Workers Comp Penalties on the Rise for NC Employers

There are a number of things a new or small business has to worry about staying in compliance with in their day-to-day operations. From an employment standpoint alone, you have to worry ensuring you have new hire paperwork for all employees. You need to get an employee handbook in place, pay all appropriate payroll taxes, document all disciplinary issues, and the list goes on and on. Another important step small businesses must keep in mind as they grow is workers’ compensation insurance, and it has become more important than ever.

North Carolina businesses with three or more employees are required to have workers compensation insurance coverage under North Carolina General Statute § 97-93. The rationale behind this requirement makes sense. Many companies do not have the funds to cover medical bills, lost wages and permanent disability suffered by a worker injured on the job. Having insurance in place helps ensure that injured workers will get the compensation they are entitled to. If a small company was to have to pay this out of pocket, it may force the company into bankruptcy. So the workman’s compensation insurance is there for the benefit of the employee and the employer.

What North Carolina small businesses have to keep in mind is that in addition to this requirement to have insurance, North Carolina statutes also state that the failure to secure the required policy can result in civil fines and criminal penalties against noninsured employers. The way this has always played out in the past is that when an employee is injured and files a claim against the employer, the North Carolina Industrial Commission gets involved and realizes the employer does not have insurance coverage. Before you know it, the noninsured employer receives a penalty assessment – often for tens of thousands of thousands of dollars.

Although that system is not new, the NC Industrial Commission has started to put more effort into their non-insurance enforcement and compliance efforts. Now many NC companies are finding themselves getting penalty assessments, even when there is no underlying workers’ compensation injury claim. These penalty orders can be devastating to a small company.

The good news is that penalty assessments and criminal charges for non-compliance can often be challenged or resolved through negotiation. Although the company can attempt to negotiate these penalties themselves, an attorney experienced in this area of the law may be able to reach a more favorable resolution.

In addition to helping injured workers who have a workers’ comp claim in North Carolina, Harman Law, PLLC provides representation to non-insured companies in workers’ compensation claims in Huntersville, Lake Norman, Charlotte and across North Carolina. As a fellow small business, we understand what it is like to not always have the same resources as large companies and pride ourselves on our honest, authentic and effective legal counsel to our clients. Feel free to contact our office to learn more information and to discuss your case. Click here to schedule an appointment: Schedule Appointment