South Carolina workers comp requirements decide exactly when an employer must carry coverage, who counts toward the threshold, and the penalty for going without. This guide breaks down the South Carolina workers comp requirements in plain English. (Injured instead of hiring? See our South Carolina settlement and claim guides linked below.) All figures are from South Carolina sources, verified as of June 2026.
South Carolina at a Glance
| Required at | 4 employee(s) |
| Which workers count | Any employer that regularly employs four or more workers in South Carolina must carry coverage; full-time and part-time workers all count toward the four, and family members employed by the business are counted as well. There is no separate construction/first-employee rule, but a low annual payroll triggers a separate exemption (see exempt_workers). |
| Who is exempt | Casual employees; employers with fewer than 4 employees OR an annual payroll under 3000; agricultural employees; state and county fair associations; railroads and railway express companies; federal employees; and certain owner-operator truck drivers and qualifying commission-paid real estate agents. |
| Penalty for going without | Under SC Code 42-5-40, an employer required to carry coverage that refuses or neglects to do so is fined 1 dollar for each employee at the time, but not less than 10 nor more than 100 dollars for each day of refusal or neglect; the Commission may double any fines and penalties assessed, and may also order the business shut down and seize business assets to pay claims. |
| Monopolistic state? | No — private carriers |
In This South Carolina Guide:
Is Workers’ Comp Required in South Carolina?
Yes — workers’ compensation is required in South Carolina once a business regularly employs four or more workers in the state.
South Carolina Workers’ Comp Requirements at a Glance
Here are the exact South Carolina workers comp requirements every employer should know:
| Employees that trigger the mandate | 4 |
| Which workers count | Any employer that regularly employs four or more workers in South Carolina must carry coverage; full-time and part-time workers all count toward the four, and family members employed by the business are counted as well. There is no separate construction/first-employee rule, but a low annual payroll triggers a separate exemption (see exempt_workers). |
| Who is exempt | Casual employees; employers with fewer than 4 employees OR an annual payroll under 3000; agricultural employees; state and county fair associations; railroads and railway express companies; federal employees; and certain owner-operator truck drivers and qualifying commission-paid real estate agents. |
| Owners & officers | Sole proprietors, partners, and LLC members are generally not automatically counted as employees but may elect to be covered; an employer’s election or rejection of coverage is handled through the Commission’s Form 38, and a previously exempt employer who voluntarily buys coverage remains subject to the Act until a Form 38 is filed withdrawing that election. |
| Penalty for going without | Under SC Code 42-5-40, an employer required to carry coverage that refuses or neglects to do so is fined 1 dollar for each employee at the time, but not less than 10 nor more than 100 dollars for each day of refusal or neglect; the Commission may double any fines and penalties assessed, and may also order the business shut down and seize business assets to pay claims. |
| Monopolistic state? | No — buy from private carriers |
How to Get Workers’ Comp Coverage in South Carolina
Through a commercial insurance carrier licensed to write workers’ compensation in South Carolina, or through the state’s assigned-risk program administered by the National Council on Compensation Insurance (NCCI).
Private market: YES
What Workers’ Comp Covers in South Carolina
Workers’ compensation is a no-fault system: an injured employee gets benefits without having to prove the employer did anything wrong, and in exchange gives up the right to sue for most workplace injuries. A typical South Carolina policy pays for medical treatment tied to a work injury, part of the wages lost while the worker recovers, longer-term disability benefits if the injury is permanent, and death benefits to a family.
It also includes employers-liability coverage, which protects the business if an injury still leads to a lawsuit.
Employees vs. Independent Contractors in South Carolina
The most common way employers get the South Carolina workers comp requirements wrong is by assuming a worker is an “independent contractor” who does not count. State agencies look at how the work is actually controlled, not the label on a 1099. If South Carolina decides a contractor was really an employee, the business can owe back premiums and penalties as if coverage should have been in place all along.
When you are close to the employee threshold, confirm each worker’s status with your state board before you decide you are exempt.
Other South Carolina workers’-comp rules: South Carolina uses an alternative payroll-based test — businesses with annual payroll under 3000 are exempt even with employees. The maximum weekly compensation rate for accidents on or after January 1, 2026 is 1189.94. Coverage determinations for general contractors and subcontractors are made case-by-case, and statutory (up-the-ladder) employers can be liable for an uninsured subcontractor’s injured workers.
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Understanding South Carolina Workers Comp Requirements
The South Carolina workers comp requirements exist so injured employees get care and lost wages without having to sue. For most employers, the South Carolina workers comp requirements come down to one number: the employee count that triggers the mandate, shown in the table above.
Once you hit that count, South Carolina workers comp requirements apply whether you planned for them or not, and the penalty for going without is real. If any part of the South Carolina workers comp requirements is unclear, your state board can confirm the threshold, the exemptions, and how to get covered.
Need to get covered? If you are an employer in South Carolina shopping for a policy, our sister site compares small-business insurance, including workers’ comp. Compare business insurance options →
Frequently Asked Questions
Is workers’ comp required in South Carolina?
Yes — workers’ compensation is required in South Carolina once a business regularly employs four or more workers in the state.
What is the penalty for not having workers’ comp in South Carolina?
Under SC Code 42-5-40, an employer required to carry coverage that refuses or neglects to do so is fined 1 dollar for each employee at the time, but not less than 10 nor more than 100 dollars for each day of refusal or neglect; the Commission may double any fines and penalties assessed, and may also order the business shut down and seize business assets to pay claims.
Who is exempt from South Carolina workers’ comp?
Casual employees; employers with fewer than 4 employees OR an annual payroll under 3000; agricultural employees; state and county fair associations; railroads and railway express companies; federal employees; and certain owner-operator truck drivers and qualifying commission-paid real estate agents.
Official South Carolina Sources & Resources
- South Carolina South Carolina Workers’ Compensation Commission: https://wcc.sc.gov
- South Carolina Workers’ Comp Statute: https://www.scstatehouse.gov/code/t42c001.php
- U.S. Department of Labor — Workers’ Comp: dol.gov
- Insurance Information Institute: iii.org
These South Carolina workers comp requirements were last verified against official sources in June 2026. Rules and penalties change — confirm the current figure with your state workers’-comp board or a licensed agent.
More South Carolina Workers’ Comp Guides
- South Carolina Workers’ Comp Settlements
- How to File a South Carolina Workers’ Comp Claim
- Workers’ Comp Guides for All 50 States
Disclaimer: This guide is informational only and is not legal, medical, or financial advice. Workers Comp Explained is an independent educational resource, not a law firm or insurer. Workers’ comp benefits, settlement values, deadlines, and requirements vary by state and by the specific facts of your injury and change over time, and any settlement figures here are illustrative only.
Confirm your rights and any deadline with your state’s workers’ compensation board and a licensed attorney before you act.