Workers Compensation laws in California are pretty straight forward: if you have any employees – even just one – you have to have workers comp. But sometimes things get confusing. Yes, it’s true. Here’s an example: what if you pay your neighbor’s son to feed your dog while you’re on vacation? Aah, see? It’s not always clear cut, now is it?
As an insurance agent, my answer to you is this: “Yes, your neighbor’s son is an employee and you must get a workers comp policy for him. And I will gladly sell it to you. Just call me at 1-800-CHEAPRATES.”
That was not my real response. It was the response that I imagine people expect an insurance agent to say. Let’s get into my real response.
So the question about paying your neighbor’s son to feed your dog, mow the lawn, or rake your leaves begs a legitimate question. Do you have to get workers comp for that situation? At first it might appear so: you’re paying someone to do work and that might seem to make you an employer and him an employee. But on the other hand, this is not for business purposes. If you’re an employer and he’s an employee, by the same logic any time you compensate someone for any type of favor wouldn’t you also then have to get a workers comp policy? Where does it end? I mean, if you have to get workers comp for your neighbor’s son feeding your dog on vacation, why wouldn’t you also have to get a workers comp policy for the time you paid your other neighbor for the time she took your son to the hospital after he broke his arm on the ropes course at summer camp? (You couldn’t pick your son up because you were on that all-inclusive Baja cruise, lucky you, Mr. Vacation.)
The truth is, I don’t have a body of literature to point to that clearly states that your neighbor’s dog-feeding son or your other neighbor’s injured-youth-transport service doesn’t qualify as an employee, and I did quite a bit of Googling. Nevertheless, I don’t think that either situation has created an employer-employee relationship. This is something that I believe to be true based on two facts: 1) I’ve never had anyone call me trying to place workers comp for this situation, and 2) I’ve never heard of a situation where someone was busted because they were supposed to have it but didn’t. I just don’t think our legislators are trying to get us buy workers comp policies for when our nephews come over to the house and rake the leaves for $5.
But let’s tweak the situation above just a little. Rather than a one-time thing, let’s say it becomes a regular thing. You weekly pay your neighbor’s son to feed your dog, mow your lawn, and sweep your driveway. Now what? This is starting to look a little more like an employer-employee relationship, which indicates a potential necessity for workers comp.
In this case, I’m happy to be the bearer of good news. If you have a homeowners, condo owners, or renters policy, you have workers comp coverage. How so? Every one of the aforementioned policies in California comes with the HO 0090 endorsement, a two page addendum stating that you have coverage for injuries sustained by “residence employees” up to $100,000. A “residence employee” is someone that you have paid to do 1) maintenance work on your house or 2) household or domestic services. AND: they have to have 1) performed at least 52 hours of work and 2) earned at least $100 from you in the last 90 days. If they meet the criteria, they are considered a residence employee and eligible for coverage on your home/condo/renters policy.
If you don’t have a home/condo/renters policy, I don’t have good news for you. You have a need for workers comp but have no coverage.
One final thought: you may be wondering how people who aren’t considered a residence employee are covered if they injure themselves while one-time feeding your dog, mowing your lawn, or sweeping your driveway. Great question! If the injury sustained was because of your negligence, you would have coverage up to full policy limits on your home/condo/renters policy. These people are covered the same way you would be covered if you came to my house and slipped and fell on my property. You’d simply be a third party, not an employee.
So in review:
- Infrequent or one-time workers doing domestic work are covered on your home/condo/renters policy up to full policy limits.
- Regular domestic employees are covered in California on your home/condo/renters policy by way of the mandatory HO 0090 endorsement, up to $100,000.
- If you have no home/condo/renters policy and you use regular domestic employees, you are uninsured and in violation of the law. Get covered – it’s not expensive!
- If you have no home/condo/renters policy and you use infrequent or one-time workers doing domestic work, you’re not violating any law, but you have no coverage.
- If you’re an actual employer employing employees for your business, you need workers comp.
It’s never easy navigating the business waters in California. Good luck and I hope this helps!