All employers (corporations, partnerships and LLCs, and sole proprietorships) in N.J. are required to have workers compensation insurance. This includes companies that aren’t based in N.J. but have employees working here. Companies must have either a workers compensation insurance policy from a New Jersey-authorized carrier, or self-insurance under the explicit approval of the Department of Banking and Insurance, if it’s determined the company has the financial ability to meet obligations. The Office of Special Compensation Funds does routine database checks to detect employers who may be uninsured.
Being uninsured can have grave consequences for a company. Liability can extend directly to corporate officers, and is not dischargeable under bankruptcy. Companies can be directly liable for costs of permanent or temporary disability, medical costs and dependent benefits. Civil penalties can also apply.
If a worker is injured on the job and is awarded workers compensation benefits for temporary disability, and his or her employer does not have workers compensation insurance in force, he or she may turn to the state’s Uninsured Employers Fund for benefits and reasonable medical expenses. The fund is also available for workers whose employers are failing to pay benefits as awarded. (The fund does not pay benefits for permanent disability.)
These kinds of claims can take time to pay out — usually 90 to 120 days after the award. Assistance from an experienced attorney can help, since the attorney will understand exactly how to submit the information the state needs to move the process forward.
Employers must post proof of coverage at the place of business. Workers who suspect their employer does not have workers compensation coverage are encouraged to make a report by completing a Report of Non-Compliance form.
Posted in Workers Compensation