In North Carolina, businesses must carry workers' compensation insurance once they regularly employ a certain number of people. Scope of Cover found that the general requirement is triggered by having three or more employees. For employers in activities involving radiation, the threshold is just one employee. Corporate officers are counted toward this total, but they can choose to exclude themselves from coverage benefits. Sole proprietors, partners, and LLC members are not automatically counted but can elect to be covered.
Key figures
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In general, all businesses employing three or more employees on a regular basis are covered by the Act.Open the source
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Employers of one or more employees who are employed in activities which involve the use or presence of radiation are required to have coverage.Open the source
#When is Workers' Comp Required in North Carolina?
The North Carolina Workers' Compensation Act generally applies to businesses that have three or more employees on a regular basis. The rules for coverage are established in this state law.
A stricter requirement applies to any employer with one or more employees engaged in activities that involve the use or presence of radiation. These businesses must secure workers' compensation coverage regardless of their total employee count.
| Business Activity | Employee Threshold |
|---|---|
| General Business | 3 or more employees |
| Activities involving radiation | 1 or more employees |
#Who Counts as an Employee?
To determine if a business meets the three-employee threshold, the state has specific rules for who is included in the count. Corporate officers are counted as employees for this purpose.
Other business principals are not automatically included. Sole proprietors, partners, and members of a limited liability company (LLC) are not counted as employees when calculating the total for mandatory coverage.
#Can Owners and Officers Opt In or Out?
Even though corporate officers are counted toward the employee threshold, they can choose to opt out of coverage. The law allows corporate officers to specifically exclude themselves from the benefits of a workers' compensation policy.
Conversely, business owners who are not automatically counted as employees have the option to obtain coverage. Sole proprietors, partners, and LLC members may elect to include themselves under their company's workers' compensation policy.
#What Are the Rules for Trucking and Owner-Operators?
North Carolina law contains specific provisions for the trucking industry. The state requires workers' compensation coverage for certain trucking owner-operators, even when they are classified as independent contractors.
However, there is an exception for some independent contractors in this sector. A motor carrier employer is not liable for on-the-job injuries to an independent contractor who is individually licensed by the U.S. Department of Transportation and personally operates their own vehicle.
#What Kind of Insurance Satisfies the Law?
Employers must obtain a true workers' compensation policy. Some other forms of insurance that cover injuries are not valid substitutes.
Occupational accident insurance is a separate form of insurance. It is not a lawful replacement for workers' compensation coverage under the North Carolina Workers' Compensation Act.
#Which Law Sets These Requirements?
The rules for workers' compensation in North Carolina are codified in state law. They are defined by the North Carolina Workers' Compensation Act.
This act is found in Chapter 97 of the North Carolina General Statutes. Specific exemptions from the act's provisions are laid out in N.C. Gen. Stat. §97-13.
Frequently asked questions
How many employees does a business need before North Carolina requires workers' compensation insurance?
A business in North Carolina that regularly employs three or more people must have workers' compensation insurance. The requirement is one or more employees for businesses involved in activities with radiation.
Are corporate officers counted toward the employee threshold in NC?
Yes, corporate officers are counted when determining if a corporation has three or more employees. However, they are permitted to specifically exclude themselves from coverage benefits under the policy.
Do sole proprietors or partners count as employees for workers' comp in North Carolina?
No, sole proprietors, partners, and members of limited liability companies are not automatically counted as employees. They can choose to include themselves for coverage by making an election on their workers' compensation policy.
Are there special workers' comp rules for trucking owner-operators in NC?
Yes. North Carolina law requires coverage for certain trucking owner-operators, even if they are independent contractors. An exception exists for independent contractors who are individually licensed by the U.S. Department of Transportation and operate their own vehicle.
Can I use occupational accident insurance instead of workers' compensation in North Carolina?
No. Under the North Carolina Workers' Compensation Act, occupational accident insurance is a separate insurance product and is not a lawful substitute for workers' compensation coverage.
Which statute governs workers' compensation in North Carolina?
The North Carolina Workers' Compensation Act sets the state's requirements. It is located in Chapter 97 of the North Carolina General Statutes.
Sources
- North Carolina Industrial Commission: Employer insurance requirementsNorth Carolina Industrial Commission · retrieved
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