Paid under the table

[testedmonkey]

California

I'm posting this on behalf of a friend who was too stupid to do things right the first time. I can't answer his questions because it boggles my mind that he's such a moron and doesn't understand how this could possibly be his own damn fault. That being said...

Bob hired John under the table because John is collecting unemployment benefits and doesn't want to lose them. Bob has Workers Comp insurance. John falls on the job and blows out his knee. John has medical insurance through his wife and Bob has offered to pay any deductibles or co-pays involved so that John can get the knee looked at. John doesn't want to do that, he wants Bob to file a WC claim because "he's not going to be able to work now." I'm not sure if John is confusing WC benefits with disablility benefits. I'm also not sure why John cares if he loses out on working since he's being paid through unemployment anyway.

In any event, would WC pay this claim, considering that there are no payroll records for John? Same goes for disability. Assuming they pay it, what effect will it have on his unemployment benefits? How badly is Bob going to get burned in this deal?

 

[seniorjudge]

California

I'm posting this on behalf of a friend who was too stupid to do things right the first time. I can't answer his questions because it boggles my mind that he's such a moron and doesn't understand how this could possibly be his own damn fault. That being said...

Bob hired John under the table because John is collecting unemployment benefits and doesn't want to lose them. Bob has Workers Comp insurance. John falls on the job and blows out his knee. John has medical insurance through his wife and Bob has offered to pay any deductibles or co-pays involved so that John can get the knee looked at. John doesn't want to do that, he wants Bob to file a WC claim because "he's not going to be able to work now." I'm not sure if John is confusing WC benefits with disablility benefits. I'm also not sure why John cares if he loses out on working since he's being paid through unemployment anyway.

In any event, would WC pay this claim, considering that there are no payroll records for John? Same goes for disability. Assuming they pay it, what effect will it have on his unemployment benefits? How badly is Bob going to get burned in this deal?

You and your crook buddies are not going to get anything from anyone.

 

[BizMan]

I don't understand why anyone would go under a table to get a job

 

[fairisfair]

John who???

 

[testedmonkey]

Missunderstood

That's an understandable reaction, Senior Judge, but I'm not a crook in any sense of the word. I'm the one who preached never to hire anyone under the table and offered to help get the payroll, taxes, and all that set up so that Bob wouldn't find his ass in a sling like he has. I think Bob and John are both morons and, yes, probably crooks.

My post wasn't asking for advice on how to be shady and I'm sorry if it came across that way. Let me clarify my questions:

1. By filing a WC claim, won't John's umemployment benefits get pulled, regardless of whether WC pays out or not? Doesn't the state cross-reference those files? What penalty does John face for collecting unemployment when he's really working?
2. By filing a WC claim on an undocumented employee, what punishment does Bob face? Or rather, for HAVING an ondocumented employee, what punishment does Bob face?

If I can explain to them the consequences of their actions, maybe they'll finally "get" why it's better to do things the legal way in the first place. However, if I can't explain the situation to you without coming across as a crook, probably I should just let them find out for themselves.

 

[seniorjudge]

That's an understandable reaction, Senior Judge, but I'm not a crook in any sense of the word. I'm the one who preached never to hire anyone under the table and offered to help get the payroll, taxes, and all that set up so that Bob wouldn't find his ass in a sling like he has. I think Bob and John are both morons and, yes, probably crooks.

My post wasn't asking for advice on how to be shady and I'm sorry if it came across that way. Let me clarify my questions:

1. By filing a WC claim, won't John's umemployment benefits get pulled, regardless of whether WC pays out or not? Doesn't the state cross-reference those files? What penalty does John face for collecting unemployment when he's really working?
2. By filing a WC claim on an undocumented employee, what punishment does Bob face? Or rather, for HAVING an ondocumented employee, what punishment does Bob face?

If I can explain to them the consequences of their actions, maybe they'll finally "get" why it's better to do things the legal way in the first place. However, if I can't explain the situation to you without coming across as a crook, probably I should just let them find out for themselves.

Your crook buddies are not going to get anything from anyone.

 

[testedmonkey]

Sheesh

Yeah, not anything from anyone, I get it. Will you at least tell me the punishment for what they're doing?

 

[Switch]

One of you guys might do some jail time because of this. I would just pretend nothing happened and stop filing claims. Better than being locked up for a while.

 

[weenor]

That's an understandable reaction, Senior Judge, but I'm not a crook in any sense of the word. I'm the one who preached never to hire anyone under the table and offered to help get the payroll, taxes, and all that set up so that Bob wouldn't find his ass in a sling like he has. I think Bob and John are both morons and, yes, probably crooks.

My post wasn't asking for advice on how to be shady and I'm sorry if it came across that way. Let me clarify my questions:

1. By filing a WC claim, won't John's umemployment benefits get pulled, regardless of whether WC pays out or not?

And he will be charged with fraud for collecting benefits when he was working.

Doesn't the state cross-reference those files? What penalty does John face for collecting unemployment when he's really working?

The state may not cross reference but the workers' compensation carrier will and John will be screwed, if the carrier doesn't deny benefits outright. Google unemployment fraud in your state.

2. By filing a WC claim on an undocumented employee, what punishment does Bob face? The workers' compensation carrier will likely deny the claim, depending on the state case law for its culpability for payment. If the comp carrier accepts the claim, it will sue Bob for breach of contract and fraud for failing to report John's wages for purposes of premium calculations.

Or rather, for HAVING an ondocumented employee, what punishment does Bob face? Fraud charges from the state and federal departments of revenue for failing to pay employment taxes on John.

If I can explain to them the consequences of their actions, maybe they'll finally "get" why it's better to do things the legal way in the first place. However, if I can't explain the situation to you without coming across as a crook, probably I should just let them find out for themselves.

Bottom line is neither one of them will now benefit by filing a workers' compensation claim and both them will get into trouble with the respective state and local agencies. Its not brain surgery, but when you get private carrier involved (versus the inept govt.) all he** will break loose.