Hiring Remote Employees? Are they covered by Workers Compensation?

In today’s innovative technology work force, more and more employers are hiring their employees for remote positions. Those remote employees who live and work in geographic location outside of the employers business location.

Although hiring remote workers has its advantages for example a wider pool of employee talent and savings on overhead cost of office space.

Some employers come to a surprise when they forget to add their remote employees state to their workers compensation insurance.

An employer should notify its workers’ compensation carrier about the remote work arrangement and the employee’s remote location. In most cases, remote employees will be considered localized in the state where they work remotely. Workers’ compensation coverage obligations and systems vary by state.

For example, Texas has an elective workers’ compensation system which allows employers to opt out of workers’ compensation insurance and allows injured employees to seek general tort damages against their employer. If a remote employee is injured in a work-related accident while working from home, it is still the employer’s responsibility and most states will require proper coverage.