View the complete text of Act 19

ACT NO. 19

Workers’ Compensation; Uninsured Employers; Penalties

This act provides:

(1) That an employee who suffers a work related injury while working for an employer who has no workers’ compensation insurance coverage may elect to pursue a civil action for damages resulting from the injury. In such a civil action, the employer has the burden of proving that the employer’s negligence was not the proximate cause of the injury and may not have the benefit of the affirmative defenses of assumption of the risk or contributory negligence and may not plead that the injury was the result of the negligence of a fellow employee, unless the negligence was willful and with the intent of causing an injury. The act also provides that the employee is not barred from bringing a civil action against an uninsured employer even after accepting payments from the employer for the work injury unless, with full knowledge of his or her rights, the employee has signed a written agreement to that effect and the agreement is filed with and approved by the Commissioner of Labor and Industry. A failure by the employer to pay the workers’ compensation benefits pursuant to the written agreement renders the agreement void after which the employee may then commence a civil action.

(2) The liability of the employer to pay temporary total disability benefits continues for seven days after the employer files with the Commissioner and the injured employee, a notice to discontinue those payments. Temporary total disability payments made after the filing of the agreement may be deducted from any permanent disability benefits to the employee if the commissioner determines that the discontinuance is warranted.

(3) When an injured employee prevails at a hearing, the order shall include interest at the statutory rate computed from the date of the employer’s initial obligation to pay those benefits. An employer who fails to make payments pursuant to an executed agreement within 15 days after payment is due shall also be liable for interest on the unpaid compensation at the statutory rate. In an enforcement action for payment pursuant to an order or agreement, an employee is entitled to an award of attorney fees and interest on the unpaid benefits.

(4) In regard to an employer who fails to secure workers’ compensation coverage, an injured employee who brings a civil action pursuant to 21 V.S.A. 618 may file a lien against the property of the following persons and those persons may be personally liable for the civil damages or the workers’ compensation benefits:

(A) If the employer is a corporation, the officers and majority stockholders.

(B) If the employer is a partnership, the partners.

(C) If the employer is neither a corporation or a partnership, the principals, the executive officers or controlling parties.

(5) If an employer fails to secure workers’ compensation insurance for more than five days after notice from the Commissioner, the commissioner, after notice, may close the business after another five days. Additionally, if an employer fails to secure or retain workers’ compensation coverage for two years after receiving an order to do so or after receiving an order to close the business, the commissioner shall order the employer to cease doing business until workers’ compensation coverage is secured.

(6) An employer, which includes the owner or operator, the officers of a corporation and the partners of a partnership, who fails to secure workers’ compensation coverage is subject to criminal sanctions of a fine up to $2,500.00 or imprisonment for up to a year, or both.

Effective Date: July 1, 1997