What to Do When a Workers Comp Check is Late

Injured workers in California are subject to a few protections that help ensure their employers make timely and appropriate benefit payments. The state enforces tiered penalties to deter insurance companies from skating their responsibilities in a worker’s compensation case. The California labor codes that enforce workers’ compensation penalties are sections 4650 and 5814.

What Labor Codes Apply to Late Payments

If insurance companies fail to make timely payments in temporary or permanent disability cases, the law provides additional penalties to be added to the entitlements. Code 4560 adds 10% to these payments. Code 5814 adds penalties of up to 25% for grossly or unreasonably late payments on disability payments, medical treatments, settlement funds, and more.

What is Labor Code 4560?

Code 4560 is a provision in the California labor code that requires insurance companies to pay a 10% penalty for overdue payments on temporary or permanent disability payments. In most cases, temporary disability benefit payments are due starting 14 days after knowledge of the disability. And permanent disability payments begin six months after a permanent injury is confirmed.

Section 4560 can apply to any injured worker eligible to receive temporary or permanent disability payments if those payments fail to come at designated two-week intervals. This provision exists to encourage timely payments and ease the burden of financial hardship for the injured worker.

What is Labor Code 5814?

Code 5814 is a provision in the California labor code that enforces timely payments for funds due to the employee for disability benefits, medical treatments, settlement funds, mileage reimbursement, and any other expenses that the insurance company is required to make, as indicated by the details of the worker’s compensation case.

Code 5814 is geared towards penalizing significant or unreasonable delays. If the insurance company has already paid the penalty under 4560, that amount is deducted from the additional penalty levied for code 5814. Additionally, suppose the insurance company discovers the missed payment before the employee reports them. In that case, they will be provided an additional 90 days at the 10% penalty rate before additional late fees are assessed. While the amount of a 5814 penalty is often at the discretion of a judge’s ruling, these fees can reach up to 25% of the balance owed.

If you are owed payments for a workers’ compensation case that are late, Invictus Law can help. We provide efficient, aggressive legal solutions to help injured workers get the benefits they are entitled to. Learn more today.

What is an Unreasonable Delay?

The tricky part about enforcing a 5814 penalty is the lack of clarity in defining an unreasonable delay. A judge can review the facts of the case independently to decide if negligence or willful intent contributed to a delayed payment. In most cases, a week’s late payment due to a clerical error is not considered unreasonable. However, factors that a judge may review include:

Amount of Payment
Time Period of Delay
Cause of Delay
Promptness of Correction
Institutional Negligence (e.g., labor shortages)
Contributing Factors (e.g., delayed notification by the employee)

How to Claim a Penalty

If you believe that your insurance payments are delayed, the first step is to notify the insurance company in writing. You should make them aware of the occurrence of a late payment AND claim the 5814 penalty. If you only make them aware of the late payment without also acknowledging the additional penalty due, you may provide the insurance company with a reasonable opportunity to avoid the additional 25% penalty.

An insurance company must make timely benefit payments, but you cannot count on them to fess up and notify you when they fail to do so. The burden of claiming the penalty falls on the injured employee to track their payments and make appropriate notifications if payments are not received in a timely manner. In most cases, these delayed payments can be resolved quickly, and a 10% penalty. However, there are situations in which both a 4560 penalty and a 5814 penalty may apply to the same worker’s compensation case.

When to Get Help with your Workers Compensation Case

When an employee suffers a work-related injury that requires a significant absence from their assigned duties, a qualified workers’ compensation attorney can help ensure that your benefits and expenses are taken care of. A worker’s compensation lawyer can represent your interests instead of those of your employer or their insurance company.

If you have incurred expenses or lost time from work and your employer is balking at picking up the tab, you need a worker’s compensation attorney to handle your case. Short-term disability payments should kick in within 14 days of your injury. But the key is that your employer has to report the injury. If your employer is dragging their feet at reporting your injury, you need to hire an attorney. And any time that your workplace injury results in termination of employment, your next stop should be to a qualified attorney. Termination of employment may be more than a bad omen for a struggle to come. In some cases, it may be viewed as retaliation.

The Bottom Line on Handling Late Workers Comp Checks

While most employers and their insurance companies handle business appropriately, everything ranging from clerical errors to willful negligence can delay payments that injured workers are entitled to. When that happens, the injured worker suffers the most from lost wages and financial hardships. The California labor code contains provisions for protecting these workers by levying penalties for late payments that make these clerical errors disadvantageous for the insurance companies, thereby forcing compliance.

Invictus Law is a premier Orange County workers’ compensation attorney helping injured workers get the benefits they are entitled to. While the burden of enforcement falls on the employee, our firm can be your bright light, helping you navigate a difficult time. Schedule a consultation today.

By Invictus Law | Posted on March 16, 2022

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