Costs of Not Insuring

The New York State Workers’ Compensation Law requires most employers in New York State to have workers’ compensation coverage for their employees. Failing to provide coverage when required by law is a misdemeanor, and may carry the following sanctions:

• Escalating fines starting at $500 for the first offense going up to $7,500 for subsequent violations within five years.
• An assessment of $250 for each claim incurred while uninsured, plus 15% of the amount awarded up to a maximum of $5,000, plus the actual compensation and medical costs.
• Any penalties the Workers’ Compensation Board assesses for non-compliance.
• An additional fine of $250 for each 10-day period of noncompliance or two percent of the employer's payroll during the period of noncompliance can be levied.

If the employer is a corporation, the president, secretary and treasurer are personally liable for medical care and compensation payments for the injured worker, and all penalties. The employer is deprived of common-law defenses in a civil suit brought by an injured employee.