SALT LAKE CITY, June 29, 2011 - The Industrial Accidents Division of the Utah Labor Commission will assume responsibility for issuing workers' compensation coverage waivers on July 1st, 2011.
Under Utah workers' compensation law, any business employing one or more employees must have workers' compensation insurance. "Although Utah law requires employers to provide workers' compensation coverage, the Utah Legislature has authorized partnerships, sole proprietors and corporations with no employees to apply for workers'compensation coverage waivers. Then, when one of these businesses contracts out its services to another company, the business can use the waiver to show that it has complied with state law and is exempt from maintaining workers' compensation insurance," according to Ronald Dressler, Director for the Division of Industrial Accidents Division.
Previously, coverage waivers were issued by insurance companies. In 2010, companies issued 3,800 waivers. The Industrial Accidents Division anticipates issuing 4,000 or more waivers during the coming year.
While coverage waivers fulfill a legitimate role in the workers' compensation system, the Labor Commission has observed a disturbing trend by some employers to mis-label employees as "independent contractors" or "members" of limited liability companies, in order to avoid workers' compensation obligations and other employer responsibilities. This trend is particularly noticeable in the construction industry, and for non-English speaking employees. The Industrial Accidents Division intends to use technology and careful monitoring of the waiver application process to help prevent and detect employee misclassification. "We have implemented a new on-line application system, as well as a verification page allowing anyone to verify the status of a waiver and print information for their records. This is an important tool for companies hiring independent contractors and needing to verify compliance with workers' compensation laws" states Dressler.
For additional information regarding waivers including who may be eligible, or to verify the status of a waiver, please visit our webpage
Questions or comments can be directed to Brad Thurman, manager of the waiver program, at (801) 530-6268 or WCCW@Utah.gov