Labor Code Section 3700 requires that all
employers secure the payment of compensation for
workers' compensation liability. Compliance with this
statute is monitored by the Director of the Department
of Industrial Relations. When the Director requests, an
employer must furnish a written statement indicating the
name of its insurer or the manner in which the employer
has complied with this statute. This information must be
supplied within 10 days after the request. Failure to
provide the requested information can result in a fine
of $500. The employer has the burden to show or prove
that it has complied with the requirements of Section
3700. The failure to secure workers' compensation
payments is a misdemeanor. The purpose of requiring an
employer to secure workers' compensation coverage is to
ensure that an employee is adequately compensated for
injuries that arise out of, or occur in the course of,
employment. Historically, the legislature has made it
easy for workers to apply for and receive workers'
compensation benefits. Employers are liable regardless
of fault. The purpose of the law is rehabilitation, not
indemnification for damages.
In exchange, the benefit system does not allow for tort damages, including
pain and suffering. Liability for death benefits and burial expenses is
also limited. Benefits are often payable without the need for litigation
and an employer who secures compensation coverage is, with certain
limited exceptions, exempt from lawsuits by the employee in any forum
outside the Workers' Compensation Appeals Board (WCAB), which generally
has exclusive jurisdiction over occupational injuries.
In theory, the balance achieved by this "exclusive remedy" doctrine is that
the employer is freed from costly and time-consuming civil litigation
and the employee receives swift and timely benefits to offset the
potentially disastrous economic consequences of a disabling injury. |
