What to do if you get a NY State Worker’s Comp Board Penalty Letter
Mar 11, 2021
What to do if you get a NY State Worker’s Comp Board Penalty Letter

The NY Worker’s Comp Board is a state agency in charge of making sure that employees who are injured at work receive treatment and wage replacement benefits. They also ensure that unscrupulous employers don’t shift their liabilities to the Uninsured Employer’s Fund by auditing payroll and income tax filings for compliance with the statutory worker’s compensation laws. Their ultimate goal is to identify uninsured employers and get them in compliance and they take their duty seriously so beware if you end up in their cross hairs. It usually takes more than you think to make it go away.


How will you be notified?

The Worker’s Comp Board will notify an employer of their inquiry with a letter; it is imperative that you do not ignore this inquiry or there can be severe monetary consequences. You typically have 30 days to provide the evidence of coverage or evidence that no coverage was required. If the notice is not responded to the Worker’s Comp Board will automatically generate a penalty notice for the period of time in question. The entity is presumed uninsured, and the penalties are assessed at a rate of $2,000 for each 10-day period that insurance has been unverified which will continue to accumulate over the time of your dispute. You will receive a statement asking that you remit payment within 30 days to avoid collections and the account will be sent to a collections agency after that time period pursuant to NY State Tax Law.
It is the employer’s responsibility to prove that you either had the required insurance or were not required to provide it. Disputes of any items on the statement should be submitted through the appeal/review process indicated on the original invoice, penalty notice or board decision. Your very first step in addressing this penalty is to gather all of your documents. If you have insurance start with you C-105 Certificate of Employer’s liability insurance or the policy declarations page. It’s possible that coverage was replaced with a new carrier and hasn’t yet been updated in the tracking system. In New York State, the policy information is tracked by the Worker’s Comp Board and can be viewed publicly here.  New York is very astute in tracking compliance so you’ll be lucky if this is all it will take.


How to prepare.

The Worker’s Comp Board expects legally documented proof to reverse the penalty. A vague letter from an employer, or an accountant, that coverage was not required during the period in question will not suffice. Payroll and tax records are your best source of information when it comes to your business.
Gather your NYS-45 and IRS 941 payroll tax forms for all years in question. You may also want to gather your completed income tax returns, 1099-Misc forms and any other evidence you have of the true independence of your contractors. Communicate with the Worker’s Comp Board, respond to their letter with everything that they have asked for and make sure that you keep your eyes open for mailed correspondence from the board. They may ask for additional information or forms.


What to do if it’s too much to handle.

If the process seems too daunting, or you’re going in circles and getting nowhere, you might consider the advice of a lawyer. An experienced attorney may better understand what the Worker’s Comp Board is looking for and why. They may also ensure that the documents produced are the ones necessary to resolve the issue without creating new ones. Lastly, a lawyer may be able to help resolve the issue faster which can result in a much lower penalty and let you get back to business faster.


Penalty payment options.

If your business was in-fact not compliant with worker’s compensation coverage when required, act quickly to respond. Penalties accrue every ten days and will add up quickly over time. The penalties assessed can be paid on a payment plan. Set up a payment plan, and make sure that the payments are made consistently until the balance is paid in full. Failure to make good on this debt will affect your ability to obtain worker’s compensation coverage in future businesses, and they have a very long memory.


Services available to you that help.

Moving forward make sure that you work closely with your lawyer, accountant, payroll provider and insurance broker to ensure that you have an effective process when it comes to opening or closing a business, starting a new payroll, sub-contracting work or working with vendors.


Using an Administrative Service Organization, such as SimcoHR, can drastically reduce your chances of being caught off-guard with compliance issues of all kinds including all statutory duties.

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Risk Mitigation Tips for Company Holiday Parties

31 Oct, 2024
The holiday season is a time for celebration, but it can also bring potential risks for employers. To ensure a safe and enjoyable experience for all employees, consider the following strategies to mitigate risks during your company’s holiday gathering. 1. Make Attendance Optional Clearly communicate that attendance at the holiday party is optional. It’s essential to create an environment where employees don’t feel pressured to attend, as this can lead to resentment or claims of discrimination. Ensure that managers understand the importance of not implying that attendance is linked to performance evaluations. 2. Keep It Non-Work Related To maintain the festive spirit, avoid any work-related activities, such as presentations or updates. Hosting the event off-site and outside of regular business hours can reinforce the idea that this gathering is a time for relaxation and fun. Allowing employees to bring a guest can also enhance the social atmosphere. 3. Set Clear Expectations Prior to the event, establish guidelines around respectful behavior and responsible drinking. Remind employees that company policies, including those regarding harassment and conduct, remain in effect during the festivities. 4. Monitor Alcohol Service Plan to manage alcohol service carefully. Ensure that no minors or visibly intoxicated individuals are served alcohol. Consider hiring professional servers or holding the event at a venue with trained staff who can refuse service to those who have had enough to drink. 5. Opt for a Cash Bar Hosting a cash bar can reduce liability, as it signals that the company is not providing alcohol directly. This approach may also limit consumption, as employees will be more mindful of their spending. 6. Limit Alcohol Intake Distributing a set number of drink tickets can help control the amount of alcohol each attendee consumes. While this tactic has limitations, it can be beneficial in promoting responsible drinking. 7. Choose Appropriate Entertainment Select entertainment and venues that foster a respectful and inclusive atmosphere. Avoid any activities that could be seen as provocative or offensive, as these settings can lead to uncomfortable situations, especially when combined with alcohol. 8. Plan for Safe Transportation Make arrangements for employees to get home safely after the event. Options may include providing ride-sharing services, public transportation vouchers, or organizing group transportation. Encouraging attendees to designate a sober driver at the beginning of the party can also be an effective strategy. 9. Offer Food and Non-Alcoholic Beverages Provide a variety of food and non-alcoholic drinks. This consideration not only helps ensure the safety of employees but also demonstrates that the company values all attendees, including those who may not wish to consume alcohol. 10. Act Responsively If an employee is visibly intoxicated and needs assistance getting home, don’t hesitate to arrange transportation. It’s crucial to prioritize employee safety over any reluctance to intervene, as taking swift action can prevent serious consequences. Conclusion By implementing these strategies, employers can create a holiday party that fosters enjoyment while prioritizing safety and respect. With thoughtful planning and proactive measures, your company’s celebration can be a memorable and positive experience for all employees. Happy holidays from Simco!

New DOL Overtime Rule Effective January 1, 2025: What Employers Need to Know

31 Oct, 2024
In April 2024, we shared the U.S. Department of Labor’s (DOL) announcement of a new overtime rule under the Fair Labor Standards Act (FLSA), setting higher salary thresholds for white-collar exemptions, which first took effect on July 1, 2024. Now, as the second increase approaches, employers should prepare for the final phase of the rule, effective January 1, 2025, when salary levels will again rise for executive, administrative, and professional employees, as well as highly compensated employees. What Are the New Salary Thresholds? Starting January 1, 2025, employers will need to ensure that salaries meet the new DOL requirements to maintain overtime exemptions: Executive, Administrative, and Professional (EAP) Employees: To qualify for the overtime exemption, EAP employees must now earn a minimum salary of $58,656 per year (or $1,128 per week). Highly Compensated Employees (HCE): HCEs must earn at least $151,164 annually to maintain their exempt status under the new guidelines. These changes aim to ensure fair compensation and proper classification for employees, helping prevent wage and hour violations. Action Steps for Employers While there may be challenges ahead, employers must take proactive steps to get ready for the rule’s implementation as scheduled. Here are some recommended actions: Evaluate Your Workforce and Classifications: Review exempt roles, including job responsibilities and salary levels, to determine how upcoming changes will affect your organization and identify any necessary adjustments. Seek Legal Guidance: Collaborate with your legal team to understand the new rule's implications and ensure compliance with state laws. Prepare for Changes: Develop strategies for potential reclassifications, including necessary training and clear communication plans to inform affected employees about changes to their status and compensation. Final Thoughts As you prepare for the upcoming changes in the DOL's overtime rule, take this opportunity to review and optimize your compensation practices. Ensuring that employee classifications and salaries align with the new thresholds will help safeguard your organization against compliance issues and promote a fair work environment for all employees. If you need assistance or have questions, contact Simco !

Your Medicare Plan Is Discontinued: What’s Next?

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