|By Cornelius Frolik, Dayton Daily News, Ohio|
|McClatchy-Tribune Information Services|
Some employers fall behind on payments because of financial woes. Some go out of business and forget to notify the state they no longer need coverage. Still others skip payments intentionally to cut costs to obtain a business advantage.
"Most of the time when you see somebody who doesn't pay their workers' comp premium, they are trying to cut corners on their overhead," said
But companies that allow their coverage to lapse risk fines and even criminal charges. Employers can also face costly lawsuits if any workers are injured on the job while coverage is expired.
"If there is an injury in the workplace when they didn't have coverage, it would be an issue for them because (my agency) will pursue" reimbursement for all medical and compensation costs, said
The bureau identified about 41,247 private employers in the state that failed to report their payroll data and submit premium payments to the agency by the
Vince also said that an average of about 40,000 policies are allowed to lapse annually.
The payments and paperwork due at that time covered the period
Some employers that did not meet the February deadline caught up just weeks after it passed. By
But more than 12,200 accounts remain outstanding, and those companies owe an estimated
Construction companies, child care centers, law firms, political executive committees, bars, retailers, union organizations and many types of small businesses were among the
Studebaker's Urbana Soft Water Service in
"We are working on a plan to get it reinstated," Hopple said.
Bureau officials say they try to work with struggling companies before imposing penalties.
The penalties can add up, but companies risk much heftier costs if workers become injured or develop illnesses related to their employment. If the bureau approves those claims, it first covers the employee medical care and lost wages and then seeks full reimbursement from the employer, said
"The strictest penalty for noncoverage is that anything that occurs during that period is charged to the employer, dollar for dollar," Abrams said.
Recalcitrant employers also face criminal prosecution if they intentionally defraud the system or repeatedly ignore warnings about noncompliance, according to the bureau.
Employers that do not pay into the system increase the premium payments for everyone else because the costs are spread across a smaller pool of accounts, officials said.
Failing to pay into the insurance system gives companies an unfair advantage when bidding for contracts or setting their prices because they can undercut competitors with their lower overhead expenses, according to the bureau.
Contact this reporter at (937) 225-0749 or cfrolik@DaytonDailyNews.com.
(c)2012 the Dayton Daily News (Dayton, Ohio)
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