Texas is the only state that allows employers to opt out of having workers’ compensation insurance. Many Texas employers are taking advantage of this easy option and becoming non-subscribers. According to the Texas Department of Insurance, 44 percent of Texas employers are non-subscribers and 20 percent of Texas employees work for non-subscribers.
Many employers decide not to carry workers’ compensation insurance because of the expense. They may pay an employee’s accident-related expenses out of pocket, provide employee benefit plans, or become self-insured by purchasing non-subscriber insurance. However they fund it, an employer is still responsible for an employee’s injuries on the job.
How Employers Can Easily Become Non-Subscribers
It is relatively easy to become a non-subscriber employer in Texas. In order to opt out of workers’ compensation, an employer has to take these four steps:
- File DWC Form-005 with the Texas Division of Workers’ Compensation annually stating that the employer is a non-subscriber.
- Notify employees in writing at the time of their hire that the employer is a non-subscriber.
- Post a written notice that the employer does not carry workers’ compensation insurance in its personnel office and in a prominent place where employees will see it regularly. The notice must comply with DWC notice and wording requirements and must be written in Spanish, English, and any other appropriate language.
- Report any workplace injuries that require an employee to miss more than one day of work, all occupational illnesses, and all fatalities to the DWC.
A non-subscriber employer is responsible for a worker’s accident on the job if the worker proves the employer in some part was negligent in causing his accident. An injured worker’s damage award could be substantial, because he may be entitled to compensation for past and future medical bills, lost income, and pain and suffering.
If you are an employee and were injured while on the job, you could be entitled to compensation from your non-subscriber employer. Start an online chat to learn about your legal options.