According to the United States Department of Labor, occupational injuries cost companies up to $170 billion every year. And some try to skirt the law; A Stoughton-based business owner was recently charged with multiple counts of fraud related to his failure to carry this workers compensation insurance.
In the end, not covering your employees sets you up for severe financial penalties and loss of your ability to do business. Plus, everyone loses when workers aren’t covered by workers compensation insurance. Please note that regardless of employer, injured workers are entitled to receive workers comp benefits through the DIA Trust Fund.
Workers’ Compensation Insurance
Workers’ compensation insurance is a vital protection for both employers and employees against the high medical costs that can result from workplace injuries. This form of insurance is a no-fault coverage that takes care of any injuries that occur during the course of work. It’s more than just protection, however; it’s the law, and employers who fail to carry it face severe penalties.
Far too many business owners take this tactic of not carrying workers’ comp. It’s tragic all around, and workers’ compensation stands to be in the news a lot more in upcoming years. Not only is it the law that employers have to carry this important form of insurance, but failing to do so is far worse than hedging your bets.
Criminal Fines and Penalties
Failure to cover your employees with workers’ comp is a serious crime. In the recent Stoughton case, the business owner was indicted on two counts of Workers’ Compensation Fraud and on one count of larceny, after failing to pay for around $40,000 in premiums to cover his workers.
Those who fail to carry workers’ comp for their employees in Massachusetts face a range of penalties in addition to potential criminal Fraud charges. These penalties can include:
– Issuance of a Stop Work Order from the DIA (Department of Industrial Accidents)
– Minimum $100/day fine from the date of the Stop order, until coverage begins and fines are paid
– Possible imprisonment for up to one year
– Additional criminal fine ranging to $1,500 if convicted
– Debarring from taking on any public contracts for three years
The High Cost of Injuries
Employers who fail to carry workers’ comp are bound to discover that such failure can be expensive when the worst happens. In 2015, ride-sharing company Uber was sued by a driver who was attacked by a fare. The company discovered the hard way that classifying its drivers as independent contractors could end up being more expensive than carrying workers’ compensation. According to the National Safety Council, an employee with a $50,000 salary would cost $1,740 in premiums, but could run up to $38,000 in injury costs if they get hurt.
Failing to carry workers’ comp doesn’t just hurt businesses, either. The bottom line is, everyone suffers from this kind of irresponsibility. It harms worker morale, as employees feel less valued in the workplace.
It causes additional stress on employers who have to constantly worry about the potential for injuries. Finally, it hurts taxpayers, who are the ones that have to eat the cost of higher insurance premiums and increased tax burden due to the need for tighter restrictions, more stringent enforcement and court costs.
Boston Workers’ Compensation Attorneys
Workers who are injured on the job and discover that their employer doesn’t carry insurance need to know that there is still an option out there. Your employer is liable for your injuries even if they’re not insured. To make sure you get paid, call on the experienced and qualified Boston workers’ compensation attorneys at the offices of John J. Sheehan for a case consultation today.