Workers' compensation insurance doesn't have to be hard
In WA the only compulsory business insurance is workers' compensation. You can choose whether to handle some risks yourself (e.g., don't insure your vehicle for damage) but it's a legal requirement to insure your liability for worker injury.
Notice that the term of art is worker, not employee. It doesn't matter if the person you're engaging is full-time, part-time, casual, piece-rate, cash-in-hand, or an ABN contractor; if you're directing a person in your business, then you must have valid WA workers' compensation insurance.
Workcover WA have the power to fine you $1,000 per day per uninsured worker, and ignorance of the law is no excuse.
Hang on, what's this guff about ABN contractors?
The Commonwealth tax rules are irrelevant to WA workers' compensation insurance. It really doesn't matter (under workers' compensation law) if the person you're directing is not your deemed employee under the 80/20 rule or similar.
When it comes to WA workers' compensation, only three things are actually relevant:
- Is the person a natural person? (that means - not a Pty Ltd company)
- Have you engaged them for the purposes of your business?
- Do they work in WA most of the time?
If the answers to all three questions are "yes", then you need to have WA workers' compensation insurance. It doesn't matter if you or your business is out-of-state, it doesn't matter if the person "has her own" workers' compensation insurance, it doesn't matter if the worker has an ABN or doesn't want the insurance or is only working for you for a couple of hours anyway.
Please protect yourself and make sure you have insurance. Even if it's a basic minimum-premium policy, don't fall foul of the state government compliance squad.
So get some advice and don't assume
You can be smart about workers' compensation insurance - there are intricacies and ways of structuring your business and your risks to keep costs to a minimum. But if you don't get the right advice (or if you're dealing with an East-coast insurance provider who doesn't understand WA workers' compensation risks), you could end up paying a lot in premium and in enforcement fines.
I specialise in risk management including workers' compensation - talk to me about how to protect your business before it's too late.
What about volunteers and not-for-profits?
I offer obligation-free risk consulting to business and not-for-profit groups alike. I pride myself on scrupulous honesty - if you already have appropriate insurance and procedures in place, I'll tell you outright to stick with what you've got. If there is room for improvement, I'll give you clear plain English directions as to how to improve. Whether you pass that advice on to your current provider or engage me to arrange it for you, I'm here on your side.