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Workers' Compensation: Do you really have your employees covered?

>>AMY SUSAN: Hi, I’m Amy Susan, Director of Communications for the Missouri Department of Labor.  On this week’s edition of Labor Talk, a podcast where experts discuss workplace issues that affect your life, I’m joined here with Bryon Klemme.  He is the Chief Administrator of the Fraud and Noncompliance Unit within the Division of Worker’s Compensation with in the Missouri Department of Labor.  Long title.

>>BRYAN KLEMME: Yes.

>>SUSAN: Welcome to the show today.

>>KLEMME: Thank you, good to be here.

>>SUSAN: Good.  Well, Byron, can you tell us what you do here for the Division and how long you’ve been with the Department?

>>KLEMME: I’m the Chief Administrator for the Fraud and Noncompliance Unit within the Division of Worker’s Compensation and I’ve been here now going on 14 years.

>>SUSAN: Okay.  And you investigate worker’s compensation fraud, correct?

>>KLEMME: Worker’s compensation fraud and worker’s compensation noncompliance.

>>SUSAN: Can you go ahead and explain to the viewers, what does that mean when you say work comp fraud and work comp noncompliance?  Cause today we’re gonna talk about that, as well as a certain case that came up recently where an insurance agent actually committed fraud.

>>KLEMME: Work comp fraud is anyone who would try to gain a benefit that they’re not entitled to or to deny someone a benefit that they are entitled to. Our investigations are all criminal and they are confidential. So fraud can be perpetrated in many ways. And when we talk about non-compliance, we’re just talking about in Missouri an employer, if they have five or more employees, they have to have a worker’s compensation policy in place to ensure the liability.  Of course, there’s always an exception in the law.  In Missouri, if you have a construction company you’re required to carry worker’s comp if you have one or more employees.

>>SUSAN: Now, we’re going to release some information in the next couple of days in the form of a press release to the media about a certain case that you all worked on where a rogue insurance agent was actually falsifying work comp insurance to the employer when, in fact, it didn’t exist.  Can you tell us without identifying this case and the person kind of what happened and how you discovered it?

>>KLEMME: Sure.  This agent was receiving premium payments from an employer.  The employer believed they had worker’s comp insurance.  The agent never bought a policy or put a policy in place.  The agent was misappropriating the money.  In turn, the agent turned around and issued a false certificate to the employer, leaving the employer to believe they had worker’s compensation insurance coverage.  We got the complaint.  We investigate it.  We found probable cause to believe a crime had been committed.  We referred it to the Attorney General’s office and they did a wonderful job of prosecuting the case and the agent was found guilty and sentenced to four years in the Department of Corrections.  They suspended the imposition of sentence and the agent got five years of supervised probation.  This agent will never be able to work in the insurance industry again in this state and he is--or the agent’s license has been revoked permanently.

>>SUSAN: How did we discover this case?  You said that someone referred it to us?  The insurance company referred it to us, but do we know if there was an injury sustained by this employer’s business?

>>KLEMME: Unfortunately, during the time when the employer believed they had insurance coverage, when they in fact did not because of the rogue agent, there was an uninsured injury during that time, which is very unfortunate.  Now that employee is--was not covered and that’s a very difficult situation.

>>SUSAN: What could you all do at the Division with the employer who failed to provide the coverage?

>>KLEMME: Well, for fraud unit purposes, we just investigate the criminal aspect of it.  The employer, if he’s paying premiums in good faith, even though he technically didn’t have coverage, we would not pursue prosecution on that.

>>SUSAN: Give us some advice or words to the wise.  What should employers do to make sure that they are, in fact, paying for worker’s compensation and they are, in fact, covering their employees?

>>KLEMME: They need to get in touch with their insurance carrier or the insurance company.  If they have a policy number, verify that that policy number that they have on their certificate is actually a policy with that company.  And if the company does not recognize that number or they don’t have that number, then they know there’s something amiss and they need to check it out further.

>>SUSAN: What about calling upon the Division?  How can you all help with an instance like this?

>>KLEMME: Yeah, they need to contact us immediately.  The sooner we get the information, the fresher the information is, the fresher the documents are, the fresher the evidence and the leads are.  It makes the case much easier to investigate.

>>SUSAN: We know what employers can do to verify, to make sure that they, in fact, have coverage, but what can employees do to make sure if they sustain an injury at work that they do have the coverage that they need?

>>KLEMME: They can visit our website at labor.mo.gov.  They can go and click on the injured workers button and then from there go to the are you covered button and they should receive all the information they need to answer their questions.

>>SUSAN: Okay.  So they can put in their employer’s information and it pops up whether or not they have coverage?

>>KLEMME: Absolutely.

>>SUSAN: Great.  Well, thank you for joining us today.

>>KLEMME: Thanks for having me.

>>SUSAN: We really appreciate it.  And if you all have any other questions or comments you can visit labor.mo.gov, click on News and Notices and then click on Labor Talk Podcast.