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Uninsured employers may put their businesses on the line

Under state law, California employers must obtain workers' compensation insurance coverage, even if they have only one employee and even if employees are temporary workers. Company owners are responsible for the payment of the insurance premiums and may not use employee money to help pay for it. Uninsured employers may be subjected to the suspension of a contractor's registration and eligibility to bid or work on public works projects.

A roofing contractor in another state recently entered a guilty plea to criminal charges of contracting without workers' compensation and also continuing contracting after his workers' compensation coverage was revoked for non-payment of premiums. The man received a suspended sentence and was allowed to spend his 10-day jail sentence at home with electronic monitoring. Also, he was ordered to pay $4,500 in restitution to a former customer.

The prosecution of this contractor followed an investigation by the Washington Department of Labor & Industries (L&I) that suspended his registration as a contractor back in 2012. It reportedly found at least two instances of work being done without registration or workers' compensation coverage since then. It was reported that the contractor owes L&I over $134,000 in unpaid insurance premiums, penalties and interest.

Authorities say uninsured employers can underbid other contractors who have higher overheads because they pay the required premiums. California contractors can avoid potentially crippling lawsuits resulting from employee injury claims, criminal prosecution and potential dissolution of the business by retaining the services of an experienced workers' compensation attorney. In the event of charges for lack of insurance, an attorney can take the necessary steps to either resolve the issue or minimize the consequences.

Source:, "Roofer Sentenced on Felony Charge for Failing to Provide Workers' Comp Coverage for Employees", Sandy Smith, Nov. 30, 2015

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