Brett Stiegel, Administrator, FRSA Self Insurers Fund, Inc.
If you obtain employees from an Employee Leasing Company (PEO) for your business, or if you subcontract to other contractors in a PEO arrangement, you need to know that there are very possible implications of non-covered workers' compensation employment exposures. Typical examples may be employees that have not been reported to the PEO (either intentionally or accidentally), casual labor, uninsured subcontractors, or undocumented workers not properly processed on payroll. The PEO will not cover any of these employment
exposures. If you obtain employees from a PEO, to protect your business you should request a direct "named Insured" minimum premium policy be issued to your business from the PEO's insurance carrier or another insurance provider. This will mean that your PEO employees are covered by the PEO, and your business will also be covered for any other employment exposures that may come up. The cost should be minimal, but the
coverage provided invaluable!
Just as important, when you are using a subcontractor who obtains their employees from a PEO, a certificate of insurance from the PEO will not be enough to properly protect your business. That certificate of insurance means the PEO has workers' compensation coverage, but not the subcontractor. You should request a separate certificate of insurance showing that your subcontractor(s) also have coverage by an insurance provider as a direct "named Insured:' This will also help you and your subcontractors to be in full compliance with Florida's Workers' Compensation law. These potential employment exposures are serious and could be extremely financially harmful to your business. Talk to your Insurance Agent to assist in properly protecting you. You'll be glad you did!
Brett Stiegel is the Administrator of FRSA's Self Insurers Fund, covering Florida roofing, sheet metal and air conditioning contractors through workers' compensation and safety programs.
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