News Release

November 22, 1996Christine Baker
(415) 557-1304

Commission Initiates Project to

Identify Employers Illegally Uninsured for Workers' Compensation

SAN FRANCISCO -- The California Commission on Health and Safety and Workers' Compensation voted unanimously at its November meeting to explore methods of identifying employers that are illegally uninsured for workers' compensation and bring them into compliance. An Issue Paper will be developed to address the problems associated with uninsured employers and offer alternative methods for tracking those employers.

The Commission recognizes that employers that are not covered for workers' compensation impose a burden on injured workers, on employers who comply with the workers' compensation insurance requirements, and on the state's taxpayers.

Employers who are insured for workers' compensation are placed at a competitive disadvantage with respect to illegally uninsured employers. Especially in industries with high premium rates, the illegally uninsured employer is able to underbid the insured employer.

Taxpayers, including injured workers and employers, are disadvantaged when taxes are raised to cover costs shifted to government services to assist the injured workers of employers who are illegally uninsured. In addition, regulations have made it increasingly more difficult for injured workers to obtain benefits from the state-supported Uninsured Employers Fund (UEF).

Several states, including Wisconsin and Colorado, have been using proactive programs to identify uninsured employers using computerized lists of employers and their workersà compensation policies. These have proved very successful at bringing uncovered employers into compliance.

Such activities in California could save UEF and state General Fund monies, assist injured workers, and reduce the current competitive disadvantage on responsible employers.

The Commission, created by the workers' compensation reform legislation of 1993, is charged with overseeing the health and safety and workers' compensation systems in California and recommending administrative or legislative modifications to improve their operation. The Commission was established to conduct a continuing examination of the workers' compensation system and of the state's activities to prevent industrial injuries and occupational diseases and to examine those programs in other states.

Further information about the Commission and its activities can be obtained by writing to Christine Baker, Executive Officer, Commission on Health and Safety and Workers' Compensation, 30 Van Ness Avenue, Suite 2122, San Francisco, CA 94102, by calling (415) 557-1304, or by faxing a request to (415) 557-1385. Information is also available through the Internet by accessing the Department of Industrial Relations' home page at