South Carolina Workers Compensation: Employer Rules
South Carolina requires workers compensation at four employees, and part-time workers count. Coverage, exclusions, posting, deadlines and penalties.
South Carolina Workers Compensation
Four employees turns the mandate on, part-time workers and family members are counted, and the report that reaches the Commission runs on a ten business day clock
The first South Carolina owner who asked me about this ran a three-person shop outside Greenville and had just added a part-time helper for Saturdays. He counted three, because in his head part-time was not a real headcount. South Carolina counted four.
That is the trap in this state, and the Workers' Compensation Commission does not hide it. Its employer FAQ says coverage is required once a business regularly employs four or more people in South Carolina, and that part-time workers and family members are counted as employees.
Miscount and you can be running uninsured without knowing it. Below is what an owner without an HR department needs: who has to carry coverage and how to count to four, who is excluded, where to buy a policy, what to post, the injury reporting clocks, what going without costs, and what the policy pays.
Who Has to Carry Coverage
Coverage becomes mandatory at four employees. The South Carolina Workers' Compensation Commission puts the general rule in one sentence in its employer FAQ: businesses that regularly employ four or more employees within South Carolina are required to maintain workers' compensation coverage, and part-time workers and family members are counted as employees.
The statute behind that sentence is S.C. Code Section 42-1-150, which defines employment to include all private employments in which four or more employees are regularly employed in the same business or establishment. Outside the exclusions covered below, the same four-employee test applies in every industry.
A second exemption sits underneath the headcount, and small employers tend to overlook it. Section 42-1-360(2) excludes any person who has regularly employed fewer than four employees in the same business within the State, or who had a total annual payroll during the previous calendar year of less than three thousand dollars, regardless of the number of persons employed during that period.
Read that as two tests that both have to be met before the Act, South Carolina's workers compensation law, applies. A five-person seasonal operation that paid out two thousand dollars last calendar year sits outside the Act on the payroll test, even though its headcount alone would bring it in. A four-person business with a real payroll is inside it.
Counting to Four
Part-time workers count, family members count, and the only real carve-out is genuinely casual labor. The Commission's coverage requirements guidance states that any employer in South Carolina who regularly has four or more workers, full time or part time, is required to have the insurance.
The phrase regularly employed has a meaning that courts supplied, not the statute. The Commission describes it as employment of the same number of people with some constancy throughout a relevant time period, and it says seasonal operations are decided case by case, with a Commissioner making the finding of fact on whether the employer regularly has four or more employees.
Casual is narrower than it sounds. The definition in Section 42-1-130 excludes a person whose employment is both casual and not in the course of the trade, business, profession or occupation of the employer, and both halves have to be true at once. The Commission has published the point directly: part-time employment is not casual in nature and is not included in the exceptions.
Corporate officers get their own mechanism. Under Commission Regulation 67-402 an officer rejects the Act by filing a Form 5, Corporate Officer Notice to Reject, with the employer's insurance carrier and giving the employer a copy. What that does to the count of four is fact specific. The Commission does not certify that any employer is outside the Act, so confirm the effect with your carrier before you rely on it.
Who Is Excluded and Who Elects In
The exclusion list lives in S.C. Code Section 42-1-360, and it is shorter than the folklore suggests. Notably, domestic service is not on it. South Carolina does not exempt household employees the way many states do, so a household that regularly employs four or more people and clears the payroll test is inside the Act like any other employer.
| Worker or role | South Carolina treatment | What the employer does |
|---|---|---|
| Sole proprietor | Not automatically an employee | May elect to be included under S.C. Code Section 42-1-130 if actively engaged in the operation of the business and the insurer is notified |
| Partner | Not automatically an employee | Same election, same two conditions. Working partners do not push a small firm to four on their own |
| LLC member | Not named in the election sentence of Section 42-1-130 | The statute names sole proprietors and partners. Confirm member treatment with the carrier and counsel, because the Commission does not certify exemptions |
| Corporate officer | May reject the Act | File a Form 5 with the insurance carrier and give the employer a copy (Regulation 67-402). Section 42-1-520 then leaves that officer at common law |
| Casual employee | Excluded under Section 42-1-360(1) | Only when the work is both casual and outside the course of your trade or business. Part-time help doing your usual work is not casual |
| Part-time worker | Counted as an employee | The Commission counts part-time workers and family members toward the four |
| Domestic worker | Not listed as an exception in Section 42-1-360 | No household exemption appears in the statute. Treat household staff like any other employees for counting |
| Agricultural employee | Excluded unless the employer elects in | An agricultural employer may come under the Act voluntarily under Section 42-1-380 |
| Seller of agricultural products on commission | Excluded under Section 42-1-360(6) | Applies where the producer pays the commission and prepares the product for sale |
| Licensed real estate salesperson | Excluded on conditions | Sale, leasing or rental for a licensed broker on a straight commission basis, under a valid independent contractor agreement |
| Owner-operator truck driver | Excluded on detailed conditions | Section 42-1-360(9) sets out the ownership, lease-purchase and contract terms. Driver and carrier may agree to add the driver to the carrier’s policy |
| State and county fair association | Excluded unless it elects in | Voluntary election under Section 42-1-380 |
| Federal employee in South Carolina | Excluded from the Act | Federal civilian workers are covered by the federal program administered by the US Department of Labor |
| Railroad or railway express employee | Excluded from the Act | Their liability rules sit outside Title 42 and are unaffected by it |
| Nonprofit staff | No specific exemption | The Commission states the Act sets forth no specific exemptions for nonprofit organizations |
| Independent contractor | Not an employee when genuinely independent | The Commission weighs direct evidence of the right or exercise of control, furnishing of equipment, method of payment and the right to fire |
That last row, the independent contractor, is the one that turns into a compliance file. The Commission says plainly that paying a worker on a 1099 does not settle the question, and that an employer can pay workers that way and still be required to carry coverage.
Where to Buy the Policy
South Carolina employers buy from private insurance carriers. There is no monopolistic state fund here, and the Commission does not sell coverage. Its employer FAQ names three routes: a commercial carrier licensed to write workers' compensation in South Carolina, the state's assigned risk program administered by the National Council on Compensation Insurance (NCCI), and self-insurance either individually or through an approved fund.
The State Accident Fund confuses people because the name sounds like a state fund open to anyone. It is not. Under S.C. Code Sections 42-7-40 and 42-7-50 it insures the State, and counties, municipalities and their agencies that elect to participate and pay the annual charge. A private business cannot buy a policy there.
| Route | Who it fits | What it takes |
|---|---|---|
| Commercial carrier | Nearly every small employer | A carrier licensed to write workers’ compensation coverage in South Carolina, placed through an agent |
| Assigned risk program | Employers the voluntary market declines | The state’s residual market, administered by the National Council on Compensation Insurance, as the Commission states in its employer FAQ |
| Membership in a self-insurance fund | Employers in a trade group that runs one | Form 6A, a $25 application fee, a current financial statement, a similar business to the fund’s members and a net worth of at least $25,000 (Regulation 67-1501F) |
| Individual self-insurance | Employers with the balance sheet to carry claims | Form 7, a $250 application fee, three years of audited financials or an auditor affidavit of net worth of at least $10 million, a claims administration plan and excess insurance quotes (Regulation 67-1501A) |
| Individual self-insurance, ongoing | Same | Security in the amount the Commission sets: a surety bond, a securities pledge or an irrevocable letter of credit, plus the Form 9 certificate for self-insurance |
S.C. Code Section 42-5-20 is the section that makes those routes the only lawful ones. Every employer accepting the compensation provisions has to insure with an authorized carrier or furnish the Commission satisfactory proof of financial ability to pay compensation directly. Premium tracks payroll and class code rather than the four-employee count that decides whether you need a policy at all.
What You Post and What You Hand Over
South Carolina handles employee notice through a poster rather than a new-hire packet. Commission Regulation 67-301 requires all employers operating under the Act, whether by law or by election, to post a Form 2, Employer's Notice of Being Subject to the Act, publicly in their place of business and keep it posted.
The Commission publishes that notice as the Workers' Compensation Compliance Poster and tells employers, on its compliance poster page, to download it and fill in your workers' compensation carrier's name, address and claims telephone number. A blank poster on the wall is not a posted notice.
The wording matters to the employee more than to you. Regulation 67-301 sets out the substance: the employer is operating under and subject to the Act, and in case of accidental injury or death the injured employee or someone acting for them shall give immediate notice to the employer, because failing to do so may delay payment or defeat the benefits entirely.
| Obligation | When | Authority |
|---|---|---|
| Post Form 2, the Workers’ Compensation Compliance Poster | While operating under the Act, publicly and continuously at the place of business | Commission Regulation 67-301A |
| Fill in the carrier name, mailing address and claims phone number | Before posting, and again whenever coverage changes | The Commission’s compliance poster instructions |
| Post or hand out an approved Form 38 on withdrawal | Before the effective date of withdrawal, which is 60 days after filing | Regulation 67-404B |
| Keep a record of every injury on a Form 12A | At the time of the injury, retained for two years | Regulation 67-411B(1) |
| Give the injured worker a copy of what was filed | Not prescribed by regulation as an employer duty | The carrier or administrator handles Commission filings, and denials go to the claimant in writing |
| New hire workers compensation pamphlet | Not required by South Carolina | No handout requirement located in Title 42 or the Commission regulations in Chapter 67 |
Nothing stops you from walking new hires through the poster and how to report an injury at orientation anyway. It is the cheapest insurance there is against a supervisor improvising after an accident.
Injury Reporting Deadlines
Two clocks run at once, and they are shaped differently. The employee has ninety days to give notice under S.C. Code Section 42-15-20.
Your own duty as the employer starts as a record on a Form 12A, and it turns into a filing deadline the moment the injury crosses a dollar threshold or costs real time away. Section 42-19-10 sets that filing at ten business days after the occurrence and the employer's knowledge of it.
| Step | Who acts | Deadline | Authority |
|---|---|---|---|
| Give notice of the accident | Employee | Immediately or as soon as practicable, and no compensation is payable unless notice comes within 90 days | Section 42-15-20(A) and (B) |
| Give notice of a repetitive trauma injury | Employee | 90 days from the date the employee discovered, or could have discovered, that the condition is compensable | Section 42-15-20(C) |
| Record the injury | Employer | At the time of the injury, on a Form 12A kept for two years | Regulation 67-411B(1) |
| Minor injury, under $500 in treatment, no more than one lost day and no permanency | Employer | No written report required if the employer pays the medical cost directly | Regulation 67-411B(2); Section 42-19-10 |
| Send the Form 12A to the carrier or administrator | Employer | Immediately, once treatment reaches $500, more than one day of work will be missed, or permanency is likely | Regulation 67-411B(4) |
| File the Form 12A with the Commission | Carrier or administrator | Within 10 business days of the occurrence and the employer’s knowledge, when treatment reaches $2,500 or there is compensable lost time or permanency | Regulation 67-411C(2); Section 42-19-10(2) |
| Deny the claim | Carrier or administrator | Within 10 business days, with written notice to the claimant plus the Form 12A, a Form 19 and the denial letter to the Commission | Regulation 67-411C(3) |
| Report a fatality | Employer, then the carrier | The employer reports all fatalities to its representative, which reports all fatalities to the Commission | Regulation 67-411B(5) and C(4) |
| Notify the Commission that payments began | Employer or carrier | Immediately upon making the first temporary disability payment | Section 42-9-260(A) |
| File the supplementary report | Employer | When the disability ends, and also at 60 days if it runs that long | Section 42-19-20 |
| File the claim | Employee | Within two years of the accident, or of death | Section 42-15-40 |
Safety reporting runs through a separate agency with separate clocks, and filing a Form 12A does nothing to satisfy it. If a serious injury or a fatality happens, handle the workplace safety report on its own timeline.
Penalties for Going Without
The civil penalty is a daily meter with a low floor and a hard ceiling. Under S.C. Code Section 42-5-40, an employer required to secure compensation who refuses or neglects to do so is fined one dollar for each employee at the time the insurance became due. Each day of the refusal or neglect costs at least ten dollars and at most one hundred dollars, until it ends.
The uglier half of that section is not the fine. During the gap, the employer is liable to an injured employee either for compensation under the Act or in a lawsuit for damages, and in that lawsuit the employer cannot raise the defenses the statute lists. The exclusive remedy that workers compensation normally buys you, protection from being sued over the injury, disappears exactly when you need it.
| Violation | Exposure |
|---|---|
| Refusing or neglecting to secure coverage | $1 per employee, with a floor of $10 and a ceiling of $100 for each day of refusal or neglect, until it ceases (Section 42-5-40) |
| An injury while uninsured | The employee may claim compensation or sue at law, and the uninsured employer may not defend on the grounds the statute lists (Section 42-5-40) |
| Willful refusal to secure coverage | Misdemeanor: a fine of $100 to $1,000, or imprisonment of 30 days to 6 months, or both (Section 42-5-45) |
| Refusing or neglecting to submit required forms and reports | $10 to $100 for each refusal or neglect under Section 42-19-30, assessable by the Commission with review and appeal |
| Deducting any part of the premium from an employee’s pay | Misdemeanor, punishable by a fine of up to $500 (Section 42-5-200) |
| A claim paid by the Uninsured Employers’ Fund | A lien on the employer’s assets, then a judgment with first-lien priority comparable to Department of Revenue tax liens, plus subpoena power over the employer (Section 42-7-200) |
| Ignoring a compliance citation | Prosecution through an Order and Rule to Show Cause. Failure to appear after proper service is an admission of the allegations |
Enforcement is a process rather than a surprise bill. Commission Regulation 67-1402 has an officer investigate, then issue a citation with findings of fact and a proposed fine along with a Compliance Agreement. The employer has fourteen days to sign and pay, or to ask the director for a review, and failing to respond within those fourteen days moves the matter to prosecution.
Signing the Compliance Agreement is itself an admission with teeth. The form agrees that the Commission has jurisdiction, that the employer should have had coverage during the stated period and did not, that it will comply going forward, that it will defend any claim brought against it, and that it will promptly pay any claim found compensable.
What to Do When Someone Gets Hurt
The order matters, and the first step is medical rather than administrative. Under S.C. Code Section 42-15-60 the employer provides the medical treatment, which also means the employer or its carrier directs it. The clinic you send someone to in the first hour usually becomes the treating relationship for the life of the claim.
The failure mode I see is not bad faith, it is memory. Nobody writes down who was told, on what date, or which clinic the supervisor called. FirstHR keeps the incident record, the acknowledgment and the employee file in one place, so the dates that decide a South Carolina claim are not living in someone's text messages.
What the Policy Pays
South Carolina pays two-thirds of the average weekly wage for total disability under S.C. Code Section 42-9-10, capped by a maximum weekly compensation rate the Commission resets every January. The cap that applies to a claim for its whole life is the rate for the year the injury happened, not the current year.
For accidents on or after January 1, 2026, that maximum is $1,189.94 a week. The Commission published it on its compensation rates page after the Department of Employment and Workforce certified the state average weekly wage for the fiscal year ending June 30, 2025. An advisory notice dated January 13, 2026 set that figure and superseded the December 15, 2025 order.
| Benefit | Amount | Duration or limit |
|---|---|---|
| Maximum weekly compensation rate, injuries on or after January 1, 2026 | $1,189.94 per week | Fixed for the life of that claim |
| Maximum weekly compensation rate, injuries in 2025 | $1,134.43 per week | Fixed for the life of that claim |
| Total disability | Two-thirds of the average weekly wage, not less than $75 a week unless the wage itself is lower, capped at the year’s maximum | Up to 500 weeks, with lifetime benefits for paraplegia, quadriplegia or physical brain damage (Section 42-9-10) |
| Partial disability | Two-thirds of the difference between the pre-injury wage and what the employee can earn after | Up to 340 weeks from the date of injury (Section 42-9-20) |
| Waiting period | Nothing for the first seven calendar days of disability | If the disability runs more than 14 days, compensation is allowed from the first date of disability (Section 42-9-200) |
| Medical treatment | Provided by the employer, including supplies and original artificial members | Up to ten weeks from the injury, and longer where the Commission finds it will lessen the period of disability (Section 42-15-60) |
| Travel reimbursement | The state employee mileage rate, 76 cents per mile from July 1, 2026 | Payable for travel to and from treatment more than five miles from home (Regulation 67-1601) |
| Death benefits | Two-thirds of the average weekly wage to wholly dependent survivors, capped at the year’s maximum | 500 weeks from the date of injury (Section 42-9-290) |
| Burial expenses | Up to $12,000 | Paid under Section 42-9-290 |
| Late payment of compensation | 10 percent added to the unpaid installment | Applies to any installment not paid within 14 days of becoming due, unless the Commission excuses the delay (Section 42-9-90) |
Those numbers are what the premium buys. Because the premium itself moves with payroll and class codes, the year-end reconciliation can change the bill after the policy year closes.
Frequently Asked Questions
How many employees before South Carolina requires workers compensation?
Four. The Commission states that businesses regularly employing four or more employees within South Carolina must maintain coverage, and Section 42-1-150 defines employment the same way. The other half of the test is payroll: Section 42-1-360(2) also exempts an employer whose total annual payroll in the previous calendar year was under three thousand dollars, whatever the headcount was.
Do part-time workers and family members count toward the four?
Yes. The Commission counts part-time workers and family members as employees, and its coverage guidance says an employer who regularly has four or more workers, full time or part time, needs the insurance. Casual employees are the narrow exception, and the work has to be both casual and outside the course of your trade or business.
Can an owner or corporate officer opt out?
A corporate officer can reject the Act by filing a Form 5 with the employer's insurance carrier and giving the employer a copy, under Regulation 67-402. Section 42-1-520 then leaves that officer at common law, meaning an ordinary injury lawsuit where contributory negligence, fellow servant negligence and assumption of risk are available to the employer. Sole proprietors and partners are not employees unless they elect in while actively engaged in the business and the insurer is notified.
Does South Carolina have a state workers compensation fund?
Not for private employers. Coverage comes from a commercial carrier licensed in South Carolina, the assigned risk program administered by the National Council on Compensation Insurance, or self-insurance. The State Accident Fund insures the State and the counties and municipalities that elect to participate, not private businesses.
What are the penalties for not carrying coverage?
One dollar per employee per day, with a floor of ten dollars and a ceiling of one hundred dollars for each day of refusal or neglect, until it stops. A willful refusal is a separate misdemeanor carrying a fine of one hundred to one thousand dollars or thirty days to six months in jail. During the gap the injured worker can also sue at law, and the employer loses the listed defenses.
How fast does a work injury have to be reported?
The employee gives notice immediately or as soon as practicable, and within ninety days at the outside. You record it on a Form 12A, send it to your carrier immediately once treatment reaches five hundred dollars, more than one day of work is missed, or permanency looks likely, and the carrier files with the Commission within ten business days at the two thousand five hundred dollar or lost-time threshold.
What has to be posted at a South Carolina workplace?
Form 2, the Workers' Compensation Compliance Poster, publicly and continuously at the place of business, with the carrier name, mailing address and claims telephone number filled in. Regulation 67-301 applies it to every employer operating under the Act, whether by law or by election. No separate new hire pamphlet is required by the state.
Start with the count. If you regularly employ four or more people, part-timers and family included, and you clear the payroll test, get the policy and the filled-in poster in place first. Injury paperwork is one piece of a bigger state picture that includes mandatory E-Verify, new hire reporting and the wage notice rules.