What if My Employer Does Not Have Workers' Compensation Insurance?

If your New York employer lacks required workers' compensation insurance, you still have options. You can file a claim through the state's Uninsured Employers Fund for medical and wage benefits. Or you can sue your employer directly under Workers' Compensation Law § 11. That law bars the employer from using your own negligence as a defense.

Finding out that your employer has no coverage is stressful. It often hits right when you need medical care and lost wages the most. The good news is that New York law plans for exactly this situation. Nearly every employer in the state must carry workers' compensation insurance. When one fails to do so, the injured worker keeps two separate paths to compensation instead of losing the claim. This article explains how each path works. It also covers how to confirm your employer is actually uninsured and what to do right now.

Two deadlines matter from the start. You generally must give your employer written notice of the injury within 30 days (WCL § 18). You also have two years to file your workers' compensation claim (WCL § 28). Acting quickly protects both options.

First, Confirm Your Employer Is Actually Uninsured

Before you assume the worst, check the coverage situation. New York's Workers' Compensation Board runs a free public lookup tool, Does Employer Have Coverage?. It lets you check whether a specific business has an active policy. It's the fastest way to know where you stand.

Keep in mind that not every business without coverage is breaking the law. New York's rules include a few narrow exemptions. According to the Board's coverage requirements, some businesses may legally operate without a policy. These include a sole proprietor with no employees. They also include a one- or two-person corporation where those individuals own all the stock and hold all offices. Certain partnerships or LLCs with no employees outside the ownership group also qualify. In those cases there is no violation. But there may also be no workers' compensation coverage to draw on, which changes your strategy.

The situation this article covers is different. Here, an employer is required to carry coverage but doesn't. That's a violation of the law. It's exactly the scenario the state built protections for.

What Happens to an Uninsured Employer

Failing to carry required coverage brings real consequences for the business. Under WCL § 52 and the Board's summary of penalties for violations, an employer that goes without coverage can face civil penalties. These run up to $2,000 for every 10-day period without coverage. Criminal exposure grows with the size of the workforce. Operating uninsured is a misdemeanor for an employer with five or fewer employees. It rises to a Class E felony for more than five. A repeat conviction within five years can rise to a Class D felony.

Just as important, an uninsured employer becomes personally responsible for the injured worker's benefits. That means the medical treatment and wage replacement the policy was supposed to fund. That personal liability is part of what makes the two compensation paths below work.

Your Two Paths to Compensation

When an employer has no coverage, New York gives an injured worker two separate routes. They serve different purposes and can recover different things. That's why the choice deserves careful thought.

Path One: The Uninsured Employers Fund

The Uninsured Employers Fund (UEF) is a state fund. It steps in to pay workers' compensation benefits when no insurance carrier can be found. Its legal basis is WCL § 26-A, which governs how claims against uninsured, defaulting employers are handled and paid. In plain terms, here's how it works. If the Board cannot find a responsible carrier after you file, the UEF can become the payor. It covers medical care and lost wages much like a private insurer would.

You file the same way you would in any workers' compensation case. You use the standard C-3 claim form, covered in the steps below. You do not need to know your employer's insurance status to file. The Board sorts out coverage. If it comes up empty, the UEF is assigned as payor.

One recent change matters for anyone with a claim in progress. As of December 1, 2025, the third-party administrator handling the Uninsured Employers Fund and related state funds changed to FCS Administrators, Inc. This affects who processes and communicates about the claim, not your underlying right to benefits. If you filed recently, mail may now come from a different administrator than you first expected.

Path Two: Sue Your Employer Directly

Normally, workers' compensation is an injured employee's only remedy against an employer. The trade-off is guaranteed no-fault benefits in exchange for giving up the right to sue (WCL § 11). But when an employer fails to carry required coverage, that same statute, WCL § 11, gives the injured employee the right to sue the uninsured employer directly in civil court instead of filing a compensation claim.

This route carries a big advantage. In that lawsuit, the employer cannot raise the worker's own contributory negligence as a defense, and the worker does not need to plead or prove freedom from contributory negligence. The employer also cannot argue the injury was caused by a fellow employee's negligence or that the worker assumed the risk of the job. A direct lawsuit can also reach damages that workers' compensation does not cover. The most notable is pain and suffering, on top of medical expenses and lost wages.

It helps to tell this apart from a third-party claim. Say someone other than your employer helped cause your injury, such as a general contractor, a property owner, or the maker of defective equipment. You may have a separate claim against that party. It can run alongside either path above. Third-party claims are common in construction-site injuries.

Step-by-Step: What to Do Right Now

Here is the sequence to follow after a workplace injury when you suspect your employer has no coverage:

1. Get medical treatment immediately. Tell the provider your injury is work-related so it's documented that way from the start.
2. Notify your employer in writing within 30 days. WCL § 18 requires written notice of the injury. This holds even if you already know the employer is uninsured. A dated email or letter preserves the record.
3. Document everything. Save photos of the scene, contact information for witnesses, pay stubs that prove your employment, and all medical records.
4. File your claim with the Workers' Compensation Board. Complete the employee claim form (Form C-3) through New York's official claim-filing service. You do not need to know your employer's insurance status to file.
5. Report the uninsured employer. Use the Board's Employer Whistleblower Form (CE-150-RF), which you can submit online or by mail. You can also call the Board at (866) 571-6729.
6. Talk to an attorney before choosing between the UEF and a lawsuit. This decision shapes what you can recover, and it's the point where professional guidance matters most.

Common Misconceptions

Several false beliefs stop injured workers from claiming what they're owed. Here's what's actually true:

• "Every employer has coverage, so this can't be happening." Coverage is required for nearly all employers. But the narrow exemptions above mean a legitimately uninsured business does exist. Verify with the Board's lookup tool instead of assuming.
• "No insurance means no recourse." False. The Uninsured Employers Fund and a direct lawsuit are both available precisely because the employer failed to carry coverage.
• "Workers' comp only pays medical bills." It also provides wage replacement, rehabilitation, and disability benefits. A direct lawsuit can add pain and suffering on top.
• "Filing against an uninsured employer isn't worth the effort." Both paths can produce real compensation. The employer's personal liability for benefits gives them a strong reason to settle the claim.
• "My employer will fire me for filing." Retaliation for filing a workers' compensation claim is illegal under WCL § 120. A worker who is fired, demoted, or otherwise punished for filing can bring a discrimination complaint to the Board.

Related Questions

Is it legal for a New York employer to operate without workers' compensation insurance?

Only in narrow cases. Most employers are required to carry coverage. Operating uninsured when coverage is required is a violation. It can bring civil penalties of up to $2,000 per 10-day period. It can also bring criminal charges, from a misdemeanor to a felony, per WCL § 52. A small set of owner-only businesses are exempt.

What is the Uninsured Employers Fund?

The Uninsured Employers Fund is a New York state fund, established under WCL § 26-A. It pays workers' compensation benefits when the Board cannot find an insurance carrier responsible for a claim. It covers medical treatment and lost wages. That way an injured worker isn't left without benefits because the employer broke the law.

How do I report an employer for not carrying workers' compensation insurance?

Submit the Workers' Compensation Board's Employer Whistleblower Form, CE-150-RF, online or by mail. You can also call the Board at (866) 571-6729. You can report an employer separately from, and in addition to, filing your own injury claim.

How long do I have to file a workers' compensation claim in New York?

You generally have two years from the date of the injury to file your claim (WCL § 28). You must also give your employer written notice of the injury within 30 days (WCL § 18). Missing these deadlines can put your right to benefits at risk, so file promptly.

Sources & Official Resources

New York Laws Cited

1. WCL § 11 — Alternative Remedy; Injured Employee's Right to Sue an Uninsured Employer
2. WCL § 18 — Notice of Injury
3. WCL § 26-A — Uninsured Employers' Fund
4. WCL § 28 — Statute of Limitations for Filing a Claim
5. WCL § 52 — Effect of Failure to Secure Compensation (Penalties)

Helpful Resources 6. NY Workers' Compensation Board — Does Employer Have Coverage? (Lookup Tool) 7. NY Workers' Compensation Board — Coverage Requirements 8. NY Workers' Compensation Board — Penalties for Violations of WC Law 9. NY Workers' Compensation Board — Employer Whistleblower Form (CE-150-RF) 10. NY.gov — File a New York State Workers' Compensation Claim 11. NY Workers' Compensation Board — Discrimination Protections (WCL § 120)

Contact The Orlow Firm

If you've learned your employer has no workers' compensation insurance, the situation is stressful but far from hopeless. You have real options. The choice between the Uninsured Employers Fund and a direct lawsuit can shape everything you're able to recover. The Orlow Firm has helped injured workers throughout Queens and New York City since 1982. We can help you gather documentation and decide which path fits your situation.

Call (646) 647-3398 for a free consultation. We work on contingency — you pay nothing unless we win.

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This article provides general information and is not legal advice. Every case is different. Contact an attorney to discuss your specific situation.