Workers’ compensation is a system that provides benefits to employees who suffer job-related injuries or illnesses. In California, employers are required by law to carry workers’ compensation insurance or be self-insured. This ensures that employees receive medical treatment and wage replacement if they are injured at work. But who actually pays for these benefits? Let’s break it down.
Who is Responsible for Paying Workers’ Compensation?
In California, employers are fully responsible for covering workers’ compensation costs. Employees do not pay for these benefits, and employers cannot deduct the cost from workers’ wages. Employers fulfill their legal obligation in one of two ways:
- Workers’ Compensation Insurance – Most employers purchase workers’ compensation insurance from private insurance companies or the State Compensation Insurance Fund (SCIF). This insurance covers medical expenses, lost wages, and disability benefits for injured workers.
- Self-Insurance – Some large businesses choose to self-insure, meaning they pay for workers’ compensation claims directly rather than purchasing insurance. These companies must meet strict financial requirements and obtain state approval.
How Does Workers’ Compensation Insurance Work?
When an employee gets injured on the job, they must report the injury to their employer as soon as possible. The employer then provides a claim form, which must be completed and submitted to the workers’ compensation insurance provider. The insurer processes the claim and, if approved, covers medical costs and wage replacement benefits.
California law requires insurance companies to cover medical treatment up to $10,000 while the claim is being reviewed. If the claim is approved, benefits continue based on the worker’s needs.
What Happens if an Employer Doesn’t Have Workers’ Compensation Insurance?
It is illegal for an employer in California to operate without workers’ compensation insurance. If an employer fails to provide coverage, they face serious consequences:
- Fines and Penalties – Employers without insurance may be fined up to $10,000 per employee or face criminal charges.
- Lawsuits – Injured workers can sue their uninsured employer for damages, including pain and suffering, which are not covered under normal workers’ compensation claims.
- State Intervention – Workers can file a claim with the Uninsured Employers Benefits Trust Fund (UEBTF), which helps pay benefits when employers fail to provide coverage. The state then seeks reimbursement from the employer.
What Benefits Does Workers’ Compensation Provide?
Workers’ compensation benefits in California include:
- Medical Treatment – Covers doctor visits, surgeries, physical therapy, prescription medications, and other necessary treatments.
- Temporary Disability Benefits – Provides wage replacement (typically two-thirds of a worker’s average weekly earnings) for employees who are unable to work during recovery.
- Permanent Disability Benefits – Compensation for workers who suffer lasting impairments due to their injuries.
- Job Displacement Benefits – Vouchers to help workers retrain for new jobs if they cannot return to their previous position.
- Death Benefits – Financial support for the dependents of a worker who dies due to a job-related injury or illness.
Why Do Some Employers Dispute Workers’ Compensation Claims?
Employers and insurance companies sometimes challenge workers’ compensation claims to avoid financial liability. Common reasons include:
- Disputing whether the injury occurred at work
- Claiming the injury is due to a pre-existing condition
- Arguing that the employee can return to work sooner than stated
If your claim is denied, you have the right to appeal. An experienced workers’ compensation attorney can help fight for the benefits you deserve.
Need Workers’ Compensation Help?
Workers’ compensation provides financial and medical support for employees injured on the job, but obtaining these benefits is not always easy. Employers must carry insurance or self-insure, but disputes and claim denials can complicate the process. If you are struggling with a claim or believe your employer is not following the law, the Law Offices of Hinden & Breslavsky, APC, can help. Call (323) 954-1800 today for a free consultation and protect your right to compensation.