Schwarzenegger Signs SB 313

Wednesday, November 11, 2009 | 0

By Julius Young

Gov. Schwarzenegger has now signed SB 313, a bill which increases penalties for failure to provide workers' comp coverage.

Sponsored by State Senator Mark DeSaulnier, SB 313 will allow penalties of double the monies that would have been paid as premiums by the employer.

Here's my recent post on the bill:
http://workerscompzone.com/index.php?en ... 019-225849

Employer fraud is now a major problem in the comp system. Dishonest employers seek to cut corners, particularly in the sort of industries that hire lots of immigrant service workers. These employers often gain an unfair competitive advantage. And poorly informed employees who are injured are forced to seek treatment at the public's expense when they find that the employer had no insurance.

In the past week there was yet another crackdown on scofflaw car washes. 49 car washes were cited for not carrying workers' comp insurance. Many of these car washes were also cited for other labor law violations.

John Duncan, Director of the Department of Industrial Relations, is quoted (in an article by Greg Griggs on workcompcentral.com) as noting that ...."we found that 12% of California employers are uninsured. This is really frightening and contributes to an increase in workers' comp costs for everyone."

I've been noting this for several years now. Here's my post, "It's the Employer Fraud, Stupid":
http://workerscompzone.com/index.php?en ... 818-110358

Supporters of SB 313 run the gamut from big labor unions to small business advocates.

If anything, one has to wonder whether the penalties are still too small.

The new penalties will probably help deter large employers from skipping comp coverage. But smaller employers may still be willing to run the risk. SB 313 is a great bill. Time will tell whether the penalties need to be hiked much higher, though.

In the meanwhile, it's good to see system stakeholders come together to address a major systemic problem.

Thanks and congratulations are due to all those who helped clear the path for passage of SB 313.

Julius Young is an applicants' attorney with the Boxer & Gerson law firm in Oakland, Calif. This column was reprinted with his permission from his blog on California workers' compensation, http://www.workerscompzone.com