Massachusetts Business Owner Pleads Guilty to Workers’ Compensation Fraud

The 63-year-old owner of a roofing and siding business in Nantucket, Massachusetts, pleaded guilty recently to five counts of workers’ compensation fraud, according to a report by the Insurance Journal. He was sentenced in Suffolk County Superior Court to two years of probation and ordered to pay $42,000 in restitution as a result of a plea agreement.

The business owner was accused of failing to accurately report his total payroll and number of employees as well as misclassifying his business and the type of work his employees were doing.

Unfortunately, business owners engage in behavior such as this far too often as a way to try and avoid paying workers’ compensation premiums.

“Premium avoidance is a serious crime that undermines the insurance system and puts lawful employers at a disadvantage,” the report quoted Massachusetts Attorney General Martha Coakley as saying. “The prosecution of these schemes prevents the increase in insurance premiums that often result from these crimes.”

Workers’ Compensation Fraud

In Massachusetts, as in all states, an employer is required by law to carry workers’ compensation coverage that will cover on-the-job accidents suffered by employees. An employer is also required to accurately report vital information regarding employees and the type of work they perform so that the liability carrier can determine the cost of that coverage. Sometimes an employer tries to minimize the number of employees working for the company, or minimize the potential risk by miscategorizing the type of work an employee does, in order to hold down workers’ compensation premiums.

Because premiums are based on the number of employees, as well as the likelihood of injuries, the potential for fraud is great. The Nantucket employer was charged with hiding the fact that his employees were engaged in hazardous work.

As Attorney General Coakley indicated, this type of fraud ultimately hurts everyone, including the workers whom the workers’ compensation system is intended to protect. If you believe that your employer is committing workers’ compensation fraud, you can report your concerns to the Massachusetts Department of Labor and Development, Office of Investigations. As an employee, you have a right to request information concerning your employer’s workers’ compensation provider. If your employer refuses to provide you with the information, you can report that refusal to the Office of Investigations or you may wish to contact an experienced Massachusetts workers’ compensation attorney.

If you have suffered a work related injury or illness in Massachusetts, you may be entitled to workers’ compensation benefits. Eligibility for benefits depends on the unique facts and circumstances of your injury or illness. If you are concerned about your employer’s workers’ compensation coverage, ask your attorney what you should do. A Massachusetts workers’ compensation attorney can review those facts and circumstances and advise you about your legal options. Contact the workplace injury lawyers at Kantrovitz & Associates, P.C., by calling 800-367-0871 or by using our online contact form.