Insurance & LiensQuestion 642 of 690
Under Labor Code §3700, a California contractor that has even one employee must:
a.File a Form W-2 with the EDD only
b.Carry general liability insurance of at least $1,000,000
c.Secure the payment of workers' compensation benefits, by an admitted insurer or an approved self-insurance certificate
d.Provide health insurance under the Affordable Care Act regardless of number of employees
Explanation
Labor Code §3700 requires every California employer (including a contractor with even one employee, full- or part-time) to secure workers' compensation by either purchasing a policy from an admitted insurer or obtaining a Certificate of Consent to Self-Insure. Failure is a misdemeanor under §3700.5 and can result in stop-work orders, $1,500-per-employee penalties under §3722, and CSLB license suspension under Bus. & Prof. §7125. Liability insurance is required of LLCs but is a different rule. W-2 is a tax form. ACA health insurance has different thresholds (50+ FTEs) and is not the §3700 rule.
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