New Jersey Workers Compensation Insurance

Sole proprietors , partners and LLC's are exempt from workers' compensation coverage. However, they may elect to obtain a workers' compensation insurance policy.

There are no distinct guidelines for sub-contractors/contractors regarding workers' compensation insurance.

Failure to provide proper coverage is considered a disorderly persons offense, and if proved to be done knowingly, a crime of the fourth degree. Penalties can be assessed up to $5,000 for the first 10 days with further assessments of $5,000 for each 10-day period of failure to insure. In regards to a corporation, liability can extend to the corporate officers as individuals. These penalties cannot be discharged through bankruptcy.

Where a work-related injury or death has occurred, the employer, including individual corporate officers, partners or members of an LLC, is directly liable for medical expenses, temporary disability, and permanent disability or dependency benefits. In addition to awards for medical expenses and other benefits, New Jersey law also provides for civil penalties against the employer and its officers where failure to insure is determined. Awards and penalties arising from these claims can become liens against the uninsured employer and its officers, which are generally enforceable in the New Jersey Superior Court against any assets belonging to the uninsured employer and its officers.