Workers' Compensation Noncompliance Penalties

Utah Code Annotated section 34A-2-211 provides for a penalty to be imposed against an employer who is conducting business with employees but without securing workers' compensation insurance. The Industrial Accidents Division conducts investigations into businesses where it believes this is the case. Investigations follow a general process designed to put the employer on notice, allow for the exchange of information, and meet the statutory obligation of assessing a penalty if necessary.

Investigation Process

  1. First Letter-
    A first letter is sent to the employer requesting workers' compensation coverage information or the reason why coverage is not needed.
  2. Notice of Noncompliance and Intent to Assess Penalty -
    Thirty (30) days after the First Letter has been sent, if information is not received indicating that an employer is in compliance or is exempted from obtaining workers' compensation insurance, a notice is sent informing the employer of the Division's intent to penalize and includes the amount of the proposed penalty.
  3. Determination and Order Declaring Noncompliance and Assessing a Penalty-
    Fifteen (15) days after the Notice has been sent, the Division will make a final determination based on the information it has in its possession, and if it is determined that the employer needed workers' compensation insurance and did not have it, an Order will be issued declaring a penalty due.

Appeal Process

  1. Within thirty (30) days from the date the Order was signed, the employer can submit an appeal of the penalty to the Division. The appeal shall specify that an appeal is being made and the basis of the employer's objection to the determination.
  2. Once the appeal is received, a review of the file will be made and the employer will be contacted in an attempt to resolve the issue. If the matter cannot be resolved, then the case will be transferred to the Adjudication Division and a hearing date set.

For information regarding hearings at the Labor Commission, please click here.

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