Introducing: The Joint Legislative Committee on North Carolina Workers’ Compensation Insurance Coverage and Compliance and Fraud Prevention

July 10, 2012, by Michael A. DeMayo

Another key provision to the latest North Carolina workers’ compensation law, HB 237, created an 8-member commission to examine the government’s capacity to deal with non-compliant employers — and to enforce relevant laws regarding mandatory insurance coverage.

The bill created this group because the North Carolina Industrial Commission actually has done very little to punish non-compliant employers.

Per the law, employers can be hit by fines of up to $100/day and beyond – on top of medical bills and benefits owed to any hurt employee. But since January of last year, the NCIC had only collected a little more than $30,000 in fines against 225 employers.

Another small change is certain to get a LOT of attention from recalcitrant employers: the commission can now send employers to jail.

To-date, that’s never happened, but now that scenario appears to be more likely – or least more plausible. An advocate for North Carolina employers, Lonnie Albright, told a local paper that the Commission’s actions have encouraged several employers to take out bank loans to make their workers’ comp insurance obligations, and that the action “certainly has got employers concerned…you either buy workers’ comp coverage or be exposed to being incarcerated.”

Is the threat of jail too much?

At what point does the law get too draconian? How much enforcement is too much enforcement? Is punitive action against recalcitrant employers even useful, from the standpoint of “let’s make the workers’ comp system more equitable and ensure that hurt/injured workers are protected?”

These are some very deep issues being worked out here!

They speak to the very essence of the workers’ comp bargain, which has worked out over a century ago, in the wake of terrible worker abuses during the early industrial era. What is an employer’s moral and ethical obligation to his/her workers? What’s the state’s role in enforcing this moral/ethical code? On a practical level, what’s the ultimate strategy for maximum fairness?

If you are personally struggling with a workers’ comp issue, these theoretical questions are probably not that relevant. For actionable advice, please connect immediately with the team here at the Law Offices of Michael A. DeMayo for a free and thorough consultation.

 
 

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