The Louisiana Workforce Commission (LWC) announces a partnership with the East Baton Rouge Parish District Attorney's office to criminally prosecute employers and employees who commit workers' compensation fraud. Recently, East Baton Rouge Parish District Attorney Hillar Moore, administered the oath of office to LWC Fraud Manager, Darrick Lee, granting him a special commission as Assistant District Attorney for this purpose.
Mr. Lee, an attorney with an LLM in taxation, has been at the helm of the Fraud Unit of the LWC, Office of Workers' Compensation since June 2018. Previously, he was employed by the Department of Children and Family Services in its Daycare Licensing Unit and as a mediator in the Monroe workers' compensation court. Under the leadership of Assistant Secretary Sheral Kellar, the Fraud Unit was reconfigured to take a more proactive approach to employer and employee fraud. Previously, the Fraud Unit consisted of a Fraud Manager, Compliance Investigators and auditors. Three attorneys, including Mr. Lee, have been added to the unit to proactively pursue civil and criminal fines against employers who fail to have the compulsory workers' compensation insurance and who engage in ill practices, like misclassifying employees and both employers and employees who commit 1208 fraud.
Since these changes have occurred the number of investigations initiated by the Fraud Unit has increased from an average of 71 cases per month in the first quarter of 2019, to an average of 136 cases per month during the second quarter of 2019 and the number of investigations resulting in civil filings in the workers' compensation courts has increased 48% in the past year. Under Mr. Lee's tutelage, the Unit is proactively mining, both internal and external tips from the LWC website at its Fraud reporting site, the 1-800-FRAUD-hotline, the Louisiana Contractors Licensing Board and from members of the GAME-ON Task Force.
The GAME-ON Task Force or Government Against Misclassified Employees – Operational Network includes LWC's Unemployment Insurance and Office of Workers’ Compensation divisions and the Louisiana Department of Revenue, with cooperative agreements with the Internal Revenue Service, the U.S. Department of Labor’s Wage & Hour Division and the Department of Wildlife and Fisheries. Employer and employee fraud is not a victimless crime. It affects everyone. When employers and employees don't play by the rules, the burden is passed on to the consumer, the state, other employers and employees.
“We are putting companies on notice that misclassifying workers won’t be tolerated in Louisiana,” said LWC Secretary Ava Dejoie. “The practice isn’t fair to the unsuspecting workers who are cheated out of critical benefits and protections, and it’s not fair to the thousands of businesses who ‘play by the rules’ but are undercut by companies that intentionally trim labor costs by misclassifying.”
When a worker is classified as an independent contractor, a company does not have to provide benefits and protections as outlined by law, such as minimum wage, overtime compensation, family and medical leave, unemployment insurance and safe workplaces. It has been estimated that companies that misclassify workers as independent contractors shave as much as 40 percent off their labor costs.
“Our office understands employee misclassification is not a victimless crime, thus combating the practice is important work. We are very excited about our new partnership,” DA Moore said.
"We are delighted to have our very own prosecutor of these fraud cases,” Assistant Secretary Kellar said.
About the Louisiana Workforce Commission
The Louisiana Workforce Commission is an agency of state government that administers programs designed to enhance workforce growth and provide family-sustaining jobs for Louisiana residents. The commission monitors employment, administers unemployment compensation and tax funds, provides training resources for employers and employees and oversees worker compensation benefits. The agency also gathers and supplies information on the labor market and occupational sectors in Louisiana.
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