Obtaining Workers’ Comp Benefits When Your Employer is Uninsured
Under the Illinois Workers’ Compensation Act, Employers are required to carry workers’ compensation insurance. However, this requirement is not always satisfied by the employer for a number of reasons: 1) some employers knowingly ignore this requirement 2) some employers mistakenly categorize their workers as “independent contractors” and believe that they are exempt from obtaining work comp insurance and 3) in some cases the employer allows insurance coverage to lapse due to nonpayment of insurance premiums.
Prior to 2005, if an employee was injured on the job while working for an uninsured employer, the injured worker would have a difficult time recovering benefits because 1) it was hard to find an attorney willing to take the case due to the slim likelihood of recovery and 2) often times the employer would file for bankruptcy shortly after the claim was filed.
Fortunately, in 2005 the legislature established the Injured Workers’ Benefit Fund (“IWBF”). The IWBF provides workers’ compensation benefits to employees injured during the course of their employment while working for an uninsured employer. The Act provides stiff monetary and criminal penalties to employers who do not carry workers’ compensation insurance. The IWBF is funded by fines that the State collects from uninsured employers.
There are number of extra legal requirements that must be met in order to obtain recovery from the IWBF. First, an amended application naming the employer and the IWBF as Respondents must be filed. The injured worker must also provide proof that the employer did not have workers’ compensation insurance.
Normally if the employer has insurance coverage, at the time of trial the employer’s attorney will often stipulate to non-disputed facts such as employment relationship, wages, the number of dependents, and in some situations they will even stipulate that you sustained an accident arising out of and in the course of your employment. In IWBF claims the State will not stipulate to anything. Therefore, at time of trial your attorney needs to prove each and every element of your case.
Furthermore, since IWBF trials usually proceed on an ex parte basis (without the employer present), there are additional requirements to ensure that the employer receives proper notice of the hearing. If the notice requirements are not met, an arbitrator’s award of workers’ compensation benefits will not stand up on appeal.
Once the award becomes final, the injured worker must file a Request for Benefits within 90 days and provide proper medical bills and billing codes in order to perfect recovery from the IWBF. Payment of the award is issued once a year and is subject to the availability of money in the IWBF each fiscal year. Consequently, the IWBF may not always pay 100% of the award. If there is insufficient money in the IWBF to pay all awards submitted, the funds are distributed to the claimants on a pro rata basis.
There are many additional steps that must be taken before, during and after the trial in order to recover benefits from the IWBF. It is important to hire an attorney who is experienced in handling IWBF claims and understands the procedural requirements.