West Virginia Workers Compensation Rules for Employers
West Virginia requires workers compensation from your first employee. Who is exempt, where the policy comes from, the deadlines, and the penalties.
West Virginia Workers Compensation
Coverage from the first employee, the short list of real exemptions, where the policy comes from, and what a lapse costs
The call I get from West Virginia owners usually opens the same way. They ran a business in a neighboring state that sets a three worker threshold, they moved operations across the line, they hired one person, and they assumed the small end of the payroll was safe for a while. It never was.
West Virginia is a first-employee state. There is no headcount to reach and no waiting period to use up. The exemptions that do exist are narrow and specific, and none of them is a size test for an ordinary small business.
There is a second confusion worth clearing early. West Virginia ran a state fund for a century and privatized it in legislation that took effect in 2006, so plenty of guidance still floating around describes a system that no longer exists. This page covers one jurisdiction and one topic. How the trade of guaranteed benefits for the right to sue works at all sits in our guide to workers compensation insurance. Everything else about employing people in the state is in the West Virginia HR compliance guide.
Which West Virginia Employers Must Carry Coverage
All of them, from the first employee. The Insurance Commissioner’s coverage rule opens with one sentence that settles the question: every employer is required to obtain West Virginia workers’ compensation coverage for the protection of its employees. The agency repeats it on its Employer Coverage page, which says all West Virginia employers are statutorily required to maintain coverage.
The word employer is drawn wide on purpose. W. Va. Code St. R. 85-8-3.5 reaches an individual, sole proprietor, firm, partnership, limited partnership, limited liability company, joint venture, association, corporation, receiver, estate, trust, guardian, executor, government entity or any other entity regularly employing another person to carry on a form of industry, service or business in the state.
Nonprofits get no pass. The same rule says industry, service or business includes any not-for-profit entity or volunteer organization to the extent that it employs individuals. A charity with two paid staff is an employer for this purpose in exactly the way a contractor with two crew members is.
Who Counts as an Employee in West Virginia
Everyone on the payroll, plus anyone you have misfiled as a contractor. Because the state requires coverage from the first employee, West Virginia never asks you to count heads. It asks a harder question instead: which of the people working for you are legally employees.
That test is statutory rather than improvised. The Insurance Commissioner defines an independent contractor by reference to the West Virginia Employment Law Worker Classification Act at W. Va. Code 21-5I-1 and following, with the specific test at 21-5I-4. A policy is not required to cover people who meet it, and self-insured employers are not required to cover them either.
| The classification question | How West Virginia answers it | Why it matters to a small employer |
|---|---|---|
| Can a worker be both employee and contractor? | No. 85-8-6.2.3 forbids classifying the same person both ways for the same employer at the same time | The part-time bookkeeper who also drives on Saturdays is one status, not two |
| Must you treat a qualifying worker as a contractor? | No. 85-8-6.2.4 lets you hire that person as an employee instead, and says to set the terms at the outset | When the classification is genuinely close, hiring as an employee removes the risk entirely |
| Do contractors get a safety net if you were wrong? | No. 85-8-6.2.5 makes independent contractors ineligible for payments from the Uninsured Employers’ Fund | A misclassified worker who is later held to be an employee lands on you, not on the fund |
| Do part-time and seasonal workers count? | There is no hours test in the coverage rule. An employer regularly employing another person is an employer | A single Saturday helper puts you inside the mandate |
| Do out-of-state workers on a short job count? | Not for 30 calendar days or less in any 365-day period, under 85-8-7.1 | Past 30 days the crew needs West Virginia coverage and the carrier needs to know |
| Can your subcontractor’s problems become yours? | Yes. W. Va. Code 23-2-1d and 85CSR10 make a primary contractor liable for a subcontractor’s workers compensation obligations in defined circumstances | Verify every subcontractor’s coverage before the work starts, not at the audit |
Two duties run alongside the classification question and both bite at audit time. W. Va. Code St. R. 85-8-4.2 gives every employer a continuous and ongoing duty to keep its carrier current on business activities, including anything that could affect payroll or premium. 85-8-6.6.1 adds a duty to report the entire payroll of all employees.
If your subcontractor mix or your job classifications have drifted since the policy was written, the reckoning arrives with the audit rather than with a notice from the state. What the auditor asks for is covered in our walkthrough of the workers compensation audit, and the classification question itself is the subject of employee versus contractor.
Who Is Left Out of the West Virginia Requirement
Seven categories, all of them narrow. W. Va. Code St. R. 85-8-4.3 lists the exemptions from otherwise mandatory coverage, and Insurance Commissioner Informational Letter No. 201 reprints them for the people who ask about exemption letters.
| Who | Does West Virginia require coverage? | The condition attached |
|---|---|---|
| Domestic service workers | No | Household work in or about a private home, performed for the household. Rule 85-8-3.3 lists cooks, housekeepers, babysitters, caregivers, handymen, gardeners and family chauffeurs |
| Employees of a maid service or temp agency working in that same home | Yes | 85-8-3.3.2 says work done for someone other than a member of the household is not domestic service. The exemption follows the household, not the task |
| Agricultural workers | Only above five | An employer with five or fewer full-time employees in agricultural services is exempt for those employees |
| Casual employment | No | A casual employer is one that employs not more than three people for a temporary, intermittent and sporadic period not exceeding ten calendar days in a calendar quarter |
| Churches | No | Named outright as an exempt employer in 85-8-4.3.4 |
| Organized professional sports | Participants only | Trainers and jockeys in thoroughbred racing may be exempted. The driver who hauls the horses and equipment must be covered |
| Volunteer rescue squads and police auxiliary units | No, for the volunteers | Must be organized under a county commission, municipality, other government body or an emergency medical services board. Paid employees must be covered |
| Employees covered by the federal Longshore and Harbor Workers’ Compensation Act | No, for those employees | Everyone on the payroll who is not covered federally still needs a West Virginia policy |
| Sole proprietors and partners | Not employees, may elect in | Elections are governed by W. Va. Code 23-2-1(g) and 31B-12-1207. An owner who works and takes pay as an employee is an employee |
| Corporate officers and directors | Employees unless elected out | The election is capped at four principal officers (president, vice president, secretary, treasurer) plus board members. Other officers working in a dual capacity cannot be elected out |
| LLC managers, officers and members | Employees unless elected out | Capped at four people, each acting as a manager, officer or member of the company |
| Limited partners and pure investors | No | Not employees under 85-8-6.7 and 85-8-6.8 unless they work in the service of the business |
| Independent contractors | No, if the classification holds | Classified under the Employment Law Worker Classification Act test at W. Va. Code 21-5I-4. Contractor status alone does not qualify a business for an exemption letter |
Elections out are a paperwork exercise with a strict shape. Under 85-8-6.4 the employer gives the private carrier written notice naming the positions that are not to be covered along with the names and social security numbers of the people holding them, and stops including their wages in payroll reports. The election takes effect for the next policy period and carries forward with the same carrier.
It is also personal rather than positional. An election is valid only for the individuals named, so the successor in the same office is covered again until you amend the notice. Bringing someone back under the policy needs 60 days of written notice before the coverage period in which coverage is sought, or it slips to the period after that.
If you believe you fit one of the seven exempt categories, you can ask the Insurance Commissioner for a letter of exemption on the agency’s form. The processing fee is $25. Informational Letter No. 201 is blunt that being an independent contractor is not a basis for one of these letters, which is the request the agency evidently receives most often.
Where a West Virginia Employer Buys the Policy
From a private carrier, through an agent. West Virginia ran a monopolistic state fund for most of its history and stopped selling coverage under privatization legislation that took effect in 2006. The Offices of the Insurance Commissioner now count over 350 carriers writing workers compensation in the state and report that aggregate loss costs have fallen more than 82 percent since the change.
That history is the reason so much stale advice circulates. There is no state fund to buy from and no monopolistic-fund gap in employer’s liability coverage to plug, because the state is out of the insurance business. What survives from the old system is the Old Fund, which exists to run off pre-privatization liabilities and shows up in the rules mainly as a way to be in default.
| Route | How you get there | Who regulates it |
|---|---|---|
| Commercial policy | Buy from an agent or from an insurer authorized by the Insurance Commissioner to write workers compensation in West Virginia | Offices of the Insurance Commissioner |
| Assigned Risk Plan | Apply through the National Council on Compensation Insurance after declinations from at least two voluntary market carriers within the prior 60 days | Insurance Commissioner, with NCCI as plan administrator |
| Individual self-insurance | Apply under W. Va. Code 23-2-9 and 85CSR18 for approval by the Insurance Commissioner and the Industrial Council | Insurance Commissioner, Self-Insurance Unit |
| Self-insured risk pools | Approved self-insured employers secure their liability through the security and guaranty risk pools maintained under 85CSR19 | Insurance Commissioner |
| Professional employer organization | Enter an arrangement with a PEO operating under 85CSR31 | Insurance Commissioner |
| State fund | Does not exist. West Virginia privatized in 2006 | Not applicable |
The Assigned Risk Plan is the market of last resort and the Insurance Commissioner describes it plainly in its residual market explainer. Rates there are often higher than the voluntary market, which is why applicants must show two declinations first. A notice of nonrenewal on existing coverage counts as one of the two. NCCI takes the application online at no charge and assigns the policy to a servicing carrier, and the assignment is random rather than requested.
Price is set by the class code for the work, your payroll and an experience modifier built from your own claim history. On top of premium sits a state surcharge that a lot of first-time buyers do not expect.
FirstHR is not an insurer or a broker and does not sell coverage, so read this section as a map of the West Virginia market rather than a recommendation. What we hold is the employee record that the policy, the audit and the claim all depend on.
What Qualifying to Self-Insure Takes in West Virginia
More financial depth and more patience than a small business has. Self-insurance runs through the Insurance Commissioner under W. Va. Code 23-2-9 and W. Va. Code St. R. 85CSR18, and the entry requirements make the scale obvious before you reach the security deposit.
The application asks for audited financial statements covering each of the three fiscal years preceding the filing, sworn to by the president, vice president and secretary of a corporation, by all partners of a partnership, or by the owner of a sole proprietorship. If you lean on a parent company’s financials, the parent documents the relationship, signs as well and satisfies the same financial responsibility tests.
Then comes the money. The minimum application processing fee is $2,500 and it is not refundable, and the Commissioner may raise it if processing costs more. Approved employers post security or bond in the form and amount the Commissioner sets: an occurrence-type surety bond, marketable government debt instruments maturing within ten years, or a letter of credit from a United States bank carrying an evergreen clause. Catastrophic exposure can trigger extra security, excess insurance or both.
Timing is unforgiving in one specific way. Self-insured status takes effect on the first day of the calendar quarter following the month of approval, and until then you keep paying your private carrier. Employers who cancel early to save a quarter of premium create exactly the uninsured gap this page is about. The Self-Insurance Unit then reviews every self-insured employer’s claims, finances, compliance and security once a year, and keeps regulating employers who have stopped self-insuring but still administer old claims.
The Poster, and What You Owe a New Hire
One posting is mandatory, and West Virginia does not print it for you. W. Va. Code 23-2C-15(b) is quoted verbatim by the Insurance Commissioner on its workers compensation forms page: every employer shall continuously post a notice upon its premises in a conspicuous place identifying its workers’ compensation insurer, and the notice must include the name, business address and telephone number of the insurer and of the person to contact with questions about a claim.
The agency then says something unusual. There is currently no legislative rule addressing the requirement, and these workplace notices are not subject to review or approval by the Insurance Commissioner. No prescribed size, no prescribed typeface, no state form to download. The obligation is real and the artwork is yours.
The Commissioner does interpret the two required pieces. The insurer identification is self-explanatory. The contact person can be one of your own people, such as a manager, human resources director or benefits coordinator, or an adjuster for the insurer, or the insurer’s third-party administrator, provided that the person is readily available to the injured worker and knows enough about the claims process to help.
There is a second posting you never want to see. Under W. Va. Code St. R. 85-11-4, when the Commissioner discovers that an employer is not maintaining coverage, the agency writes a notice to that employer’s employees, has it posted in a conspicuous place at the chief works, and sends a copy to the Secretary of State for publication in the State Register. The notice carries a printed warning that anyone who removes, defaces or renders it illegible before the employer returns to good standing is guilty of a misdemeanor and shall be fined $1,000.
Injury Reporting Deadlines in West Virginia
Two clocks, and the second one runs to your insurance carrier rather than to a state agency. The employee should give notice immediately. You have five days from that notice to report the injury to your private carrier.
| What has to happen | Deadline | Who does it | Authority |
|---|---|---|---|
| Employee seeks medical care for the injury | Immediately after the injury | Employee | W. Va. Code St. R. 85-1-3.1 |
| Employee gives the employer written notice of the injury | Immediately on occurrence or as soon as practicable. Notice within 2 working days is deemed immediate | Employee or someone acting for the employee | W. Va. Code St. R. 85-1-3.1 |
| Employee files a claim, or asks that one be filed | Immediately after the injury, on form OIC-WC-1 | Employee, with Section II completed by the initial healthcare provider | 85-1-3.1 and OIC approved forms |
| Employer reports the injury to its private carrier | Within 5 days of receiving notice of the employee’s desire to file a claim | Employer | W. Va. Code St. R. 85-1-4 |
| Employer completes the Employers’ Report of Occupational Injury or Disease | With the report to the carrier, on form OIC-WC-2 | Employer | OIC approved forms |
| Waiting period before temporary total disability is payable | More than 3 consecutive calendar days of inability to work | Carrier | W. Va. Code St. R. 85-1-5.1 |
| The first 3 days become payable | Once the worker is unable to work more than 7 consecutive calendar days | Carrier | W. Va. Code St. R. 85-1-5.1 |
| Employer tells the state it no longer has employees requiring coverage | When the business closes, is sold, or the last covered employee leaves | Employer, on the OIC Termination of Coverage form | OIC Revenue Recovery |
Late notice from the worker does not end the claim by itself. W. Va. Code St. R. 85-1-3.1 says failure to give immediate notice weighs against a finding of compensability and dilutes the credibility of the claim, then adds that under no circumstances shall late notice be the sole basis for denial.
The same rule hands employers something useful. Enforcing a personnel policy that requires a claimant to report an injury immediately is expressly not a discriminatory practice under Chapter 23. So write the policy, put it in the handbook, apply it evenly, and you are standing on the Commissioner’s own words rather than on hope.
What Going Without Coverage Costs in West Virginia
Twice your monthly base premium for every month or part of a month you were uninsured, capped at $10,000. The fine sits in the employer default rule published with the rest of the Title 85 workers compensation rules at 85-11-19, and W. Va. Code 23-2C-8(d)(3) sets the cap. It applies whether or not you have coverage by the time the uninsured stretch is discovered, and restoring coverage then lapsing again starts a fresh fine up to another $10,000.
| Exposure | What West Virginia imposes |
|---|---|
| Uninsured fine | Twice the monthly base premium calculated at the start of the uninsured period, for each month or part of a month, capped at $10,000 per continuous period |
| Repeat lapse | A second uninsured period after coverage is restored carries its own fine of up to another $10,000 |
| Liability to the Uninsured Employers’ Fund | Repayment of everything the fund spends on your injured worker: all medical and indemnity benefits, claim administration costs, defense attorney fees and interest |
| Suit by your own employee | The Commissioner posts a notice telling your employees you are uninsured and may be sued by them for work related injuries |
| No coverage for the owners | An employer that fails to maintain required coverage gets no coverage for its partners, members, proprietor or officers, and no Uninsured Employers’ Fund benefits for them |
| Default follows the injury, not the cure | If you are in default on the date of injury, the exclusion lasts for the life of that injury even after you pay up, and benefits paid meanwhile become overpayments |
| Default List and Employer Violator System | The company plus every owner, officer, member, partner and holder of a 10 percent or greater ownership interest goes into the Employer Violator System until the company comes off the Default List |
| State licenses, permits and contracts | Under 85CSR32 a state agency must refuse to grant, issue or renew, and must revoke, any contract, license, permit or certificate to conduct a trade, profession or business held by an employing unit on the Default List |
| Injunction against operating | The Commissioner may sue in the Circuit Court of Kanawha County to enjoin a default employer from carrying on business, or instead require a bond of at least 50 percent more than the amounts due |
| Dissolution blocked | The Secretary of State withholds any certificate of dissolution or withdrawal until the Commissioner certifies that the employer has cured or arranged to cure the default |
| False statements | Knowingly and willfully making false statements about information required under Chapter 23 is a felony under W. Va. Code 61-3-24e(5), punishable by up to three years confinement, a fine up to $10,000, or both |
The Employer Violator System is the piece small owners underestimate, because it attaches to people rather than to the company. W. Va. Code St. R. 85-11-20 puts every owner, officer, member, partner and holder of a substantive ownership interest into the system alongside the business, and keeps them there until the business leaves the Default List.
Landing on that list is not a surprise. Under 85-11-17 the Commissioner sends written notice first, states the circumstances causing the default, gives 15 days before the listing takes effect, and offers an expedited administrative hearing that has to be held within 10 business days of the request. The letter you leave unopened is the entire warning.
What to Do When Someone Gets Hurt, in Order
Care first, paperwork the same day, carrier inside five days. West Virginia keeps the ordinary claim between the worker, the treating provider and your carrier, which means the sequence below is mostly about not being the reason a good claim goes sideways.
Most of what goes wrong after this point is a records problem rather than a legal one: who was hired when, which state they actually work in, what they were told at onboarding, and where the signed acknowledgment went. That part is what FirstHR holds. The policy still comes from your carrier.
Prevention is the cheaper end of all of this, and the rules that govern it are federal here. Our guide to OSHA requirements for employers covers the recordkeeping and hazard obligations that sit underneath every claim on this page.
If you operate in more than one state, none of these numbers travel. Thresholds, exclusions and deadlines are set state by state, which is what our state-by-state requirements guide exists to compare. Wage rules split the same way, which is why West Virginia has its own minimum wage page.
Frequently Asked Questions
Does a West Virginia business with one employee need workers compensation?
Yes. West Virginia sets no headcount threshold. The Insurance Commissioner’s coverage rule states that every employer is required to obtain West Virginia workers’ compensation coverage for the protection of its employees, and the agency’s Employer Coverage page says flatly that all West Virginia employers are statutorily required to maintain it. Employer is defined broadly in W. Va. Code St. R. 85-8-3.5 to include an individual, sole proprietor, partnership, limited liability company, joint venture, association, corporation, trust, estate, government entity or any other entity regularly employing another person to carry on industry, service or business in the state. Not-for-profit and volunteer organizations are included to the extent that they employ people. Some neighboring states do set a numeric threshold, which is where the confusion usually starts. West Virginia does not, and assuming otherwise is the most expensive mistake on this page.
Are sole proprietors, partners and LLC members covered in West Virginia?
Generally not, unless they elect to be. The Insurance Commissioner’s rule treats elections not to provide coverage for partners of a partnership, sole proprietors, members and certain investors in limited liability companies, and certain corporate officers as governed by W. Va. Code 23-2-1(g) and 31B-12-1207. A limited partner under the Uniform Limited Partnership Act is not an employee unless that person actually works in the service of the partnership, and a person who is solely an investor and takes no part in directing, administering or controlling the business is not an employee either. The exception matters as much as the rule: an owner who works in the business and takes pay as an employee is an employee. If you want owners covered, tell the carrier in writing rather than assuming the policy reaches them.
Can a West Virginia employer leave corporate officers off the policy?
Yes, within limits. Under W. Va. Code St. R. 85-8-6.3 an employer may elect not to cover certain corporate officers and all members of the board of directors, and anyone elected out is not entitled to benefits under Chapter 23. The election for officers is capped at four principal officers: president, vice president, secretary and treasurer. Other officers and assistant officers who work in a dual capacity, meaning they also perform work an ordinary employee would do, cannot be elected out, and the burden of proving otherwise is on the employer. Limited liability companies may elect out no more than four people, each acting as a manager, officer or member. The election is made by written notice to the private carrier naming the positions and the individuals, and it takes effect for the next policy period.
Does West Virginia have a state workers compensation fund?
No. West Virginia ran a monopolistic state fund for most of its history and privatized the system in legislation that took effect in 2006. The Offices of the Insurance Commissioner now report over 350 carriers offering workers’ compensation insurance to West Virginia employers, and say aggregate loss costs have fallen more than 82 percent since privatization. You buy from a licensed private carrier through an agent. Employers who cannot get a quote in the voluntary market use the Assigned Risk Plan, the market of last resort, for which the National Council on Compensation Insurance is the plan administrator. Applicants need declinations from at least two voluntary market carriers within the 60 days before applying, and a notice of nonrenewal counts as one of the two.
How fast does a work injury have to be reported in West Virginia?
The employee should tell you immediately, and you have five days to tell your carrier. Under W. Va. Code St. R. 85-1-3.1 an injured worker should seek medical care, give the employer written notice of the injury immediately or as soon as practicable, and file a claim or ask that one be filed. Notice given within two working days is deemed immediate. Late notice weighs against compensability but the rule says it can never be the sole basis for denying a claim. On the employer side, 85-1-4 requires you to report to the private carrier every injury sustained by anyone in your employ within five days of receiving notice of the employee’s desire to file a claim. The filing goes to your carrier, not to a state agency.
What is the penalty for not carrying workers compensation in West Virginia?
The fine is twice your monthly base premium for each month or part of a month you were uninsured, capped at $10,000 for a single continuous uninsured period under W. Va. Code St. R. 85-11-19 and W. Va. Code 23-2C-8(d)(3). Lapsing again after you restore coverage starts a fresh fine up to another $10,000. The fine is the smallest part. You repay the Uninsured Employers’ Fund for every dollar it spends on your injured worker, including medical and indemnity payments, claim administration costs, defense attorney fees and interest. You go on the Workers’ Compensation Default List, and so does every owner, officer, member, partner and holder of a 10 percent interest, through the Employer Violator System.
Is an independent contractor exempt from West Virginia workers compensation?
A properly classified independent contractor does not have to be covered, but that is a classification question rather than an exemption. West Virginia decides status under the Employment Law Worker Classification Act at W. Va. Code 21-5I-1 and following, with the test set out in 21-5I-4. The Insurance Commissioner adds three points employers miss. A person cannot be classified as an employee and an independent contractor of the same employer at the same time. An employer is never required to treat a qualifying worker as a contractor and may hire that person as an employee instead. And independent contractors are not eligible for payments from the Uninsured Employers’ Fund. Informational Letter No. 201 confirms that contractor status is not one of the categories that qualifies a business for a letter of exemption.