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Ask Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq., Attorney
Category: California Employment Law
Satisfied Customers: 118809
Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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My Worker's comp carrier is telling me that we need to

Customer Question

My Worker's comp carrier is telling me that we need to include a minimum 48k in payroll for premiums - of each LLC member (not just manager member). I can't find any legislation on line about that. Can you help explain?
JA: Because employment law varies from place to place, can you tell me what state this is in?
Customer: California
JA: Is the employment agreement "at will," union, full time or part time?
Customer: There is no employment agreements. Employees are at will. LLC members receive distribution at year end, but do not work for the company
JA: Anything else you want the lawyer to know before I connect you?
Customer: I don't think so.
Submitted: 5 months ago.
Category: California Employment Law
Expert:  Law Educator, Esq. replied 5 months ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
There is nothing in AB 2883 that sets a minimum salary for members of the LLC, that is the law that now mandates previously excluded members of an LLC must now all be covered under workers compensation. However, each insurer can set their coverage minimum salaries because if not LLC would avoid paying any workers compensation premiums claiming the members did not earn any salary only dividends.
There are very narrow exclusions under AB 2883, which went into effect January 2017. Officers, directors and partners are required to be covered under the employer’s workers’ comp policy unless they meet a narrower definition of excluded employee. The law excludes a general partner of a partnership or a managing member of a Limited Liability Company who executes a written waiver stating under penalty of perjury that the person is a qualifying general partner or managing member. Under this narrower definition, officers, directors, and partners can only opt out of coverage by signing a waiver under penalty of perjury and filing the waiver with their employer’s insurer.
If the managing members do not file the waiver, then the insurer can set a minimum salary requirement for workers compensation to be based upon.
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