Workers' Compensation - Restaurant CPA

Recently, The State Bar of California and CalChamber hosted a seminar addressing Workers’ Compensation Law in California. The special guest presenters included the Honorable Paige S. Levy, Chief Judge of California’s Division of Workers’ Compensation; Yvonne Lang, top California attorney specializing in the defense of workers’ compensation claims; and Maria Sager, top California attorney representing injured employees in workers’ compensation claims. Erika Pickles, an employment law counsel and HR adviser for CalChamber moderated the seminar. We found the December event very captivating. The experts gave varying stances and applicable information for employers and employees.

Speakers discussed the complexities of evolving workers’ compensation claims and laws. They provided an overview of the workers’ compensation system in California, recent legal developments, insurance requirements, California-recognized injuries, treatment authorizations, indemnity benefits, time limits to pursue and defend against claims, ways to settle claims, penalties and civil considerations, and workers’ compensation fraud. A myriad of topics was covered during the event, but we have highlighted some key notes that are applicable to the restaurant and hospitality industry.

Employers are responsible for managing claims resulting from injuries at the workplace. This requires a clear understanding of California workers’ compensation system.

Employers Must Have Workers’ Compensation Insurance for all Employees

Employers are required to have workers’ compensation insurance to cover all employees including themselves, regardless of the size of the workplace. California is a no-fault system state which means workers’ compensation benefits extend to injured workers without proof of fault for any party. In the restaurant and hospitality industry, it is common to have employees who maintain multiple jobs. If an employee is injured at another workplace while still employed at your workplace, you are still required to abide by the workers’ compensation system. As an employer, you are required to accommodate any time off due to their injury, and any accommodations they need when the employee returns to the workplace. If these requirements are not met, your workplace can be held liable by the workers’ compensation system, and found in violation of the Americans with Disability Act (ADA).

Penalties for not having Workers’ Compensation are Severe

The penalties for not maintaining workers’ compensation insurance are rigid. They include misdemeanor charges, tens of thousands of dollars in fines, and issuing a “stop order” prohibiting the use of employee labor until the employer obtains the proper insurance. The Department of Industrial Relations can file a lien against the uninsured employer’s property, and the Uninsured Employers Trust Fund can file liens and sue the uninsured employer as an employer and as a personal individual.

Workers’ Compensation Fraud

Workers’ Compensation Fraud is a controversial topic. Workers’ compensation insurance and the law do not take this issue lightly whether it is on the employee or employer’s side. In regards to an employee, “any individual who makes or causes to be made any knowingly false or fraudulent material statement or material representation for the purpose of obtaining or denying workers’ compensation benefits or payments is guilty of felony” (Insurance Code 19871.4). An example of employer fraud could be an employer not reporting an injury to their carrier or TPA after the injury is reported, even if the employer pays the injured worker’s medical expenses and/or disability wages out of their own pocket.

Workers’ Compensation Law Update

As of January 1, 2017, a revision and new regulation requires all carriers to report all claims in which medical costs are accrued, even in cases of basic first aid claims. “Regardless of the cost of medical treatment, including first aid, is paid by an employer or insurer, or regardless of whether a workers’ compensation claim is filed” (CLC Section 5401 (a)).

If you need more clarification or guidance in regards to workers’ compensation law, please refer to the State of California Department of Industrial Relations (DIR) at www.dir.ca.gov or the Workers’ Compensation Appeals Board (WCAB) at www.dir.ca.gov/wcab.

For more information, please contact us.

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