California law requires that the majority of employers carry workers’ compensation insurance to provide for their workers in the event that they sustain a work-related injury during the course and scope of their employment. Unfortunately, some employers either do not carry this insurance or even do not realize that they are required to do so. California Labor Code § 3351 defines “employee,” and the definition is broader than most people realize, including even workers such as handymen, nannies, and minors. In the event an employee sustains an injury, the Uninsured Employers Benefit Trust Fund (UEBTF) may provide funding for the employee. If the employer is illegally uninsured and fails to pay the compensation awarded to the employee by the Workers’ Compensation Appeals Board, the employee may submit a claim to the UEBTF for payment of his or her claims.
The Subsequent Injuries Benefits Trust Fund (SIBTF) is another source of compensation for injured workers. Under California Labor Code § 4751, employees who had a previous permanent disability or impairment at the time he or she sustained another injury in the work place can apply to the SIBTF for compensation. To be eligible for compensation from the SIBTF, the injury from the current employment combined with the previous disability or employment must have the combined effect of at least a seventy percent permanent disability for the worker. Moreover, the new injury must cause at least thirty-five percent of the permanent disability.
Note that an employer does not have to be illegally uninsured for an injured employee to be eligible to receive benefits through the SIBTF. The SIBTF is meant to help pay a portion of the permanent disability compensation for permanently disabled workers for qualifying workers, as described above. If an employee qualifies to receive benefits through the SIBTF, the employer will pay only the portion of permanent disability that is attributable to the injury received through the current employer. The SIBTF will pay the remainder of the benefits owed to the employee. The purpose of the SIBTF is to encourage employers to hire workers who are already permanently disabled without fear that they will be held responsible to pay benefits that are attributable to a permanent disability incurred through previous employment.
We have extensive experience in assisting our clients understand the repercussions of all types of workers’ compensation claims on their business. Call us today so we can talk with you about your business and its responsibilities.