Last week, our blog discussed how the Workers' Comp Fraud Unit of the San Bernardino County District Attorney's Office declared that it was ramping up its efforts to prosecute both uninsured employers and business owners who fail to abide by the state's employment and work comp laws.
Over the last year, multiple agencies here in the state of California -- including the Department of Industrial Relations, the Workers' Compensation Insurance Fraud Unit and District Attorneys in several counties -- have joined forces as part of a concerted effort to crack down on the "underground economy," meaning both uninsured employers, and those employers who abuse state employment and work comp laws.
The state of California is very serious when it comes to employers and their legal obligation to maintain workers' compensation insurance coverage. To illustrate, those employers found to be lacking valid work comp coverage are viewed as uninsured and subject to not only a "Stop Notice and Penalty Assessment" from the California Labor Commissioner, but fines of $1,500 per employee (up to a maximum of $100,000).
Under California law, all employers are required to carry workers' compensation insurance so that their employees will be adequately protected in the event of a serious work-related accident. Failure to carry this mandated coverage can have incredibly severe consequences. For example, uninsured employers face criminal prosecution, large fines from the California Labor Commissioner, civil lawsuits from injured workers and the possibility of business closure.
In a very interesting story out of Montana, the state's highest court recently heard arguments in an uninsured employer case pitting a religious group with certain ideals concerning labor against a 2009 state law mandating that all employers must provide work comp coverage.
Over the past year, our workers' compensation defense blog has been covering a rather tragic story involving an employee who was killed in a workplace accident at a Brooklyn-based tortilla company.
In workers' compensation defense news, a high-ranking official with the California Division of Occupational Safety and Health (Cal/OSHA) recently indicated that the agency will be partnering with other government entities to crack down on violations in the agriculture industry.
Over the last few years, there has been a sustained call at the state capital to crack down on the number of uninsured employers, meaning those who fail to provide the requisite level of work comp coverage.
Uninsured employers, meaning those who fail to carry the necessary amount of workers' compensation coverage in the state of California, face a multitude of penalties from steep fines and potential jail time to the loss of a professional license.
The importance of securing the necessary amount of workers' compensation insurance simply cannot be overstated. Uninsured employers face the risk of steep fines, civil litigation, criminal prosecution and even a potential work stoppage.