Providing workers’ compensation insurance is every North Carolina employer’s duty. Unfortunately, as previously mentioned on this Charlotte NC Workers’ Compensation Law Blog, many employers are failing to provide their workers with insurance, and others are putting workers at risk by inaccurately classifying them as ‘independent contractors’ instead of ’employees.’
In fact, a News Observer editorial has charged that employers are skirting workers’ compensation laws to the detriment of their employees. Using what have become known as “ghost” policies, employers are cutting corners and leaving their workers unprotected by underinsuring employees under the independent contractor classification.
As a result, workers do not always receive adequate compensation after suffering an injury on-the-job. The case of one 39-year-old construction worker, who was involved in a workplace accident in 2009 that left him in a wheelchair, highlights the problem with the state’s laws.
The man’s employer, a construction company, had purchased a ghost policy, and as a result the worker is now left with a quarter of a million dollars in medical debt.
Many employers use this tactic to avoid paying for adequate workers’ compensation insurance. However, by not covering employees, the employer itself takes a risk–if no one is injured, it is possible that no one will learn of the employer’s fraud. But if an uninsured or underinsured worker is injured, the employer may face criminal charges and lose his or her business.
Abusing workers’ compensation policies is not an acceptable practice. When North Carolina workers sustain injuries and have trouble receiving workers’ compensation benefits, they are often wise to discuss the matter with an experienced attorney. In some cases, strategies may be available to recover compensation from even uninsured or underinsured employers.
Source: News Observer, “Ghost Story,” Aug. 21, 2012