New York Employers Are Dodging Workers Comp Premium Payments (WIN & NYT)

[Omaha Steve]

http://www.laborradio.org/node/5153

New York Employers Are Dodging Workers Comp Premium Payments

By Doug Cunningham

The Fiscal Policy Institute says New York employers cheat the worker's comp system to the tune of $500 million to $1 billion a year. The illegal workers comp underpayments are 15 to 20 percent of New York state's total annual workers comp premiums.

[Omaha Steve]

1. NYT story, sorry I just found this

http://www.nytimes.com/2007/01/25/nyregion/25labor.html?_r=1&oref=slogin

Study Says Many Firms Cheat New York Workers’ Comp System

By STEVEN GREENHOUSE
Published: January 25, 2007

A new study estimates that employers cheat New York State’s workers’ compensation system by not paying $500 million to $1 billion a year in required insurance premiums, forcing other employers to pay higher premiums.

The study by the Fiscal Policy Institute, a liberal research group, found that these illegal underpayments represent 15 percent to 20 percent of all the workers’ comp premiums that are supposed to be paid each year statewide.

Some companies pay no premiums while others underpay by underreporting the size of their work force to qualify for lower premiums, the study said.

Government, business and labor leaders say the noncompliance hurts the state’s business climate by forcing law-abiding companies to pay higher workers’ comp premiums when many corporations are already complaining that their premiums are too high.

“We were surprised to find this magnitude of noncompliance,” said James Parrott, the chief economist for the Fiscal Policy Institute. “This noncompliance has helped cause at least two things: very low benefits for injured workers in New York, which are among the lowest in the country, and second, despite these low benefits, workers’ comp premiums that are considered very high.”

Mr. Parrott said inadequate data made it hard to pinpoint the exact amount of cheating.

The report asserts that if more companies paid their full premiums, the extra money would enable the state to cut workers’ comp premiums over all and increase benefits for injured workers. The report maintains that a lack of enforcement has emboldened employers to cheat.

“Not being honest on payroll has become almost an accepted practice in New York State,” said Art Wilcox, a workers’ comp expert with the New York State A.F.L.-C.I.O. “It hurts the competitiveness of a business that does the right thing. It hurts the competitiveness of an insurance broker who refuses to play games with payroll. And it certainly hurts any insurance carrier who won’t bend the rules because they’re competing against people who will.”

FULL story at link.