Worker’s Comp can be a tricky subject. One item to understand well is that the state is taking the time to match affiliated companies and this could cause you to lose your exemption. See below for a breakdown of the main rules for affiliation that could affect you if you or one of your partners owns portions of multiple businesses:
- Up to 3 owners can be exempt
- Each owner must own 10% or more
- The maximum of 3 is for any and all affiliated companies
- Affiliated companies mean any companies that share an owner
What does this mean? We will give you a real life scenario.
- ABC Building is owned by John and Fred.
- John also owns XYZ Plumbing with two others, Sally and Marie.
- John, Sally and Marie already have Worker’s Comp Exemptions for XYZ Plumbing.
- Fred is not eligible for an exemption with ABC because between the affiliated companies, there are already 3 in place.
To read this section of the statute, CLICK HERE. Scroll down to 440.02 (15) (b) 2.
Thinking of partnering up with someone? Be sure you know what other companies they have or you may be surprised when your exemption is denied.