What Is California Labor Code §3710.1: Stop Order on an Uninsured Employer?

Where an employer has failed to secure the payment of compensation as required by Section 3700, the director shall issue and serve on such employer a stop order prohibiting the use of employee labor by such employer until the employer’s compliance with the provisions of Section 3700. Such stop order shall become effective immediately upon service. Any employee so affected by such work stoppage shall be paid by the employer for such time lost, not exceeding 10 days, pending compliance by the employer.

What is this stop order?

It is a state order that halts an uninsured employer's use of any employee's labor until the employer gets coverage.

The director issues it once the state finds an employer failed to secure insurance as Labor Code 3700 requires. The order takes effect the moment it is served on the employer, with no waiting period, and it stays in force until the employer proves it has coverage in place.

Who does this stop order protect, and who does it bind?

It binds the employer, and it protects every worker the employer would otherwise keep on the job without coverage.

The order reaches the employer's whole operation, not just one person's claim. Anyone kept from working because of it shares the same right to be paid for that time, whether or not that person has already filed an injury claim. This differs from Labor Code 3715, which gives an already-injured worker a path to the appeals board; a stop order can go out even before anyone is hurt, simply because the employer has no coverage.

Do you get paid for time lost because of the stop order?

Yes. Your employer must pay you for the work you lost, up to 10 days, while it gets coverage in place.

This pay comes directly from your employer, not from a state fund. Keep track of the days you were turned away and any notice you saw or were given about the stop order. If your employer does not pay you for that time, treat it as a wage question and keep your records, since it is separate from any injury claim you may also have.

Can your employer fight the stop order?

Yes, by asking the director for a hearing within 20 days of being served.

Your employer has 20 days after service to file a written request for a hearing. The state must hold that hearing within 5 days of the request, and the director sends the time and place by mail. At the end of the hearing, the stop order is immediately affirmed or dismissed. Within 24 hours, the director mails every party a written notice of the findings by registered or certified mail. From there, a party can ask the superior court for a writ of mandate, but only within 45 days after that notice is mailed.

How does the stop order connect to other consequences for the employer?

The same visit usually brings a separate state penalty, and the employer can still face other consequences too.

When the director serves the stop order, it typically serves a $1,500-per-employee penalty at the same time under Labor Code 3722. That same gap in coverage can also expose the employer to a Labor Code 3700.5 misdemeanor charge, and it leaves open the Labor Code 3706 civil suit for the worker, instead of or alongside a Labor Code 3715 claim. Each of these tracks runs on its own, so your employer can face several of them over the same lack of coverage.

Does the stop order affect your own workers' compensation claim?

No. Your right to pursue your own injury claim does not depend on how the stop order turns out.

Whether the director affirms or dismisses the order, Labor Code 3715 still lets an injured worker file directly with the appeals board against an illegally uninsured employer, and a civil case under Section 3706 stays open too. The stop order is about halting the employer's operation until it gets coverage; it does not decide your benefits.

What should you save if your employer was stop-ordered?

Keep the dates you lost work, any notice you saw, and proof of your own employment and pay.

Write down the exact days you could not work and any posted notice or verbal word of the stop order. Save pay stubs and schedules showing your normal hours, so you can show what you lost. If you were also hurt on the job, keep that evidence separately, since your injury claim and your lost-time pay are two different issues.

A stop order is about your employer's coverage, not about blocking your own injury claim, and the two move on separate timelines. Yazdchi Law P.C. reviews each matter individually and can help you sort out both your lost pay during a work stoppage and any injury claim you may have. Call (661) 273-1780 or use the contact form to go over what happened.