Do Employers Need Workers Comp for Part-Time or Seasonal Employees?

When it comes to workers’ comp, many employers are unsure whether part-time and seasonal employees must be included in their coverage.

We have been seeing audits come back for some of our business clients for ectra premium because the owners didn not include part time or seasonal workers in their payroll estimates for their workers comp policies.  This confusion can lead to costly mistakes, especially during workers’ compensation audits.

Let’s break down the requirements and explain why, unless you’re using a staffing or temp agency that covers workers’ comp, you must include part-time and seasonal employees in your policy.

Understanding Workers’ Compensation Coverage

Workers’ compensation insurance is a crucial safeguard for both employers and employees. It provides benefits to workers who suffer job-related injuries or illnesses. These benefits typically cover medical expenses, lost wages, and rehabilitation costs. For employers, having workers’ comp protects them from potentially devastating lawsuits and helps ensure they comply with state regulations.

Are Part-Time Employees Covered?

One common misconception is that part-time employees don’t need to be included in workers’ compensation policies. However, this is not the case. In most states, including Maryland, part-time employees must be covered under the employer’s workers’ comp policy. The reasoning is simple: part-time employees are just as likely to suffer a work-related injury as full-time employees, and they are entitled to the same protections.

Employers must include part-time employees in their workers’ compensation coverage and report their payroll during the workers’ comp audit. Failing to do so can result in penalties, increased insurance premiums, and even legal trouble if a part-time employee is injured and not properly covered.

Seasonal Employees and Workers’ Comp

Seasonal employees present another area of confusion for employers. These are workers hired temporarily to meet increased demand during certain times of the year, such as during holidays or peak seasons in industries like agriculture, retail, and hospitality.

Just like part-time employees, seasonal employees must be included in your workers’ compensation coverage. Even though their employment is temporary, their risk of injury on the job is the same. If you hire seasonal workers, their payroll must also be reported during your workers’ comp audit. Neglecting to include these employees can lead to the same negative consequences as omitting part-time employees.

What About Staffing or Temp Agencies?

The exception to these requirements comes into play if you hire part-time or seasonal workers through a staffing agency or temp agency. In these cases, the agency is typically responsible for providing workers’ comp coverage for their employees. However, it’s crucial to confirm this with the agency before proceeding. You don’t want to be caught off guard in the event of an injury or during an audit.

If you’re directly employing part-time or seasonal workers, you are responsible for their workers’ compensation coverage. It’s always best to clarify with the agency and ensure all parties understand their obligations.

Why It’s Essential to Include All Employees in Your Workers’ Comp

Including all eligible employees in your workers’ compensation coverage isn’t just about following the law; it’s about protecting your business and your workforce. Workers’ comp is designed to provide support when your employees need it most. By ensuring that all part-time and seasonal employees are covered, you’re safeguarding your business from potential liabilities and showing your employees that their well-being matters, regardless of their employment status.

How to Ensure Compliance

 To stay compliant with workers’ comp regulations and avoid costly mistakes:

1. Review Employment Status Regularly: Regularly review your employees’ status, including part-time and seasonal workers, to ensure they are covered under your workers’ comp policy.
2. Keep Accurate Payroll Records: Maintain accurate and up-to-date payroll records for all employees, including part-time and seasonal workers. This will help you during workers’ comp audits.
3. Communicate with Staffing Agencies: If you use a staffing or temp agency, confirm that they provide workers’ comp coverage for the employees they assign to your business.
4. Consult with an Insurance Professional: If you’re unsure about your obligations, consulting with an insurance professional, like those at Huff Insurance, can provide clarity and peace of mind.

Final Thoughts

Navigating workers’ compensation requirements can be tricky, especially when dealing with part-time and seasonal employees. However, by understanding the regulations and including all eligible employees in your coverage, you can avoid penalties, protect your business, and ensure that your entire workforce is supported.

If you have questions or need assistance with your workers’ comp policy, Huff Insurance in Maryland is here to help. We’re committed to ensuring that all aspects of your coverage are in order, so you can focus on running your business with confidence.

Fireplace and Chimney Safety for Homes

Fireplaces and chimneys are wonderful additions to any home, providing warmth, comfort, and ambiance. However, they also come with responsibilities. Ensuring your fireplace and chimney are well-maintained is crucial for keeping your home safe from fires and other hazards. This guide will help you understand the best practices for fireplace and chimney safety, so you can enjoy the cozy atmosphere without worry.

Regular Inspections and Cleanings

One of the most important steps in maintaining fireplace and chimney safety is regular inspections and cleanings. Over time, creosote, a highly flammable byproduct of burning wood, can build up in your chimney. If left unchecked, it can ignite and cause a chimney fire. Here’s what you should do:

• Annual Inspections: Have a certified chimney sweep inspect your chimney at least once a year. They’ll check for creosote buildup, blockages, cracks, and other potential hazards.
• Regular Cleanings: Depending on how often you use your fireplace, your chimney may need to be cleaned more than once a year. The National Fire Protection Association recommends cleaning once there’s 1/8-inch of creosote buildup.
• Check Your Fireplace: Inspect your fireplace regularly for any cracks or signs of wear in the firebox, which could lead to problems if left unaddressed.

Safe Firewood Practices

The type of wood you burn and how you store it plays a significant role in fireplace safety. Here are some tips to keep in mind:

• Use Seasoned Wood: Always burn seasoned hardwood, such as oak, maple, or hickory. Seasoned wood has been dried for at least six months and produces less creosote than unseasoned wood.
• Avoid Treated Wood: Never burn wood that’s been painted, stained, or treated with chemicals. This type of wood can release harmful fumes when burned.
• Store Wood Properly: Keep your firewood stacked at least 20 feet away from your home and off the ground to prevent pests and moisture from affecting it.

Safe Fireplace Operation

Knowing how to safely operate your fireplace is key to preventing accidents and ensuring a cozy, worry-free experience:

• Use a Fireplace Screen: Always use a metal or glass fireplace screen to prevent embers from escaping and starting a fire.
• Don’t Overload the Fireplace: It can be tempting to pack the fireplace with logs, but this can lead to excessive heat and increase the risk of a chimney fire.
• Never Leave a Fire Unattended: Make sure the fire is completely out before you go to bed or leave the house.

Properly Disposing of Fireplace Ashes

Over the years, we have handled multiple home insurance claims where the homeowner did not properly dispose of the ashes.  In one case, they places ashes in their trash can outside of their house, only to be awakened by the sound of smoke alarms when the ashes caught the can and the side of their house on fire.

After enjoying a fire, it’s important to safely dispose of the ashes to prevent any accidental fires. Here’s how to do it:

• Let Ashes Cool: Always allow ashes to cool for at least 24 to 48 hours before attempting to remove them. Hot embers can remain hidden in the ashes long after the fire has died out.
• Use a Metal Container: Transfer the cooled ashes into a metal container with a tight-fitting lid. Never use a plastic or paper bag, as residual heat could cause them to ignite.
• Store Safely: Place the metal container outside, away from your home and any combustible materials. A good rule of thumb is to keep it at least 10 feet away from any structures.
• Dispose of Properly: Once the ashes are completely cool, they can be disposed of with your regular trash, or consider using them in your garden as fertilizer if the wood was untreated.

Chimney Cap and Damper Maintenance

The chimney cap and damper are essential components that contribute to the safe operation of your fireplace:

• Chimney Cap: A chimney cap helps prevent debris, animals, and moisture from entering the chimney. It also acts as a spark guard, keeping embers from escaping onto your roof.
• Damper: The damper controls the flow of air through your chimney. Ensure it opens and closes properly to prevent drafts and smoke from entering your home.

Gas Fireplace and Chimney Safety

Gas fireplaces are a popular alternative to traditional wood-burning fireplaces because they are cleaner and more convenient. However, they still require proper maintenance and care to ensure safety. Below are some essential tips to keep in mind when using a gas fireplace.

• Annual Inspections: Just like wood-burning fireplaces, gas fireplaces should be inspected by a professional at least once a year. This ensures that the gas lines, valves, and other components are in good working order and free of leaks.
• Clean the Glass: The glass front of your gas fireplace can accumulate soot over time. Clean it regularly with a non-abrasive cleaner to maintain clear visibility and safety.
• Check for Leaks: Routinely check the gas lines for any signs of leaks. If you smell gas or suspect a leak, turn off the gas immediately and contact a professional.
• Use the Right Fuel: Only use the type of gas recommended by the manufacturer. Never attempt to burn wood, paper, or other materials in a gas fireplace.
• Keep the Area Clear: Ensure that the area around the gas fireplace is clear of flammable materials such as curtains, furniture, and decorations.
• Proper Ventilation: Make sure the fireplace is properly vented to the outside to prevent carbon monoxide buildup. Always open the vent or flue before lighting the fireplace.

Carbon Monoxide and Smoke Detectors

Even with all the right precautions, it’s crucial to have working carbon monoxide and smoke detectors in your home. Here’s why:

• Carbon Monoxide Detectors: Carbon monoxide is an odorless, colorless gas that can be deadly if it builds up in your home. Install detectors near your fireplace and in sleeping areas, and test them regularly.
• Smoke Detectors: Smoke detectors should be installed in every level of your home, particularly near bedrooms. They provide an early warning if a fire starts, giving you and your family time to escape.

Huff Insurance Can Help

At Huff Insurance, we understand the importance of keeping your home safe. As an independent insurance agent, we have access to multiple markets to find the right coverage at the right price. If you need homeowners insurance we’re here to help you protect your investment. Contact us today to learn more about how we can help you stay safe and secure.

Do You Have Enough Business Liability Insurance?

One of the most common questions I get from business owners is, “Do I have enough business liability insurance coverage?”

My response? “I can’t answer that until we see the lawsuit.”

The truth is, there’s no way to predict the amount you could be sued for in a liability claim. It’s a gamble, and the stakes are high.

Let’s explore some real-life examples to illustrate this.

The Rosedale, MD Train Derailment

Several years ago, in Rosedale, Maryland, a trash truck stopped on a railroad crossing as a CSX train approached, blaring its whistle. The truck didn’t move out of the way in time. The result? Several train cars derailed. The truck was obliterated, trapping the driver inside, and the collision led to an explosion that rocked the area.

Here’s a breakdown of the fallout and the potential liability exposure for the business owner whose employee was driving the truck:

• Damage to Rail Cars: The rail cars were heavily damaged, with some completely destroyed.
• Railroad Track Damage: Hundreds of feet of railroad track were severely damaged.
• Lost Goods: The products in the derailed rail cars were either damaged or completely lost.
• Cleanup Costs: Removing the derailed cars and repairing the track was an extensive and costly process.
• Pollution Cleanup: Chemicals from the wreck seeped into the ground, requiring a significant cleanup effort to prevent environmental hazards.
• Storage Costs: The damaged rail cars and track sections needed to be stored while the National Transportation Safety Board (NTSB) investigated the incident.
• Business Interruptions: Nearby businesses suffered lost income due to road closures and the inability to operate amid emergency response efforts.
• Property Damage: Several nearby homes and buildings sustained serious damage, with some even condemned due to structural issues.
• CSX Losses: CSX incurred losses from not being able to use the damaged tracks, disrupting the movement of goods.
• Investigation Costs: The NTSB investigation into the derailment added to the total liability.
• Health Claims: People in the area reported illnesses caused by the chemicals and fumes released during the explosion.
• Injuries: Individuals near the explosion site were injured, leading to potential injury claims.

When you consider the total costs of such an event, it becomes clear that a $1,000,000 liability policy wouldn’t even scratch the surface.

Another Example: A Restaurant Fire in Baltimore

Now, let’s consider another incident. A popular restaurant in Baltimore accidentally started a fire that quickly spread to neighboring businesses. The fire originated in the kitchen, and despite the staff’s efforts to contain it, the flames spread out of control.

Here’s the fallout and potential liabilities from this incident:

• Fire Damage to the Restaurant: The restaurant itself was almost entirely destroyed.
• Damage to Neighboring Businesses: Two adjacent businesses, a boutique and a coffee shop, were also heavily damaged by the fire and water used to extinguish it.
• Loss of Inventory: The fire destroyed thousands of dollars’ worth of inventory in both the restaurant and the neighboring businesses.
• Business Interruption: All three businesses had to close for several months, leading to significant business income losses.
• Injuries to Customers and Staff: Several customers and employees sustained injuries while evacuating, leading to medical expenses and potential lawsuits.
• Cleanup and Restoration Costs: The cleanup effort was extensive, involving debris removal and restoring the property to its original condition.
• Temporary Relocation Costs: The affected businesses incurred additional costs by relocating temporarily during the restoration period.
• Loss of Goodwill: The restaurant lost significant business goodwill, and its reputation was tarnished, impacting future revenue.

In this case, a $1,000,000 liability policy would again fall short of covering the various claims and losses that could arise. Damages could easily exceed several million dollars when considering the combined costs of rebuilding, lost income, and legal claims.

How Much Business Liability Insurance Is Enough?

When you hear about a $1,000,000 liability insurance policy, it sounds like a lot—until you’re faced with situations like these. Events like a train derailment or a fire spreading to neighboring businesses can quickly reveal how inadequate that coverage might be.

The reality is that it’s impossible to predict the exact amount of liability coverage your business might need. Would $2,000,000, $5,000,000, or even $10,000,000 be enough?

The truth is, you can never have too much coverage. Because you’re not just protecting your business’s current assets but also its future earning potential.

Take Action: Protect Your Business’s Future

At Huff Insurance, we can help you assess your current liability coverage and determine if it makes sense to increase it by an additional $1,000,000 or more. If you don’t already have a business umbrella insurance policy, now is the time to get one. Every business needs one!

Give us a call today at 410-647-1111. Let’s make sure your business is protected from the unexpected.

Uninsured Drivers, Why you need to protect yourself!

Driving on Maryland roads can be challenging—and even dangerous—especially with the growing number of uninsured drivers. These drivers pose a significant risk to everyone on the road, and the statistics are alarming.

According to a study by the Insurance Research Council, 14.1% of all accidents are caused by uninsured drivers, and a staggering 16% of all motorists are driving without insurance at any given time.

Imagine this: 50,000 cars pass by our office daily on Ritchie Highway. If we apply those percentages, it means that about 8,000 of those vehicles are driven by uninsured drivers. That’s a concerning figure for anyone sharing the road.

Protect Yourself with Adequate Uninsured Liability Insurance

The best way to protect yourself against uninsured drivers is by ensuring your insurance policy includes adequate Uninsured Liability Insurance limits. This coverage is crucial because an accident with an uninsured motorist can lead to significant financial strain. Without it, you could find yourself facing substantial out-of-pocket expenses for medical bills, vehicle repairs, and other costs.

Uninsured Liability Insurance serves as your financial safety net, covering expenses that the other driver’s insurance should have paid—if they had any. This coverage is particularly important given the high number of uninsured drivers on the road today.

Uninsured Drivers and the Importance of Umbrella Insurance

To enhance your protection, many insurance companies now offer the option to add uninsured motorist coverage to your umbrella insurance policy. This additional coverage provides another layer of protection for you and your family, safeguarding your financial security in the event of an accident with an uninsured driver.

Not all policies automatically include this coverage, so it’s essential to check with your insurance agent or company to see if it’s available. Given the prevalence of uninsured drivers, this coverage can be a valuable addition to your insurance portfolio.

Don’t Leave Your Coverage to Chance

If you’re unsure whether your current policy provides adequate protection against uninsured drivers, don’t hesitate to seek professional advice. At Huff Insurance, we offer a free review of your coverage to ensure you have the best possible protection.

As a full-service, Trusted Choice Independent Insurance Agency, we work for you—not the insurance companies. This allows us to find the best insurance protection plan tailored to your needs. We represent over a dozen of the top regional and national insurance companies, ensuring you get the coverage that best suits your situation.

Contact Huff Insurance Today

Don’t wait until it’s too late to protect yourself from uninsured drivers. Contact Huff Insurance today at 410-647-1111 to review your insurance plan. We’ll help you ensure that both your auto insurance and umbrella insurance policies provide the protection you need to keep you and your family safe.

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 Essential Steps to Protect Yourself When Hiring a Contractor

Hiring a contractor to handle home repairs or renovations can be a daunting task. While a well-done job can enhance your home’s value and aesthetic appeal, it won’t mean much if you end up in a lawsuit due to improper insurance coverage. To protect yourself, follow these steps to ensure your contractor is fully insured before starting any work.

1. Get a Certificate of Insurance Before Signing a Contract

Before you even think about signing a contract or agreeing to have a contractor work on your property, always insist on seeing a Certificate of Insurance. This certificate is a document provided by the contractor’s insurance agent, proving they have current coverage. Don’t settle for just a policy or verbal assurance—ask for the actual certificate that confirms the insurance is in place.

This certificate will outline the types of coverage the contractor has, including general liability insurance, which is crucial in case of property damage or injury. A properly insured contractor will have no problem providing this document promptly.

2. Include Insurance Clauses in Your Contract When Hiring A Contractor

When drafting your contract, add specific wording that protects you if the contractor’s insurance lapses. For instance, you can include a clause stating that if the contractor fails to maintain insurance coverage, they will lose the job and refund your deposit in full. This gives you an extra layer of protection and ensures the contractor takes their insurance obligations seriously.

3. Verify Insurance Before Work Begins

Even if you’ve seen the Certificate of Insurance when signing the contract, don’t stop there. Just before the contractor starts work on your property, which could be weeks after signing the agreement, contact the insurance agent or company listed on the certificate to verify that the insurance is still in force. Insurance policies can lapse, and you don’t want to find out too late that the coverage expired.

4. Ensure Workers Are Covered by Workers’ Compensation

If your contractor plans to hire labor for your project, make sure they have Workers’ Compensation insurance. This type of insurance covers medical expenses and lost wages for workers who might get injured on the job. Without it, you could be held liable for any injuries that occur on your property.

5. Check Insurance for Subcontractors

Contractors often hire subcontractors to help with specific parts of a project, such as plumbing or electrical work. If this is the case, request and verify Certificates of Insurance for each subcontractor. If a subcontractor doesn’t have proper insurance, they shouldn’t be allowed to work on your property. This step ensures that all parties involved are adequately covered, reducing your risk of liability.

6. Get Expert Insurance Advice

Lastly, never take insurance advice from your contractor. While they may be skilled at their trade, they are not insurance experts. If anything about the contractor’s insurance coverage seems unclear or insufficient, contact your insurance agent at Huff Insurance for advice. Our team can review the contractor’s insurance and make sure you’re not left exposed to any risks.

7. Here are several types of contractors you might consider hiring for different projects:

Here are the common types of contractors that you may be looking to hire.   Each contractor will have different insurance needs, so it is important to talk to your insurance agent when hiring a contractor.

1. General Contractor – Manages overall construction projects.
2. Electrician – Specializes in electrical wiring and systems.
3. Plumber – Handles plumbing installations and repairs.
4. Roofing Contractor – Installs and repairs roofs.
5. HVAC Contractor – Works on heating, ventilation, and air conditioning systems.
6. Landscaping Contractor – Designs and maintains outdoor spaces.
7. Carpenter – Focuses on woodwork, framing, and custom furniture.
8. Painter – Specializes in interior and exterior painting.
9. Masonry Contractor – Works with brick, stone, and concrete.
10. Flooring Contractor – Installs and repairs various types of flooring.
11. Paving Contractor – Installs and maintains paved driveways and surfaces
12. Drywall Contractor – Installs and finishes drywall.
13. Remodeling Contractor – Specializes in home renovations and remodels.

Conclusion When Hiring a Contractor

By following these steps, you can protect yourself from potential legal and financial headaches when hiring a contractor. Ensuring that your contractor is properly insured will give you peace of mind and allow you to focus on the success of your home project.

Safeguarding Your Finances: 10 Essential Tips for Credit Card Fraud Prevention

Credit card fraud is one of the most prevalent forms of identity theft in the United States. According to the Federal Trade Commission (FTC), many Americans face this threat every year. A survey by Security.org found that 60% of credit card holders have encountered fraud, with nearly half experiencing it more than once. Although fraud won’t disappear anytime soon, you can protect yourself with the right credit card fraud prevention practices. Here are ten essential tips to secure your credit card from unauthorized use and keep your financial information safe.

Use Strong Passwords

A strong password is your first line of defense against credit card fraud. According to the Cybersecurity & Infrastructure Security Agency (CISA), a strong password should:

• Be at least 16 characters long
• Include random, mixed-case letters, numbers, and symbols or a combination of four to seven unrelated words
• Be unique to each account

Creating unique passwords for every account may seem daunting, but it’s crucial. For example, your password for your bank could be X9!zQ6&kL#72A$d9T*01, while your email password might be PlanetJazzElephantSunriseLightbulbCanyon. Regularly updating your passwords is just as important as creating strong ones. Even the most secure passwords can be stolen or compromised.

Pro Tip: Use a password manager to help create, store, and autofill your passwords securely. This tool can identify weak or repeated passwords and generate strong alternatives, enhancing your online security.

Avoid Public Wi-Fi for Financial Transactions

Public Wi-Fi networks are convenient but risky for conducting financial transactions. According to a Forbes Advisor study, 40% of people have had their information stolen while using public Wi-Fi, often in cafes, restaurants, airports, and hotels. If a hacker accesses the network, they can intercept your data.

To protect yourself, avoid logging into financial accounts or making transactions over public Wi-Fi. If you must use it, employ a Virtual Private Network (VPN) to keep your online activity private and secure.

Be Cautious When Sharing Information Over the Phone

Scammers often attempt to steal personal information by pretending to be from legitimate businesses over the phone. They might claim to be from your bank and request verification of your credentials due to a supposed compromise. These scams can be very convincing, using urgency to make you act without thinking.

Never share personal information with unexpected callers. Instead, hang up and contact the institution directly using the official contact information on their website.

Don’t Click on Unsolicited Links

Phishing scams are another common tactic for stealing credit card details. Scammers send texts or emails posing as trustworthy entities, such as your bank, asking for personal information. They might replicate logos and formatting to appear legitimate.

Avoid clicking on links or replying to suspicious emails or texts. Mark them as spam and verify unexpected communications by contacting your financial institution directly using the information on the back of your credit card.

Opt for Paperless Account Statements

Credit card fraud isn’t always high-tech. Thieves can retrieve sensitive information from your trash, like credit card offers or bank statements. Opt for paperless billing to reduce the risk of physical theft and keep sensitive information out of the trash. Shred any documents with personal information you need to discard using a crosscut or confetti shredder.

Monitor Your Accounts and Credit Reports

Fraudsters often start with small purchases to test the waters. Regularly check your account statements for unauthorized transactions to catch fraud early. Additionally, review your credit reports from Equifax, TransUnion, and Experian to detect identity theft or errors. The Consumer Financial Protection Bureau (CFPB) offers a checklist to help spot inaccuracies in your credit reports.

Pro Tip: You can access up to six free credit reports per year at AnnualCreditReport.com.

Verify Website Security Before Making Transactions

When shopping online or accessing financial accounts, ensure the website is encrypted. Look for a lock icon in the browser bar and “https” in the URL, indicating a secure connection. Remember, a lock icon only signifies encryption, not trustworthiness. Always use good judgment.

Choose Tap-to-Pay Technology

Tap-to-pay is more secure than inserting your card into a reader. This technology uses a chip to create a one-time code that replaces your account information, preventing interception. Skimming devices can capture your information during swiping transactions, making tap-to-pay a safer option.

Use Mobile Wallets

Mobile wallets like Apple Pay and Google Pay work similarly to tap-to-pay. They generate a one-time encrypted code for each transaction, ensuring that your credit card information remains secure. Even if intercepted, the information cannot be used by thieves.

Enable Two-Factor Authentication

Two-factor authentication adds an extra layer of security by requiring two different authentication factors. Typically, this includes a password and a one-time code sent via text or email. Some credit card companies use this method to verify transactions, adding an extra step for security.

If you become a victim of fraud, report it to the FTC immediately. Your information can help prevent future scams and protect others from falling victim.

Stay Vigilant in Credit Card Fraud Prevention

Credit card fraud is pervasive, but you can significantly reduce your risk by staying informed and cautious. Use strong passwords, opt for secure payment methods, monitor your accounts, and follow best practices for online security. By taking these steps, you make yourself a less attractive target for fraudsters.

The Importance of ID Theft Insurance Coverage

Despite your best efforts to prevent fraud, there’s always a chance your information could be compromised. That’s where ID theft coverage on your insurance policy comes in. It offers financial protection and support if your identity is stolen. This coverage can help with the costs associated with restoring your identity, such as legal fees and lost wages. It may also provide access to specialists who can guide you through the recovery process. Having ID theft coverage is an extra layer of security that can give you peace of mind, knowing you’re protected if the unexpected happens.

Understanding the DOL Overtime Rule Changes for 2024

On April 23, 2024, the U.S. Department of Labor (DOL) introduced significant updates to the overtime regulations, impacting the salary threshold for overtime exemptions under the Fair Labor Standards Act (FLSA). These DOL overtime rule changes aim to redefine who qualifies as a “white-collar” or “highly compensated employee” (HCE), affecting many businesses and employees across various sectors, including insurance.

What’s New in the DOL Overtime Rule?

The new rule raises the salary threshold for exemption from overtime pay for executive, administrative, and professional workers. As of July 1, 2024, the salary threshold will increase from $684 per week ($35,568 annually) to $844 per week ($43,888 annually). Furthermore, by January 1, 2025, this threshold will rise again to $1,128 per week ($58,656 annually).

For highly compensated employees, the annual compensation threshold will also see adjustments. Starting July 1, 2024, it will increase from $107,432 to $132,964, and by January 1, 2025, it will reach $151,164.

These changes require all employers, including those in the insurance sector, to review and adjust their payrolls to comply with the new standards by the specified dates.

Breaking Down the Fair Labor Standards Act (FLSA)

The FLSA regulates several key employment aspects, including:

• Minimum wage: Currently set at $7.25 per hour at the federal level. (Currently $15 in Maryland and higher for some local jurisdictions.)
• Overtime pay: One and one-half times the regular rate of pay is required for hours worked over 40 in a workweek.
• Record-keeping and youth employment standards: Applicable to employees in the private sector and federal, state, and local governments.

Under the new DOL rule, to qualify for an exemption from overtime, employees must meet specific salary and duties tests. These exemptions typically apply to executive, administrative, and professional roles, as well as outside sales employees.

Understanding the Duties Tests

1. Executive Employees:
   • Must be compensated on a salary basis at a rate not less than the weekly standard level.
   • Primary duty must be managing the enterprise or a recognized department or subdivision.
   • Must customarily direct the work of at least two or more other full-time employees.
   • Must have the authority to hire or fire other employees or influence such decisions.
2. Administrative Employees:
   • Must be compensated on a salary or fee basis at a rate not less than the weekly standard level.
   • Primary duty must be office or non-manual work directly related to the management or general business operations.
   • Must exercise discretion and independent judgment on significant matters.
3. Outside Sales Employees:
   • Primary duty must be making sales or obtaining orders/contracts for services.
   • Must regularly engage in activities away from the employer’s place of business.

The Highly Compensated Employee (HCE) Test

For the DOL overtime rules changes, the HCE test combines a high compensation requirement with a less stringent duties test. Employees must:

• Perform office or non-manual work.
• Earn at least the annual compensation threshold, which includes a specified weekly salary amount.
• Regularly perform one of the duties of an exempt executive, administrative, or professional employee.

Impact on Employers and Employees

Employers can use nondiscretionary bonuses and incentive payments to meet up to 10% of the standard salary levels. For instance:

• Beginning July 1, 2024, up to $84.40 per week of the $844 threshold can be met through these payments.
• From January 1, 2025, up to $112.80 per week of the $1,128 threshold can be met similarly.

However, discretionary bonuses, which are given without prior contract, cannot be used to meet any part of the salary level requirement. If an employee does not earn enough in nondiscretionary bonuses within a year, employers may make a “catch-up” payment within one pay period to retain the exemption.

Protecting Your Business: The Importance of a Good Insurance Program

As businesses adapt to the new DOL overtime rules, it’s crucial to have a robust business insurance program in place. Employment Practices Liability Insurance (EPLI) can protect your business from wage and hour lawsuits, whether founded or unfounded. An EPLI policy covers legal defense costs, settlements, and judgments, and often provides risk management services to help ensure compliance with employment laws.

By securing a good EPLI policy, your business can mitigate the financial risks associated with employment-related claims, providing peace of mind and allowing you to focus on running your business effectively. For more details, visit our EPLI page.

State and Local-Specific Regulations

It’s important to note that state laws and local jurisdictions may have additional or different requirements beyond the federal regulations. Employers should ensure compliance with both federal, statel and local labor laws.

DOL Overtime Rule Changes Conclusion

The updated DOL overtime rules introduce crucial changes that impact the classification of exempt and non-exempt employees. Employers must adjust payroll practices and ensure compliance by the specified dates. By understanding and implementing these new rules, businesses can maintain compliance and support their workforce effectively.

Here is a lnk to the DOL website for the frequently asked questions when it comes to the overtime rules.

Overtime Rules FAQs

Navigating Business Auto Insurance and Rental Car Issues

When you’re running a business, transportation is often a key element. Whether you’re sending employees to meet clients or transporting goods, having the right business auto insurance is crucial.

But what happens when you need to rent a car for business purposes?

This can bring up several issues, especially if you’re not sure how your business auto insurance applies to rental cars. Let’s dive into the specifics of business auto insurance and renting cars, and why it’s important to verify your coverage with us at Huff Insurance.

What is Business Auto Insurance?

Business auto insurance, also known as commercial auto insurance, covers vehicles used for business purposes. This includes cars, trucks, vans, and other vehicles owned by your business. Coverage typically includes:

• Liability Coverage: Pays for damages you cause to others.
• Physical Damage Coverage: Covers repairs to your vehicle from accidents, theft, or other damages.
• Medical Payments: Covers medical expenses for you and your passengers.
• Uninsured/Underinsured Motorist Coverage: Protects you if the other driver is at fault and doesn’t have enough insurance.

Understanding Rating Symbols for Business Auto Insurance

Business auto insurance policies use specific rating symbols to define the coverage provided for different vehicles. These symbols are crucial when it comes to renting a car, as they determine whether your rented vehicle is covered under your existing policy.

Each type of coverage on your policy (liability, physical damage, etc.) can use different symbols, but it’s important to note that very few companies offer Symbols 1 for physical damage coverage.

Here’s a breakdown of each symbol and how they affect your coverage:.

Symbol 1 – Any Auto:

This symbol provides the broadest coverage. It means your policy covers any auto, including owned, leased, hired, rented, or borrowed vehicles. If your policy includes Symbol 1, you’re likely covered for liability when renting a car for business. However, very few companies offer Symbol 1 for physical damage coverage.  So you may need to purchase the loss damage waiver from the rental car company.

Symbol 2 – Owned Autos Only:

Coverage applies only to vehicles owned by the business. This does not extend to rental cars. If you have this symbol, you may need to purchase additional rental car insurance.

Symbol 3 – Owned Private Passenger Autos Only:

This covers only private passenger vehicles owned by your business. It does not cover trucks, buses, or other types of vehicles, nor does it extend to rental cars.

Symbol 4 – Owned Autos Other Than Private Passenger Autos Only:

This symbol covers all owned vehicles that are not private passenger vehicles, such as trucks and buses. Rental cars are not included under this symbol.

Symbol 5 – Owned Autos Subject to No-Fault:

This symbol applies to owned autos required to have no-fault benefits in a state where no-fault insurance is mandatory.

Symbol 6 – Owned Autos Subject to a Compulsory Uninsured Motorist Law:

This symbol covers owned autos required to have uninsured motorist coverage in a state where such coverage is mandatory.

Symbol 7 – Specifically Described Autos:

This symbol applies only to the vehicles specifically listed on your policy. If your policy includes Symbol 7, only those vehicles explicitly described in the policy are covered. This does not extend to rental cars unless they are listed on the policy, which is typically not the case.

Symbol 8 – Hired Autos Only:

This symbol covers vehicles you lease, hire, rent, or borrow. If your policy includes Symbol 8, rental cars would be covered, making it ideal for businesses that frequently rent vehicles.  Again, double check your policy to make sure that your liability AND your physical damage coverages have symbol 8.

Symbol 9 – Non-Owned Autos Only:

This covers vehicles you do not own, including employee-owned vehicles used for business purposes. However, this does not typically extend to rental cars unless specified by the policy.

Symbol 19 – Mobile Equipment Subject to Compulsory or Financial Responsibility or Other Motor Vehicle Insurance Law Only:

This symbol covers mobile equipment (like forklifts) that must be registered and are subject to compulsory insurance laws.

Renting a Car for Business: What You Need to Know

When renting a car for business, it’s essential to understand how your existing business auto insurance applies. Here are common issues you might face:

1. Liability Coverage:

Many assume their personal auto insurance will cover rental cars, but business rentals are a different story. Your business auto insurance should extend liability coverage to a rental car. This ensures that if an accident occurs, you’re covered for damages or injuries to others.

2. Physical Damage Coverage:

Physical damage coverage for a rental car is another critical consideration. Without it, you might be responsible for costly repairs or replacement if the rental car is damaged or stolen. Your commercial auto insurance policy can sometimes extend this coverage, but it’s not guaranteed.

One thing to keep in mind is that in order to add the physical damage coverage for rented vehicles, we need to have the annual rental expenditures and the max value of a vehicle that you will rent.

3. Rental Car Insurance from the Rental Company:

Rental companies offer additional insurance options, such as collision damage waivers (CDW) and liability coverage. While these can provide extra peace of mind, they will cost you extra money for the rental.  Before purchasing, check if your business auto insurance already covers these areas.  There are times when the rental car company insurance will be the best option for you.  Check our research page we have that talks about the rental company insurance.

Why Verify Your Coverage with Huff Insurance?

Before renting a car for your business, it’s crucial to verify your coverage with Huff Insurance. Here’s why:

• Avoid Gaps in Coverage: Ensuring your business auto insurance extends to rental cars can prevent unexpected out-of-pocket expenses.
• Peace of Mind: Knowing you’re covered allows you to focus on your business without worrying about potential liabilities.
• Customized Advice: Our experienced team can review your policy and suggest necessary adjustments to ensure comprehensive coverage.

Steps to Verify Your Coverage

To ensure you’re properly covered when renting a car for business, follow these steps:

1. Review Your Policy: Look at your current business auto insurance policy to see if rental cars are covered.
2. Contact Huff Insurance: Give us a call to discuss your coverage needs. We can clarify whether your existing policy extends to rental cars.
3. Adjust Your Policy if Needed: If your current policy doesn’t offer sufficient coverage, we can help you adjust it or add endorsements to meet your needs.

Conclusion

Renting a car for business purposes involves more than just picking up the keys. Ensuring you have the right commercial auto insurance coverage can save you from potential financial headaches.

At Huff Insurance, we’re here to help you navigate these complexities and ensure your business remains protected.  And if you have any doubt, or if getting the right coverage on your policy is not possible, then go ahead and buy the coverage from the rental car company.

Give us a call at 410-647-1111 to verify your commercial auto insurance and extend liability and physical damage coverage to your rental car.