Recent bankruptcies of several major corporations have created rising fear in workers that compensation claims will be seriously affected. Such fears are highly exaggerated. An employer MUST have workers' compensation insurance or meet requirements for self-insurance. If there is workers' compensation, claims continue to be handled in the usual manner. If the employer is self-insured they MUST have a security bond posted which will make payments in the event of bankruptcy. If the employer was illegally uninsured and was not a valid self-insurer, payments will be made by the Uninsured Employers Fund. Bankruptcies are common in workers' compensation but, since the companies are almost always small, attract little notice. Workers' compensation has always had provisions for dealing with business failures, including the simultaneous bankruptcy of both the employer AND the compensation carrier or the surety company. Even insurance companies must have reinsurance and surety bonds to do business. Employers have workers with spouses and children working for companies near failure. It is best to be informed and in a position to offer reassurance to a worker who fears impending consequences which, if fact, do not exist. During bad business cycles YOUR business will be affected by demoralization caused by another employer to your worker's family. Accurate information will substantially lessen fear. (workersxzcompxzkit) While the employer cannot offer legal advice, you can refer your workers to New York Workers' Compensation Board websites. There are people at the compensation board who answer such questions every day. Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers' compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100. Click on these links to try it for yourself. WC Calculator: www.ReduceYourWorkersComp.com/calculator.php TD Calculator: www.ReduceYourWorkersComp.com/transitional-duty-cost-calculator.php WC 101: www.ReduceYourWorkersComp.com/workers_comp.php Do not use this information without independent verification. All state laws are different. Consult with your corporate legal counsel before implementing any cost containment programs. ©2008 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact I[email protected]