Often, when people start talking about worker’s comp fraud all the focus is on employees who fake injuries, who fail to disclose pre-existing conditions, or who exaggerate the severity of injuries so they can live off workers comp funds without going back to work.
But employers commit fraud as well. And it’s important to realize that filing a claim against your employer can be to your benefit when genuine fraud exists.
They’ve failed to obtain insurance at all.
This form of fraud exposes your employer to criminal penalties. According to New Jersey Law, they can be sent to jail for up to 18 months and assessed a $10,000 fine.
In the meantime, a fund exists to pay benefits if you are a victim of this kind of fraud, through the Office of Special Compensation Funds.
They’ve classified you incorrectly.
In New Jersey employers must obtain worker’s compensation insurance for part time and short-term employees. They don’t have to obtain it for contractors, though, which inspires many employers to misclassify their employees.
But if your employer is your sole source of income, takes up 40 hours of your time, and controls how you do your work then you are not a contractor and should not be working off a 1099. Get an attorney’s help so you can compel the employer to list you as a full-time, W2 employee. If you’ve already been injured, an attorney can also help show why their policy should be covering you.
They make false or misleading statements.
Employers may try to make false or misleading statements to create a situation where you lose benefits, because they don’t want to pay premiums. This can also happen if they’re self-insured, because they don’t want to pay funds out of their own bank account.
Once upon a time, “false or misleading statements” was only applied to employees; if an employee was caught making them, they could deny benefits. But as of 2018, the law applies to employers too. And employers who delay or deny benefits fraudulently may be required to pay the sum due, with interest.
Stonewalling Benefits as a Self-Insured Employer
Self-employers have been known to play all sorts of dirty tricks to avoid paying benefits. For example, they might tell an employee there’s a 30 day waiting period for benefits when there isn’t. Or require you to fill out form after unnecessary form to stall.
You’re unlikely to catch some forms of fraud.
There are some forms of fraud employers commit that you’re unlikely to see. For example, if they’ve misrepresented the nature of their business to the insurance company, that company is likely to catch the fraud before you do.
You have the power to report fraud.
While having a workman’s compensation attorney is always a good idea, you don’t have to wait for one to report fraud. You can email the Department of Labor to make a report. They will investigate, and your employer will not have any legal way to retaliate against you if they do.