04/19/2012 01:17 pm ET Updated Apr 19, 2012

North Carolina To Employers: Pay For Worker Injuries Or Go To Jail

Several business owners in one state will have to cough up some cash for injured employees. Well, that or they can go to jail.

One North Carolina agency is mandating that more than a dozen uninsured businesses come to a hearing on May 22 to settle claims that they weren’t compensating injured workers, the Charlotte Observer reports. If the business owners don't show up for the hearing or don't pay up, they'll reportedly be forced to go to jail.

The call for the hearings comes after an investigation by the News and Observer that found tens of thousands of businesses in the state required to protect their employees with insurance actually don’t.

In North Carolina, a business must carry workers' compensation insurance if it employs three or more workers, has one or more employees using or in the presence of radiation or if the business is in the agricultural or domestic services sector it must employ 10 or more full-time non-seasonal agricultural workers, according to Duncan Law, a North Carolina-based firm.

More than 4 million employees suffer from a work-related injury or illness every year, according to Work Comp News. And more than 2 million workers suffer injuries that are so severe that they have to miss work and need more care.

But even in this environment, employers all over the country are looking for ways to cut insurance costs, which means that workers often get squeezed. In Oklahoma, the Senate passed a bill earlier this week that would allow employers to opt out of the state's workers' compensation program, the Associated Press reports. Big business hailed the legislation, saying it would reduce costs. Critics said it will cut benefits for injured workers.

It’s not just workers' compensation insurance that's facing cuts. The average amount employees paid for insurance through work rose this year, while workers also faced more restrictions on coverage, according to a survey released last month.

CORRECTION: An earlier version of this post misidentified the source of the investigation into North Carolina business' workers' compensation policies. The News and Observer conducted the investigation.