Penalties for not
having California Workers Compensation
the great state of California not carrying Workers'
Compensation insurance is a crime subject to civil and
criminal penalties potentially. This is a serious
situation which doesn't get better by ignoring it. Get
a quote today for Workers' Compensation and avoid the
The California Division of Labor Commissioners office
determines if a company is not legally carrying workers'
compensation coverage, which is a misdemeanor offense
punishable by either a fine of $10,000 or imprisonment
in county jail for up to one year, or both.
What if an employee
gets sick or hurt on the job and we don't have workers'
If an employee is sick or hurt from
the job you, the employer, are immediately responsible
for the medical costs and claims which may occur. You
also could be held liable for civil litigation if the
employee decides to pursue the matter in court.
What if an employee
files a Workers' Compensation claim with the California
Workers' Compensation appeals board and we are
If an employee is hurt and files a
claim with the State of CA the employer will first be
issued a stop employment order, where it is illegal for
the company to operate its business with employee
labor. If this is not obeyed the state can fine the
employer up to $10,000 and imprisonment up to 60 days.
In addition the Division of Labor will asses a fine of
$1,000 per employee up to $100,000 total. The medical
costs alone could be disastrous for a company to cover
as we've all seen the dramatic rise of healthcare
expenses over the last decade, let alone the risk of the
fines and jail time.
Additional fines of between $2000
and $10,000 per employee up to $100,000 maximum may be
issued depending upon State of Appeals board and judge
review relative to a case's compensable or
What if an executive
officer or partner in the company is hurt on the job?
Generally speaking executive
management is still required to be covered by workers'
compensation coverage unless they have ownership in the
company. Contact us about the specifics of the
situation if you think it may not be required due to an
ownership or relative situation.
Can I self insure my workers'
It is possible to self insure your
company but you must show a net worth of greater than 5
million dollars and you must apply and receive state
approval to do so first.
Really as the owner and operator of
a business in California it makes no sense to consider
operating outside the laws and try to skirt the
requirement of providing workers' compensation insurance
for your company. The costs of covering medical claims
alone for any injured employees could reach the millions
when factoring in the exponential rise in medical
treatment costs. What if an employee spent 6 months in
the hospital due to a work related injury? This is one
issue which does not get better in time through putting
How to get the best Workers Comp rate
Different approaches to Workers Comp