Workers’ compensation is required in Arizona. Under the law, almost all employers must either purchase a workers’ compensation policy or prove that they are self-insured. But what happens if you are an injured worker and you find out your employer didn’t buy a policy? Or what happens if they had a policy but let coverage lapse?
The good news is that injured workers should still receive benefits. The state’s Industrial Commission takes the lead on paying benefits to workers whose employers should be insured. And even better: the ICA will charge the cost of benefits to your employer, so they end up paying anyway. Call our firm to speak with an Arizona workers’ compensation lawyer if you are hurt at work but your employer is uninsured.
Exempt Employers from Workers’ Compensation
All employers must purchase workers’ compensation if they have at least one full- or part-time employee. However, coverage Is not required for:
- Sole proprietors who do not have any employees
- Casual or occasional workers
- Domestic workers
- Subcontractors
- Independent contractors
When a worker is injured, they will qualify for various benefits for their on-the-job injury, including medical treatment that is necessary and reasonable.
Why Do Employers Refuse to Purchase Coverage?
Some of them do not buy a policy because they aren’t aware of the requirement. For example, they might be a sole proprietor who for decades did not have any employees. Then they hired a part-time employee but didn’t know they were now required to have workers’ compensation insurance.
Other employers wrongly believe they are using independent contractors when, in fact, the worker is an employee. Whether a worker qualifies as an “employee” is a fact-driven inquiry. Some employers wrongly think that if they label a person as an independent contractor then that is the end of the matter.
Finally, some employers don’t purchase workers’ compensation because they want to save money. The economy is distressed, and some employers are trying to avoid debt. Generally, employers spend about $1 for every $100 in payroll. For a medium-sized business, this could represent thousands of dollars each year.
Penalties for Failing to Carry Coverage
Not having workers’ compensation insurance is a Class 6 felony in Arizona. (Arizona Revised Statutes § 23-932.) An employer convicted will face the full range of penalties, including criminal fines and time behind bars.
The state can also assess civil penalties for not having a workers’ compensation policy. The penalty is $1,000 for a first violation but can rise to $5,000 for a second violation in a ten-year period or $10,000 for a third violation.
Further, the state can seek a court injunction to shut down a business until it comes into compliance with the worker’s compensation requirements. That is a drastic step, but any business that continues to operate would be in violation of a court order. A judge could find them in contempt.
What is the Special Fund?
The Industrial Commission in Arizona has created the Special Fund pursuant to Arizona law. This fund will pay out medical care benefits and a portion of lost wages to workers whose employers are uninsured, similar to how workers’ compensation benefits work. Any injured worker should submit a Worker’s Report of Injury form to the ICA. You will only get approved for benefits if you were injured while working and are not exempt.
The Special Fund Division will then bill your employer for the total amount of benefits paid, along with a penalty of either 10% or $1,000 (whichever is higher). This penalty should induce them to purchase a workers’ compensation policy moving forward.
If your employer says you are an independent contractor, then you should pursue this route. Submit your claim to the ICA and they will investigate.
Can You Sue?
Typically, workers’ compensation is an exclusive remedy for an injured worker against their employer. If you sue, it will typically be a third party who has in some way contributed to your on-the-job injury. A classic example is a manufacturer of a defective piece of equipment which fails to work properly, injuring you.
However, if your employer lacks workers’ compensation insurance, then you could sue them in court for a personal injury. You can seek full compensation for all losses, including full lost income or wages. If you bring a workers’ compensation claim, then you will get at most two-thirds of your average pre-injury wages. You can also seek compensation for pain and suffering.
Do Uninsured Workers Need a Lawyer?
Yes. You certainly benefit from hiring an experienced Arizona workers’ compensation attorney. We can:
- Help you understand your options, including submitting a claim with the Industrial Commission of Arizona or filing a personal injury lawsuit.
- Complete your workers’ compensation claim and submit it to the ICA.
- Handle your workers’ compensation claim before the ICA, including attending any required hearings.
- Negotiate a settlement, where appropriate, to obtain compensation for your injuries.
The ICA does not rubber-stamp every claim for benefits. Instead, they will scrutinize whether you were injured while working. Although workers’ comp benefits are no-fault, you still need to show you were hurt while on the job. The ICA might also suspect you really have a pre-existing injury. There are many reasons why they deny claims. Call our firm to speak with an attorney if you’ve already been denied. You have the right to an appeal.
Call Snow, Carpio & Weekley, PLC
Workers’ compensation has made it easier for injured workers to get the benefits they need after a serious workplace accident or injury. Instead of suing and waiting for a settlement, you can immediately access medical care under a workers’ compensation policy.
Don’t let your employer’s uninsured status dissuade you from seeking help. You should call our firm to talk about what options to take. We have helped many uninsured workers seek benefits or other compensation for an on-the-job injury. Get the financial and medical help you deserve.
Call Snow, Carpio & Weekley, PLC, today at (877) 370-5788 or submit your private information online. Our consultations are completely free.
