Worker's Compensation Insurance Requirements in Wisconsin

As an employer, when am I required to carry worker's compensation insurance?

You must carry worker's compensation insurance if you meet any of these conditions:

If you...	Worker's compensation insurance is required
Employ 3 or more full-time or part-time employees.	The day you employ the third person
Pay gross wages of $500 or more in any quarter for 1 or more employees for work done in Wisconsin.	The 10th day of the 1st month of the next quarter
Are a farmer and you employ 6 or more workers on the same day for any 20 days during the calendar year. (Note: some relatives may not count as employees) 10 days after the 20th day of employment

How do I get worker's compensation insurance?

Contact an insurance company licensed to write worker's compensation in Wisconsin. The policy must name Wisconsin as a covered state in section 3-A. Your insurance company must file the properly endorsed policy with the Wisconsin Compensation Rating Bureau.

If you are refused insurance coverage, you can get coverage from the Wisconsin Compensation Rating Bureau through the Worker's Compensation Insurance Pool.

Note: the Wisconsin Compensation Rating Bureau is not a State agency. The State of Wisconsin does not write or provide worker's compensation insurance coverage.

Must out-of-state employers carry Wisconsin worker's compensation insurance?

Yes, you must carry the insurance if you have employees working in Wisconsin.

Who is considered an employee and covered by the Worker's Compensation Act?

Nearly all private and public employees in Wisconsin are considered employees and covered under the Act, including:

Part-Time Employees
Family Members (except for certain relatives of a farmer)
Minors
Corporate Officers

Who is not considered an employee under the Worker's Compensation Act?

Domestic servants
Any person whose employment is not in the trade, business, profession or occupation of the employer
The following relatives of a farmer: parents, spouse, child, brother, sister, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law or sister-in-law.
Sole proprietors, partners and members of limited liability companies.
Qualified and certified members of certain religious sects
Volunteers of non-profit organizations receiving salary or in-kind compensation of not more than $10 per week
Employees of Native American tribal enterprises, including casinos
Real estate brokers, agents and salespersons that satisfy the 2 elements pursuant to s. 452.38, Wis. Stats.

Can sole proprietors, partners and members limited liability companies voluntarily purchase worker's compensation insurance?

Yes

What about independent contractors?

A person must meet a nine-part test before they are considered an independent contractor rather than an employee.

What about corporations and corporate officers?

All worker's compensation policies for corporations include corporate officers. However, in a closely held corporation (less than ten shareholders), up to two officers may exclude themselves from coverage. The exclusion for officers must be made by endorsement on the worker's compensation policy. Insurance is required for the rest of the officers and employees.

In addition, excluded officers are included in the employee count to determine in worker's compensation insurance is required.

Worker's compensation insurance is not required if a closely held corporation has no more than two corporate officers and no other employees. The officers must file a Corporate Officer Option Notice with the department.

What penalties can I get if I do not worker's compensation insurance when it is required?

You could be assessed a penalty of double the insurance premiums you should have been paying during the uninsured period, or $750, whichever is greater. You may also be subject to a penalty of $100 / day, up to seven days.

We could also order that your business be closed. If an employee of an uninsured business is injured, the business owner may also be held personally liable for claim benefits paid to injured employees.

Once an employer is required to get a worker's compensation insurance policy, how long does the employer have to keep it?

An employer is required to maintain a worker's compensation policy as long as they have one or more part-time or full-time employees. If the employer only one part-time employee making less than $500 per quarter, the employer must maintain the insurance for the remainder of that year and for the next calendar year before they are eligible to withdraw.

If they employer lays off all their employees, the employer may drop their worker's compensation insurance while they have no employees. However, the employer remains subject to the Act. Therefore, because the employer has already become subject to the Act, if the employer hires an employee at a later date, the employer must have a worker's compensation insurance policy in place on the date any employee begins working, unless the employer has withdrawn from the Act.

Once a farmer is subject to the Act, the farmer is required to have a worker's compensation policy, as long as they have one or more part-time or full-time employees. Even if a subject farmer has only 1 part-time employee, the farmer must maintain the insurance until they have gone a full calendar year without employing 6 or more employees on 20 or more days before they are eligible to withdraw from being subject to the provisions of the Act.

Corporations cannot withdraw from the provision of the Act. Closely held corporations with no more than 10 stockholders that have no more than 2corporate officers and no other employees, may elect not to be subject to the Act by completing and filing with the Department a Corporate Officer Option Notice. A corporation with more than two corporate officers or any other employee is not eligible to file a Corporate Officer Option Notice and must obtain and/or maintain a worker's compensation insurance policy.

Call us at (608) 266-3046 if you are not sure whether or not you are subject to the Act or if you are not sure when you are required to have a worker's compensation policy.

As an employer, how do I benefit from the Wisconsin Worker's Compensation Act?

You receive benefits that can mean the difference between the success or failure of your business. If one of your employees gets hurt while working for you, you could be sued for damages, medical care, lost wages, and much more. By complying with the law and carrying appropriate worker's compensation insurance, you receive:

Protection from most lawsuits brought by an employee because of a work-related illness or injury.

Fair and prompt delivery of benefits to your employee who is injured on the job.

Fair adjudication of disputes by a Division of Hearing and Appeals - Office of Worker's Compensation Hearings Administrative Law Judge.
Fair and standard insurance premium rates approved by the Office of the Commissioner of Insurance.

Does my employee benefit from the Worker's Compensation Act?

If your employee does get hurt on the job, the worker's compensation system will help ensure prompt payment of benefits and fair adjudication of disputes.

Applicable Laws and Rules

This document provides statements or interpretation of the following laws and regulations enacted as of October 23, 2023: secs. 102.04, 102.05, 102.07, 102.076, 102.28, 102.82 and 452.38, Wis. Stats.

Laws enacted and in effect after this date, new administrative rules and court decisions may change the interpretations in this document. Guidance issued prior to this date, that is contrary to the information in this document is superseded by this document, according to sec. 73.16 (2)(a), Wis. Stats.

Contact Us

Wisconsin Department of Workforce Development, Worker's Compensation Division
PO Box 7901
Madison WI 53707-791
Phone: (608) 266-3046

DWD is an equal opportunity employer and service provider. If you have a disability and need assistance with this information, please dial 7-1-1 for Wisconsin Relay Service. Please contact the Worker's Compensation Division at (608) 266-1340 to request information in an alternate format, including translated to another language.

WKC-13328-P (R. 10/2024)