2024 Who Pays Workers’ Compensation Benefits in California?

Workers’ compensation benefits are a valuable tool that allow workers who have been injured on the job or developed a work-related condition or disease to receive payments for key expenses, such as medical treatment, lost wages, and vocational rehabilitation. However, the workers’ compensation system can be perplexing, with vagueness around the benefits a worker is entitled to, where the money comes from, and who pays workers’ compensation benefits in California.

Workers’ Compensation Insurance Coverage in California

Under California Labor Code Section 3700, all California employers need to provide workers’ compensation benefits to their employees. So, if a business employs one or more workers, the law requiring mandatory workers’ comp insurance is applicable to them, with exceptions. In cases where a sole proprietor business owner wants to purchase a workers’ compensation plan only to cover themselves, it is possible to do so, but it must be stated in the insurance policy.

Workers’ compensation insurance is a type of liability insurance in which the employer is assumed to be fully liable for all of the work-related injuries suffered by the employee. This means that even if the injured worker caused the accident leading to their injuries, they will still be entitled to receive workers’ compensation payments, except for some conditions, such as if they were using alcohol or drugs at the time of the accident.

In California, executive officers, as well as corporation directors, are required to be included in the workers’ compensation coverage plan, except for the case where the business is exclusively owned by the officers and directors. If the directors and officers are the exclusive owners, they may be able to opt out of workers’ compensation benefits.

If you are an employee who believes that your employer is not adequately covering you with workers’ compensation benefits, it’s critical to work with an experienced workers’ compensation lawyer. They can help analyze your situation, advise you of your rights, and get you the full compensation you need.

Where to Purchase Workers’ Compensation Insurance

Employers can purchase workers’ compensation insurance either through the State Compensation Insurance Fund or from a licensed insurance company. In some cases, employers may also be able to self-insure for workers’ compensation. A commercial broker-agent can help employers find a plan that works for their company either through the state fund, a licensed insurance company, or self-insurance.

The State Compensation Insurance Fund is an entity operated by the state that has the sole purpose of transacting workers’ compensation in a manner that is not for profit. The State Compensation Insurance Fund is competing with private insurance companies, but it will also provide last-resort insurance to companies that private insurers refuse to cover.

For employers to self-insure, they will need to get state approval. Furthermore, they will need to have a net worth of a minimum of $5 million dollars, with a net income of $500,000. Finally, they will need to post a security deposit. Due to the stringent legal requirements, only a few companies could qualify for self-insurance; however, this is increasing in popularity due to the option for multiple small businesses within the same industry to pool their resources together.

FAQs

Q: Who Pays for Workers Compensation in California?

A: In California, employers are required to have workers’ compensation insurance in case their employees get injured on the job or develop a work-related illness or condition. Therefore, workers’ compensation benefits are usually covered by the workers’ compensation insurance companies of the employer. Instead of purchasing a workers’ compensation insurance policy with a private company, employers may be able to obtain a self-insurance authorization from the state.

If your employer is refusing to pay for workers’ comp insurance, then this is against the law.

Q: Are California Employers Required to Have Workers Compensation Insurance?

A: Yes, employers in the state of California generally must have an insurance policy that will provide benefits to their employees if they suffer from a work-related injury, illness, or condition that keeps them out of work. This law applies to the majority of employers in California, regardless of the size of the company or the number of workers employed. If an employer fails to have adequate workers’ compensation coverage, they can face legal consequences in addition to other penalties and fines.

Q: Who Is in Charge of Workers’ Compensation in California?

A: In California, the Division of Workers’ Compensation, or DWC, which is a part of the California Department of Industrial Relations, has the responsibility of supervising the entire workers’ compensation system in the state. The DWC enforces laws and regulations related to workers’ compensation and oversees the administration of those laws.

They also resolve disputes between workers who have been injured and their employers or their insurance companies, as well as provide information and other resources to different relevant stakeholders.

Q: How Much Does Workers Comp Cost Employers in California?

A: The cost of a workers’ compensation insurance policy for California employers varies based on certain factors, including the type of business, the industry the business is involved in, the number of workers in the business, the claims history of the business, and the risk factor associated with the involved work. Insurance premiums for workers’ compensation are typically calculated based on the employer’s payroll and the classification of the types of jobs carried out by the workers.

Get Support With Your Workers’ Compensation Benefits Case

While being injured on the job can be devastating and disheartening, workers’ compensation can serve as a lifeline for injured workers until they are able to return to the workplace. Employers in the state of California are required to have adequate insurance coverage in order to cover key costs for their workers if they are injured on the job.

If your employer does not have adequate coverage to pay your workers’ compensation benefits, or if they are refusing to assist with the process of filing for benefits, they are likely breaking the law. An experienced lawyer from Canlas Law Group can help you get the benefits you are entitled to receive, allowing you to focus your energy on healing instead of fighting your employer for appropriate benefits. Contact us today.