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Almost all businesses in the United States need to carry workers’ compensation insurance. In Florida, companies with a certain number of employees – six in agriculture, at least one in construction, and four for most other companies — must carry workers’ compensation. Failure to comply with Florida’s worker’s compensation rules can result in hefty fines, stop-work orders, and even jail time. In this article, we will dive into the different penalties for noncompliance with workers’ compensation insurance in the state of Florida. 

What Are The Penalties?

Fines And Fees

It’s important to always comply with workers’ compensation laws as state investigators are permitted to conduct job site inspections at any time they see fit. Not only does the investigator have the right to look around and speak to your employees, but he also has the power to see your business records and issue subpoenas. If an investigator determines that an employer is violating laws regarding workers’ compensation, they can assign steep fines. 

The fine for not having the necessary policy by Florida law is double what the employer would have paid in workers compensation premiums for the duration of time they went without compliance in the last two years, or a minimum fee of $1,000, whichever is greater. In addition to that, a fee of $5,000 is also assessed for every worker who has been falsely claimed as an independent contractor. 

The cost in fees and fines of violating workers’ compensation rules easily dwarfs the price of purchasing the insurance in the first place.

Stop-Work Orders

If an investigator issues a fine, they will usually also issue a stop-work order to ensure your business complies with the law. A stop-work order can be detrimental to your company as you’re forced to cease all operations at your job site. This can damage the reputation of your company and leave your company with no revenue for some time. Many businesses that are issued stop-work orders end up closing permanently, so preventing this case scenario is essential to the well-being of your organization.

Civil Lawsuits

Usually, when an employee is injured during their employment, that employee must go through the worker’s compensation process. This is where it’s determined how much an employee will receive for a particular injury. However, if you don’t have workers’ compensation, the employee can sue you.

In civil courts, juries decide the amount a plaintiff should be compensated for their injury. Ask any injury plaintiff attorney, suing usually results in much larger verdicts compared to the worker’s compensation system. Additionally, for those without workers’ compensation insurance, you may also have to pay for the attorney defending the employee, resulting in even more loss to your company. 

Miami Employer Arrested: Contracting Firm Owner Faces Workers Compensation Fraud And Theft Charges 

In South Florida, The Department of Financial Services announced that the owner of Miami Finish Carpentry, a carpentry contracting firm, was explicitly fined for reportedly hiding payroll, in an attempt to avoid paying workers their compensation. As a result, the owner is facing up to 30 years in prison, if convicted. This example indicates the importance of following legal guidelines for workers compensation and real-world consequences of non-compliance. Following workers compensation laws allows you to ensure the safety and wellbeing of your employees, and avoid any costs that may result in strict penalties. For more information on this article regarding workers compensation charges, click here.

Avoid Penalties And Spend Less Money

Workers’ compensation is more than just a legal requirement – it’s an investment in making your business a safer, more productive environment. Complying with Florida’s worker’s compensation laws exemplifies to your employees that their safety is a priority. Also, it ensures that your company is protected from the heavy fines/penalties that come with non-compliance. Take the necessary steps to protect your business and save money while doing so. With Biscayne Risk & Insurance, we can walk you through the entire process and break down a plan that works best for you. 


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