Workers’ compensation usually protects managers and companies in California from fines and criminal prosecution over injuries and illnesses, but not always. Here’s what you need to know about “Serious Concealed Danger.”
Managers in California may face criminal charges if they fail to inform the Division of Occupational Safety and Health in writing of any “serious concealed danger” within 15 days after acquiring actual knowledge of the danger.
Here are the particulars of the rule:
‘Serious Concealed Danger’
Serious concealed danger, used with respect to a product or business practice, means that the normal or reasonable foreseeable use of, or the exposure of an individual to, the product or business practice creates a substantial probability of death, great bodily harm, or serious exposure to an individual and the danger is not readily apparent to an individual who is likely to be exposed.
‘Product’
Product means an article of trade or commerce or other item of merchandise which is a tangible or an intangible good, and includes services.
‘Great Bodily Harm’
Great bodily harm means a significant or substantial physical injury.
‘Serious Exposure’
Serious exposure means any exposure to a hazardous substance when the exposure occurs as a result of an incident or exposure over time and to a degree or in an amount sufficient to create a substantial probability that death or great bodily harm in the future would result from the exposure.
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‘Manager’
Manager means a person having both (1) management authority in or as a business entity and (2) significant responsibility for any aspect of a business which includes actual authority for the safety of a product or business practice or for the conduct of research or testing in connection with a product or business practice.
‘Actual Knowledge’
Actual knowledge means has information that would convince a reasonable person in the circumstances in which the manager is situated that the serious concealed danger exists.
Immediate Notification Is Required
If there is an imminent risk of great bodily harm or death, the corporation or manager is required to immediately notify the Division and the Division is required to take steps to address the imminent hazard.
Other Workers’ Compensation-Related Violations and Penalties
“Serious concealed hazard” isn’t the only workers’ compensation situation that can generate penalties. For example:
Bad faith. Employers are liable for fines of up to $100,000 for:
- Knowingly and frequently inducing claimants to accept less compensation than is due
- Causing claimants to resort to proceedings against the employer to obtain compensation
- Knowingly refusing to comply with their obligations
- Administering their obligations in a dishonest or injurious manner
Failure to respond. There is a fine of $50 for failure to respond to an inquiry of the director of workers’ compensation.
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Child labor violations. There is a penalty amounting to a 50 percent increase in the benefit due, to a maximum of $250 per week, if the injured worker is an illegally employed minor.
False statement. An employer or employee knowingly making a false or fraudulent statement may be imprisoned for up to 5 years and fined up to $150,000 or double the value of the fraud, whichever is greater.
Delayed payment. Employers may have to pay a discretionary penalty of up to 25 percent of the amount delayed, to a maximum of $10,000, but can avoid the penalty by paying 10 percent of the penalty of the delayed payment within 90 days if that delay is discovered before the employee makes a claim for the penalty. In addition, there is a penalty of up to $400,000 for a company’s general business practice of unreasonable delays or benefit refusals.
In tomorrow’s Daily, more on workers’ compensation, and notification of a new webinar on the difficult challenge of terminating a workers who is out on workers’ comp.