Virginia Raises Fines for Employers Without Workers’ Comp

Employers in Virginia who fail to provide workers’ compensation insurance for their employees will be assessed, beginning July, a civil penalty of up to $250 per day for each day of noncompliance, subject to a maximum penalty of $50,000, plus collection costs.

Virginia Workers’ Compensation Commission said the state’s General Assembly approved an increase in the civil penalty imposed when an employer required to insure under the Workers’ Compensation Act fails to insure. The current law imposes on employers a civil penalty of at least $500 and up to $5,000 for each period of being uninsured.

The law change amends section 65.2-805 of the state’s Workers’ Compensation Act which addresses the civil penalty for employer failure to insure. The amendment was approved March 7, 2014 and will be effective on July 1, 2014.

“The law had not been updated in many years, and the penalties were not actually in line with the cost of workers’ comp insurance coverage,” said Laura Collins, insurance department manager at the Virginia Workers’ Compensation Commission.

“So sometimes, employers would actually risk not having worker’s comp insurance and face penalties instead of having workers’ comp insurance coverage which is actually mandatory insurance coverage required by law for those employers who are required to have it,” she said.

The Commission said an employer is required by state law to insure in Virginia when they regularly employ more than two part-time (or full-time) employees.