For employers
Caught without workers' comp in New York: penalties & what to do
New York has one of the strictest coverage mandates in the country, and the Workers' Compensation Board enforces it aggressively. Going uninsured — even by accident, even for a short lapse — can mean five-figure fines, a shut-down order, personal liability for the owners, and, if a worker gets hurt, a lawsuit that workers' comp would normally have prevented.
- Being uninsured can cost up to $2,000 for every 10-day period without coverage (WCL §52[5]) — first penalty notices often exceed $12,000.
- It can be a criminal misdemeanor or felony, and corporate officers are held personally liable.
- The Board can issue a Stop-Work Order that shuts your business down immediately.
- If a worker is injured while you're uninsured, you lose the lawsuit shield and must repay the entire claim — the part that bankrupts small employers.
The penalty ladder
Penalties stack — you can face civil fines, criminal charges, payroll-record penalties, and debarment for the same lapse. Fines accrue per 10-day period, so the cost climbs the longer the gap lasts.
| Violation | Penalty | Authority |
|---|---|---|
| No coverage (civil) | Up to $2,000 per 10-day period uninsured, or twice the cost of compensation for the period | WCL §52(5) |
| No coverage, 5 or fewer employees (criminal) | Misdemeanor — fine $1,000–$5,000 | WCL §52(1) |
| No coverage, more than 5 employees (criminal) | Class E felony — fine $5,000–$50,000 | WCL §52(1) |
| Repeat offense within 5 years | Class D felony — fine $10,000–$50,000 | WCL §52(1) |
| Fraud / misrepresenting coverage or payroll | Up to $2,000 per 10-day period (or 2× the cost); criminal fines $1,000–$50,000 | WCL §52(1)(d) |
| Falsifying / failing to keep payroll records | Misdemeanor $5,000–$10,000; felony $10,000–$25,000; civil $1,000 per 10-day period | WCL §131 |
| Failure to post the Notice of Compliance | $500 per violation | WCL §51 |
| Public-works debarment after a conviction | 1-year ban (misdemeanor) or 5-year ban (felony) from public contracts | WCL §141-b |
Stop-Work Orders
Under WCL §141-a, the Board can issue a Stop-Work Order for a coverage lapse or outstanding debt — halting all business operations immediately, not just the uninsured work. It stays in effect until you show proof of coverage and resolve the penalty. Working in violation of the order triggers additional penalties.
Personal liability of owners
The corporate veil doesn't protect you here. The company's president, secretary, and treasurer are personally liable for these penalties under WCL §26, §52, and §131 — meaning the Board can pursue their personal assets, not just the business's.
The real nightmare: a worker gets hurt while you're uninsured
The fines are survivable. This usually isn't. Workers' comp normally protects an employer with the "exclusive remedy" rule — an injured employee can only claim comp benefits and cannot sue you. Drop your coverage, and that protection vanishes.
What to do if you've been caught
Get coverage immediately
Buy a policy today from any authorized carrier or from the NY State Insurance Fund (NYSIF), which by law must cover any employer that applies. Continuous coverage stops the per-10-day clock from running.
Respond to the notice on time
You generally have 30 days from a penalty notice to request a review or reduction and submit proof of coverage. Ignoring it makes it final — and the penalty keeps growing.
Comply with any Stop-Work Order first
Do not keep operating in violation — that adds penalties. Resolve the order by proving coverage and addressing the debt.
Contact the Board's Bureau of Compliance
Call the WCB at (877) 632-4996 to confirm what's owed and how to cure it. Keep records of your coverage dates and payroll.
Get professional help for anything serious
If there's a felony charge, a large penalty, or an injured-worker claim, involve an attorney and your insurance broker right away.