extends to corporate officers, limited liability company (LLC) members, sole proprietors, partners, and independent contractors, all of whom are considered employees under the state’s workers’ compensation law. However, corporate officers or LLC members may apply for an exemption if they own at least 10% of the company.
Contractors must ensure that all subcontractors possess the necessary workers’ compensation coverage before commencing any project. If a subcontractor lacks this coverage, the responsibility for any work-related injuries falls on the primary contractor. Therefore, obtaining proof of insurance or valid exemptions from subcontractors is essential to mitigate potential liabilities.
What Are the Potential Penalties for Non-Compliance?
Failure to comply with Florida’s workers’ compensation requirements can lead to severe penalties. This includes Stop-Work Orders (SWOs) and expensive fines.
The Division of Workers’ Compensation can issue an SWO to any employer without the required coverage, compelling the cessation of all business operations. Such orders may also be issued if an employer understates payroll, conceals employee duties, or fails to produce requested business records within ten business days.
Employers without proper coverage may also face fines amounting to twice the insurance premiums that should have been paid over the past two years or a minimum of $1,000, whichever is greater. Additionally, a $5,000 fee is imposed for each worker misclassified as an independent contractor.
Operating without the mandated insurance can result in criminal charges, including potential jail time, depending on the severity of the violation and the state’s enforcement policies.
Are There Special Requirements for Out-of-State Contractors Working in Florida?
Out-of-state contractors aiming to work in Florida must adhere to specific guidelines to ensure compliance, as well. It’s important to make sure you understand the legal requirements in the state you’re working in. Those requirements in Florida include:
- Notice Requirements: Contractors should promptly inform their insurance provider or agent about their intent to undertake projects in Florida.
- Insurance Coverage: Such contractors must either obtain a Florida workers’ compensation policy or add an endorsement to their existing policy that explicitly includes Florida in Section 3.A. of the policy.
- Extraterritorial Reciprocity: Some states have reciprocity agreements with Florida, allowing contractors to operate temporarily under their home state’s workers’ compensation policy. However, this is limited to work not exceeding 10 consecutive days or 25 days within a calendar year.
Stay in Compliance and Keep Your Florida Construction Project Moving ForwardEnsuring adherence to Florida’s workers’ compensation laws is vital for the seamless progression of your construction projects. At Florida Construction Law Group, we’re committed to helping construction crews and contractors handle legal compliance matters to keep jobs on task and on time. Contact Florida Construction Law Group to make sure your compliance needs are met.