Workers’ Compensation Insurance in Arkansas
What are the requirements for workers’ comp insurance in Arkansas?
Most Arkansas businesses with three or more employees are required by law to have workers’ compensation insurance coverage for their employees. There are exceptions to this requirement, so businesses with fewer than three employees should check with authorities before assuming they do not fall under the workers’ compensation laws. Employers in doubt may contact their agent or the Commission’s Information Officer, its Operations/Compliance Division, or the Legal Advisor Division.
Workers’ comp insurance coverage is provided through a workers’ compensation insurance policy or by the business owner receiving state approval to be self-insured for such purposes. Any other arrangement by the employer’s representative may constitute fraud.
Business owners failing to comply with these laws may be subject to penalties by the state of Arkansas, and they may also lose protections afforded them by workers’ compensation insurance and the laws of Arkansas.
What does workers’ comp insurance cover in Arkansas?
In the event of a workplace accident, workers’ comp insurance provides both medical coverage and payments for lost wages and permanent disabilities. This can include temporary or permanent benefits.
Temporary workers’ comp benefits refer to the scenarios of when your employee is unable to work for more than one week, your worker is able to receive compensation for the lost wages, which are called “lost time benefits.” Your employee’s doctor must certify your employee is not able to work.
Lost time benefits are 2/3 of your employee’s monthly income and determined by your employee’s earnings the month before the individual gets sick or is injured in the workplace. This benefit is considered temporary and only lasts while your employee’s doctor is actively treating you. When your employee’s doctor determines that your team member is able to return to work, your employee will receive a letter from the insurance company called a Notice of Claim Status, which clarifies that the doctor said you can officially work again.
If your employee is unable to return to work full-time or can only do modified work, and as a result they are earning less than they usually do, your employee can continue to get time lost benefits, which will be two-thirds of the difference in their earnings.
Permanent workers’ comp benefits refer to the scenario when your employee’s doctor finds that your employee’s condition is stationary, or not expected to improve any further. In this case, the doctor will determine whether your employee has a permanent disability. If your employee does, the doctor will give your worker a percentage of disability. This number, along with your employee’s age, education, work history helps determine your employee’s rate of compensation.
Who is not required to have workers’ comp insurance in Arkansas?
In Arkansas, farm workers and real estate agents are not required to be covered by workers’ compensation insurance. Domestic workers or employees of religious, nonprofit, or charitable organizations are also not required to have coverage. A self-employed individual in Arkansas is also not required to carry workers’ comp insurance but may opt to voluntarily purchase a policy.
What are the penalties for not having workers’ comp insurance in Arkansas?
Business owners who fail to carry the required workers’ comp coverage will be required to pay fines as a penalty to the state of Arkansas. In addition, these business owners will lose protections provided by the Arkansas Workers’ Compensation Commission.