There are two basic types of Workers' Compensation fraud:
- Employer (sometimes with agents)
- Employee (sometimes with providers or attorneys)
Employer fraud, also commonly called premium fraud, are those acts of fraud--including under-reporting payroll, misclassification of employees' duties and experience modification evasion--committed by an employer, for the purpose of reducing premium liability.
You may not discriminate against a worker who has filed previous Workers' Compensation claims. However, when you have several of the following suspect behaviors present or you observe an emerging pattern, don't be afraid to investigate further for possible fraud or to forward your suspicions to the appropriate authority. Here's a list of tips to consider as warning signs of possible fraud.
Malingering employees can and will take advantage of a lack of supervision.
The tip above sets forth a number of factors that should be kept in mind at all times when dealing with an employee injury. The list highlights a number of common indications that a worker's claim might be fraudulent. Although only a small fraction of workers' compensation claims are fraudulent, the cases that do occur are expensive, cut into your business's productivity, and can send your Workers' Compensation premiums sky-high. By being sensitive to the possibility that any claim might be fraudulent, you reduce your risk that a fraudulent claim, however rare, gets by undetected.