A volunteer pitches in at your food pantry, church festival, or job site. Then you wonder whether that person belongs on your workers’ comp policy. Unless you work in insurance, it’s hard to tell which rules apply. The worry isn’t the paperwork. It’s learning the answer after someone gets hurt.
At the Horan insurance agency, we work with multiple carriers across Central New York. That gives us a view of how these questions come up for nonprofits and for-profit businesses alike.
This article explains what the Workers’ Compensation Board says about volunteers, what counts as compensation, why a for-profit business can’t use volunteers, how student interns fit, and what to tell your agent.
Do Volunteers Belong on a New York Workers’ Comp Policy?
It depends on the organization. The Workers’ Compensation Board states that unpaid, uncompensated volunteers doing charitable work for a nonprofit aren’t employees, so the nonprofit doesn’t have to cover them. A for-profit business is different. The Board states that its volunteers are employees, and the business must cover them.
According to the Board, a nonprofit that compensates no one, including its executive officers, doesn’t have to carry coverage. A nonprofit that does compensate people must cover its employees, with listed exceptions such as clergy who perform religious duties alone and certain teachers.
Our guides to insurance basics for CNY non-profit organizations and New York workers’ comp cover the wider picture. For accident coverage that may fit when workers’ compensation doesn’t apply, see our article on volunteer accident insurance for CNY nonprofits.
What Counts as Compensation for a Volunteer?
The Board treats stipends, room and board, and other perks with monetary value as compensation. A volunteer who receives any of them may fall outside the Board’s “unpaid and uncompensated” category. Money that offsets expenses a volunteer incurred for the nonprofit, and nothing more, doesn’t count as a stipend.
Suppose a food pantry in Fulton gives one regular helper a weekly cash payment and a room above the pantry. That person may sit outside the Board’s “unpaid and uncompensated” category, and the pantry may want to ask its agent how the Board’s rules apply.
Why Can’t a For-Profit Business Use Volunteers?
Because New York treats unpaid workers at a for-profit business as employees. The Board’s list of employees at for-profit businesses includes unpaid workers, such as volunteers and family members, under Workers’ Compensation Law Section 3, Groups 1 through 14-a.
The New York Compensation Insurance Rating Board’s manual carries that into premium. When a for-profit corporation uses volunteers in its operations, the premium base includes at least the wages another employee would earn for the same or similar work. From here on, we’ll call it the Rating Board.
Imagine a roofing company in Fulton lets a friend’s nephew help on a few weekend jobs without pay. Under the Board’s rule, the company would treat that helper as an employee, so the question becomes whether its policy and payroll records reflect the work.
Our article on how New York treats workers outside payroll on a workers’ comp policy goes deeper on people who don’t appear on payroll.
Do Student Interns Count as Employees for Workers’ Comp?
In most cases, yes. The Board states that a for-profit business, nonprofit, or government agency must cover student interns, paid or unpaid, who provide services to it. Whether an intern counts as an employee depends on factors such as tuition credit and the degree of control the organization exercises.
An exception applies to interns in a teaching or non-manual role in or for a religious, charitable, or educational institution under the federal tax code. Those institutions can cover such interns on a voluntary basis. The Board lists manual labor tasks such as filing, cleaning, moving furniture, shoveling snow, and mowing lawns.
Can a Nonprofit Extend Workers’ Comp to Its Volunteers?
It may be possible. In most cases, the Rating Board’s manual leaves nonprofit volunteers uncovered unless an election is made. The manual also describes voluntary compensation insurance, which gives workers’ compensation benefits, up to the statutory benefits, to people who aren’t required to have coverage.
This article doesn’t describe how an election works, because carriers may handle the request in different ways. Volunteer firefighters and volunteer ambulance workers fall under their own benefit laws, which the Board’s website explains.
What Should You Tell Your Agent About Your Volunteers?
Tell your agent who gets paid, who does what, and when helpers show up. Those details help your agent discuss how carriers may treat your situation. Share these:
- Whether the organization is a for-profit business or a nonprofit, and the kind of nonprofit it is.
- Who receives any payment, stipend, lodging, or other perk, and what each person receives.
- What the volunteers do, including any manual work.
- Whether any students work as interns.
- Which events or seasons bring in the most helpers. Our article on special event insurance for festival and fundraiser organizers covers the event side.
Settling Volunteer Questions Before the Next Event or Season
We covered what the Board says about volunteers at nonprofits and for-profit businesses, what counts as compensation, and where student interns fit. Volunteer rules can feel like a maze when you just want to thank the people who help. That’s a fair frustration.
Settling these questions before the next event or busy season may give you composure and stability. Overlooking them may leave an unpaid helper, a stipend, or an intern unaddressed until a claim arrives.
As an independent agency working with multiple carriers across Central New York, the Horan insurance agency would like to be a resource. We can compare how carriers approach nonprofits and for-profit businesses and walk through your volunteers, payments, and policy. Our experience with Central New York organizations helps us spot where a question may be worth raising.
Click the Get a Quote button below to start that conversation.
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