Is it legal for a company to deduct for Workers Comp - REO Property Preservation Forum
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post #1 of 25 (permalink) Old 10-28-2015, 06:41 PM Thread Starter
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Is it legal for a company to deduct for Workers Comp

I was recently contacted by cyprexx to complete some work for them. I was told that if I did not have workers comp insurance that 9% of my invoices will be deducted to cover it. I am in an exempt state that as long as I don't have employees, I am not required to have this coverage. I can have it, but it would be useless as owners are exempt from the coverage. Is this legal for a company not to accept a states exempt form and require you to pay for this?
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post #2 of 25 (permalink) Old 10-28-2015, 07:49 PM
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Originally Posted by madxtreme01 View Post
I was recently contacted by cyprexx to complete some work for them. I was told that if I did not have workers comp insurance that 9% of my invoices will be deducted to cover it. I am in an exempt state that as long as I don't have employees, I am not required to have this coverage. I can have it, but it would be useless as owners are exempt from the coverage. Is this legal for a company not to accept a states exempt form and require you to pay for this?
Legal? Yes.

Problem is, they are not using the 9% deducted to purchase a comp policy for you. Really - Call them up sometime & tell them you'd like to file a claim on the -9% policy, you'll hear crickets on the other end. Their workers comp requirement is simply an in-house requirement they have come up with, doesn't matter to them what your state does or doesn't require. The -9% is their way of monitarily penalizing you for not meeting their companies requirement.

Legal? Yes
Ethical? Doesn't seem like it does it?

Iíve already told you more than I know.
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post #3 of 25 (permalink) Old 10-28-2015, 07:52 PM
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comp

Not sure what state your in but if your a sole prop and you need the comp file get the basic as a sole prop you never be able to file but outweigh the cost of the 9% vs the charge the will charge and at least it will be a insurance deduction vs losing 9% outright
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post #4 of 25 (permalink) Old 10-28-2015, 08:06 PM
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1) Owner Self Proprietors can purchase work comp on themselves (I do since I'm the most valuable person in my company

2) you can purchase work comp policy to cover only "non-insured" subs in case of a work place accident (just like Cyprexx)

3) you can purchase a "non owners" policy without owners coverage. It's basically worthless BUT as NewYork said its better than 9% deduction.

4) I have always thought this WC deduction is illegal and years ago, before I carried WC, when Cuprexx was a small company my CPA called their accounting office for a copy of Form ??? so I could deduct this "voluntary" contribution for Ins benefits. No form was forthcoming BUT they did stop the requirement.
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post #5 of 25 (permalink) Old 10-28-2015, 08:13 PM
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Tell them to list yourself as additional insured and ask for a copy of the insurance doc before commencing any work.
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post #6 of 25 (permalink) Old 10-29-2015, 06:56 AM Thread Starter
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Tell them to list yourself as additional insured and ask for a copy of the insurance doc before commencing any work.

Not a bad idea, although we all know where this will lead. I'm going to do a little more research.
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post #7 of 25 (permalink) Old 10-29-2015, 04:39 PM
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Again the obvious answer here is don't work for Cyprexx. Never under any circumstances. If there were a way I could be more blunt I would.
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post #8 of 25 (permalink) Old 10-29-2015, 07:44 PM Thread Starter
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they contacted me about rehab, not regular preservation. The pricing that they gave me seemed fair, and I have been trying to get into that side of the biz since I started. I've done a few bids for a few realtors, but I assume I'm just their backup bid because I have never gotten an approval. I don't really know where else to get them.
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post #9 of 25 (permalink) Old 10-29-2015, 07:55 PM
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they contacted me about rehab, not regular preservation. The pricing that they gave me seemed fair, and I have been trying to get into that side of the biz since I started. I've done a few bids for a few realtors, but I assume I'm just their backup bid because I have never gotten an approval. I don't really know where else to get them.
No ONE should ever GIVE you pricing for a rehab. You give them YOUR pricing.
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post #10 of 25 (permalink) Old 10-29-2015, 07:57 PM
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they contacted me about rehab, not regular preservation. The pricing that they gave me seemed fair
Are you referring to the $1.24 flooring sq. ft. painting gig? Where are you going to make up the losses?
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