New Hampshire just rewrote who carries workers’ compensation risk in leasing deals - and made compliance mandatory.
Senate Bill 655, signed into law on June 12, 2026 and effective August 11, 2026, introduces a key change for employee leasing arrangements. The measure, backed by Sen. Innis along with Sens. Rochefort, Murphy, Pearl, Ward, and McGough, and Reps. Labrie and Peternel, allows parties in a co-employment relationship to decide who provides workers’ compensation coverage for leased employees.
The choice must now be made clear in the leasing agreement. But the law draws a firm line: coverage must always be in place, regardless of who takes responsibility.
For insurers, that changes the structure of risk. Employee leasing companies have often held workers’ compensation policies covering leased workers. Under the new law, client companies can step in and carry their own policies. That shift could lead to more direct underwriting of employers that previously relied on leasing company programs.
The law pairs that flexibility with strict compliance requirements.
When a client company elects to provide coverage, it must notify employees that it is the employer responsible for workers’ compensation insurance, using a format set by the commissioner. At the same time, the employee leasing company must report detailed policy information to regulators within 30 days. The required disclosures include the client company’s name, the insurance carrier, the policy number, and the policy’s effective and expiration dates.
This reporting structure introduces a tighter compliance loop. Insurers and brokers will need to ensure policy data moves accurately and quickly between the client company and the leasing firm, so deadlines are met.
The statute also addresses liability between the parties. Both the employee leasing company and the client company retain protection under the workers’ compensation “exclusivity of remedy” rule in RSA 281-A:8, regardless of who purchases the insurance. In practice, that rule generally limits injured workers to workers’ compensation benefits rather than civil lawsuits against the employer.
At the same time, the law removes automatic vicarious liability between the two sides. It states that the employee leasing company “shall not be vicariously liable for the actions or omissions of the client company,” and that the client company is not liable for the leasing company’s actions or omissions.
That clarification matters for insurers. It narrows exposure across co-employment arrangements and sharpens the focus on the specific insured entity.
The law also sets consequences if coverage breaks down. If a client company elects to provide workers’ compensation insurance but fails to secure it as required under RSA 281-A:5, it becomes subject to penalties under RSA 281-A:7. For carriers, that raises concerns around uninsured exposure, especially during transitions in responsibility.
Another provision reinforces the shift. The law repeals a prior requirement that employee leasing companies must pay for workers’ compensation coverage for leased employees, replacing it with a system built on negotiated responsibility.
The bill also includes a minimum wage exemption for certain minor league baseball players covered by collective bargaining agreements. But for the insurance industry, the central impact is clear: a restructuring of how workers’ compensation coverage is allocated, reported, and enforced in leasing relationships.
With the effective date set for August 11, 2026, insurers and brokers now have a defined window to adjust policy structures, contract language, and compliance workflows tied to co-employment arrangements. The result is a system that offers more flexibility but demands tighter execution.
