Worker's Compensation Insurance

14 Failing to have worker’s’ compensation coverage is a criminal offense. Section 3700.5 of the California Labor Code makes it a misdemeanor punishable by either imprisonment in the county jail for up to one year, a fine of up to double the amount of workers’ compensation premium that would have been necessary to secure coverage during the illegally uninsured period (in an amount not less than $10,000), or both. Additionally, the state issues penalties of up to $100,000 against illegally uninsured employers. If an employee gets hurt or sick because of work and the employer is not insured, the employer is responsible for paying all bills related to the injury or illness. Employers may want to contact the Information and Assistance officer at their local DWC office for further information. Workers’ compensation benefits are the exclusive remedy for injuries suffered on the job only when the employer is properly insured. If an employer is illegally uninsured and an employee gets sick or hurt because of work, the employee can file a civil action against the employer in addition to filing a workers’ compensation claim. Employers that fail to pay required benefits may also be liable to reimburse the Uninsured Employers’ Benefit Trust Fund. Employers can be prosecuted for insurance fraud for the willful failure to secure workers’ compensation insurance as required by law. The CDI works closely with other agencies to investigate potential instances of fraud and also works with local district attorneys’ offices to prosecute those caught violating the law.