Uninsured Employers Are Rampant In North Carolina

In North Carolina, 30,000 employers lack workers' compensation insurance.

The News and Observer and Charlotte Observer have reported that nearly 30,000 employers in North Carolina may not have workers’ compensation coverage, even though legislation requires them to have it in case a worker is injured on the job. Although there are stiff penalties and criminal sanctions (it is a Class H felony to intentionally not have insurance if the damages are over $1,000.00) the state has not aggressively enforced compliance with the statute.

Nearly 30,000 employers in North Carolina may not have workers’ compensation coverage

In New York, when the Fiscal Policy Research Institute did a similar study in 2008, it was estimated that as many as one-third of the employers required to have workers’ compensation insurance did not have it, and that as much as $500 million – $1 billion was being lost to the system. Immediate action was taken by then governor Spitzer to correct the problem and all agencies involved were ordered to cooperate and get the problem fixed.

There is no uninsured fund in this state, so if there is no insurance, you can guess who foots the bill: the taxpayer.

A similar massive effort needs to be taken in North Carolina. There is no uninsured fund in this state, so if there is no insurance, you can guess who foots the bill: the taxpayer. Those of us who pay taxes and buy insurance end up paying for the cost of these injuries. Employers cheat the system with no punishment, and we end up paying the hospital bills, providing the food stamps, and paying higher taxes. The crooked employer makes the money and leaves others to clean up the mess. Is this what we teach our children?

The crooked employer makes the money and leaves others to clean up the mess.

The vast majority of employers purchase workers’ compensation insurance. However, when 30,000 other employers don’t, the good guys are placed at a competitive disadvantage. And what message is being sent to those who want to do the right thing? If no one is enforcing the law, why bother to spend that money? Some will simply say: “I’ll take my chances. Even if I get caught, even now they just make you come into compliance and waive the penalty. That’s not a bad deal.” It’s like driving down an interstate highway, knowing that no Highway Patrol Officer is out there making sure people are not speeding. Most of us will drive carefully, but we all know that with no law enforcement there are many who will go as fast as they can, and eventually bad things will happen.

The current system is broken and simply must be repaired.

There is a two-fold solution: (1) enforce the law, and (2) create an uninsured fund to cover those who fall through the cracks. The current system is broken and simply must be repaired.

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