Workers' Compensation Division Overview in New Hampshire

ABOUT THE DEPARTMENT The Department of Labor helps employers and insurance carriers to operate successfully within New Hampshire s labor laws. We encourage a successful, fair, and safe workplace throughout the Granite State. The Department has two primary areas: - - Workers compensation division Wage and hour division 1

The workers compensation division administers the workers compensation platform for employers and employees operating within the State of New Hampshire. The division has several units within: Coverage unit: this unit receives and monitors reporting of coverage for employers. The unit will monitor compliance with the requirement to hold coverage and will engage with employers for compliance purposes. - Claims unit: this unit receives and monitors compliance with the requirements relative to benefits, primarily indemnity payments. The unit will receive Memos of Payment from carriers, along with wage information, and reviews to ensure that the injured worker is being paid properly. - WORKERS COMPENSATION DIVISION First report of injury unit: this unit monitors compliance with reporting requirements for injuries. As you all may be aware, a report must be made to the Department within 5 days of notice of an injury. - Compensation Appeals Board: this is the appellate board of the Department for workers compensation matters. - Pro Se Dispute Resolution Coordinator: this is a single employee position that is established by statute. This individual assists unrepresented injured employees in understanding, asserting, and protecting their rights. Notably, this individual does not represent claimants, nor can she provide legal advice. - 2

As noted, the coverage unit receives and monitors reporting of coverage for employers. Under RSA 281-A:5 employers are required to obtain coverage during any period of time they are operating in the State of New Hampshire with employees. Failure to do so may subject the employer to civil penalties up to $2,500 plus up to $100 per employee per day. WORKERS Where an employer does not have any employees, there is no requirement to maintain coverage. However, RSA 281-A:18-a allows an entity to elect to exclude up to 3 executive officers or members from the compulsive coverage requirements The exclusion must be filed with the Department in order to be in force. Carriers file these exclusions. This is notable as employers can exclude owners, however it is limited. If there are 4 individuals as owners, coverage will be required. COMPENSATION COVERAGE 3

RSA 281-A:53 requires employers to record in sufficient detail and report or cause to be reported to the commissioner any injury sustained by an employee in the course of employment as soon as possible, but no later than 5 days after the employer learns of the occurrence of such an injury. Failure to do so timely may subject the business to civil penalties up to $2,500 per instance. Employers can report directly to the Department themselves. However, in most cases, employers provide information to their carrier to report on their behalf. CLAIM REPORTING Department rules also require that the injury be reported to the carrier. Once a carrier receives notice of a potential claim, it has 21 days to review to decide it will be accepted or denied. If denied, the carrier must provide the claimant with a written narrative outlining the reasons for denial and rights relative to requesting a hearing to contest the denial. 4

What is indemnity? In short, it is weekly cash payments. Generally, these are due when a claimant is earning less than their average weekly wage due to a work-related injury. Payments can be based on a full disability or partial. INDEMNITY Provided coverage is properly in place, this will be handled by the carrier. However, note that employers have responsibilities here. 5

RSA 281-A:23, I: An employer subject to this chapter, or the employer's insurance carrier, shall furnish or cause to be furnished to an injured employee reasonable medical, surgical, and hospital services, remedial care, nursing, medicines, and mechanical and surgical aids for such period as the nature of the injury may require. The injured employee shall have the right to select his or her own physician. MEDICAL EXPENSES Note that the bill must be presented to the carrier for review. The carrier has 30 days to so upon presentation. If the bill is denied, the carrier must provide a narrative response advising the claimant of the reason and the right to request a hearing. The claimant can then dispute the denial at a Department of Labor hearing. 6

The claims unit receives and monitors compliance with the requirements relative to benefits. This includes indemnity benefits (cash payments) and medical benefits. EMPLOYER RESPONSIBILITIES Carriers will file Memos of Payment (MOPs) indicating the payments being made. Sometimes, this is information that the carrier will request of you. It is important to provide this information as promptly as possible. 7

You may have been or may be asked to complete a Wage Schedule. Completing this is a requirement under Lab 506.02 (k). Employers shall complete and make available to the carrier two copies of the Wage Schedule , form 76WCA (9/2015) contained in Appendix II or record of gross earnings pursuant to Lab 506.02 (b). Employers shall report the weekly wages on the basis of gross wages, including pay for overtime work, vacation pay, commission, and bonuses for the periods to which such payments apply and also including when applicable, the reasonable value of board, rent, housing, lodging, fuel or other similar advantage furnished by the employer as in RSA 281-A: 2, XV, RSA 281-A: 15. Employers shall note the reason for weeks of zero earnings. EMPLOYER RESPONSIBILITIES Your carrier will ask for this in order to ensure that the benefits being paid to the claimant are accurate and properly calculated. 8

The Department also receives outreach on premium audit disputes. This is where a carrier has audited a business and raised their premium based on such audit. The Department has limited jurisdiction here in that a hearing may be held to resolve disputes between an employer and the employer's workers' compensation carrier regarding whether persons engaged by the employer are employees or independent contractors for the purposes of determining whether an additional premium charge is to be paid by the employer for workers' compensation insurance. PREMIUM AUDIT DISPUTES What does this mean? If a carrier is including individuals who are not employees of the business for purposes of calculating a premium, the business may dispute the premium charged through a hearing at the Department. 9

Alternatively, there is a dispute resolution process through NCCI. Applicable to scenarios where an insured believes their carrier is miscalculating a premium or misapplying classifications. PREMIUM AUDIT DISPUTES Here there is no dispute over who is an employee or not for purposes of premium calculation. 10

The Wage & Hour Division administers and monitors compliance with wage and hour laws of the State of New Hampshire. The Division is comprised of several units: Inspection: the Department has inspectors who visit businesses to ensure compliance with relevant State labor laws. These inspectors work directly with employers in helping them come into compliance. They will cite violations when found and such violations could be subject to civil penalties. WAGE & HOUR DIVISION Safety: the Safety & Training Division of the Department of Labor is responsible for administering and enforcing workplace safety laws and regulations for public employers. The Department has inspectors on staff tasked with working with employers to monitor compliance. Boiler & Elevator: the Department also has several individuals certified to inspect boilers and elevators within the State. This unit ensures that units are properly inspected and certified. It also ensures that inspectors are properly licensed. 11

You may be aware that youth workers are under strict requirements as to hours they can work. For those under 16: Every day: Not earlier than 7 AM, not later than 9 PM School day: Not more than 3 hours School week: Not more than 23 hours Full vacation week: Not more than 48 hours YOUTH LABOR For those aged 16 or 17: Certain labor: Not more than 10.25 hours per day Night work: Not more than 8 hours in a day when working 3 or more nights during the week Full school week: Not more than 30 hours 4 day school week: Not more than 40.25 hours 3 day or less school week: Not more than 48 hours 12

What is an employee? RSA 281-A:2, VI (a) "Employee", with respect to private employment, means any person in the service of an employer subject to the provisions of this chapter under any express or implied, oral or written contract of hire except a railroad employee engaged in interstate commerce whose rights are governed by the Federal Employers' Liability Act. If they elect to be personally covered by this chapter, "employee" includes persons who regularly operate businesses or practice their trades, professions, or occupations, whether individually, or in partnership, or association with other persons, whether or not they hire others as employees. INDEPENDENT CONTRACTOR V. EMPLOYEE 13

What is an independent contractor? Anyone in the service of an employer subject to the provisions of this chapter under any express or implied, oral or written contract of hire .is presumed to be an employee. However, that presumption may be rebutted provided a specific 7 point criteria is met. This criteria is contained within RSA 281-A:2, VI (b) (1) INDEPENDENT CONTRACTOR V. EMPLOYEE 14

(b)(1) Subject to the preceding subparagraph, any person, other than a direct seller or qualified real estate broker or agent or real estate appraiser, or person providing services as part of a residential placement for individuals with developmental, acquired, or emotional disabilities, who performs services for pay for an employer, is presumed to be an employee. This presumption may be rebutted by proof that an individual meets all of the following criteria: (A) The person possesses or has applied for a federal employer identification number or social security number, or in the alternative, has agreed in writing to carry out the responsibilities imposed on employers under this chapter. (B) The person has control and discretion over the means and manner of performance of the work, in that the result of the work, rather than the means or manner by which the work is performed, is the primary element bargained for by the employer. INDEPENDENT CONTRACTOR V. EMPLOYEE (C) The person has control over the time when the work is performed, and the time of performance is not dictated by the employer. However, this shall not prohibit the employer from reaching an agreement with the person as to completion schedule, range of work hours, and maximum number of work hours to be provided by the person, and in the case of entertainment, the time such entertainment is to be presented. (D) The person hires and pays the person's assistants, if any, and to the extent such assistants are employees, supervises the details of the assistants' work. (E) The person holds himself or herself out to be in business for himself or herself or is registered with the state as a business and the person has continuing or recurring business liabilities or obligations. (F) The person is responsible for satisfactory completion of work and may be held contractually responsible for failure to complete the work. (G) The person is not required to work exclusively for the employer. 15

An advantage of utilizing sub-contractors is that these individuals, when properly classified, are not considered employees. This can help with costs and responsibilities. However, this does not mean that a prime contractor is completely off the hook. PRIME CONTRACTOR RSA 281-A:18 states that: A contractor who subcontracts all or any part of a contract shall bear the liability of the subcontractor of that contract for the payment of compensation under this chapter to the employees of the subcontractor, unless the subcontractor has secured the payment of compensation as provided for in this chapter. Any contractor who shall become liable for compensation under this section may recover the amount of the compensation paid and necessary expenses from the subcontractor. 16

This is not limited to workers compensation. RSA 275:46 states: Whenever any person shall contract with another for the performance of any work which the contracting person has undertaken to perform on a common site or location, he shall become civilly liable to employees engaged in the performance of work under such contract for the payment of wages, exclusive of liquidated damages, as required by RSA 275:43, 44 and 45, whenever and to the extent that the employer of such employees fails to pay such wages, and the employer of such employees shall be liable to such person for any wages paid by him under this section. PRIME CONTRACTOR It is important to be aware of these provisions. Most contractors do not know that they may still be responsible for employees of sub-contractors. 17

The Department receives outreach from sub- contractors relative to the coverage requirements. The sub-contractors state that a prime contractor is requiring them to obtain coverage in order to work on a project LAWS & RULES APPLICABLE TO SUB- CONTRACTORS They are confused as they know they do not have to have coverage as they do not intend to use employees, nor do they intend to use sub- contractors where the liability may flow up to the prime contractor. While there is no requirement for these individuals to hold coverage, the prime contractor is well within its rights to require coverage as part of the agreement. The Department has no jurisdiction over the rights of private parties to contract in this manner. 18

THANK YOU! Wesley Gardner Director Workers Compensation Division Wesley.Gardner@dol.nh.gov John Garrigan General Counsel John.W.Garrigan@dol.nh.gov Please feel free to reach out with any questions or concerns. A listing of specific contacts may be found at the following link: www.dol.nh.gov/contact-us 19