In Wisconsin, workers’ compensation insurance laws require most employers with three or more employees to carry coverage. That seems simple enough, but laws add other situations where business owners must cover employees, making workers’ comp insurance nearly universal in the state. The cost is anywhere between 19 cents and $20 per $100 of payroll annually, depending on job descriptions.
Protecting your employees with good workers’ compensation insurance protects your business. Work with the experts at The Hartford to get a free, no-obligation quote that walks you through exactly what coverage you need.
What Are Wisconsin Workers’ Compensation Insurance Requirements?
Both private and public employers need to have a workers’ compensation policy in place the moment they have three or more full-time or part-time employees, according to Wisconsin’s Department of Workforce Development (DWD). Additionally, business owners need to get workers’ comp if they:
- Employ at least one full-time or part-time worker who earned a combined $500 in wages in one calendar quarter; insurance must be in place by the 10th day of the first month of the next quarter
- Employ at least six workers on a farm on the same day for 20 or more days during the calendar year; insurance must be in place by the 10th day after the 20th day
Once a Wisconsin employer is required to get workers’ comp, they must maintain coverage. Even if the employer lays off everyone but a single part-time employee, a Wisconsin employer must carry workers’ comp insurance for the remainder of the calendar year and the following calendar year. When the employer is ready to hire again, they must have a policy in place the moment they hire a single employee.
Sole proprietors and partnerships with no employees, as well as limited liability companies (LLC) with only members, do not have to carry workers’ comp in Wisconsin. That said, some business owners decide they need workers’ compensation even when it’s not required.
Who Is Considered an Employee in Wisconsin?
The Wisconsin Workers’ Compensation Act defines an employee as anyone who is contracted to perform services for compensation. This includes:
- Part-time workers
- Family members
- Corporate officers
Wisconsin Workers’ Compensation Insurance Exemptions
Nearly every Wisconsin employer has to cover their employees. However, state law does allow for a few exceptions, including:
- Domestic servants, such as nannies, cooks, maintenance workers, and gardeners
- Farmer workers who do not meet the criteria listed above
- Volunteers, including those who receive money or things of value less than $10 per week
- Religious sect members
- Native American tribal enterprise employees
Additionally, federal employees, such as postal workers, members of the military, and people working on interstate railroads, get federal workers’ compensation insurance and are not eligible for state coverage.
Where Can I Buy Workers’ Compensation Insurance in Wisconsin?
Wisconsin has an open marketplace, which means most small business owners get their coverage from one of more than 300 private insurers licensed to sell workers’ compensation insurance in the state. This is also true for out-of-state employers with workers in Wisconsin. Our list of top workers’ compensation providers includes large national carriers, an online broker, and a regional insurer so that you can pick the one that can best cover your risk.
Top Wisconsin Workers’ Compensation Insurance Providers
Wisconsin business owners in any industry who want broad coverage
Outdoor and recreation businesses who want help developing employee safety plans
Business owners across all industries who want to compare offers from multiple carriers
Construction and auto repair companies that face hazards from tools, machines, and environment
New healthcare businesses, including doctors, dentists, physical therapists, and chiropractors
The Hartford is our top pick for Wisconsin workers’ compensation insurance because of its broad coverage. It offers a workers’ comp policy that automatically includes six unique coverages that usually cost more with other insurers, including coverage for volunteers and your costs when assisting The Hartford in a claim. Additionally, The Hartford adds value to its policies through partnerships that offer discounts on work shoes, ergonomic office furniture, and employee background checks.
Argent, the workers’ compensation division of regional carrier West Bend Mutual Insurance Company, is the right choice for outdoor entertainment and recreation companies. These businesses need a carrier that understands the unique dangers employees face in outdoor tourism, hunt clubs, and archery ranges. Argent has experience with these and other sports and leisure businesses and offers top-notch loss control services like on-site risk assessments and assistance in developing worker safety procedures.
CoverWallet is an online insurance broker dedicated to small businesses. As a broker, CoverWallet can partner with numerous workers’ compensation insurance providers to get you quotes to compare. The online application is easy to complete and often returns multiple offers. If you’re not sure of your best move, you can chat with an insurance professional who can walk you through your options.
Headquartered in Wisconsin, Acuity Insurance is a good workers’ comp option for businesses in construction and auto repair where heavy equipment, manual labor, and hazardous worksites put employees at risk. Business owners who choose Acuity have free access to its 24/7 hotline, Maximum Acuity Service for Healthcare (M.A.S.H.) so that injured employees can get immediate medical advice on nonemergency injuries. This service benefits employees and helps you save money by reducing claims costs.
Travelers is an ideal choice for medical offices and healthcare providers who are just starting out. The company offers workers’ comp coverage to a wide range of new ventures, including physicians, physical therapists, dentists, and chiropractors. Moreover, Travelers has nurse case managers in local clinics across the country to help injured employees return to work quickly. This service has reduced days out of work by 35%.
How Much Does Workers’ Compensation Insurance Cost in Wisconsin?
The most recent data available from the National Association of Social Insurance show Wisconsin business owners pay an average of $1.63 per $100 of payroll each year for workers’ compensation. Your costs may be different because premiums are based on your payroll, the risks your employees face, and your claims history compared to similar businesses. The basic formula for determining your rate is:
Payroll / $100 x Classification Code Rate x Experience Modification Rating = Premium
In Wisconsin, your main operations generally determine your class code. If you own a landscaping business, then your class code is 0042 for landscaping services. Some employees’ duties may not involve landscaping, but they’re still classified under 0042 and cost $8.89 per $100 of payroll to insure. That base rate is then multiplied by an experience modification rating, a number created by your insurer that represents how safe it thinks your business is.
Because they are common across many businesses, sales professionals, clerical office workers, and drivers are the only positions that are classified by what they do no matter what industries they are in.
Wisconsin Workers’ Compensation Cost Example
Let’s say you own a small plumbing company in Madison that has three employees: an office clerk (class code: 8810) who makes $35,000 per year, an outside salesperson (class code: 8742) making $50,000 annually, and a plumber (class code: 5183) who makes $85,000 per year. Your total payroll is $100,000.
When you look up your employee’s class codes and rates, this is what you see:
8742 Sales Professional
5183 Plumbing Contractors
Using these numbers, you determine your starting rate like this:
Clerk (19 cents x $350)
Sales Rep (45 cents x $500)
Plumber ($3.97 x $850)
Base Workers’ Comp Premium
However, that total is just a starting rate. Your insurer may also factor in an experience modifier, also called an emod, to show how your business’s claims history compares to others in your industry. Businesses with multiple claims or severe losses may see their workers’ compensation premium go up.
Wisconsin Workers’ Comp Audit Requirements
Insurers typically audit workers’ comp policies at the end of the policy term. These premium audits are designed to make sure an employer pays the right amount of premium by reconciling the estimated payroll with the actual payroll. Depending on the results, you may get a refund for excess premiums or a bill if you came up short.
Premium audits start approximately two months prior to renewal. A small business owner can save a lot of extra work by gathering the necessary paperwork prior to the audit. Some information you might need includes:
- Payroll records or checkbook
- State and federal tax records
- Employee job descriptions
- Employee timesheets
- Payments to casual laborers and subcontractors
- Certificates of insurance from independent contractors and subcontractors
What Does Wisconsin Workers’ Compensation Insurance Cover?
In most states, workers’ compensation insurance pays medical bills and partial weekly wages for employees who suffer work-related illnesses and injuries. In Wisconsin, workers’ compensation benefits are broken down into three categories:
- Medical expenses: Pays all reasonable and necessary medical costs
- Indemnity payments: Covers a portion of injured workers’ wages for temporary and permanent disabilities as well as funeral expenses to surviving family members
- Vocational rehabilitation: Covers retraining programs for employees who are unable to return to their previous position; indemnity payments continue during rehabilitation
Wisconsin workers’ comp benefits kick in after the employee’s fourth day of lost time. The first three days are only covered if a covered injury lasts more than seven days.
What Are the Penalties for Not Having Workers’ Comp in Wisconsin?
Wisconsin employers must have workers’ compensation insurance the moment they hire their third employee. If a business owner fails to buy coverage and their employee is injured, then the business owner is personally liable for the benefits the employee would have received. The DWD can also force an uninsured employer to stop operations until he gets coverage.
Employers also can be charged a penalty of double the amount of premium owed during the uninsured period or $750, whichever is greater. That penalty may be reduced to $100 per day if:
- The lapse in coverage was seven days or less
- The employer has not previously been penalized for noncompliance
- No employee injuries occurred while the employer was uninsured
Safety Violations Impact on Wisconsin Workers’ Compensation Penalties
Safety violations can increase or decrease an injured workers’ benefits in Wisconsin. If an employer violates safety standards, the state can increase the employee’s benefits by 15% or more. On the flip side, the employee’s benefits may be reduced by 15% if she is in violation.
Wisconsin refers to this as “The Safe Place Statute,” to ensure that both employers and employees share responsibility for workplace safety. The goal is to reduce accidents and overall workers’ compensation costs by encouraging everyone to follow proper safety standards.
What Is the Uninsured Employers’ Fund?
The Uninsured Employers Fund (UEF) pays workers’ compensation benefits to Wisconsin employees if they’re injured on the job, and their employers do not have coverage. It’s funded by the fines the state charges illegally uninsured employers while also pursuing reimbursement for the claims it pays for these employers.
Employees can file a claim with the UEF by:
- Completing a UEF claim application
- Providing required documentation, such as paychecks, check stubs, and tax returns
- Documenting medical treatments, rehabilitation services, and other relevant expenses
How to File a Wisconsin Workers’ Compensation Insurance Claim
Employees, employers, and insurance carriers all have responsibilities in Wisconsin’s workers’ comp claims process. For instance, employees should:
- Notify their employers of the incident: Either written or verbal notice must be given even if the injury appears minor; employees have two years to report their injuries but are encouraged to report them immediately.
- Seek medical attention: This may include first aid, but it might also mean going to urgent care or making an appointment with a primary care physician.
- Maintain all related records: Wisconsin workers’ comp insurance claims can remain open for six years; the DWD recommends hanging on to medical and payment records for 12 years.
The employer is responsible for alerting the insurance carrier that someone on his staff suffered an occupational injury or illness. From there, the insurance carrier reports the incident to the DWD and pays the employee’s benefits. Injured employees need to wait three days before workers’ comp benefits kick in, but they should receive their first check within 14 days of the incident.
Employers can’t fire employees who have filed workers’ compensation claims but do not need to keep the same position open for an indefinite period of time. If an injured employee can return, the employer must offer him his old job. Employers also need to offer an injured worker a position he is capable of performing or offer retraining.
Wisconsin Workers’ Compensation Deadlines
Below are some key workers’ comp deadlines in Wisconsin organized by the individual responsible:
- Workers must file claims no later than two years after the injury date or six years if the employer knows about it; the statute of limitations for filing a claim on occupational disease and some traumatic injuries never runs out
- Employers must report claims to their carriers within seven days from the knowledge of the injury; if there’s a fatality, they must report it to the DWD’s Workers’ Compensation Division and their carrier within 24 hours
- Insurance carriers have 14 days to report compensable injuries to the Workers’ Compensation Division
- Workers can apply for a hearing with the administrative law judge (ALJ) up to six years after the date of injury or last compensation payment
- Workers or employers can file an appeal with the Labor Industry Review Commission (LIRC) within 21 days of the ALJ’s decisions
- Workers or employers have 30 days after the LIRC’s decision to start an action with their county’s circuit court
- Workers or employers can file an appeal with the Court of Appeals within 45 or 90 days depending on when they’re notified of the circuit court’s decision
- Workers or employers have 30 days after the Court of Appeals decision to petition the State Supreme Court for review
Wisconsin Workers’ Comp Resources
- Contact information:
Wisconsin Department of Workforce Development
- Workers’ Compensation Division
P.O. Box 7901
Madison WI 53707-7901
- Workers’ Compensation Division
- Key forms:
Wisconsin workers’ compensation insurance makes sure that employees are protected if they’re injured on the job. Plus, the state increases benefits to injured employees if you violate safety standards. Together these make working with a knowledgeable agent key to protecting your employees and your business.