Wisconsin workers' compensation insurance guide for employers

Which employers in Wisconsin must carry workers’ compensation?

Wisconsin employers must have workers’ compensation insurance if they meet any of the following criteria, according to Wisconsin’s Department of Workforce Development and Worker’s Compensation Division.

• If an employer has three (3) or more full-time or part-time employees on staff then workers’ comp is required. Immediately upon employing the third person, you are required to have a workers’ comp policy.
• If you employ one (1) or more full-time or part-time employees to whom you have paid combined gross wages of $500 or more in any calendar quarter for work done at one or more locations in Wisconsin, you must have insurance by the 10th day of the first month of the next calendar quarter.
• If you are a farmer or in the agricultural business and employ six (6) or more workers on the same day for any 20 days during the calendar year, you must have insurance by the 10th day after the 20th day of employment.
• It should be noted that if you are an out-of-state employer with employees performing job duties in Wisconsin, you must have a workers’ compensation policy. The policy must be with an insurance company licensed to write in Wisconsin and endorsed to name Wisconsin as a covered state in Section 3a of your policy.

Understanding the exceptions

In Wisconsin, there are some possible exceptions to the workers’ comp rules. Per an employer brochure available from the state, these can include domestic workers, volunteers, some farm workers, employees of Native American tribal enterprises, most real estate brokers, agents, and salespersons, and some federal workers.

Next, let’s better understand the type of coverage a policy generally includes.

What does workers’ comp generally cover in Wisconsin?

Similar to other states, coverage typically includes some partial coverage of medical costs or income replacement. Per the department of Labor, here are some examples of what a policy may provide an employee who needs time away from work after an incident.

• If an employee experiences an injury or occupational illness while on the job, workers’ compensation insurance generally covers reasonable and necessary medical costs for treatment.
• There can be benefits available for temporary wage loss (Temporary Partial Disability (TPD) or Temporary Total Disability (TTD) sustained by an employee while recovering from an injury. Determining eligibility for temporary disability benefits requires documentation from a doctor. Benefits for temporary wage loss due to disability are based on two-thirds of the employee’s wage rate up to a specified maximum amount.
• Benefits for permanent disability (Permanent Partial Disability (PPD) or Permanent Total Disability (PTD), if the employee does not fully recover from the injury. Permanent disability is awarded for the potential or actual loss of earning capacity. The amount of benefit payment for permanent disability depends on the seriousness of the permanent disability.
• Vocational rehabilitation. Should an employee need time for training or learn a possible new job skill, a policy typically covers some of the costs.
• If a death occurs to an injured employee, death benefits and burial expenses  will be paid up to specified limits.

How does a Wisconsin employer purchase a workers’ compensation policy?

In most cases, a company can research and compare quotes from private insurance carriers. There are about 300 companies that offer workers’ compensation insurance for employers in Wisconsin. Employers need to keep in mind, however, that the state of Wisconsin does not sell or provide coverage.

That said, if securing a plan on the open market proves problematic, the state suggests that you ask your agent to send an application to the Wisconsin Compensation Rating Bureau. The Bureau acts as administrator and trustee of the Wisconsin Worker’s Compensation Pool.

What can happen if a company has no coverage?

Employers who fail to obtain workers compensation insurance as required in Wisconsin face a a variety of ramifications.

• Failure to carry the proper workers’ compensation insurance can result in a penalty equal to twice the insurance premiums the business should have been paying or $750, whichever is greater.
• A business can also be closed by the state until workers compensation insurance coverage is secured.
• Employers are also personally liable for costs related to injuries that occur while a  business was uninsured.
• Companies whose coverage lapsed for seven days or less may be subject to a penalty of $100 per day for each uninsured day.

Employers should also know that deducting wages from employees’ paychecks to help cover the cost of workers’ compensation premiums is illegal.

What needs to happen if an incident occurs in the workplace?

Employees who are injured in the workplace are required to tell a supervisor immediately, even if the injury does not appear serious. In addition, employees must seek medical attention for the injury. In the case of minor injuries, that may just mean getting first-aid treatment. In more serious cases, visiting a doctor or the emergency room may be warranted. Employees must also save relevant medical and payment records related to their treatment.

It’s also important to note that employees are required to notify you as the employer without delay of any injury. A workers’ comp claim must be filed no later than two years after the injury or within 12 years, if the employer knew about the injury (or should have known). No statute of limitations applies to occupational diseases and some traumatic injuries.

More resources for Wisconsin employers

• Department of Workforce Development
• Frequently asked questions for Wisconsin employers
• Wisconsin Workers’ Compensation Act
• Employer resources
• Workers’ comp training manual
• Potential penalties for noncompliance