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Insurance

Businesses in New York State that are corporations or have employees are required to carry Worker's Compensation and disability insurance. Worker's Compensation and disability insurance coverage for sole proprietorships and partnerships without employees is optional. In addition, corporations and businesses with employees are subject to Federal and State Unemployment Insurance regulations. Although not mandatory, other types of insurance commonly carried by businesses are property insurance and liability insurance.

Disability Benefits Law
Workers Compensation, paid by the employer, insures that employees are covered in case of serious sickness or injury in non-employment related accidents or illnesses. This coverage is not mandatory for sole proprietorships or partnerships that do not have employees. Employers may choose to offer additional insurance. For further information visit the Disability Benefits Law.

Worker's Compensation Law
This type of insurance insures employers against liability from personal injuries or death of employees during the course of employment. This insurance is paid by the employer and is required by the Workers Compensation Law. This is optional coverage for sole proprietorships and partnerships with no employees.

Employers may obtain coverage through private insurance companies or the State Insurance Fund. Information for employers pertaining to select laws, rules, regulations, compliance, and premium information is available at the NYS Workers' Compensation Board.

Property Insurance
Property insurance policies cover business losses to their own property. Areas of coverage include buildings, equipment and building contents. Voluntary coverage may be obtained through private insurers.

Liability Insurance
Liability insurance is voluntary and offers protection from economic losses, due to damage of another's property, unintentional injury or death.

Unemployment Insurance:

Federal Unemployment (FUTA) Tax
The Federal Unemployment Tax Act (FUTA) is part of the federal and state program that pays unemployment compensation to workers who lose their jobs. You as an employer report and pay FUTA tax separately from social security and Medicare taxes and withheld income tax. You pay FUTA tax only from your own funds. Employees do not pay this tax or have it withheld from their pay.

For more information and to obtain necessary forms, link to the Internal Revenue Service website.

Liability for Unemployment Insurance Under NYS Law
Different employer types have different liability for contributions under the Unemployment Insurance Law. In addition, the rules regarding termination of liability are different for each employer type. Once an employer is determined liable, a NYS-45, Quarterly Combined Withholding, Wage Reporting and Unemployment Insurance Return is required to be filed with the appropriate taxes due. A quarterly return must be filed even if no wages were paid in a quarter or no tax is due for either New York State Department of Labor or New York State Department of Taxation and Finance, or both. For additional information regarding state unemployment insurance contact the New York State Department of Labor.

Employee Status Under Common Law
Generally, a worker who performs services for you is your employee if you can control what will be done and how it will be done. Unless specifically excluded by law, all employment performed for a liable employer by employees is covered whether it is on a part-time, full-time, temporary, seasonal, or casual basis. Employees may perform services on or off the employer's premises or in their own homes. Home workers are considered employees under the State Labor Laws. Obtain Publication 15-A, Employer's Supplemental Tax Guide, for more information determining whether an individual providing service is an independent contractor or an employee. Generally, people in business for themselves are not your employees if they perform work under contract to you (i.e. accountants, consultants, tradesman, etc.)

To learn more on Unemployment Insurance link to the website: Protecting NY's Workforce.

Miscellaneous Coverage
Other insurance coverage available to businesses include individual and group medical insurance, life insurance, business interruption, and Contract Surety Bonds (these bonds are usually required by contractors on federal, state, or local government jobs).

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