Workman’s Comp Fraud: How to Tell When it’s Affecting Your Company

Worker’s compensation, also called workman’s comp, is an insurance program that is mandated by the state for most employers to have. While each state’s laws regarding workman’s comp vary, in Florida the mandate declares that every employer in the construction industry must provide workman’s comp coverage if they have one or more part time or full time employees. Employers outside the construction industry must provide the coverage if they employ more than four part time or full time employees.

This type of insurance is vital, not only employees, but to employers as well. The coverage provided helps compensate employees who suffer on-the-job injuries and illnesses, paying for their medical bills and a percentage of their lost wages while they recover. Because employees are provided these benefits, in most cases no matter who was at fault for the injury or illness, they often forfeit the right to take the employer to court to obtain further compensation for the damages.

While most employees understand just how important worker’s comp is, there are some that try to take advantage of this insurance by filing false claims, underreporting the amount of money they make, or over exaggerating their injuries. This costs tax payers billions of dollars every year and can actually affect your business directly in several ways:

• Higher worker’s comp premiums are often the first and most direct way businesses are affected. Because insurance companies are often stuck with the high cost of fraud, they pass on that cost to the businesses purchasing the insurance.
• Because of the higher premiums, you may be forced to adjust the cost of your goods or services to balance out the amount of money the business pays out and brings in. This can be frustrating for customers, who may walk away from the company.
• You may be forced to reduce the number of employees you have to make up for the higher premium costs.

If you’re faced with workman’s comp fraud, would you know how to identify it? According to the National Insurance Crime Bureau, most frauds contain two or more of the following factors.

Worker’s Comp Warning Signs

1. The worker is injured on Friday afternoon, but the injury isn’t reported until Monday morning, or the injury occurs bright and early on Monday morning.
2. The injury or illness occurs right before a change in employment. The employee may only be seasonal, temporary, or you may have been planning to fire or lay them off.
3. The employee has a medical condition that is both pre-existing and very similar to the injury they are reporting.
4. The employee frequently moves, changes jobs, or changes physicians.
5. There were no witnesses to the injury and the description of the cause does not line up with the injury.
6. The employee refuses to see a physician to have the injury examined and diagnosed.
7. You have a hard time reaching the employee after the injury, even though he or she is supposed to be home and disabled.
8. The employee has a second job or volunteers on the side.
9. Has the employee ever tried to borrow money from the company or co-workers? They could be facing financial difficulties.
10. Watch out for those unusual coincidences. For instance, if the injury occurred right after you denied their request for time off.

Fraudulent workman’s comp claims affect us all; make sure you’re paying close attention to the situation, before and after your employee files a claim.

Need a new employee or a temporary one while your current employee recovers from an on-the-job injury? At HH Staffing, we promise to set you up for a success! Our temp staffing solutions or temp to hire services have access to many, qualified, and skilled accessed and background screened talents who would be happy to fill any open position you have available. Contact our professional staffing service today for assistance with finding the right employee for permanent or temp employment in Clearwater, Sarasota, Orlando, Tampa Bay, or St. Petersburg. Questions call us on our toll free line at 855-709-4478 or visit our website at www.hhstaffingservices.com