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What Is California Labor Code §3706 (Sue an Uninsured Employer)?
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By Eman Yazdchi, Esq. · Certified Specialist in Workers' Compensation Law, State Bar of California Board of Legal Specialization · Cal Bar #285231
If any employer fails to secure the payment of compensation, any injured employee or his dependents may bring an action at law against such employer for damages, as if this division did not apply.
What does California Labor Code 3706 actually let an injured worker do?
Labor Code 3706 lets the worker sue an uninsured employer for damages outside the usual comp-only remedy.
California employers must secure workers compensation coverage. When an employer fails to do that, Labor Code 3706 removes a key protection the employer would normally have. The injured worker or dependents may bring a civil action for damages as if the workers compensation division did not apply.
This is a serious remedy. It can open damages that workers compensation alone does not pay, including pain and suffering in the civil case. The worker may also need to pursue benefit options through the workers compensation system and the Uninsured Employers Benefits Trust Fund. Eman Yazdchi is a Certified Specialist in workers' compensation law, certified by the California Board of Legal Specialization, State Bar of California.
How does Labor Code 3706 fit with the insurance duty?
The civil action exists because the employer failed to secure the compensation coverage required by law.
California Labor Code 3700 requires employers to secure payment of compensation. Labor Code 3706 is the consequence when that duty is not met and a worker is injured. The employer cannot use the normal exclusive-remedy protection in the same way. The worker should investigate coverage early. Insurance status affects where claims are filed, what parties are named, and how recovery can be collected.
What damages can a Labor Code 3706 civil case seek?
The civil case can seek ordinary damages against the uninsured employer, not just scheduled comp benefits.
Workers compensation pays defined benefits. A civil damages case can include categories the comp system does not pay, such as pain and suffering and broader economic loss, if the facts and proof support them. The worker still needs evidence of injury, causation, damages, and collectability. Labor Code 3706 creates the path, but the civil case still has to be built like a real lawsuit.
What does Labor Code 3708 add to an uninsured employer case?
Labor Code 3708 can create a presumption of employer negligence in the civil action against the uninsured employer.
Labor Code 3708 is often paired with Labor Code 3706. It can make the civil case easier than an ordinary negligence case because the uninsured employer faces a presumption tied to the injury. That does not mean the worker can ignore proof. The worker still needs medical evidence, wage loss proof, witness testimony, and records showing the employer failed to secure coverage.
Can the worker also seek workers compensation benefits?
Yes. The worker may need to pursue comp benefits and the civil action at the same time.
An uninsured-employer case often has two tracks. One track seeks workers compensation benefits, sometimes through the Uninsured Employers Benefits Trust Fund. The other track is the Labor Code 3706 civil action against the employer. Coordination matters because payments, liens, and reimbursements can affect the final outcome. The worker should not assume one filing protects every deadline in the other forum.
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Tap to call →Frequently Asked Questions
What is an uninsured employer under Labor Code 3706?
It is an employer that failed to secure payment of workers compensation as California law requires. If a worker is injured while the employer lacks coverage, Labor Code 3706 can allow a civil action for damages against that employer.
Does Labor Code 3706 only give workers compensation benefits?
No. Labor Code 3706 allows a civil action for damages as if the workers compensation division did not apply. The worker may also pursue comp benefit options, but the civil case can seek damages that ordinary workers compensation does not pay.
What is the Uninsured Employers Benefits Trust Fund?
The Uninsured Employers Benefits Trust Fund can pay workers compensation benefits in certain cases when the employer was illegally uninsured and cannot pay. It is separate from the civil damages case against the employer, and it has its own procedures.
Can an uninsured employer face penalties besides the civil case?
Yes. Failure to carry required workers compensation coverage can create civil and criminal consequences for the employer. Those consequences are separate from the injured worker's need to recover medical care, wage loss, and damages after the injury.
What should I save in an uninsured employer case?
Save wage records, employer names, jobsite photos, supervisor texts, injury reports, witness names, and any proof about insurance coverage. These facts help prove employment, injury, lack of coverage, benefit rights, and the civil damages claim.
Last reviewed by Eman Yazdchi, Esq., July 2026.
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