Statutory and Litigation Penalties for Failure to

Statutory and Litigation Penalties for Failure to Secure the Payment of Workers’ Comp Benefits in Maine
Published: 04/26/2018 
By: RKM 

It is essential that every Maine employer consider its obligation to obtain workers’ compensation insurance.  The Maine Worker’s Compensation Act requires that, with some exceptions, employers secure the payment of compensation in conformity with sections 401 to 407. The importance of “securing compensation,” i.e., having comp insurance either through a carrier or through authorization by the Superintendent of Insurance to self-insure, cannot be overemphasized because of the two intertwined penalties.  

First, the Act provides for a multipronged formal penalty scheme consisting of potential conviction of a Class D crime, a civil penalty of $10,000 or of 108% of the premium that should have been paid, and administrative dissolution of a corporation or a limited liability company, or revocation or suspension of a license, certification, or a registration necessary to do business.

Second, just as important, an employee who is injured while working for an uninsured employer has the option of pursuing workers’ compensation benefits or filing a civil claim. If the employee chooses to file a civil claim, her or she may seek damages not available through a claim under the Workers’ Compensation Act.  These potential damages include scarring, disfigurement, pain, suffering, loss of enjoyment of life, permanent impairment, and punitive damages.  

Further, the employer mounting a defense of such a civil claim would be barred from asserting the defenses of comparative fault, negligence of a fellow employee, or assumption of the risk of injury.  Persons who have questions about the application of statutory and litigation penalties should speak to a qualified attorney to understand their rights and obligations.






By |2020-01-29T11:26:59+00:00January 4th, 2019|News|0 Comments