Rental Property Owners today face many risks and exposures and they are not aware of what they are covered for. Many are not covered for what they should be and that accounts for millions of dollars in uninsured claims each and every year. This is why it’s so important for rental owners to have a broker that specializes in their industry and understands your unique needs. Someone who has experience with all the exposures and necessary coverage to be able to advise you thoroughly. Here are three important topics that we have helped some of our clients deal with in the past few months that could be devastating to any rental owner should they go overlooked.
1 – The Risks of Hiring Illegal Immigrants
No matter your personal views on illegal immigration, when it comes to employment, hiring illegal immigrants can greatly increase your liability if they are injured on the job.
A big question in workers’ compensation (WC), and still the subject of continuing debate, is whether illegal immigrants are, or should be, covered. Since each state’s system operates independently, laws can vary. To avoid liability issues, it is important for you to verify that every employee you hire is legally able to work in the United States.
Many employers mistakenly believe that having illegal immigrants disqualified from their WC plan will save them money in both premiums and claims dollars. In reality, WC stops injured employees from being able to take legal action against their employers for their injuries.
This means that if illegal immigrants are exempt from WC they could file a tort liability suit against their employer for pain and suffering in addition to lost wages and medical costs. Because WC benefits are normally limited or scheduled in some way, a tort liability suit could be significantly more costly for you as the employer.
Whether your state’s WC laws include illegal immigrants or not can vary on a case-by-case basis. As concern over the issue grows, more focus has been put on the employers and how they contribute to the employment of illegal immigrants.
In 1986, Congress enacted the Immigration Reform and Control Act (IRCA). Its primary goal is not to penalize the illegal immigrants themselves by denying them WC coverage, but to stop the opportunity for such employment by penalizing the employers who knowingly hire them.
The IRCA puts a bulk of the responsibility to verify an employee’s legal ability to work in the United States on the employer. Those that fail to perform a proper check or who knowingly hire an illegal immigrant could face fines, loss of business license, criminal penalties and loss of WC coverage. In some cases, this loss of coverage could allow an injured employee to then sue for damages that would far exceed normal WC payments.
Know Who You Hire
To avoid loss of coverage and potential legal action, it is important that you establish a system to verify the legal status of potential employees. This includes the following:
- Ensuring that each new employee fills out an I-9 form, required by the federal government for legal employment
- Contacting your local Motor Vehicle Department to validate driver’s license or state ID numbers
- Opening a free online account with the Social Security Administration to validate numbers provided to you by job applicants
2 – Reporting Workers Compensation Claims:
Workers’ compensation laws are often misunderstood because they can vary significantly between states. If your employee reports an injury and you are unsure of what steps to take, you are not alone. However, regardless of your company’s geographical location, the first two days after an employee gets injured on the job are always the most important.
It is important to act quickly and take action immediately for legal reasons, but also because studies show that the faster you initiate the workers’ compensation process after an injury, the lower the ultimate cost of your claims. Additionally, waiting more than 48 hours after an incident occurs gives the injured party and witness’s time to forget crucial details about what happened. It also means employees’ recollections may become skewed from opinions of outside parties, like an attorney, or from talking to one another.
You can help protect your company and save money by taking the following steps in the 48 hours after an employee reports an injury: Refer employee for medical attention
- If the injury is an emergency, seek immediate care for the employee. All state workers’ compensation laws allow the employee to see any doctor in an urgent situation. If the circumstance is not an emergency, refer the employee to a medical provider within your company’s network.
- Never prevent an employee from getting medical attention, even if you feel the injury is not serious.
Perform an assessment or accident investigation
- Visit the place where the injury occurred and make notes of the surrounding environment. Speak with employees who witnessed the event or who work in close proximity to where the incident occurred.
- Be thorough, and also be sure to gather consistent information for all incidents. It is important to begin this investigation within the first 48 hours so that details of the accident or injury are fresh in the minds of employees.
Immediately ensure the injury or accident will not happen again
- After investigating the site, take the necessary steps to make certain the incident will not occur again. For example, block off the area in question if there looks to be a spill or other unsafe situation.
Report the injury
- According to the department of labor, several reports must be generated when an injury occurs in the workplace. Complete a First Report of Injury or Occupational Disease form as required by your state workers’ compensation law. The incident should also be reported to the HR department, the employee’s direct supervisor and the medical provider who saw or treated the employee.
- Report the incident objectively—do not skew information gathered from the scene or from witnesses in any way, even if your preliminary instincts tell you the claim is not legitimate.
Inform employee about company policies on returning to work
- Not only is it crucial to review work restrictions and leave procedures, but it is also imperative that you inform the employee about the possibility of transitional-duty jobs that would suit their needs during the injury recovery period.
Submit the workers’ compensation claim
- This is also an important step to complete quickly because your insurance provider could give you valuable information about medical care, make timely payments and begin his own investigation into the incident as necessary.
In addition to these points, make sure you become familiar with the workers’ compensation laws in your state(s) of operation. Your state’s workers’ compensation board will help you stay in compliance with the legal timelines in effect in your state, which will ultimately help save your company money.
3 – When an Employee Refuses Workers’ Compensation Treatment
Based on the geographic location of your business, many state workers’ compensation statutes limit and mandate certain employer actions when a worker is injured. Depending on the state, there are specific timelines to follow and forms to complete. But what about when a worker is injured and refuses to accept treatment or file a claim? What are your responsibilities? While the exact legal answer depends on your situation and state laws, consider the following to limit your liability.
When You Notice
If you notice that an employee has been injured, even if the employee has not mentioned it, gently bring it up and discuss the circumstances of the injury with the employee to determine whether the injury is job-related. Many state workers’ compensation statutes obligate employers to report injuries as soon as they have knowledge of them.
Delay in reporting the injury could result in much more costly claims. Completing the paperwork to report injuries is not an admission of your liability—on the contrary, it could protect you.
In the Case of Refusal When you do discuss the injury with the employee, explain that reporting job-related injuries entitles injured workers to certain benefits while recovering from the injury. If the employee does not wish to file a claim for the injury, file the employer’s portion of the report with a statement of refusal to pursue a claim signed by the employee. It is crucial that you document this conversation to protect your organization from being penalized in the future.
Employees that do initially report injuries but then refuse treatment under the physician or facility that your organization furnishes should sign a similar form confirming this refusal.
Benefits for Employees that Refuse Treatment
State workers’ comp statutes vary, but in most cases, workers’ compensation benefits are suspended for employees that refuse to comply with any reasonable request for examination or refuse to accept medical service or physical rehabilitation which the employer elects to furnish. Benefits may not be payable for this period of refusal of treatment—check with your workers’ comp carrier.
What to Do Now
It is important that you prepare for an eventual employee refusal to submit a claim or refusal to accept treatment for a workplace injury. All employers should have a legal representative draft a form for refusal of treatment that complies with state requirements so it is immediately available when needed. Discuss with supervisors the importance of documenting and reporting all injuries, whether or not the worker chooses to report them.
Workers’ compensation insurance is obligatory in most states. Contact the exclusive endorsed broker for the Apartment Owners Association of California,
GS Insurance Solutions for more information. GS Insurance Solutions, Inc. is a full service insurance brokerage specializing in the real estate & apartment industry. We have access to insurance programs that will allow you to take advantage of additional premium credits for being an AOA Member.