Hiring a caregiver directly provides significant cost savings and benefits compared to a traditional agency. However this arrangement does impose certain obligations and liability on you as an employer. Purchasing a workers compensation insurance policy is the best way to protect yourself financially and legally in the rare event of on-the-job injury.

This guide will help you navigate your legal obligations and the benefits of having workers' compensation insurance when hiring caregivers whether through Clara, or on your own.

Legal Obligations for Household Employers

In California, household employers are required to carry workers' compensation insurance for their domestic employees, including caregivers, under specific circumstances:

• If the employee has worked at least 52 hours in the 90 days leading up to a potential work injury

• If the employee has earned at least $100 during that same 90-day period

In effect, this means all household employers are legally required to hold a workers’ compensation policy. It's important to note that these requirements apply even if you have only one employee. Failure to comply with these regulations can result in significant fines, legal penalties, and potential criminal charges. (See here for more on "Why should I employ my caregiver legally?")

The Importance of Workers' Compensation Insurance

Even if you're not legally required to have workers' compensation insurance, it's highly recommended for several reasons:

1. Financial Protection: It covers medical expenses and a portion of lost wages if your caregiver is injured on the job.

2. Legal Protection: It generally prevents employees from suing you for workplace injuries.

Consider this real-life example: A caregiver sustained a back injury while working, resulting in 12 weeks of lost work and $15,000 in medical expenses. The total workers' compensation benefits would have been approximately $20,000. Without insurance, the family had to pay these costs out of pocket.

Obtaining Workers' Compensation Insurance

There are several ways to acquire workers' compensation insurance in California:

1. Homeowner's Insurance: Many homeowner's insurance policies offer workers' compensation coverage for household employees as a “rider.” Check with your provider about adding this coverage.

2. State Compensation Insurance Fund: If your homeowner's insurance doesn't offer coverage, you can obtain a policy through the California State Compensation Insurance Fund.

3. Private Insurance Companies: Many private insurance companies offer workers' compensation policies specifically for household employers.

When obtaining a policy, be prepared to provide information about your employee's duties, hours worked, and wages. The annual premium is typically based on the employee's expected earnings.

Clara's Approach to Workers' Compensation

At Clara, we understand that managing workers' compensation can be complex. That's why we handle all the logistics for you, at no additional cost, including:

1. Requesting Quotes: We obtain a quote from our network of trusted insurance providers on your behalf.

2. Setting Up Payment Schedules: We integrate the insurance premiums into your standard weekly invoices, making payment seamless and hassle-free.

3. Policy Management: We manage the policy throughout the employment period and terminate it when it's no longer needed.

This comprehensive approach ensures that you remain compliant with California law while focusing on what matters most – providing quality care for your loved ones.

Conclusion

As a household employer in California, understanding and complying with workers' compensation requirements is crucial. Not only does it protect you financially and legally, but it also ensures the well-being of your caregivers. With Clara's support, navigating these requirements becomes straightforward, allowing you to provide the best possible care environment.

Remember, while this guide provides general information for 2025, laws and regulations can change. It's always advisable to consult with a legal professional or contact Clara directly for the most up-to-date and personalized advice regarding your specific situation.

To learn more about how Clara can simplify your journey as a household employer, including managing workers' compensation insurance, visit www.clarahomecare.com or speak with one of our care consultants today.