Ark. Code Ann. » Title 11 Chapter 09
Arkansas Code Annotated

Ark. Code Ann. § 11-9-406 (2020)

Failure to secure payment of compensation — Penalty

✓ Arkansas Code release r76: Acts through about 2020 (2021-2025 sessions missing)
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    1. Any employer required to secure the payment of compensation under this chapter who fails to secure compensation shall be subject to a fine of up to ten thousand dollars ($10,000) as determined by the Workers' Compensation Commission payable to the Death and Permanent Total Disability Trust Fund or be guilty of a Class D felony.
    2. This subsection shall not affect any other liability of the employer under this chapter.
    1. Whenever the commission has reason to believe that any employer required to secure the payment of compensation under this chapter has failed to do so, the commission shall serve upon the employer a proposed order declaring the employer to be in violation of this chapter and containing the amount, if any, of the civil penalty to be assessed against the employer pursuant to subdivision (b)(5) of this section.
      1. An employer may contest a proposed order of the commission issued pursuant to subdivision (b)(1) of this section by filing with the commission, within twenty (20) days of receipt of the proposed order, a written request for a hearing.
      2. Such a request for a hearing need not be in any particular form but shall specify the grounds upon which the person contests the proposed order, the proposed assessment, or both.
      3. If a written request for hearing is not filed with the commission within this time, the proposed order, the proposed penalty, or both, shall be a final order of the commission and shall not be subject to further review by any court.
      4. A proposed order by the commission pursuant to this section is prima facie correct, and the burden is upon the employer to prove that the proposed order is incorrect.
      1. If the employer alleges that a carrier has contracted to provide it workers' compensation insurance coverage for the period in question, the employer shall include the allegation in its request for hearing and shall name the carrier.
      2. The commission shall promptly notify the carrier of the employer's allegation and of the date of hearing.
      3. The carrier shall promptly, and no later than five (5) days prior to the hearing, respond in writing to the employer's allegation by providing evidence of coverage for the period in question or by affirmatively denying the employer's allegation.
    4. Hearings conducted under this section shall proceed as provided in §§ 11-9-704 — 11-9-711.
    5. The commission may assess a fine against an employer who fails to secure the payment of compensation in an amount up to one thousand dollars ($1,000) per day of violation payable to the fund.
    6. If an employer fails to secure the payment of compensation or pay any civil penalty assessed against the employer after an order issued pursuant to this section has become final by operation of law or upon appeal, the commission may petition the Pulaski County Circuit Court or of the county where the employer's principal place of business is located for an order enjoining the employer from engaging in further employment until such time as the employer secures the payment of compensation or makes full payment of all civil penalties.

History. Init. Meas. 1948, No. 4, § 39, Acts 1949, p. 1420; A.S.A. 1947, § 81-1339; Acts 1993, No. 796, § 11.

A.C.R.C. Notes. Acts 2001, No. 1757, § 9, provided in part:

“Nothing in the act, which originated as House Bill 2646 of 2001, nor in Act 1552 of 1999 shall impliedly repeal any part of Act 796 of 1993. Act 796 of 1993 is expressly reaffirmed by this act, which originated as House Bill 2646 of 2001.”

Case Notes

Cited: Laman v. McCord, 245 Ark. 401, 432 S.W.2d 753 (1968); Neal v. Oliver, 246 Ark. 377, 438 S.W.2d 313 (1969); Wilhelm v. Parsons, 2016 Ark. App. 56, 481 S.W.3d 767 (2016).

Notes of Decisions
Cited in 4 cases (1 in the last 5 years), 2005–2021 · leading case: Riddell Flying Serv. v. Callahan, 206 S.W.3d 284 (Ark. Ct. App. 2005).
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Riddell Flying Serv. v. Callahan, 206 S.W.3d 284 (Ark. Ct. App. 2005). · cites it 4× “In view of the decisions he has received thus far, Callahan may wonder whether RFS will even be subjected to the penalty allowed under Ark.Code Ann. § 11-9-406 (Repl. 2002) for its failure to secure payment of compensation.”
Main v. Metals, 377 S.W.3d 506 (Ark. Ct. App. 2010). “§ 11-9-401, § 11-9-406. . McGehee Metals obtained a release from Dr.”
Wilhelm v. Parsons, 2016 Ark. App. 56, 481 S.W.3d 767. · cites it 2× “There are other penalties available to assess against any employer who fails to properly secure compensation, as provided by Arkansas Code Annotated section 11-9-406. Or, perhaps, there may exist a dispute between the insurance carrier and CMB for CMB’s failure to report proper…”
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). · cites it 30× “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(a)(1): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(1): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(2)(A): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(2)(C): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(2)(D): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(4): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(5): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
Ark. Code Ann. § 11-9-406(b)(6): 1 case
Reyes v. Bayne, No. 4:21-cv-00334, 2021 WL 2533466 (E.D. Ark. June 21, 2021). “ “[t]he AWCC denied Plaintiffs due process by providing a defective notice that incorrectly equates a civil penalty violation of Ark. Code Ann. § 11-9-406 with criminal prosecution[;]”61  Ark.”
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