DLI resumes issuance of noncompliance penalties

Work Comp Campus main

Aug. 18, 2023

DLI resumes issuance of noncompliance penalties

In the past, additional requests for information (RFI) were sent when there was no response to the initial RFI. Such additional requests will no longer be sent and penalties will resume.

Due to noncompliance, the Department of Labor and Industry's Compliance, Records and Training is resuming issuing penalties according to Minnesota Statutes § 176.194, subdivision 3(6). These penalties will be assessed against the claim administrator (insurer or third-party administrator).

Penalty structure:  the first five violations result in a written warning; the sixth through 10th violations result in a $3,000 penalty; and 11 or more violations result in a $6,000 penalty.

Minnesota Statutes § 176.194, subd. 4, states:  "If an entity has more than 30 violations within any 12-month period, in addition to the monetary penalties provided, the commissioner may refer the matter to the commissioner of commerce with recommendation for suspension or revocation of the entity's (a) license to write workers' compensation insurance; (b) license to administer claims on behalf of a self-insured, the assigned risk plan, or the Minnesota Insurance Guaranty Association; (c) authority to self-insure; or (d) license to adjust claims."

The number of violations are determined on a rolling 12-month calendar basis and are cumulative against the claim administrator. If there are multiple offices, the violations are not assessed against the individual offices, but contribute to the total.

Compliance, Records and Training strongly encourages all claim administrators to adjust their Work Campus permission of "Designated Contact for Information Requests from DLI" to a single email address to receive all RFI messages and remove the permission from all other users. The email address can be a group email address; however, a person's first name and last name must be associated to the user account in Campus. Another benefit of this approach, from a management standpoint, is that tracking the requests will be easier because the requests will then flow through a centralized point rather than through individual adjusters.

For additional information about this change refer to the July 7 message, "Change to requests for information process begins July 17" on the Campus central webpage.

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