Massachusetts law requires employers to provide or obtain workers’ compensation insurance. If they fail to do so, they may face significant penalties, including debarment or the cessation of all business operations. Recently, a Massachusetts court discussed the basis for debarment in a matter in which an employer argued that the Commonwealth lacked justification for imposing the penalty. If you were hurt at work and have questions about your rights with regard to workers’ compensation benefits, it is smart to talk to a Massachusetts workers’ compensation attorney.
It is reported that a Department of Industrial Accidents investigator was working in the area of the employer’s facility and decided to visit the business. Upon doing so, it discovered that the employer’s workers’ compensation policy was canceled. As such, the investigator issued a stop work order. The employer, who stated he was unaware the policy had been canceled, had coverage reinstated the following day.
Allegedly, the Department of Industrial Accidents nonetheless stated that debarment was nondiscretionary and automatic under the Massachusetts Workers’ Compensation Act. The employer appealed the stop work order, but the court affirmed the Department’s decision. The employer then appealed.
Penalties for Lack of Workers’ Compensation Insurance
On appeal, the lower court’s ruling was affirmed. In its opinion, the court stated that, as written, the relevant statute dictated that an employer that lacks self-insurance or workers’ compensation insurance was subject to automatic debarment, rejecting the employer’s interpretation of the statute as only imposing such penalties on employers that misclassified employees.
The court explained that the legislative intent of a statute must be gleaned from reading it as a whole, giving effect to each section, word, and clause. In reading the subject statute as a whole, the court found that it was clear the intent was to penalize an employer that either failed to provide insurance for its employees or misclassified employees to avoid higher insurance premiums, not merely to punish those that lacked insurance.
The court also rejected the employer’s argument that the law in question violated its constitutional right to due process because it did not afford the employer the chance to offer evidence that the cancellation of its insurance policy was not the result of intentional behavior. The court noted that the evidence illustrated that the employer was both aware of the stop order and given an opportunity to present evidence challenging the validity of the order at a hearing. Thus, the employer had an opportunity to present meaningful evidence in a meaningful manner, and therefore, its constitutional rights were upheld.
Meet with an Experienced Massachusetts Attorney
The Massachusetts Workers’ Compensation Act protects employees, in part, by demanding that employers provide workers’ compensation insurance. If you sustained harm in the workplace, it is wise to meet with an attorney as soon as possible. James K. Meehan of the Law Office of James K. Meehan is an experienced Massachusetts workers’ compensation attorney with the skills and knowledge needed to help you seek just results. You can contact Mr. Meehan to set up a meeting by using the form online or by calling him at 508-822-6600.