Workers Compensation

14 Signs That Your Employer May Be Committing Workers’ Compensation Fraud

Is your employer committing fraud?

Today we have a guest post from our colleague Leonard Jernigan of North Carolina.

All employees should be on the lookout for signs that their employer or potential employer is engaging in workers’ compensation fraud.

The list of signs below was inspired by this one from the Washington State Department of Labor & Industries.

These signs may indicate that your employer is not paying workers’ compensation insurance for their employees. If they aren’t, this could put you in a very difficult situation if you are ever injured on the job.

If any of these signs sound familiar, report the employer to the Fraud Investigations Department of the Deparment of Labor and Industries and, if at all possible, find another job.

Your employer may be engaged in workers’ compensation fraud if:

  • They pay you in cash and don’t give you any kind of payroll stub.
  • They give you a 1099 form instead of the standard W-2.
  • They pay you other than in cash or check, by such things as free rent, reimbursement of expenses, barter, etc.
  • They pay you on a piecework basis and do not record hours.
  • They require you to work long hours but turn in fewer hours than you actually worked.
  • You or somebody you know is injured on the job, and the employer promises to pay the medical bills rather than reporting the accident to the North Carolina Industrial Commission.
  • The reported hours on an injured worker’s accident report do not match the hours the employer reported to the North Carolina Industrial Commission. 
  • You or somebody you know finds that they do not qualify for unemployment insurance because the employer under-reported your hours.
  • They submit bids on jobs that are well below the industry standard.
  • They do not maintain or report complete and accurate employee payroll information.
  • They are operating a business without the proper license or registration and have workers.
  • They have a large number of corporate officers listed for the firm, and all work at the firm.
  • They hire their own children to work for the firm (other than on a family farm).
  • They have several “corporate officers” who do not exercise control of the business operations.