State Audit: N.C. Workers’ Comp. Oversight Needs Improvement

It looks like the North Carolina Industrial Commission will have a host of improvements to tackle in 2017.worker

The state initiated an audit of the agency, and determined that there have been improvements in the agency’s oversight of North Carolina workers’ compensation claims. However, it is still failing to meet identification and investigative targets, the audit concluded.

This report was a follow-up of the commission’s performance following a previous audit three years ago that concluded the NCIC was not acting on data that was complete, reliable and accurate to proactively single out companies that did not have workers’ compensation insurance, as required by law. This has been an ongoing issue in South Carolina, where a series of articles by The News & Observer of Raleigh revealed there were at least 30,000 companies in this state as of 2012 that were operating without the proper workers’ compensation insurance coverage. Auditors indicated they believed that number might be as high as 52,000, which could mean there are as many as 156,000 employees in North Carolina working for non-compliant companies.

The North Carolina Workers’ Compensation Act mandates that companies in North Carolina with three or more employees carry workers’ compensation coverage, unless they fall into one of the few exemptions. The purpose of the state’s workers’ compensation law is to make sure a worker and/or family will receive benefits for medical coverage and a portion of lost wages if the worker is injured or killed on-the-job.

As the Winston Salem Journal reports, the commission responded to the report by firstly refuting the 52,000 figure, saying that included all companies that were deemed at some point to have been non-compliant, but that many in the last few years have become compliant.

Since April 2014, when the commission started using a new type of compliance software, the commission has imposed more than $2.5 million in fines to penalize some 1,300 employers and force them into compliance with the law – the ultimate goal of course being to protect those workers. That’s a sizeable uptick from years’ past. For example, in 2012 to 2013, the commission collected just $175,000 in fines for non-compliance with workers’ compensation law. The following year, that figure increased to $342,000. In that year, records revealed there were more than 800 penalty invoices that were canceled, those having a combined value of reportedly $9.35 million.

Auditors say that while these figures provide a window, the truth of the matter is neither the commission nor the state’s rate bureau has an exact idea of how many employers in the state have never been in compliance. It’s typically 632 days from the time the NCIC identifies a possible workers ‘compensation violation to the time the case is closed with a formal ruling. The agency noted it has just five full-time employees who are dedicated to the investigation of workers’ compensation violations. Part of the reason for that, the auditors’ report indicated, is the commission has yet to figure out exactly how long it takes – or should take – to investigate one of these non-compliant businesses. That makes it hard for the state to know what level of resources are needed.

In the meantime, while these investigations are dragging on, the auditors note that injured workers are having an impossible time getting their medical bills paid and recovering lost wages.

This is why many injured workers turn to an experienced workers’ compensation lawyer.

Contact the Carolina workers’ compensation lawyers at the Lee Law Offices by calling 800-887-1965.

Additional Resources:

State audit finds more improvements needed on workers’ comp oversight, Nov. 22, 2016, By Richard Craver, Winston Salem-Journal

More Blog Entries:

Hood v. State, ex rel. Department of Workforce Services – Work Injury Claim, Nov. 9, 2016, Winston-Salem Workers’ Compensation Lawyer Blog

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