NFIB Asks for Greater Enforcement in Workers Comp Negotiations

Small business owners are asking for stiffer enforcement of workers comp laws.

The penalty for misclassifying an employee as an independent contractor just to avoid paying workers comp on them is one and a half times the annual premium.

National Federation of Independent Business state director Jim Brown says that’s not enough to keep some construction companies from ducking the law.

“We’re proposing to increase fines significantly. And hopefully some people will get caught and the news will spread and the department will have more resources to inspect some of these job sites.”

Right now the Department of Commerce and Insurance has just six site inspectors. Brown says general contractors who follow the law have been hurt by lax enforcement because those who don’t can underbid them on projects. However, Brown says the industry also needs to do a better job policing itself.

The NFIB is negotiating workers comp rules with state lawmakers after successfully delaying new requirements that proved to have unintended consequences. They require self-employed builders to carry workers comp on themselves. Many said the law would instantly drive them out of business.