Making Misrepresentations in Vermont? There’s a Penalty for That

Compliance Corner

It seems a basic assumption in a workers' compensation claim is that honesty and transparency are the only way to take care of an injured worker and get business back to usual as quickly as possible.

But just in case anyone wants to stray from the path of truth, the State of Vermont has in place consequences for making misrepresentations -- and Simply Research subscribers can access those rules in the state's Compliance Summaries.

We highlight some here.

Fines & Forfeiture

A person who willfully makes a false statement or representation, for the purpose of obtaining any benefit or payment, either for herself or for any other person, after notice and opportunity for hearing, may be assessed an administrative penalty of not more than $20,000, and shall forfeit all or a portion of any right to compensation, as determined to be appropriate by the Commissioner after a determination by the Commissioner that the person has willfully made a false statement or representation of a material fact.

No State Contracts

In addition, an employer found to have violated the false statement rules is prohibited from contracting, directly or indirectly, with the State or any of its subdivisions for up to three years following the date the employer was found to have made a false statement or misrepresentation of a material fact, as determined by the Commissioner in consultation with the Commissioner of Buildings and General Services or the Secretary of Transportation, as appropriate. Either the Secretary or the Commissioner, as appropriate, shall be consulted in any contest relating to the prohibition of the employer from contracting with the State or its subdivisions.

What about an Employer Trying to Lower Premiums?

When the Department of Labor has sufficient reason to believe that an employer has made a false statement or representation for the purpose of obtaining a lower workers' compensation premium, the Department shall refer the alleged violation to the Commissioner of Financial Regulation for the Commissioner's consideration.

Successor Penalties

A penalty shall continue in effect against any successor employer that has one or more of the same principals or corporate officers as the employer against which the penalties were assessed or order issued and is engaged in the same or similar business.

Criminal Liability Still in Play

In addition to the administrative penalties, a person may face a criminal case for misrepresentations regarding workers' compensation.

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