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New York work comp board stops operations at noncompliant Brooklyn factory

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.

This was exactly what transpired in New York City last month when officials with the state Workers' Compensation Board (hereinafter the Board) officially shut down an uninsured Brooklyn tortilla company where an employee was killed in a tragic accident.

According to reports, Juan B., a 22-year-old employee from Guatemala, was killed when he fell into an industrial dough mixer at the Tortilleria Chinantla.

Officials from the Board indicated that the factory had been without workers' compensation insurance since last March and had amassed roughly $56,000 in noncompliance penalties.

Immediately after the accident, the Board issued a stop work order that prohibited Tortilleria Chinantla from continuing its operations until it secured the necessary work comp coverage and paid all outstanding fines.

While it may seem odd that a stop work order was not issued in the months preceding the accident due to the failure to provide work comp coverage, officials with the Board indicated that this is not the agency's policy.

"We handle matters with businesses who seem to have gone out of compliance first through correspondence," said Board spokesman Joe Cavalcante.

However, he did indicate that the Board will shut down a business for the failure to provide work comp coverage should any of the following events occur:

  • An injured worker files a claim for work comp benefits while the business is uninsured
  • The business amasses a rather substantial amount of financial penalties
  • Violations are detected by federal investigators
  • A workplace fatality occurs

In the case of Juan B.'s death, the Tortilleria Chinantla was shut down the day after the accident.

Interestingly, Tortilleria Chinantla has previously been cited by the Board for failing to provide work comp insurance. In 2008, the factory allowed its coverage to lapse, amassing $2,500 fine before renewing its policy.

If you are an uninsured California employer facing a real problem - prospective fine, prosecution, an employee injury or litigation - there are steps that can be taken to minimize the consequences. In these difficult circumstances, you may want to consider consulting with an experienced legal professional.

This post was provided for informational purposes only and is not to be construed as legal advice. (Names have been withheld to protect the identity of the deceased.)

Related Resources:

State shuts tortilla factory where worker died (The New York Times)

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