Stop Work Orders for Failure to Obtain Workers’ Compensation Coverage: Our firm has represented private clients whose businesses have been shut down after receiving a Stop Work Order (“SWO”) for failing to obtain workers’ compensation insurance.  The State of Florida has the authority to issue a SWO against any business that operates without securing workers’ compensation insurance for all its employees. Under Chapter 440, Florida Statutes, Section 440.107, Florida Statutes, and Chapter 69L-6, Florida Administrative Code, the Department of Financial Services will issue a SWO when it determines either that the business failed to secure payment of workers’ compensation insurance or failed to produce requested business records within 10 days. The SWO may have the legal effect of stopping all business operations at a particular worksite or throughout the entire state. Any business that operates in violation of a SWO may be assessed $1,000 per day, and violation of a SWO may carry criminal penalties, as well.  The financial penalties associated with a SWO may be severe depending on the factual circumstances. In order for the Department to release the SWO and allow the business to recommence operations, the business must agree to pay a penalty, either in a lump sum or in regular intervals. The penalty is two times the amount of workers’ compensation that the business failed to obtain for each worker. Further, if the business does not produce records to the Department, then the Department may “impute” the penalty for up to two years. In other words, if the Department determined that 10 employees did not have workers’ compensation coverage, and the business fails to provide adequate documentation regarding those employees, the Department has the authority to assume that each of the 10 workers has been employed for two years. As such, the penalty would be the amount of workers’ compensation that the business should have paid on those 10 employees over the course of two years, multiplied by two.  The Department’s action must be timely contested by the business, otherwise the business will not be able to protest the SWO or the penalty assessment. If the business fails to timely contest the agency action, the agency may proceed to enter a penalty assessment against the business. If your business is subject to a Stop Work Order, it may be in your best interest to contact our office as soon as possible so that we can discuss a strategy and the steps necessary to protect your business.