Workers compensation employer responsibilities are a legal obligation—not a courtesy—and skipping them invites fines, lawsuits, or criminal charges. In California, employers are accountable for every step: active insurance coverage, timely reporting, medical access, and retaliation safeguards. One delay or missed duty can lead to audits, penalties up to $100,000, jail terms of up to one year, or even personal liability. There’s no room for assumptions.
What follows isn’t theory—it’s your compliance checklist. From insurance rules to retaliation risks, every section outlines what the law requires, where employers fail, and how much it can cost.
What Are an Employer’s Responsibilities Under California Workers’ Compensation Law?
California Workers’ Compensation is a mandatory insurance program that benefits employees injured on the job. Employers must comply with the law to avoid fines, lawsuits, and business disruptions.
California employers have specific legal duties when handling a Workers’ Compensation claim. These duties include:
Maintaining Workers’ Compensation Insurance Coverage
California law requires employers to maintain active Workers’ Compensation insurance coverage at all times, even if they have only one employee.
Posting Required Workers’ Compensation Notices at the Workplace
Employers must post visible workers’ compensation compliance notices on the worksite. These notices must clearly outline employee rights, the claims process, and insurance contact information.
Examples include:
- Post the “Notice to Employees” (DWC-7 form) in a common area
- List the name and contact number of the insurance claims administrator
- Provide claim filing steps using clear, accessible language
- Display contact details for the Division of Workers’ Compensation Ombudsman
Providing Prompt Medical Care After a Work-Related Injury
Employers must provide immediate medical care after a job-related injury, regardless of who was at fault.
If the employer uses a Medical Provider Network (MPN), the injured worker must receive care from a provider in that network. Employers must give written MPN information to the employee within one business day.
Distributing and Processing Claim Forms for Injured Employees
California employers must provide a DWC-1 claim form within one business day.
To meet this requirement:
- Provide the DWC-1 claim form to the injured worker
- Assist the employee in completing the form correctly
- Submit the completed form to the insurance provider without delay
Reporting Work Injuries to the California Division of Workers’ Compensation
Employers must report any work-related injury or illness to the California Workers’ Compensation Board within five days of learning about the incident. Reporting fulfills legal obligations and supports accurate claim records.
Missing this deadline may result in a $5,000 penalty per violation under state law.
Ensuring Workplace Safety and Implementing Risk Prevention Practices
Employers have a legal duty to provide a safe working environment to reduce the risk of injury. The law requires ongoing safety programs and corrective actions.
Examples of required safety measures include:
- Conduct safety training for all new and existing employees
- Post clear warning signs in hazardous areas
- Submit workplace violations to Cal/OSHA when identified
- Remove physical hazards such as spills, clutter, or faulty equipment
- Implement and update an Injury and Illness Prevention Program (IIPP) as required by California law
Following Anti-Retaliation Laws for Injured or Claiming Workers
It is illegal for employers to retaliate against workers who file or participate in a Workers’ Compensation claim.
Prohibited actions include:
- Terminating the employee after they report an injury
- Reducing the workers’ hours to penalize them
- Reassigning or demoting the worker for filing a claim
Employees can report retaliation to the California Labor Commissioner or file a 132a petition with the Workers’ Compensation Appeals Board. Employers may face job reinstatement orders, back pay, and penalties up to $10,000.
Reporting Suspected Workers’ Compensation Fraud
Employers must report suspected Workers’ Compensation fraud. It is a legal obligation under California law. Fraud includes false claims, fake injuries, or dishonest medical billing. Reporting protects the integrity of the system and keeps benefits available for real injuries. It prevents abuse, controls insurance costs, and supports fair claims handling. Employers may report fraud to their insurance carrier or the California Department of Insurance.
Meeting Ongoing Compliance Obligations Under California Law
Employer compliance includes duties beyond claim handling. These responsibilities support fair treatment and legal protection for injured workers.
Complying with ADA Requirements for Injured Employees Returning to Work
Employers must follow the Americans with Disabilities Act (ADA) when helping injured workers return to work. Reasonable accommodations are required to allow the employee to perform essential job functions.
Examples of reasonable accommodations:
- Modify the worker’s job tasks based on physical limits
- Adjust shift schedules to support medical needs
- Change the workstation layout or provide assistive equipment
- Engage in the interactive process to identify effective solutions
Informing Employees of Their Workers’ Compensation Rights and Benefits
Employers must inform all employees of their Workers’ Compensation rights. This duty is fulfilled through written notices, posted signs, employee handbooks, and onboarding orientation materials.
California Employer Requirements for Workers’ Compensation Insurance Coverage
Employers must inform all employees of their Workers’ Compensation rights. This duty is fulfilled through written notices, posted signs, employee handbooks, and onboarding orientation materials.
All California employers must provide workers’ compensation benefits under California Labor Code Section 3700.
This requirement applies to various categories of employment, including:
- Part-Time Employees: Workers employed for fewer hours than full-time staff.
- Seasonal Workers: Employees hired for specific seasons or peak periods.
- Family Members: Relatives employed by the business.
- Corporate Officers and Directors: Individuals serving as executives or board members.
- Household Staff: Domestic workers such as nannies or caregivers.
However, there are exceptions:
- Sole proprietors, unless they choose to buy coverage
- Executive officers who fully own the corporation
- Independent contractors, unless misclassified as employees
For comprehensive information, refer to the California Department of Insurance Information page.
Employer Mistakes in Workers’ Compensation Compliance
Common compliance mistakes include:
- Report work injuries late to the insurance carrier
- Lack of written and enforced workplace safety policies
- Retaliate against workers who file injury claims
- Fail to post required Workers’ Compensation notices
- Delay in issuing the DWC-1 claim form to employees
Employer Consultation Timing for Workers’ Compensation Defense Attorneys
Employers should consult a defense attorney when:
- Disputes arise over the cause or extent of the employee’s injury
- Evidence suggests the claim may involve fraud or misrepresentation
- The employee hires legal representation for their claim
- A claim leads to a potential penalty, audit, or litigation
If you are unsure when to hire a workers’ compensation attorney, consider common legal scenarios that could increase your liability as an employer.
Roy Yang Law for Workers’ Compensation Defense
Roy Yang Law brings over 15 years of experience in Workers’ Compensation defense. Our firm is built on three core values: Passion. Experience. Diligence. We:
- Deliver focused legal strategy for California employers
- Speed up claim handling and response timelines
- Reduce employer liability through precise case management
- Secure results by constructing a path to justice for each client
If you want a Workers’ Compensation defense representation, contact us now!
Employer Penalties under Workers’ Compensation Law Non-Compliance
Employers who fail to comply with California Workers’ Compensation laws face severe penalties. These include state-issued fines, criminal charges, and exposure to employee lawsuits.
Fines and Criminal Charges for Uninsured Employers
California employers without Workers’ Compensation insurance face criminal and civil penalties.
Penalties include:
- Up to $10,000 in fines under Labor Code §3700.5
- Up to one year in county jail
- Stop order that halts business operations immediately
Uninsured employers are also liable for all costs if a worker is injured.
Civil Lawsuits Resulting from Employer Workers’ Comp Violations
Employees can sue an uninsured employer for work-related injuries.
Lawsuits may include full medical costs, lost income, and additional damages.
Employers are fully liable when no insurance policy is in place.
Workers’ Compensation Employer Responsibilities: FAQs
What is the employer’s advantage in offering workers’ compensation?
Offering workers’ compensation benefits protects employers from lawsuits, limits liability, ensures legal compliance, and supports a safer, more stable workplace.
Does workers’ compensation insurance protect the employer?
Yes, workers’ compensation insurance protects the employer from lawsuits and reduces liability for injury-related expenses.
How long does an employer have to hold a job for someone on workers’ compensation?
There is no law requiring job protection indefinitely. Continued employment depends on company policy and ADA accommodations.
Can employers terminate an employee while on workers’ compensation?
Yes, employers can terminate an employee on workers’ compensation if the termination is not because of the claim.
When can employees sue employers in court for injuries?
Employees can sue employers in court when there is no workers’ compensation insurance, fraud, or intentional misconduct.
