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DWD Worker Classification
Worker's Compensation - Worker Classification
Farmers are covered if they have 6 or more employees (at one or more locations), working on the same day for 20 days (consecutive or non-consecutive) during a calendar year.
There is no wage threshold for farmers. It doesn't matter how much a farmer pays in wages. What matters is the number of employees (after excluding certain employees who are family members, relatives or "exchanged workers" as described in more detail below).
For farmers, the threshold is 6 employees, not 3. However, farmers are not required to obtain insurance unless they have 6 or more employees on at least 20 days during a calendar year. After the 20th day, farmers have 10 days to obtain insurance.
A calendar year starts on January 1st and ends on December 31st.
- The 20 days do not have to be consecutive.
- On each of the 20 days, it can be the same 6 employees or 6 different people.
- The 6 employees may be full-time or part-time.
- The 6 employees may be at more than one location within the state.
- Certain relatives are not counted in determining whether there are 6 employees.
Who is a farmer?
The statutory definitions of farming, farm premises, farm operations and farmers are extremely broad. The law has a long list of farm operations related to plant and animal commodities that cover everything from cultivating, breeding, tending, raising, training, managing and harvesting--to processing, drying, packing, packaging, freezing, grading, storing, delivering, distributing, or marketing. The law also says that farming shall also include "any other activities commonly considered to be farming whether conducted on or off (farm) premises."
What if a farmer rents the farm premises?
If makes no difference whether the farmer owns or rents the farm premises. The same broad exemptions from the requirement to obtain insurance apply.
What if a farmer doesn't make a profit?
It does not matter. There is no requirement that the farmer actually succeed in raising any crop, animal, animal product, or commodity.
What about logging?
"Logging, lumbering or wood cutting" operations are not, by themselves considered farm operations. However, if they are done as part of other farm operations, they are considered farm operations for all worker's compensation purposes. On the other hand, clearing farm premises, salvaging dead timber and managing and using wood lots are, by themselves, considered farming. They are not considered "logging, lumbering or wood cutting."
What about people who provide services to farmers?
Commercial threshers, clover hullers, silo fillers, corn shredders, and other employers who work for farmers are not considered to be engaged in farming operations. These contractors become subject to the Worker's Compensation Act like any other non-farm employer. These employers and their employees are not counted for purposes of determining whether a farmer has 6 employees.
What about relatives of a farmer?
- Eligibility for benefits.
The most important thing to remember is that the special rules for relatives relate only to counting, not to benefits or insurance premiums. Put simply, all these rules mean is that certain relatives are not counted when deciding whether a farmer has crossed the 6-employee threshold.
However, once it is determined that a farmer is subject to the Worker's Compensation Act--at which time the farmer must obtain insurance--then all employees of the farmer (including all the relatives who were not counted for purposes of determining whether that insurance was required) are covered under that policy. This means, quite properly, that the farmer's insurance premiums will be based on all wages paid by the farmer to all employees--including these relatives.
- Counting toward the 6-employee threshold.
When determining whether a farmer has 6 or more employees, the law says that certain direct ancestors and descendants of the farmer ("lineal" relatives) and certain more distant familial relatives and in-laws ("collateral" relatives) shall not be counted. The list in Table 1 applies to all farmers. For purposes of counting, these relatives are not employees.
|Farmer's Relatives That Are Not Counted as the Farmer's Employees|
|Child||Sister-in-law or Brother-in-law|
|Brother||Daughter-in-law or Son-in-law|
|Sister||Mother-in-law or Father-in-law|
If the farm operation is a sole proprietorship, the relatives of the owner listed in Table 1 are not counted when counting the number of employees.
If the farm operation is a partnership, the relatives of a partner listed in Table 1 are not counted when counting the number of employees.
If the farm operation is a limited liability company, the relatives of a member of the limited liability company listed in Table 1 are not counted when counting the number of employees.
If the farm is a family farm corporation, relatives of a shareholder listed in Table 1 are not counted when counting the number of employees.
Important Note: If the farm is a corporation, (where all shareholders are not related as lineal ancestors or descendants) all employees including the relatives of a shareholder listed in Table 1 are counted when counting the number of employees.