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The risks of not carrying workers’ compensation insurance

As an employer in California, you are required by law to have workers’ compensation insurance to protect yourself and your employees. If an employee does get injured and it is discovered you do not have insurance coverage, you could face serious penalties. At Sacks & Zolonz, LLP, we understand the complications that can arise in such a situation. So you can avoid penalties and other issues, you must understand the law and what it requires of you.

Workers’ compensation requirements for employers vary from state to state. California is rather strict, according to the State of California Department of Industrial Relations, requiring all business owners who have at least one employee to carry insurance coverage. If you do not have insurance and an employee get hurts, you will be required to pay all related expenses. Your employee may also sue you. If you fail to pay, the employee may seek compensation through the state-ran Uninsured Employers’ Benefit Trust Fund. The state may pursue your assets and collect compensation from you to fund the UEBTF benefits your employee collects.

Not having insurance will net you at least a $10,000 fine and may carry penalties up to $100,000. You could also possibly be sentenced to a year in jail. The state may place an order that prohibits you from using employee labor until you do secure proper insurance. Do note not carrying workers’ compensation insurance is considered a misdemeanor crime under the state law. Please visit our website to get more information about workers’ compensation.

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