California employers are required to provide workers' compensation coverage to their employees, which also requires the employer to pay for benefits should an employee become injured or ill on the job. Workers' comp is costly and claims can be time-consuming, confusing, frustrating, and down-right confusing all at the same time. Some "simple" requirements that all employers should remember:
* Obtain workers' comp insurance or qualify to become self-insured.
* Provide a workers' comp pamphlet to new employees that explains their rights and responsibilities under the workers' comp laws.
* Post the required workers' compensation poster.
* To avoid penalties and possible criminal sanctions, you should never try to deflect employees' workers' comp claims. You can help defend your business from such accusations by aggressively tackling all of your responsibilities under the workers' compensation law.
When an injury or illness occurs, you must:
* Provide a workers' comp claim form to the affected worker within 24 hours of when the injury or illness is reported.
* Return a completed copy of the claim form to the worker within 24 hours of receipt.
* Forward the claim form, along with the employer's report of occupational injury or illness, to the claims administrator within 24 hours of receipt.
* Provide transitional light-duty work whenever appropriate.
In an unlawful practices settlement involving a Raley's in Northern California a few years ago, Raley's had to pay $550,000 in penalties and costs of an investigation as well as an additional $30,000 to fund training. The settlement also included an additional $150,000 sanction if other violations occur during the next five years.
The Raley's store alleged to have discouraged an injured worker from filing a workers' comp claim. An investigation revealed that this was not an isolated incident -- that Raley's managers regularly suggested that injured employees turn to their own health care providers for work-related injuries. Criminal charges were filed against two store managers as well as a civil lawsuit against Raley's under the unlawful business practices.
Failure to carry workers' compensation insurance is a misdemeanor, and employers can be fined along with jail time. If you're not insured when a worker gets injured or becomes ill at work, you could have to pay all related medical bills. And, because you were not carrying workers' compensation insurance, you will not be covered by the "exclusive remedy" provisions of the workers' compensation law--which means the worker could sue you for additional damages.
Other things to consider:
* Do you have a certificate of insurance from your coverage carrier? You'll need this certificate to prove you have valid workers' compensation insurance, such as if the state Department of Industrial Relations (DIR) inspects your records. If you don't have one, be sure to request it from your carrier.
* Have you posted the workers' compensation "notice to employees" poster? This must be displayed where workers can see it. Not posting this notice is a misdemeanor that carries a fine of up to $7,000.
* Are you covering the cost of the insurance? Don't make the mistake of passing the cost along to your employees, in the form of a wage deduction or otherwise. The law requires employers to pay for the insurance.
* Do you file claims for all injuries (beyond those requiring more than first aid)? This is required by law, and employers are prohibited from paying employee medical bills directly or paying cash for treatment of work-related injuries and illnesses.
* Are you properly classifying employees, reporting payroll, and estimating projected employment? While misclassifying employees, underreporting payroll, or underestimating projected employment might lower your comp premiums, they can also be considered insurance fraud.
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