Connecticut labor laws require most employers must carry some kind of insurance for workers’ compensation benefits in case their employers are injured on the job. Unfortunately, some employers try to sneak out of this obligation in order to save money. As a result, when a worker is hurt, the employer is unable to provide workers’ compensation benefits.

Connecticut officials recently ordered 27 construction firms working in the state to stop working on the projects, saying that the companies were illegally trying to avoid their obligations to workers’ compensation and other labor laws. The state Department of Labor’s Division of Wage and Workplace Standards said the companies were purposefully misclassifying employees as independent contractors who did not require workers’ compensation coverage.

The so-called stop-work orders will force the companies to shut down work at their construction sites and pay a penalty of $300 per day the company goes without paying for workers’ compensation insurance. The agency said it has issued 199 of these stop-work orders over the past 12 months, as employers have tried to skirt their obligations for workers’ compensation, unemployment taxes, payroll reporting and other programs designed to make the workplace safer and fairer.

Workers’ compensation is a system that outlines benefits that go to injured employees. Every qualifying business must have some form of workers’ compensation insurance, and most employees qualify for the benefits if they get hurt on the job. Workers’ compensation is designed to make sure that these injured workers get the compensation they need to deal with medical expenses and lost wages while they recover, or if their injury renders them unable to return to work.

Workers’ compensation systems are designed to take the place of lawsuits against employers, so as to make sure that workers get the benefits they need without having to go through the time and expense of a trial. However, when injured workers find that their requests for benefits are denied, they may need legal help in pressing to make sure they get the compensation they deserve.

Source: Insurance Journal, “Conn. Issues Stop Work Orders to 27 Constructions Firms for Misclassifying Workers,” April 4, 2013