Legal Question in Workers Comp in South Carolina

Re: Sub Contractor

1) In S.C., a company is not required to obtain WC insurance unless it has 4 or more employees. So the S.C. subcontractor is technically correct. However, a company with less than 4 employees is not prohibited from purchasing WC insurance.

2) If a S.C. subcontractor is working for your company and one of its employee's is injured while working on your job, that injured employee can file a S.C. WC claim. This is true even if that subcontractor only has 2 employees. If the subcontractor does not have WC insurance, then the law looks to the next higher level contractor until one is located that does have WC insurance. That higher level contractor is considered the "statutory employer" of the injured worker. The injured worker may recover WC benefits from that higher level contractor's WC insurance carrier.

3) If your company obtains a proper verification of S.C. WC insurance from the subcontractor at or before the time on engagement, (do not wait until after contracting with the subcontractor to obtain verification), then the S.C. subcontractor will be responsible for any injuries to his employees. Even if the subcontrator allows his W.C. insurance to lapse without your knowledge, your company is still protected so long as you obtained proper written verification at the time of engagement. Proper written verification consist of a Form S-2 or its equivalent from the subcontractor's WC carrier confirming coverage.

I hope this answers your question. Let me know if I may be of further assistance.