Workers’ compensation is important for employees who are injured while performing job tasks. In Colorado, as in many other states, employees rely on these benefits to cover any expenses regarding medical procedures, lost wages, and rehabilitation. However, like any system that involves insurance and claims, workers’ compensation can sometimes lead to fraud.
To help guide you through the difficult and sometimes confusing processes, consulting a Denver workers’ compensation lawyer can help protect your rights and ensure you avoid legal pitfalls. Fraud in workers’ compensation claims can stem from employees and employers. All parties need to be informed and aware of the risks involved, as well as how to avoid falling into legal traps.
What Is Workers’ Compensation Fraud?
Workers’ compensation fraud occurs when false or misleading information is provided to get undeserved benefits. It generally falls into two categories:
1. Employee Fraud: Intentionally making the severity of their injuries more serious than it is, reporting injuries that didn’t happen at work, or lying about symptoms to receive greater benefits than they are entitled to.
2. Employer Fraud: Employers can misclassify workers or fail to carry the required workers’ compensation insurance. Employers can illegally attempt to reduce their employees’ benefits or avoid liability for injured workers.
How Does Workers’ Compensation Fraud Happen in Colorado?
Workers’ compensation fraud can take many forms. Here are some common scenarios where fraud might happen:
Exaggerating Injuries
Some employees might exaggerate their injuries or claim a more serious condition than they actually have to try to get more compensation. For example, an employee might report a minor headache as a severe concussion injury or claim that an injury occurred at work when it happened elsewhere.
False Work-Related Injuries
Employees may sometimes misreport injuries, claiming they occurred while performing their job duties when, in fact, they happened outside of work. This can happen in an attempt to cover up a personal injury and take advantage of worker comp benefits.
Underreporting Employee Numbers or Classifying Jobs Incorrectly
Employers may not report the correct number of employees on payroll or misclassify employees as independent contractors. This reduces the worker’s insurance premiums, potentially leaving employees without the right protection in the event that they get injured.
Employees Working While Receiving Benefits
In some cases, employees who are receiving workers’ compensation benefits may work in other jobs or engage in physical activities that contradict their claimed injuries. This creates caution for insurance companies and is a common form of fraud.
Consequences of Workers’ Compensation Fraud in Colorado
Fraudulent claims can have severe consequences for both employees and employers. Here’s what you should know about the potential penalties:
For Employees
• Criminal Charges: Employees could face criminal charges, including jail time and fines. In Colorado, workers can be charged with Class 1 misdemeanor or even felony fraud depending on the seriousness of the fraud.
• Reputation Damage: Being caught committing fraud makes it harder to find work in the future.
• Loss of Benefits: You’ll be disqualified from receiving workers’ compensation benefits. Additionally, employees may be required to pay back any received benefits under false pretenses.
For Employers
• Fines and Penalties: Employers who fail to carry proper workers’ compensation insurance, misclassify employees, or commit fraud can deal with heavy fines, penalties, and even criminal charges. The consequences are deeper especially if an employee is injured and no coverage is available.
• Increased Insurance Premiums: Increased premiums for workers’ compensation insurance, as insurance companies may adjust rates based on fraudulent claims in a specific business or industry.
• Civil Lawsuits: Employers can also face lawsuits from employees in the case that they endangered their worker rights or led to an underpayment of benefits.
How to Avoid Common Mistakes and Protect Your Claim
To avoid making mistakes that could lead to fraud accusations, both employees and employers in Colorado need to take the right steps. Here’s how to avoid the most common mistakes:
Report Injuries Honestly and Timely
For employees, it’s important to report any injury as soon as it happens and provide accurate information about how and when the injury happened. Avoid exaggerating symptoms or downplaying the injury’s seriousness, as it will help keep the good faith of your claim. It will help you receive the right benefits.
Keep Accurate Records
Employees should keep a personal record of all medical visits, treatments, and any conversations related to their injuries. For employers, it’s important to keep accurate records of employee classifications, wages, and the number of employees on staff. Right documentation prevents possible disputes and miscommunication about the claim.
Follow Medical Advice
Injured employees should follow all medical recommendations and avoid partaking in physical activities that contradict their injuries. This could be seen as defrauding the system. Employers should make sure their workers have access to medical care and help in the return-to-work process.
Consult a Denver Workers’ Compensation Lawyer
If you are uncertain about the complex claims process or think instances of fraud are present in your workers’ compensation case, reaching out to an attorney can be very helpful. Legal representatives can guide you through the process, help you avoid mistakes, and make sure you’re adhering to Colorado’s workers’ compensation laws.
The Right Coverage and Compliance
Employers should always have the required workers’ compensation insurance and correctly classify their workers. Consulting with a legal or insurance professional can help you avoid costly mistakes and stay compliant with Colorado’s worker’s compensation requirements.
What to do Moving Forward
Workers’ compensation fraud is a serious issue in Colorado that can have serious penalties and consequences for both employees and employers. By understanding how fraud occurs and taking steps for claims that are honest and accurate, mistakes can be avoided that could compromise a valid claim. It is crucial to maintain the safety and fairness of the workers’ compensation process in Colorado.
