If you’ve picked up a newspaper or watched the news recently in North Carolina, you have likely seen reports of several ongoing investigations into violations of workers’ compensation laws by area employers. These probes are in progress while the North Carolina House of Representatives is holding hearings on fraudulent employee classifications that cheat workers out of legitimate benefits and also cheat the state out of hundreds of millions of dollars in taxes.
One of the investigations actually involves a state agency. Employees of the North Carolina Department of Public Instruction who have been injured on the job have missed almost a month of workers’ compensation payments they are due. While the snafu has been blamed on a change in claim processing providers, the Department’s Chief of Insurance says that those who have missed checks cannot be compensated for hardships caused by the delay. DIP workers say that the delay has caused missed payments on houses, cars and utilities, causing even further struggles for those legitimately due the compensation.
In the House, legislators are studying widespread non-compliance with the state’s workers’ compensation and other employment laws. Most of these violations come in the form of employers who classify workers as independent contractors rather than employees so they can avoid some of the financial obligations required for employees. Not only does this misclassification save employers on workers’ compensation obligations since they are generally not obligated to cover non-employees, but the employers can also avoid paying FICA and unemployment taxes.
Officials say that this type of fraud has more consequences than just denying the worker his or her benefits. The taxpayers pick up the tab for medical and unemployment costs when the employer doesn’t. The unscrupulous practices even affect the job market in North Carolina: businesses that comply with the rules have to fit those costs into their budgets, while those that don’t comply have a financial advantage and can use their resources to their advantage in competition with the businesses that follow the law.
Regardless of any action taken by the state government, employers will likely continue these practices to improve their bottom line. If you have been injured on the joband are being denied benefits for any of these reasons, you should contact an attorney with experience in recovering workers’ compensation benefits. Fighting illegal practices may not just help you individually, but may help uncover unlawful actions by a business.
Source: ABC11.com, “I-Team: North Carolina State Employees Not Getting Worker’s Comp Checks,” Andrea Blanford, July 24, 2015
Secondary Source: WRAL.com, “House weighs employment fraud reform,” Laura Leslie, July 15, 2015