What Is Workers’ Compensation Fraud?

more+
less-
Explore:  Employee Benefits Fraud

Workers’ compensation is a state-mandated program intended to provide speedy medical benefits and other benefits to workers injured on the job. Benefits are obtained through insurance policies paid for by employers in exchange for release of liability for on-the-job injuries. Often exploited by employers and employees, the system is susceptible to workers’ compensation fraud. What is it? 

Workers’ compensation fraud is any activity or misrepresentation intended to thwart the checks and balances of the workers’ compensation program in New Jersey. Types of fraud committed by employers include the following: 

  • Underreporting of employees on payroll
  • Classification of employees as independent contractors
  • Attempts to deny or pay off claims by injured workers instead of accessing insurance provided by the employer
  • Any misrepresentation that causes denial of deserved eligible benefits to a worker injured on the job 

Types of employee workers’ compensation fraud include: 

  • Misrepresentations made at any time during the claims process about a current or previous injury
  • Making a false injury claim
  • Receiving disability payments without disclosing other employment

In July of this year, an appellate court upheld the dismissal of a workers’ compensation claim by a former New Jersey firefighter after it found he committed fraud by concealing information from doctors and others about previous knee injuries he had suffered. The court found that the firefighter was not a credible witness and was unable to prove his injuries occurred from occupational exposure. 

Workers’ compensation fraud reduces benefits, increases premiums and slows the system for everyone.