Workers’ Compensation: Impact on Churches
On-the-job injuries can be a real concern for your houses of worship, especially during inherently injury-prone events. Considering the number of volunteers necessary for annual retreats, Vacation Bible School, and other family festivities typically scheduled for your church, synagogue or mosque, accidents will inevitably occur.
Believe it or not, places of worship typically deal with workers’ compensation issues quite frequently. To prevent any unnecessary claims, review your organization’s specific coverage under your workers’ comp plan, including important precautionary measures to be followed.
Each state provides individual guidelines for workers’ comp. Some states, such as Illinois and Colorado, require every company with more than one employee to provide workers’ comp insurance, while other states offer the option for organizations, such as churches, to opt out.
Declining this type of insurance protection proves risky however, since lawsuits may result if your church doesn’t have suitable coverage and someone is injured while working or volunteering.
Important facts regarding workers’ compensation:
- Be sure to classify employees appropriately. Misclassification of employees to avoid paying higher insurance rates may result in penalties, incurring additional costs.
- Volunteers are not considered actual employees. Even if your house of worship carries workers’ comp, injured volunteers may choose to sue instead of collecting the settlement.
- Protect yourself while still using volunteers. Offer an accident policy for volunteers or require them to sign a waiver form, though these may still be challenged in court.
- If gross negligence is displayed by your organization, waiver forms will ultimately be ruled against in a court of law.
Unfortunately, accidents at your place of worship can’t always be controlled and are bound to occur. By remaining in close contact with your insurance agent, you can optimize your coverage appropriately and alleviate the possibility of a potentially harmful lawsuit.
If you found this advice helpful, our thoughtful, nonprofit-focused staff at Online Stewardship Accounting & Consulting can also help with many other accounting and consulting needs.
Contact us at Lynn@OnlineStewardship.com or 904-398-4747.
