Workers' compensation fraud: Overview

It is said that claimant fraud is the most talked about kind of fraud. This is the type where employers are in the best position to help uncover. Claimant fraud happens when employees knowingly lie to collect benefits. The modus operandi is they will claim an injury as work-related when it wasn’t, exaggerate an injury, or secretly continue working while collecting benefits. This kind of fraud usually is a costs trickle down to all employers in the form of higher premiums.

What Workers' Compensation Fraud Is Not

Collecting benefits for a work-related injury is not fraud. Many employers feel that the longer an employee stays off work and collects benefits, the more likely the claim is fraudulent. Under state law, injured employees don’t have to get back on the job until the doctor releases them to work.

There is no definite way to identify fraud without proof, but there are what they so called red flags that will help you identify fraudulent claims. Employers should call their carriers immediately if they identify two or more of these flags.

Disgruntled employee. The employee has a motive to fabricate the claim. The reason is perhaps he or she was denied vacation time, demoted or fired.

Employee is hard to contact. The employee may be working to another job while collecting benefits. This practice is also called “double-dipping,” which constitutes fraud.

No witnesses. Make note of alleged accidents with no witnesses, especially if the employee’s duties rarely call for him or her to work alone.

Varying accounts of accident. The injured worker may describe the accident differently to the employer and the doctor, or witnesses’ accounts may differ from the injured worker’s account.

Employers should at all times make sure that new hires have the skills and the character they want in their employees. Remember a sound hiring policy is always the best and safest place to start and it is easier to prevent workers compensation fraud than anything else. The next time you’ve got to see any of these red flags to your employee never hesitate to consult your lawyer about the validity of the claim. The lawyers know exactly how to handle those cases. All you need to do is to choose the right attorney for you.