Fraud and Non-Compliance Frequently Asked Questions

I have business locations in Missouri and Kansas. The Missouri location has 3 employees and the Kansas location has 5. I was informed that I didn′t have to have Missouri workers′ compensation insurance because I only have three employees. Is that correct?

Short answer, NO! In the state of Missouri employers with 5 or more employees must carry workers′ compensation insurance. The only exception is for the construction industry. If you are in the construction industry and have one or more employees you are required to carry workers′ compensation insurance. The statute does not differentiate between full-time or part-time employees. Neither does it state that the five employees have to be in Missouri. If an employer has locations in various states, they need to count the total number of employees they have. If the sum of those employees equals 5 (1 or more for construction), then the employer must carry workers′ compensation for the Missouri employees. Whether or not you need to provide coverage for the employees in the other states would depend on their specific laws. In this particular case, the employer has 8 employees thus requiring coverage.

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I am working for a company out of the state of Texas. A company representative told me the company has workers′ compensation insurance with Texas Mutual Insurance. Will this cover me in Missouri?

Probably not. Texas Mutual Insurance normally covers injuries that occur in Texas or Texas residents working out-of-state. If you are working for any out-of-state employer, it is always wise to contact the insurance company that issued the workers′ compensation policy and verify you are covered. Coverage does not always carry over from one state to the next. If you find out you are working for an employer that is not covered in Missouri, please feel free to call us and we will investigate the matter.

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I am representing a client who the insurance company is stonewalling. I can′t seem to get it to negotiate a settlement. If I file a complaint with the Fraud and Noncompliance Unit and the matter is then resolved, can I withdraw my complaint?

No. The Fraud and Noncompliance Unit was created to investigate criminal violations of Missouri′s workers′ compensation law (RSMo 287). If a complaint is filed, the unit will investigate the matter to determine if a criminal violation has occurred. If the unit is able to substantiate a violation, the Division Director may refer it to the Office of the Attorney General for prosecution. If no violation is substantiated the case is administratively closed. The unit was not intended to nor does it participate in the administrative settlement side of the workers′ compensation system.

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I was looking at my pay stub and realized my employer is deducting money for workers′ compensation insurance. Can it do that?

If you are an employee and not a subcontractor, it is illegal for an employer in the state of Missouri to charge you for workers′ compensation insurance. In accordance with RSMo 287.290, "No part of the cost of such insurance shall be assessed against, collected from or paid by any employee." Not only is it wrong to shift the burden of workers′ compensation insurance onto employees, it gives the employer an unfair economic advantage over their competitors. If you are an employee, being charged for workers′ compensation insurance by your employer, you can contact the Fraud and Noncompliance Unit and it will investigate the matter.

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I was hurt at work and informed my supervisor about the injury. The supervisor refuses to file an injury report. Can the supervisor do this?

In Missouri, every employer or its insurer is required to file a First Report of Injury with the Division of Workers′ Compensation, within 30 days after obtaining knowledge of an injury or death of an employee. If the employer has coverage through an insurance carrier, it has five days to report the injury or death to that carrier and the carrier is then required to report the injury to the Division. The Fraud and Noncompliance Unit would investigate such a complaint as a violation of RSMo 287.380.1.

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I have an injured employee who is collecting TTD and is working at another job. Is this fraud?

It depends on a number of factors. Merely collecting TTD and working at another job, does not in and of itself, constitute fraud. One of the criminal elements of fraud is a misrepresentation of a material fact (a lie) in order to obtain a benefit. If a claims adjuster, medical provider or an employer asked the injured employee if he or she is working and the employee denies it, then there could be a violation of Missouri′s workers′ compensation statute.

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I have videotape of an injured employee, violating doctor′s restrictions. Has the employee violated Missouri′s workers′ compensation laws?

Maybe! Violating a doctor′s work restrictions may or may not be a violation of Missouri′s workers′ compensation laws. For example, an injured worker goes to the doctor and indicates that he or she is in a lot of pain. When asked how severe, the injured employee states, "8 out of 10". You have the employee on videotape building a barn. He or she is carrying 4′ x 4′ posts, bags of cement, hammering, climbing a ladder, etc. This scenario would not be fraud! Why? Where is the lie?

Consider the same scenario with the exception of the doctor′s visit. This time, the doctor asks the injured employee, "How has the injury affected your ability to perform daily functions". The injured employee responds, "prior to the injury I could climb ladders, mow my grass, go horseback riding, and work in my garden. Now, I can′t even pick up a bag of flour." Now you have a possible fraudulent act. Why? You have a lie! The injured employee indicated he or she could not perform at a certain level and there is evidence that this statement is not correct. The fraudulent statement must be made to someone in a position to determine if benefits are paid. That can be the medical provider, the employer, or the insurer.

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I am a carpenter and was injured at work on Friday at a construction site and reported it to my supervisor. He asked me to wait until Monday to file an injury report because he doesn′t have workers′ compensation insurance. He said he would buy it today and I would be covered on Monday. Is that legal?

No! First of all, any employer in the construction industry is required to carry workers′ compensation insurance if it has one or more employees. If your employer does not have coverage, it is non-compliant with Missouri′s workers′ compensation law and the Fraud and Noncompliance Unit would investigate that violation. When an employer applies for coverage it is asked about prior accidents. In most situations, if it admits to your injury, it won′t be covered under the policy it purchases on Monday. If it does not admit to the injury and then has you file a fraudulent claim on Monday, you and your employer could be committing workers′ compensation fraud.

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I work for an employer who has 17 employees. She pays seven of us in cash, but I know she has workers′ compensation insurance. Is this legal?

No. The employees who are being paid cash will not have taxes taken out of their pay. This will have an effect on their Social Security and unemployment insurance. It also could affect the employer′s workers′ compensation premium. Insurance companies determine how much to charge for workers′ compensation by using three main categories. They are: type of job performed, amount of payroll, and how many injuries the employer has over a period of time. By reducing reported payroll, the employer would not be paying the proper premium for the risk the insurance company is covering. In addition, this gives that employer an unfair financial advantage over other employers who are paying the proper rate. The Fraud and Noncompliance Unit would investigate the employer for premium fraud.

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I recently hired a subcontractor to put a roof on a house I am building. I obtained a copy of its Certificate of Insurance (COI) for workers′ compensation insurance. My insurance company recently audited me and now I have to pay more in premiums because the COI was no good. Is there anything you can do?

Yes, we would be interested in investigating this. We would check into two areas. First, we would determine if the subcontractor has workers′ compensation insurance. Second, we would investigate its submission of a false or forged certificate of insurance. Submitting a false/forged certificate of workers′ compensation insurance is a class D felony. By avoiding its obligation to provide coverage it is denying its employees workers′ compensation benefits in the event they receive a workplace injury. In addition, it is making it more difficult for employers that obey the law to compete in the market by being able to under bid them on jobs.

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One of my employees is out on a workers′ compensation claim. She brought in an "off work" slip she said she got from her doctor. The form indicates she is to be off of work for seven days because of her injury. I called the doctor′s office and was told the doctor did not give her an "off work" slip. Is this a crime?

Probably. It is a criminal violation for someone to misrepresent a material fact (lie) in an attempt to obtain a workers′ compensation benefit. If the injured worker forged or had someone else forge the document and then she submitted it to you we would investigate the matter. If we are able to prove it was done to obtain a workers′ compensation benefit, the Division Director could refer the matter to the Office of the Attorney General.

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