Regularly Getting it Wrong

Written by: David S. Dix, Esq.

For many employers in Georgia, Workers’ Compensation is simply fact of life and a cost of doing business.  However, for smaller businesses with fewer employees, Workers’ Compensation may not be a foregone conclusion.  Not all employers are subject to the Workers’ Compensation Act, and not are required to carry workers’ compensation insurance. The Workers’ Compensation Act itself does not apply to employers that have “regularly in service less than three employees in the same business…unless such employees and employers voluntarily elect to be bound.” O.C.G.A. §34-9-2(a).  In other words, for a small enough business, workers’ compensation does not apply unless the employer and employees elect to opt into the system. However, if you think the act does not apply to your business, the recent Court of Appeals decision in Wills d/b/a/ Wills Construction v Clay County et al. Court of Appeals Case No. A16A1328 highlights the importance of being right.

In the case, Wills, the employer was a contractor who won a bid for a construction contract.  The contract did not require Wills to carry workers’ compensation insurance.  Wills believed that he did not regularly have more than two employees in service because he would simply hire employees on an as needed basis whenever he had contracts or projects that required additional help. The Court of Appeals focused on the term “regularly” and made it clear that it is not synonymous with “constantly” or “continuously.”  Wills was deemed to be subject to the Workers’ Compensation Act because he was in the practice of hiring additional employees whenever a construction project required it. In other words, even though the employer in Wills only intermittently employed more than two employees, he did so regularly.

The employer in Wills took a gamble that he was not subject to the Workers’ Compensation Act.  Georgia law requires an employer liable under the Act to maintain workers’ compensation insurance or self-insure against the risk. Failing to meet those obligations can result in heavy fines and penalties. Misunderstanding the law and what it means to regularly employee less than three employees can be an expensive mistake.