What happens if an employer does not carry workers' compensation insurance?

When an employer fails to carry workers' compensation insurance, they expose themselves to significant financial and legal risks. The correct answer outlines that such an employer may face penalties and become liable for all medical costs and lost wages associated with injuries that employees incur while performing their job duties.

In Minnesota, the law mandates that most employers must carry workers' compensation insurance to provide coverage for employees who suffer job-related injuries or illnesses. If an employer is found to be uninsured, they can face hefty fines and potential lawsuits from injured employees. Essentially, the employer would be responsible for covering all the medical expenses and lost wages out of pocket, which could lead to severe financial strain or bankruptcy.

This emphasis on liability and penalties underscores the importance of securing the necessary insurance coverage to protect both the employer and their employees in a workplace injury scenario. The other options either do not accurately represent the legal requirements or consequences of being uninsured, highlighting the recurring responsibilities that employers have to maintain compliance with workers' compensation regulations.