As noted by the California Department of Industrial Relations, all employers in our state are required to carry workers’ compensation insurance as a matter of law. Companies and organizations that fail to comply with this requirement face significant liability risks—potentially including financial sanctions and criminal penalties.
At Yrulegui & Roberts, we have extensive experience representing uninsured employers across a wide range of legal matters. In this article, our workers’ compensation defense lawyers provide an overview of the risks that uninsured employers face, and we explain how a proactive approach can help address the problem at the lowest possible level.
Possible Consequences of Being an Uninsured Employer in California
California requires companies to provide workers’ compensation coverage to employees throughout the entire course of their employment. Employers that fail to maintain mandatory coverage face serious financial and legal risks, should a workplace accident occur. Specifically, uninsured employers could end up dealing with any combination of the following:
- Civil Damages Claim: A person injured while working for an uninsured employer may file a lawsuit directly against the company. The damages available through a personal injury claim are typically significantly higher than those available through a workers’ compensation claim.
- Penalty Compensation: Pursuant to California law, employees filing a claim against an unlawfully uninsured employer can seek penalty compensation in the form of a 10% increase in their benefits.
- Monetary Sanctions: California regulators can impose direct monetary fines against an uninsured employer. In some cases, the owner of the company can even be held personally liable for these fines.
- Criminal Penalties: Although they are reserved for the most egregious cases, an unlawfully uninsured employer can be prosecuted for a misdemeanor. To be clear, it is technically a jailable offense.
The claims process against an uninsured employer often starts with a document called a Special Notice of Lawsuit (SNOL). Typically given by a process server, a SNOL indicates that an injured employee will be filing against an uninsured employer claim. To seek benefits through California’s trust fund, injured employees are required to provide the allegedly uninsured employer with a SNOL notice.
If you received a Special Notice of Lawsuit, it is imperative that you consult with an experienced uninsured employer defense attorney right away. These are complicated cases and a proactive approach can make all of the difference in protecting the business.
Uninsured employer claims should always be handled on a case-by-case basis. In some cases, the SNOL may be filed without good cause; as such, an aggressive defense may be the best approach. In other cases, an attorney will focus not just on defending the injury claim at hand but also finding a solution that protects the financial viability of the firm and brings the employer into compliance with the law to the satisfaction of California’s regulatory agencies.
Call Our Fresno, CA Uninsured Employer Defense Attorneys Today
At Yrulegui & Roberts, our California workers’ compensation defense lawyers have extensive experience representing uninsured employers. We are proud to promote a culture of honesty and integrity. For a strictly confidential, no commitment initial consultation, please contact us at 559-222-0660. With offices in Fresno, Bakersfield, and Sacramento, we represent clients throughout the Central Valley of California.