Bill Targets Employers Who Dodge Workers’ Comp Law
California lawmakers are considering legislation that seeks to strengthen compliance of a state law requiring businesses to purchase workers' compensation insurance, the Contra Costa Times reports.
About 100,000 employers in California do not provide workers' compensation insurance, and law enforcement was not equipped to detect them.
Sen. Mark Ridley-Thomas's (D-Los-Angeles) bill (SB 869) would provide tools and funding to fraud investigators to match records of employers' payroll reports with records of insured employers. Currently, the records are at two separate agencies and are not compared easily.
Violators will be forwarded to a second database and to the local district attorney's office. Penalties include fines starting at $1,000 per employee and possibly prosecution.
If the new program is effective, California would save millions of dollars annually on medical bills for uninsured workers.
The money generated from fines and penalties are intended to cover program costs. Any remaining revenue would go to the Uninsured Employers Fund, which pays $20 million in medical bills annually.
The measure recently passed in the Senate and is expected to win approval from the Assembly and Gov. Arnold Schwarzenegger (R) (Dunai, Contra Costa Times, 6/12).