Last week L&I announced that a food service employee will be required to repay more than $11,000 in disability payments. The employee was caught working at a nursing home and hotel while collecting time-loss workers’ compensation benefits. Time-loss benefits are only payable when an injured worker is incapable of working. L&I provides these benefits while the injured worker is recovering from an industrial injury or occupational disease.
Workers’ compensation willful misrepresentation and fraud
Under RCW 51.32.240, it is “willful misrepresentation” for an injured worker to obtain workers’ compensation benefits they are not entitled too. Willful misrepresentation includes intentional, conscious, or deliberate false statements. It also includes misrepresentations, omissions, and concealment of facts. The key is that these actions are with the intent of obtaining or increasing workers’ compensation benefits. Injured workers failing to disclose work-type activities that results in income, repeatedly, may face willful misrepresentation.
If L&I determines that willful misrepresentation occurred, it can charge the injured worker 50% penalty in addition to recouping over-payments. On top, if L&I thinks it is warranted, it will seek criminal fraud charges. However, it is important to note that criminal charges are for fraud. And recall that fraud has a different legal definition than willful misrepresentation.
Misunderstanding and confusion among injured workers
Many injured workers that I represent do not understand the meaning of willful misrepresentation and fraud. The lack of understanding causes anxiety regarding simple activities and daily living. Some injured workers fear that activities such as grocery shopping or volunteering could be willful misrepresentation or fraud. To ease anxieties, I often remind injured workers that being totally disabled doesn’t mean being physically or mentally helpless. In other words, injured workers should certainly engage in appropriate activities.
L&I has an active fraud division to investigate alleged willful misrepresentation. According to L&I: “workers’ comp fraud is not a victim-less crime. Cheaters take resources away from legitimately injured workers and raise costs for employers and employees who pay into the […] system”. Most importantly, injured workers who collect appropriate benefits and are not engaging in intentionally deceptive behavior have nothing to worry about.