Three. North Carolina requires workers compensation for most employers with three or more employees regularly employed in the same business, and for any employer with even one employee whose work involves radiation. Corporate officers count toward the three. Sole proprietors, partners and LLC members aren't counted automatically but can elect coverage.
The rule
Under G.S. 97-2 and 97-13, the Workers' Compensation Act covers private employers with three or more employees regularly employed in the same business or establishment in North Carolina. The Industrial Commission, which enforces the Act, says in general all businesses employing three or more employees on a regular basis are covered. There's one lower threshold: an employer with one or more employees in activities involving radiation must carry coverage.
Who counts toward three
The Industrial Commission says corporate officers are counted when deciding whether a corporation has three or more employees, even though an officer can choose to be excluded from the policy itself. Unpaid officers of certain nonprofits aren't covered by the Act but still count toward the total.
Sole proprietors, partners and LLC members are not automatically counted as employees. They can elect to cover themselves if they're actively engaged in the business and the insurer is notified.
Whether a particular worker counts can depend on the facts. If you're close to three, call us or the Industrial Commission before assuming you're under the line.
Exceptions
The Act lists exceptions, including casual employees, domestic servants, farm laborers when fewer than 10 full-time nonseasonal farm workers are regularly employed, and certain small sawmill and logging operations. The details are in G.S. 97-2 and 97-13.
Under three? Think about it anyway
A business with fewer than three employees can still buy a policy, and once it does, the law presumes it has accepted the Act for the life of the policy. Many small contractors carry it because general contractors require a certificate before they'll hire them. Under G.S. 97-19, a contractor that sublets work without one can be liable for the sub's injured workers, even when the sub has fewer than three employees.
Other states we write
The threshold isn't the same everywhere. South Carolina's is four, Virginia's is more than two, and Maryland's is generally one. If your crew works across state lines, ask us to check your policy's other-states coverage.
In short
- Three or more employees regularly employed triggers the requirement in North Carolina.
- One employee is enough if the work involves radiation.
- Corporate officers count; sole proprietors, partners and LLC members can elect coverage.
- Contractors may need a certificate from every sub, whatever its size.
Related questions
- What is the penalty for not having workers comp in NC?
- Do subcontractors need workers comp in NC?
- How many employees before I need workers comp in South Carolina?
- How many employees before I need workers comp in Virginia?
Coverage pages
- North Carolina Business Insurance
- Wilmington Business Insurance
- Leland Business Insurance
- Charlotte Business Insurance
Talk to us
Every situation is a little different. If you want someone to look at your own policy, call us at (910) 791-1011 or start a quote online. We're an independent, family-owned company founded in 1977, with eight offices in North Carolina, and we're licensed in North Carolina, South Carolina, Virginia and Maryland.
Sources
- N.C. Gen. Stat. 97-2 (definition of employment, three or more employees regularly employed, officers, elections)
- N.C. Gen. Stat. 97-13 (exceptions; employers who buy a policy are presumed to accept the Act)
- NC Industrial Commission, Workers' Compensation Insurance Requirement
- N.C. Gen. Stat. 97-19 (contractor liability when subletting without a certificate)
- SC Workers' Compensation Commission, Employer FAQs (who must carry coverage in South Carolina, who counts, exemptions)
- Virginia Workers' Compensation Commission, Insurance Information for Employers
- Maryland Workers' Compensation Commission, Questions and Answers for Employers (Form C-98)
This page is general information, not a coverage determination or legal advice. Policies, rules and availability vary and change. Review your own policy or talk to your advisor.