Running on Empty: What to do if your Minnesota Employer Doesn’t Have Workers’ Compensation Insurance?

What to do if your Minnesota Employer Doesn’t Have Workers’ Compensation Insurance?

Workers' Compensation Insurance

Virtually all Minnesota employers are subject to a legal requirement that they carry workers’ compensation insurance. This requirement is not generally dependent on the size of the employer. It applies regardless of the number of employees a particular employer has. So what happens if, for example, you work for a small, family-run business with only a few employees, and recent discussion about another employer’s situation has led you to believe that your employer does not have any workers’ compensation insurance whatsoever; what should you do?

First of all, it’s generally fairly easy to determine whether your employer actually has insurance. The Minnesota Department of Labor and Industry maintains a website where you can quickly search for an employer and see whether a policy is listed for that employer.

If your employer isn’t listed on the department website, this doesn’t mean your employer is breaking the law. First, your employer could be self-insured. While this isn’t particularly common, it does meet Minnesota legal requirements, as long as they received approval from the Minnesota Commerce Department to self-insure. Second, your employer could fall under one of the narrow exceptions to the general requirement that an employer must have workers’ compensation insurance. Family-run businesses, for example, don’t have to carry insurance for the proprietor or the proprietor’s spouse, parents or children. They do; however, have to carry insurance for any other employees. Additionally, family farm owners don’t need insurance for farm workers if the farm paid less than $8,000 in cash wages over the last year and certain other conditions are met. In other words, while it’s unlikely that your employer is not required to carry workers’ compensation insurance, it is possible.

If none of the exceptions to the insurance requirement apply and your employer (a) doesn’t have insurance, and (b) isn’t self-insured, what should you do? You can report the employer to the Department of Labor and Industry by using the same link to the website above. The department will investigate the reported violation.

Why does any of this matter? Tempting as it may be to think that you don’t need to do anything about an uninsured employer because it’s too much hassle and not your concern anyway, it is important for you to say something. If you are injured on the job and your employer turns out to be uninsured, you can still claim workers’ compensation benefits from the Minnesota Special Compensation Fund. Your employer will be required to reimburse the fund for the amount of your claim (plus penalties and fines). However, many employers may not have the resources to reimburse the fund, meaning that your claim could end up taking more from the fund than is replaced. This is detrimental to the state, the taxpayers, and to any other employee making a future claim for compensation from the fund.