What If My Employer Has No Workers’ Compensation Insurance?

Getting hurt at work is stressful enough on its own. Finding out your employer has no workers’ compensation insurance makes a bad situation feel even worse. If you work in Chicago, whether you’re pouring concrete near the Chicago River, running a forklift at a warehouse off the Dan Ryan Expressway, or working a construction site near Wacker Drive, you have legal rights even when your employer broke the law. Illinois does not leave injured workers without options.

Table of Contents

• Illinois Law Requires Employers to Carry Workers’ Compensation Insurance
• What Happens to an Uninsured Employer Under Illinois Law
• Your Two Main Options for Recovering Benefits When Your Employer Is Uninsured
• The Injured Workers’ Benefit Fund Can Step In When Your Employer Won’t Pay
• General Contractors Can Be Liable for Subcontractors Without Insurance
• Steps to Take Right Now If Your Employer Has No Workers’ Compensation Insurance
• FAQs About What Happens If My Employer Has No Workers’ Compensation Insurance

Illinois Law Requires Employers to Carry Workers’ Compensation Insurance

Under the Chicago workers’ compensation lawyer resources at Briskman Briskman & Greenberg, one of the first questions we get from injured workers is whether they are even covered. The answer starts with the law itself.

Illinois law requires employers to provide workers’ compensation insurance for almost everyone who is hired, injured, or whose employment is localized in Illinois. This obligation applies from day one of employment. It covers full-time workers, part-time workers, and in most cases, temporary workers as well.

The governing statute is the Illinois Workers’ Compensation Act, 820 ILCS 305. This law defines which employers must carry coverage, how claims are filed, and what happens when an employer fails to comply. Most employers in Illinois fall under its reach, including private businesses, corporations, hospitals, and even government entities.

Employers have two main options for meeting this requirement. Employers may either buy insurance or obtain permission to self-insure. Self-insuring requires Commission approval and proof of financial ability to pay claims. Joining a group workers’ compensation pool is another route, but under 820 ILCS 305, membership in a pool does not relieve an employer of its obligations under the Act.

Some individuals, such as sole proprietors, business partners, and corporate officers, may exempt themselves from coverage. Overall, it is estimated that 91% of Illinois employees are covered under the Act. That still leaves a meaningful portion of the workforce potentially exposed to employers who either skipped coverage or let it lapse.

If your employer operates a construction business, a trucking company, or another extra-hazardous occupation, the rules are even stricter. The Illinois Employee Classification Act (820 ILCS 185) requires that workers in these fields be covered in nearly all circumstances, even if the employer labels them as independent contractors.

What Happens to an Uninsured Employer Under Illinois Law

An employer that skips workers’ compensation insurance does not get to walk away from responsibility. Illinois law hits uninsured employers with serious consequences, both civil and criminal.

An employer that knowingly and willfully fails to obtain insurance may be fined up to $500 for every day of noncompliance, with a minimum fine of $10,000. Corporate officers can be held personally liable if the company fails to pay the penalty. That personal liability piece matters. It means you may be able to pursue the individual running the company, not just the business entity itself.

The criminal side is equally serious. Negligent failure to provide workers’ compensation insurance coverage is punishable by a Class A misdemeanor for each day without coverage (maximum 12 months imprisonment, $2,500 fine). Knowing failure to provide workers’ compensation insurance coverage is punishable by a Class 4 felony for each day without coverage (maximum 1-3 years imprisonment, $25,000 fine).

If, after a hearing, the Commission finds that an employer failed to provide workers’ compensation insurance coverage, such failure shall be deemed to be an immediate serious danger to the public health, safety and welfare. This will justify the issuance of a work-stop order, requiring cessation of all its business operations. If the business is declared extra-hazardous, the Commission may issue a work-stop order even before holding a hearing.

An investigator with the Illinois Workers’ Compensation Commission Insurance Compliance Division may issue a citation to any employer that is not in compliance with its obligation to have workers’ compensation insurance under this Act. If you suspect your employer is uninsured, you can report them to the Illinois Department of Insurance’s Workers’ Compensation Insurance Compliance Division, located at 115 S. LaSalle St., 13th Floor, Chicago, IL 60603.

Beyond fines and criminal charges, employers who are subject to and who knowingly fail to comply with this Section shall not be entitled to the benefits of this Act during the period of noncompliance. In the action, such employer shall not avail himself or herself of the defenses of assumption of risk or negligence or that the injury was due to a co-employee. That is a significant shift in the legal landscape for your claim.

Your Two Main Options for Recovering Benefits When Your Employer Is Uninsured

When your employer has no workers’ compensation insurance, Illinois gives you a choice. You do not have to pick one path without understanding both. A workers’ compensation lawyer can help you evaluate which route makes the most sense given the facts of your situation.

Option 1: File a Claim with the Illinois Workers’ Compensation Commission (IWCC)

An employee of an uninsured employer, or the employee’s dependents in case death ensued, may, instead of proceeding against the employer in a civil action in court, file an application for adjustment of claim with the Commission in accordance with the provisions of this Act and the Commission shall hear and determine the application for adjustment of claim in the manner in which other claims are heard and determined before the Commission. This means you can still pursue standard workers’ compensation benefits, including medical care, temporary total disability (TTD) pay, and permanent partial disability (PPD) awards, through the same administrative process used for insured employers.

Option 2: Sue Your Employer Directly in Civil Court

An employee who is injured during the time the employer was uninsured may sue the employer in civil court, where benefits are unlimited. In addition, during the trial the burden will be upon the employer to prove it was not negligent. That reversed burden of proof is a powerful advantage. Normally, injured workers must prove negligence. Here, the employer must prove they were not negligent.

In a civil lawsuit, you are not capped by the workers’ compensation fee schedule. You can seek damages that go beyond what the workers’ compensation system typically provides, including compensation for pain and suffering. The tradeoff is that civil litigation generally takes longer and requires more resources.

Workers injured in construction accidents near Millennium Park, manufacturing facilities along the South Side, or industrial sites in the suburbs face the same choice. The right path depends on your specific injuries, your employer’s financial situation, and your long-term recovery needs.

The Injured Workers’ Benefit Fund Can Step In When Your Employer Won’t Pay

Even if you win a claim against an uninsured employer, getting them to actually pay can be another challenge. Illinois created a safety net for exactly this situation.

The Injured Workers’ Benefit Fund was created in 2005 (820 ILCS 305/4(d)). When the Commission collects penalties and fines from uninsured employers, it deposits these monies into the IWBF. The IWBF then pays workers’ compensation benefits to injured employees whose uninsured employers failed to pay. Without the IWBF, these workers and their medical providers might not have received the benefits they were due.

The Injured Workers Benefit Fund (IWBF) was established for employees to recover workers’ compensation benefits such as PPD, TTD, and payment of medical expenses in cases where an employer is deemed to have had no insurance on the date of injury.

To access the IWBF, your case must meet specific criteria. To be eligible for IWBF payments, a case must meet all the following criteria: the employer failed to provide workers’ compensation insurance coverage for the employee’s injury, failed to pay the workers’ compensation benefits due and owing to the injured employee under the final award, and the injured employee (or his or her representative) has filed an Application for Adjustment of Claim with the Commission, naming the employer.

You must have received a final award granting workers’ compensation benefits due to the injured employee by the employer (an award is final when the last appeal period has expired and no appeal was filed). Send the Commission the Request for Benefits Form (IC 44) within 90 days after the receipt of a final award.

If there are insufficient monies in the IWBF to pay all claims submitted, distribution will be on a pro rata basis as determined by the Commission. This is why acting quickly and working with an experienced attorney matters. Delays can affect your recovery.

General Contractors Can Be Liable for Subcontractors Without Insurance

Construction work in Chicago involves layers of contractors. A general contractor managing a high-rise project near the Loop may hire subcontractors who, in turn, hire their own crews. If one of those subcontractors has no insurance and one of their workers gets hurt, Illinois law has a clear answer about who bears responsibility.

Under 820 ILCS 305/1(a)(3), where a subcontractor is uninsured, the employee of that subcontractor may recover compensation under the Act from the general contractor or from the individual or entity, if any, that engaged the services of the general contractor. The subcontractor is then liable for indemnification.

This provision protects workers on multi-contractor job sites. If you were hurt working for an uninsured subcontractor on a Chicago construction project, you may have a claim against the general contractor, even if you never had a direct employment relationship with them. The general contractor can then seek repayment from the subcontractor.

This is especially relevant for workers in trades like roofing, ironwork, concrete, and welding, where subcontracting is the norm. Workers injured in these situations often have more options than they realize. The key is identifying all parties in the chain of contracts and understanding how Illinois law assigns liability at each level.

A skilled workers’ compensation attorney can trace that chain of contracts and identify every party that may owe you benefits or compensation. Do not assume that because your direct employer had no insurance, your claim is a dead end.

If your injury also involved a third party, such as a negligent equipment manufacturer or a property owner, you may have additional claims beyond the workers’ compensation system entirely. Illinois law, under 820 ILCS 310/5(b), allows you to pursue a third-party civil lawsuit at the same time as your workers’ compensation claim, as long as the responsible party is someone other than your employer.

Steps to Take Right Now If Your Employer Has No Workers’ Compensation Insurance

Time matters in these cases. Illinois has strict deadlines. Under 820 ILCS 305/6(d), you generally have three years from the date of the accident to file a claim, or two years from the date of your last benefit payment, whichever is later. Missing that window can bar your claim entirely.

Here is what you should do immediately after discovering your employer is uninsured:

1. Report your injury to your employer in writing. Under 820 ILCS 305/6(c), you must give notice of the accident as soon as practical, but no later than 45 days after the accident. Do this in writing and keep a copy.
2. Get medical care right away. Under Section 8 of the Illinois Workers’ Compensation Act (820 ILCS 305/8), your employer is responsible for necessary medical treatment. Document everything, including every doctor visit, prescription, and diagnosis.
3. Verify your employer’s insurance status. The Illinois Workers’ Compensation Commission allows you to search for an employer’s insurance coverage on their website at iwcc.illinois.gov. If your employer is uninsured, this confirms your right to pursue the IWBF route or a civil action.
4. File an Application for Adjustment of Claim with the IWCC. This formally opens your case before the Commission. The IWCC has its main Chicago office at 100 W. Randolph St., Suite 8-200, Chicago, IL 60601.
5. Contact a workers’ compensation attorney. An attorney can evaluate whether to pursue a Commission claim, a civil lawsuit, or both. They can also name the IWBF as a party if your employer is confirmed uninsured.

Briskman Briskman & Greenberg has helped injured workers across the Chicago area, from the North Side to the South Side and throughout the suburbs, understand their rights and pursue the compensation they deserve. If you were hurt at work and your employer has no insurance, contact us at (312) 222-0010. You can also reach a workers’ compensation attorney at our Lake County office if you are located in the northern suburbs. As a Chicago personal injury lawyer firm, Briskman Briskman & Greenberg handles workers’ compensation cases on a contingency fee basis, meaning you pay no attorney fees unless we recover compensation for you. You may still be responsible for certain costs and expenses, so ask us about the specifics when you call.

FAQs About What Happens If My Employer Has No Workers’ Compensation Insurance

Can I still get workers’ compensation benefits if my employer has no insurance in Illinois?

Yes. Illinois law gives you two main options. You can file an Application for Adjustment of Claim with the Illinois Workers’ Compensation Commission (IWCC) and pursue benefits through the standard administrative process, or you can sue your employer directly in civil court. If your employer wins a claim but still refuses to pay, the Injured Workers’ Benefit Fund (IWBF), created under 820 ILCS 305/4(d), may step in to cover the benefits owed to you.

What is the Injured Workers’ Benefit Fund, and how do I access it?

The Injured Workers’ Benefit Fund (IWBF) is a state fund funded by fines and penalties collected from uninsured employers. It pays workers’ compensation benefits, including TTD, PPD, and medical expenses, to injured workers whose uninsured employers failed to pay a final award. To access it, you must have filed an Application for Adjustment of Claim with the IWCC, received a final award, and submitted a Request for Benefits Form (IC 44) to the Department of Insurance within 90 days of the final award.

Can I sue my employer in civil court if they had no workers’ compensation insurance?

Yes. Under the Illinois Workers’ Compensation Act (820 ILCS 305), an employer that knowingly fails to carry insurance loses the protections the Act normally provides to employers. You can file a civil lawsuit seeking damages that are not capped by the workers’ compensation system. In that lawsuit, your employer cannot use the defenses of assumption of risk or co-employee negligence, and the burden shifts to the employer to prove they were not negligent.

What if I was hurt working for an uninsured subcontractor on a Chicago construction site?

Under 820 ILCS 305/1(a)(3), if your direct employer (the subcontractor) had no workers’ compensation insurance, you may be able to file a claim against the general contractor who hired that subcontractor. The general contractor can then seek reimbursement from the uninsured subcontractor. This provision protects construction workers on multi-contractor job sites throughout Chicago and surrounding areas.

How long do I have to file a claim against an uninsured employer in Illinois?

Under 820 ILCS 305/6(d), you generally have three years from the date of the accident to file a claim with the Illinois Workers’ Compensation Commission if no compensation has been paid, or two years from the date of your last benefit payment if any compensation was paid, whichever is later. You must also report your injury to your employer within 45 days of the accident under 820 ILCS 305/6(c). Missing either deadline can seriously harm your claim, so contact an attorney as soon as possible after your injury.

This page is an advertisement. Briskman Briskman & Greenberg is responsible for its content. The firm’s principal office is located at 30 N. LaSalle Street, Suite 1402, Chicago, IL 60602. Past results do not guarantee similar outcomes in future cases. Each case is unique and results depend on the specific facts and circumstances involved.

More Resources About Frequently Asked Questions

• Can I Be Fired for Filing a Workers’ Compensation Claim?
• What If My Workers’ Compensation Claim Is Denied?
• Can I Sue My Employer for a Workplace Injury?
• Can I Receive Workers’ Compensation and Social Security Disability?
• How Long Do I Have to File a Workers’ Compensation Claim in Illinois?
• What Is My Chicago Workers’ Compensation Case Worth?
• How Long Does a Workers’ Compensation Claim Take?
• Do I Need a Workers’ Compensation Lawyer?
• What Happens If My Injury Gets Worse After I Return to Work?