Nevada Workers Compensation: Employer Rules

The most expensive assumption I have watched a small employer make in Nevada is that two part-time people do not count. They do. Nevada starts the obligation at the first person working under a contract of hire, and the state does not care whether that person works forty hours or six.

Nevada is also one of the states where the paperwork is genuinely specific. The forms have numbers, the deadlines are counted in working days, and the fine for missing one of them is written into the statute. None of it is hard once you have seen it. The day someone falls off a ladder is just the wrong day to read it for the first time.

This page covers Nevada only, in the order you will need it: who has to carry coverage and who is excluded, how owners and contractors are treated, where to buy the policy, what goes on the wall, the injury deadlines, what to do when someone gets hurt, and what going without coverage costs.

Who Has to Carry Coverage

Every Nevada employer with one or more employees must carry workers compensation insurance unless a statutory exclusion applies. There is no employee-count threshold to cross and no grace period for a first hire.

The Workers' Compensation Section of the Division of Industrial Relations puts it in one sentence in its employer guide: unless excluded by statute, it is mandatory for an employer who has one or more employees to provide coverage.

The statutory backbone is two sections of the Nevada Revised Statutes (NRS). NRS 616B.633 makes the Nevada Industrial Insurance Act compulsory wherever an employer has anyone in service under a contract of hire, meaning anyone you have hired. NRS 616B.612 requires every employer to provide and secure compensation for injuries arising out of and in the course of employment: injuries caused by the job and suffered while doing it.

Two beliefs cause most of the accidental lapses I see. The first is that part-time employees do not need coverage. The second is that family members on the payroll do not. The Division lists both as myths in its employer compliance training and answers each the same way: coverage is required. Construction trades are required to carry coverage with no exception at all.

A narrow reciprocity exception exists for employees brought into Nevada temporarily who are insured in another state where extraterritorial provisions are in effect, meaning that state's coverage travels with its workers. The Division notes that construction is carved out of even that.

Occupational diseases, illnesses caused by the work rather than by an accident, run on a parallel track under NRS Chapter 617 with the same employer duties.

Who Is Excluded From Coverage

Nevada writes its exclusions as a list of people who are not employees, not as a list of small employers who are off the hook. NRS 616A.110 carries nine categories, and the practical ones for a small business are casual labor, household help and farm work. The table below also includes the owner, officer and contractor rules, which sit in other sections.

Read the casual labor line carefully, because it has two conditions and employers usually remember one. Casual work inside your own trade or business is covered work. A restaurant that pays someone for three days of prep during a busy week has an employee. The same restaurant paying someone to repaint the dining room may not.

Owners, Officers and Contractors

Owner status in Nevada turns on the entity, not on the job. Unincorporated owners start outside the system and can opt in. Incorporated owners start inside it and can opt out in writing.

NRS 616A.310 defines a sole proprietor as a self-employed owner of an unincorporated business, including working partners and members of working associations. Coverage holds only while that person remains domiciled in Nevada, meaning Nevada stays their permanent home.

Opting in takes a written notice to the Administrator of the Division of Industrial Relations and to a private carrier under NRS 616B.659. Officers and managers opt out with a written notice under NRS 616B.624, and that rejection takes effect when the insurer receives it, not when you decide.

Contractors are where Nevada gets strict, in any industry. Under NRS 616A.210 subcontractors, independent contractors and their employees are deemed employees of the principal contractor. NRS 616A.285 then defines a principal contractor broadly enough to catch anyone who coordinates the work, contracts for the whole project, hires a subcontractor or pays one. Meeting a single one of those tests puts you in the definition.

The one exception NRS 616A.210 allows is the independent enterprise test in NRS 616B.603. A business is not the employer of the person it contracts with when both halves are true. First, that person holds themselves out as a separate business and either holds a business or occupational license in their own name or owns, rents or leases property used in the business. Second, the hiring business is not in the same trade, business, profession or occupation.

Licensed contractors cannot use that exception. NRS 616B.603 excludes any principal contractor licensed under NRS Chapter 624, the state contractor licensing law, so its subcontractors, independent contractors and their employees stay its employees for coverage purposes. The Division puts it plainly: in construction, the principal contractor is almost always responsible for coverage.

The federal tests for the same question are a separate body of law and they do not override Nevada's. The safe habit in Nevada is to assume coverage is required until both halves of the independent enterprise test are clearly met.

Where Nevada Employers Buy the Policy

Nevada employers buy coverage in the private market. The Nevada Division of Insurance says in its self-insured FAQ that Nevada is not a monopolistic state, meaning employers are not required to buy from a state-run fund, and it lists four routes for a company that needs coverage.

The first and most common is a policy from a carrier licensed in Nevada, arranged through an agent or broker. The second is joining an association of self-insured public or private employers, which small and mid-sized companies in the same industry sometimes use to pool risk. The third is becoming a certified self-insured employer. The fourth is the assigned risk pool for employers no carrier will agree to insure.

Self-insurance is certified by the Commissioner of Insurance and the financial bar is high. NRS 616B.300 requires a tangible net worth of at least $2,500,000 at initial qualification, evidenced by a statement from an independent certified public accountant.

That net worth test applies until the employer has operated successfully as a self-insured employer for three years. After that, the test switches to net cash flows from operating and financing activities of five times the average of claims paid over the last three years, or $7,500,000, whichever is less.

On top of the financial test comes security: a surety bond, cash or an authorized equivalent, in an amount no less than 105 percent of expected annual incurred claim costs and never less than $100,000, plus evidence of excess insurance against catastrophic loss. For a typical small business this is not a realistic path, and I mention it mostly so you can rule it out quickly.

The assigned risk pool is the backstop. The Division of Insurance identifies it as the assigned risk pool of the National Council on Compensation Insurance (NCCI) and says applicants need at least two refusals in the standard market before they qualify.

Pricing in both the standard market and the pool starts from annual NCCI filings that the Commissioner approves with a March 1 effective date. For the voluntary, or standard, market the filings set advisory loss costs, the expected-claims baseline each carrier prices from. For the assigned risk pool they set the rates themselves.

Posters and Proof of Coverage

Nevada requires one workers compensation poster, a second one wherever employees receive tips, and a copy of the policy on site. It does not require a workers compensation pamphlet to be handed to a new hire, which surprises employers arriving from states that do.

The main poster is Form D-1, the informational poster required by NRS 616A.490 and by NAC 616A.460 (NAC is the Nevada Administrative Code, the regulations that sit under the statutes). It must be at least 11 by 17 inches, displayed so every employee can read it, and it must be a version issued or approved by the Workers' Compensation Section.

The bottom section of the D-1 is not decoration: it has to carry the name, business address, telephone number and contact person for your insurer, your third-party administrator, the managed care organization or providers the insurer has contracted with, and the nearest adjuster in Nevada. Your insurer supplies it.

Beyond the wall, what Nevada requires is a briefing rather than a pamphlet. NAC 616A.460 tells every employer to advise employees of the name, business address and telephone number of the insurer or third-party administrator adjuster located nearest to the workplace.

Folding that briefing into the first day, next to the emergency contacts and the safety walkthrough, is the cleanest way to satisfy it and the reason it belongs in an onboarding checklist rather than in somebody's memory.

The second poster is Form D-22, at least 8.5 by 11 inches, which NAC 616A.470 requires of any employer with employees who receive tips. The current version, revised in July 1999, still describes an opt-in election: the employee reports tips on Form D-23 separately for each pay period, the declaration cannot be amended, and tip-based benefits start three months after the employer receives it.

The statute behind the poster now reads more simply. Under NRS 616B.227, compensation is calculated on wages plus the tips an employee reports to the employer for federal tax purposes under 26 U.S.C. 6053(a), and an employer insured by a private carrier pays premium on those reported tips at the same rate as regular wages. The statute also requires you to tell employees to report tip income for that reason.

In practice, keep the D-22 on the wall, because NAC 616A.470 still requires it wherever employees receive tips, but handle tips the way NRS 616B.227 reads now. Copy each tip report employees file with you under 26 U.S.C. 6053(a). If a private carrier insures you, give it a copy on request, keep one, and pay premium on those tips at your regular-wage rate; a self-insured employer keeps the copy for its records.

That premium rule matters more in Nevada than almost anywhere, because the state allows no tip credit at all against the minimum wage. You pay tipped employees the full minimum wage, and their reported tips come on top of it.

Proof of coverage is a separate duty under NRS 616A.495. Each place of business must have one of these available for inspection at all times: a copy of the policy including the declaration page, the certificate issued by the Commissioner if you are self-insured, or the certificate plus association letter if you are in a self-insured group. A place of business at a temporary location meant to stay there for no more than a year gets 24 hours after a request to produce it. Failing to keep that proof available is a misdemeanor under NRS 616A.495(2).

One more piece of paper shows up at licensing time. Form D-25, the Affirmation of Compliance with Mandatory Industrial Insurance Requirements, is signed under penalty of perjury under NRS 244.33505 and NRS 268.0955 when a business applies for a county or city business license. It asks you to state that you carry coverage, are exempt, or hold a self-insurance certificate.

Injury Reporting Deadlines

Nevada counts injury deadlines in two units: calendar days for the employee, working days for the employer and the medical provider. Mixing them up is the most common way a small employer earns a fine on an otherwise clean claim.

Note what starts the employer clock. It is not the accident and it is not the C-1. The six working days begin when the C-4 arrives from the treating physician, chiropractic physician, physician assistant, advanced practice registered nurse or the medical facility the duty was delegated to. If your mail sits unopened for a week, the clock has been running the whole time.

What to Do When Someone Gets Hurt

The order matters, and the first two steps happen before anyone thinks about insurance. Care for the person, then create the record, then notify the insurer, then file the report.

Keep the injury file where you keep everything else about that employee, not in a separate shoebox. Records that live in one place are the reason we built FirstHR.

Penalties for Going Without Coverage

Nevada does not treat a lapse as a paperwork problem. The Administrator can bill the back premium, fine the employer, shut the jobsite down and refer the matter for criminal prosecution, and the injured employee keeps every right they would have had.

Start with the money. Under NRS 616D.200 the Administrator may charge the employer the premiums a private carrier would otherwise have been owed for the uninsured period, capped at 6 years, plus interest from when those premiums should have been paid. That money goes into the Uninsured Employers' Claim Account, which pays the claims of injured workers whose employers had no coverage.

The administrative fine follows the length of the lapse. NAC 616D.345 sets it at up to $1,000 for a failure of 90 days or less, up to $5,000 for more than 90 days but not more than a year, and up to $15,000 beyond a year.

In setting the fine, the Administrator weighs whether the employer is small and whether the failure was a carrier error, an unintentional employer error or intentional. A small employer, defined as fewer than 150 employees, whose lapse was not intentional may have the fine cut by up to half.

Then the business can be closed. NRS 616D.110 lets the Administrator order an immediate stop to all business operations at the place of employment or jobsite until coverage is in place, and the employer must order everyone off the site on receipt. Law enforcement assists on request. Knowingly failing to comply with that order is a separate misdemeanor under NRS 616D.115.

The criminal exposure is real and graduated. Under NRS 616D.200 a first offense is a misdemeanor. It becomes a category C felony if an employee suffers substantial bodily harm or dies during the uninsured period, or if it is a second or subsequent offense within 7 years of the previous one.

The felony is punishable by 1 to 5 years in state prison and a fine of $1,000 to $50,000. On conviction the court must order restitution to any insurer that incurred costs and reimbursement of the Uninsured Employers' Claim Account.

Principal contractors carry this risk for other people. If an employee of a subcontractor or independent contractor is hurt and that employer never secured coverage, the Division's coverage requirements guide states that the principal contractor is responsible for the actual cost of the claim plus administrative fees. That is why the coverage verification lookup belongs in your onboarding routine for every sub, not in the file after the fact.

Frequently Asked Questions

Does a Nevada business with one employee need workers compensation insurance?

Yes. Nevada sets no headcount threshold. The Workers' Compensation Section states that unless excluded by statute, it is mandatory for an employer with one or more employees to provide coverage, and NRS 616B.633 applies the act to any employer with a person in service under a contract of hire. Part-time employees count and so do family members on the payroll. Construction trades have no exception.

Can a Nevada business owner leave themselves off the policy?

It depends on the entity. Sole proprietors, working partners and members of working associations are not employees of the business and may elect coverage rather than being required to carry it. Officers of a corporation and managers of an LLC are covered by default; an unpaid one may reject in writing to the company and the insurer, and a paid owner-officer may reject in writing to the insurer under NRS 616B.624.

Where do Nevada employers buy workers compensation coverage?

In the private market. The Division of Insurance states that Nevada is not a monopolistic state and lists four routes: a policy through an agent or broker, a self-insured group, a certified self-insured employer program, or the high-risk pool. Certified self-insurance requires a tangible net worth of at least $2,500,000 at qualification plus security and excess coverage, so most small employers use the first route.

How long does a Nevada employee have to report a work injury?

Seven days. NRS 616C.015 requires written notice to the employer as soon as practicable but within 7 days after the accident, on Form C-1 and prepared in duplicate. The employer or supervisor signs it as an acknowledgment of receipt, which waives nothing. Employers keep blank forms on hand and retain completed notices for 3 years from the date of the accident.

How fast must a Nevada employer file the C-3 report?

Within 6 working days of receiving the C-4 from the treating provider, under NRS 616C.045. The report goes to the insurer or third-party administrator, signed and complete, with a statement of the employee wages attached when the C-4 shows the employee is expected to miss 5 days or more. The Administrator imposes a fine of up to $1,000 for each violation.

What happens to a Nevada employer caught without coverage?

Back premiums for up to 6 years plus interest, an administrative fine of up to $1,000, $5,000 or $15,000 depending on the length of the lapse, and a possible order to cease all operations at the site until coverage is secured. A first offense is a misdemeanor and becomes a category C felony where an employee is seriously hurt or killed during the uninsured period, or on a repeat offense within 7 years.

Do independent contractors have to be covered in Nevada?

Often yes. A business avoids employer status only when the person it hires is an independent enterprise, holding a business or occupational license in their own name or owning or leasing property used in the business, and only when the two are not in the same trade or occupation. Licensed contractors face a stricter rule: NRS 616B.603 denies that test to a principal contractor licensed under NRS Chapter 624, so under NRS 616A.210 its subcontractors, independent contractors and their employees are deemed its employees.