§ 213. Non-compliance or default. 1. Whenever a covered employer does
not comply with this article by providing for the payment of disability
and family leave benefits to his or her employees in one or more of the
ways provided in section two hundred eleven of this article or whenever
a carrier fails to pay the benefits required by this article to
employees of a covered employer, then such employer shall be fully and
directly liable to each of his or her employees for the payment of
benefits provided by this article. The amount of the benefits to which
employees of such employers are entitled under this article and
attendance fees of any attending physicians or attending podiatrists or
health care provider fixed pursuant to subdivision two of section two
hundred thirty-two of this article shall, on order of the chair, be paid
out of the fund established under section two hundred fourteen of this
article. In case of non-compliance of the employer, such employer shall
forthwith pay to the chair, for credit to the fund, the sum so expended
or one percent of his or her payroll for his or her employees in
employment during the period of non-compliance, whichever is greater;
provided, however, that if it shall appear to the satisfaction of the
chair that the default in payment of benefits or the non-compliance of
the employer otherwise with his or her obligation under this article was
inadvertent, the chair may fix the sum payable in such case for
non-compliance or default at the amount paid out of the fund and a sum
less than one percent of such payroll, and in addition the penalties for
non-compliance imposed under this article. In case of failure of the
carrier to pay benefits, the employer shall forthwith pay to the chair,
for credit to the fund, the sum so expended.

2. Where a carrier authorized by the superintendent of financial
services to do business in this state has failed to pay benefits on
behalf of an employer pursuant to this article solely because an order
of rehabilitation, conservation or liquidation has been issued by a
court of competent jurisdiction of this or any other state or
jurisdiction, the provisions of subdivision one of this section shall
not apply as they relate to: (a) the payment of benefits to an employee
if the policy of the employer's carrier is subject to the protection
afforded by any guaranty fund pursuant to the insurance law; or (b) the
reimbursement to the fund, created under section two hundred fourteen of
this article, by an employer whose carrier has failed to pay benefits.

3. The provisions of section one hundred forty-one-b of this chapter
shall not apply to violations of this section after January first, two
thousand eighteen and before January first, two thousand twenty.
Thereafter, in the event an employer is subject to debarment solely due
to a penalty for violation of this section, the chair may, in the
interests of justice, restore the employer's eligibility to submit a bid
on or be awarded any public work contract or subcontract. The chair may
exercise this authority only if it is the employer's first time
violation of section one hundred forty-one-b of this chapter; the
employer is not liable for any outstanding workers' compensation,
disability or family leave claims as a result of the lack of coverage;
and the employer has paid all fines, assessments, and penalties
associated with the lack of coverage.