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Workers’ Comp Fraud Is Latest Wave of Hurricane Sandy Damage

While the first anniversary of Hurricane Sandy is upon us, investigators of a special task force are still discovering the devastating aspects of this unprecedented superstorm. Indeed, cleanup and recovery efforts have helped thousands of residents of the eastern seaboard put their lives and homes back together, but the damage may be more than physical.

Part of the latest fallout from the storm involves prosecution of unscrupulous individuals and companies who perpetrated fraud in the chaos following Sandy. In one such case, a Toms River man performed roof repair in the months following the storm using fraudulent documents to certify that he carried the requisite workers’ compensation insurance. The man was in fact uninsured and was indicted on charges of forgery and failure to provide a written contract, among other charges, offenses that carry an 18-month prison term upon conviction.

What are the consequences for employers without workers’ comp?

Thankfully, in the Toms River case, no employees were injured while working for the uninsured employer, but in other cases, fraudsters are not so fortunate. When a work-related accident causes injury or death, employers and even individual corporate officers, partners and limited liability company members are held directly liable for temporary disability benefits, permanent disability benefits, medical expenses and dependency benefits.

New Jersey law also levies civil and criminal penalties against employers and their officers.

Specifically, the law provides that failing to insure is a disorderly persons offense and, if determined to be willful, a crime of the fourth degree. Moreover, penalties starting at $5,000 can be assessed, with additional sums added on for each additional 10-day period without adequate insurance.

What if I’m injured and I discover my employer is not covered for workers’ comp?

Employees can sue their employees in a personal injury case, an action that is usually barred by workers’ comp. In certain instances, employees may even be eligible for compensation under workers’ comp and personal injury law.

If you were injured as an employee of an uninsured employer, contact Hoffman DiMuzio today.

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