Provides personal liability for owner, executive officer, or executive director of employer for failure to pay for workers' compensation coverage.
Impact
This bill modifies existing state laws under the workers' compensation framework by expanding liability to principal owners of the employer. Previously, only employers faced penalties for uninsured workers' compensation claims. With A4283, individual owners now share liability under these scenarios, aligning their financial responsibility with the legal expectations placed on their companies. This shift aims to deter employers from neglecting their workers' compensation obligations.
Summary
Assembly Bill A4283 proposes that owners, executive officers, and executive directors of employers will be held personally liable for any penalties imposed on their businesses for failing to secure workers' compensation coverage. This law aims to ensure that employees receive compensation even when their employer neglects its responsibilities. violations regarding workers' compensation insurance can result in significant penalties, including a $1,000 fine and additional assessments related to claims.
Contention
However, A4283 may raise concerns among business owners regarding the potential for personal financial repercussions stemming from the action or inaction of their companies. Critics may argue that the increased personal liability could discourage individuals from investing in or managing small businesses due to fear of unforeseen penalties that could affect their personal assets. Such a shift could lead to hesitance in hiring or maintaining a workforce due to the heightened risks associated with noncompliance.