You cut your New York workers comp bill with paperwork, not by cutting coverage. Weekly payroll records, correct job categories, subcontractor certificates, and a second quote from NYSIF, the state's own carrier, are the four levers. The base prices insurers start from also fell 13.2 percent for policies starting October 1, 2025 and another 21.9 percent from October 1, 2026, so a renewal that did not go down deserves a hard look. Who this is for: New York contractors with employees whose workers comp bill feels too high.
The short version
- New York caps the weekly payroll your premium is charged on for commercial construction work, but only if you keep weekly per-employee records.
- Office staff, owners, and managers have their own job categories that cost far less than field work. Make sure they are in them.
- Subcontractors with no proof of coverage on New York's state form get added to your payroll at audit.
- You can buy from a private insurer or NYSIF, the state's own carrier. Get both quotes.
- The base prices insurers start from dropped twice in a row. Your insurer marks them up its own way, so your change will differ.
Am I using New York's construction payroll cap?
On commercial work, New York only charges your premium on the first part of each employee's weekly pay. The cap is $1,833.63 a week through June 30, 2026, then $1,922.25. Two conditions: it does not apply to one and two family homes, and you must keep weekly records per employee showing job category, hours, and job location. A carpenter earning $2,600 a week on a Manhattan job is charged as if he earned $1,922.25. Without the records, the auditor charges full payroll. The records need the county too, because New York rates construction by territory.
Are my people in the right job categories?
Every employee is rated under a class code, the job category your payroll is rated under. Field trades cost the most. Three cheaper categories are often missed.
| Who | New York category | The catch |
|---|---|---|
| Office staff | Clerical (Code 8810) | Must work in an area separated by walls, partitions, or counters and never do field work. One site visit a week moves the whole salary to the field rate. |
| Owners who are corporate officers | Executive officers (Code 8809) | Only if the officer does not regularly work as a foreman, worker, or outside salesperson. |
| Project managers | Construction executive (Code 5606) | Must supervise through superintendents or foremen, not run the crew directly. |
| Field workers in two trades | Split between the two trades | Allowed in construction only if your original payroll records show the actual hours in each. Percentages are not allowed. |
More on this in whether office staff should cost less to insure in New York.
Why are my subcontractors showing up on my bill?
Because in New York you pay for an uninsured sub's injured worker. Under Workers Compensation Law 56, a contractor that hires a sub with no coverage is liable for that sub's injured employee, and insurers charge the contractor for the uninsured sub's payroll at audit, rated in the sub's own trade class rather than yours. If you cannot show what the sub paid its workers, the auditor can charge on a percentage of what you paid the sub, so keep the sub's invoices and any payroll breakdown you can get. Collect proof before each sub starts, on state form C-105.2 or NYSIF's U-26.3, not an ACORD certificate. See workers comp and 1099 contractors in New York.
Should I shop my policy, and does NYSIF count?
Yes, and yes. New York employers buy from a private insurer, from the New York State Insurance Fund (NYSIF), or, with approval, self-insure. NYSIF is the state's own carrier. It competes with private insurers and must accept any employer, so New York has no separate plan of last resort. Get a NYSIF quote next to your private quotes every year.
Pricing works like this. The rating board publishes a base price for each job category, called a loss cost. It is not your rate: each insurer marks it up by its own factor, then applies your experience mod, a multiplier based on your claims history. So two insurers quoting the same crew land in different places. If your renewal went up with no new claims, ask why in writing and get other quotes. Contractors who pay above-average hourly wages may also earn a credit under New York's Construction Classification Premium Adjustment Program.
How much can these steps save?
It depends on how far your paperwork is from where it should be. Nobody can price that for you from a web page, so here is what decides the size of each saving.
| Step | What decides how much it saves you |
|---|---|
| Weekly records so the payroll cap applies | How far your weekly wages run above the cap, and how much of your work is commercial |
| Moving a true office employee to clerical | The gap between clerical and the field trade that pay sits in now |
| Collecting sub certificates before audit | Whatever the uninsured sub's payroll would have cost you, at the sub's own trade rate |
| Getting three quotes including NYSIF | How far apart the insurers' own markups sit, and how much they want your trade |
For the shopping side, see cheaper workers comp insurance in New York, and for what a policy costs, workers comp cost in New York.
What this looks like in real life
Illustrative example. It is typical of what we see and is not a promise of how any specific situation would be handled.
The setup: A carpentry contractor in Queens has 14 employees and $1,300,000 of payroll, mostly commercial fit-outs in Manhattan. His premium had been charged on full payroll for three years.
What went wrong: He kept only monthly payroll totals, so the auditor could not apply the payroll cap. Four lead carpenters earned about $2,400 a week. His office manager was rated as a carpenter because she dropped off materials at a job twice a month.
What it cost: Weekly records let the cap apply to the four lead carpenters, taking about $113,000 of chargeable payroll off the bill. The office manager moved to clerical once she stopped the site trips and got a partitioned office. A NYSIF quote came in under his renewal.
The fix: None of it came from cutting coverage. The records took his bookkeeper an extra hour a week.
Frequently asked questions
Q: How can I reduce my workers comp costs in New York?
Keep weekly per-employee payroll records so the construction payroll cap applies, put office staff and owners in their cheaper categories, collect state-form certificates from every sub, and quote NYSIF alongside private insurers every year.
Q: What is the New York construction payroll cap?
On commercial construction work, premium is charged on each employee's weekly pay up to a cap: $1,833.63 a week from July 1, 2025 and $1,922.25 from July 1, 2026. It does not apply to one- or two-family homes, and it needs weekly records per employee.
Q: Did New York workers comp rates go down?
The base prices did. They fell 13.2 percent for policies starting October 1, 2025 and 21.9 percent for policies starting October 1, 2026. Your insurer applies its own multiplier and your claims history, so your bill will change by a different amount.
Q: Is NYSIF cheaper than a private insurer in New York?
Sometimes. NYSIF is the state's own carrier, must accept any employer, and competes with private insurers. The only way to know is to get its quote next to the others.
Q: Why did my audit add my subcontractors to my payroll?
Because you did not have proof of their coverage on New York's state form. Under Workers Compensation Law 56 you are liable for an uninsured sub's injured worker, so the insurer charges you for that payroll. Collect C-105.2 or U-26.3 before each sub starts.
Q: Will excluding myself as the owner lower my New York workers comp cost?
It can, if your business type allows it. It also means no benefits if you are hurt, and some general contractors will still want you covered. See the New York guide on excluding yourself before deciding.
How Morrow helps
Morrow is a licensed independent commercial insurance brokerage that works with contractors and trades every day. Finding the payroll cap, classification, and subcontractor savings hiding in a New York contractor's workers comp policy is something we do at every renewal.
- Free contract review. Send us the contract or bid documents and we mark up the insurance section in plain English, whether or not you buy anything from us.
- Free, instant certificates. Clients issue their own certificates of insurance online in about a minute, any hour, any day, at no charge.
- Markets you cannot reach online. One application, shopped across many insurance companies for general liability, workers comp, auto, umbrella, and pollution coverage.
One more thing. This article is general information and is not legal advice or a statement of coverage. Your contract and your policy wording control in every case. Requirements vary by customer, by state, and by insurance company, so have a licensed advisor review your own contract and your own policy before relying on any of it.
Last updated: Reviewed by the Morrow commercial lines team. Last updated September 2026.