The Office of the New York State Inspector General announced the arrest of a Schenectady drywall installer accused of failing to provide his employees with legally required workers’ compensation insurance.
Dennis R. Hammonds, 40, was arrested on two counts of failure to secure compensation. The press did not name an attorney for him.
According to the press release, the accused is the owner and operator of Hammonds Drywall, LLC. An investigation by the inspector general’s office found that between February 2017 and November 2018, he worked as a drywall subcontractor for two general contractors without having the state-required workers’ compensation insurance.
“Workers’ compensation insurance is an essential and required part of legally doing business in New York State,” said New York State Inspector General Letizia Tagliafierro. “Proper coverage protects the employee, the employer, and the client in the event of an accident or injury. Neglecting to provide workers’ compensation insurance coverage to employees, as this individual allegedly did, is a crime.”
It is unclear if the general contractors who purportedly hired the accused will also be penalized for working with his company even though it didn’t have the necessary insurance for its employees.
Workers’ compensation insurance covers an injured or sick employee’s medical and recovery expenses when they are injured or fall ill in the workplace. Without insurance, employers would have to pay out of pocket for those expenses and potentially face legal liability if the injured employee chose to file a lawsuit.
Almost every state, including New York State, legally requires all contractors to carry workers’ compensation insurance for their employees. While every state has its own rules, most states at a minimum require employers to obtain workers’ compensation insurance if their business employs four or more employees. In New York State, for example, failing to have coverage for more than five employees is considered a felony. The only exception to this rule is the construction industry, which requires contractors to obtain insurance for all employees, even if there are fewer than five. Other common exceptions include:
- Sole proprietors – If you own and operate your own business alone, you may be exempt from paying workers’ compensation coverage.
- Farmers – Seasonal workers on farms don’t require coverage in most states.
- Independent contractors – Some states don’t consider independent contractors as employees, and they are therefore exempt from coverage.
- Domestic workers – Many states don’t consider workers in private homes as employees, and so they don’t require workers’ compensation insurance.
Employers who attempt to avoid paying for workers’ compensation coverage can face serious penalties. If you’re a business owner suspected of committing workers’ compensation insurance fraud, then you should immediately seek legal counsel. A good attorney can help you navigate the legal system, build a defense based on extenuating circumstances, and negotiate to obtain the best possible outcome in your case.
South Florida Workers’ Comp Fraud Attorney
Is your business accused of workers’ compensation fraud in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced workers’ compensation fraud attorneys.