Labor Department Expands Efforts To Uncover Employer Fraud

Thursday, June 5, 2014

The Workers’ Compensation Division of the Tennessee Department of Labor & Workforce Development has put into place new procedures to identify employers who engage in payroll fraud such as intentionally misclassifying workers as independent contractors, failing to report all wages paid, misrepresenting the kind of work performed, or paying workers “under the table.” These practices are typically used to avoid paying workers’ compensation and unemployment insurance tax premiums. 

“We are working aggressively to stop misclassification fraud by employers. When these unethical practices are identified, the Division of Workers’ Compensation of the Department of Labor & Workforce Development will assess administrative penalties for misclassification as well as refer cases for prosecution,” said Administrator for Workers’ Compensation Abbie Hudgens. 

The Employee Misclassification Advisory Task Force made recommendations that led to legislation to improve the state’s efforts to reduce misclassification fraud. The Department of Labor entered into a settlement that assessed a penalty of more than $300,000 against a drywall contractor who materially understated his payroll to his insurance carrier. The settlement is the largest ever of the department’s Employee Misclassification Education and Enforcement Fund. 

The Employee Misclassification Advisory Task Force, created by the General Assembly in 2010, made recommendations that led to legislation to improve the state’s efforts to reduce misclassification fraud. 

The Task Force submitted three annual reports to the Legislature – the latest on January 30. The following are among actions taken by the department based on Task Force recommendations. 

§  Establish a referral process for possible criminal prosecution:

Workers’ Compensation has referred cases to the Tennessee Bureau of Investigation or the appropriate District Attorney General for any action deemed necessary under any applicable criminal law. 

§  Hire additional investigators:

Three investigators, one of whom is bilingual, have been hired under the legislation since July 2013.

 §  Procure fraud detection software:

The Workers’ Compensation Division is in the last phase of acquiring this software. 

§  Launch a public awareness initiative:

o    The Workers’ Compensation division began a speaking tour in the summer of 2013 in which representatives from the division and the Tennessee Department of Commerce and Insurance spoke at conferences and other venues across the state. These speakers continue to be available for future presentations.

o    The division created a Website that provides useful distinctions between employees and independent contractors.

o    The division offers a toll-free number, 800/332-2667, and a tip form, for citizens to report a business suspected of misclassifying its workers. 

Although the Employee Misclassification Advisory Task Force is scheduled to sunset on June 30, most of the current task force members have agreed to participate on a new Employee Misclassification Advisory Committee.



First Tennessee Increasing Quarterly Cash Dividend On Common Stock By 33%

First Horizon National Corp.'s (NYSE:FHN) is increasing its quarterly cash dividend on common stock by 33 percent. First Horizon’s board of directors has approved payment of a quarterly cash dividend on its common stock of $0.12 per share payable on April 2, 2018 to the common shareholders of record on March 9, 2018. The per-share quarterly cash dividend in 2017 was $0.09 so the ... (click for more)

Criminal Justice Grant Opportunities For Local Governments And Organizations

Local government bodies and community based agencies can now apply for grants for criminal justice and victims service projects. The Office of Criminal Justice Programs (OCJP) in the Department of Finance & Administration today announced the solicitations and a series of workshops for community service providers and local government entities. OCJP is the State Administering ... (click for more)

City's Top Traffic Reconstruction Expert: "Man, This Truck Just Creamed A Dozen Cars"

The Chattanooga Police Department's top traffic reconstruction expert testified Tuesday that when he first viewed the scene of an horrific crash at the Ooltewah exit he thought "Man, this truck just creamed a dozen cars." Officer Joe Warren told a jury from Nashville that, according to his calculations, Benjamin Scott Brewer was traveling at 81-82 miles per hour when he struck ... (click for more)

Taji Webb, 26, Shot And Killed Monday Night; Shooter Will Not Be Charged

Taji Webb, 26, was shot and killed Monday night. Police said they have determined that the shooting was justified and the unidentified shooter would not be charged.   The Chattanooga Police Department responded at 10:43 p.m. to a person shot call in the 1500 block of Ryan Street .  Upon arrival, officers located Webb lying on the ground suffering from a gunshot ... (click for more)

Dismal Educator Teaching At UTC - And Response

Roy Exum,  People are talking about the inability of UTC to turn out high quality teachers. Well, should any university be expected to turn a sow's ear into a silk purse? We all know how our school system students fail miserably on national scholastic aptitude tests as a whole.  Forget Tcap tests, those are teacher tests not meant for measuring student progress, but ... (click for more)

Roy Exum: Making A Difference

It was about 50 years ago when the late writer Loren Eiseley penned an essay called “The Starfish Thrower” so it’s been one of my favorite stories for almost as long. It tells about a man who walks up to a young boy on a beach, this just after a strong storm had washed hundreds of helpless starfish onto the shore. The boy was picking up the stranded starfish and, one at a time, ... (click for more)