RALEIGH – A new performance audit shows that the N.C. Industrial Commission has been lax in monitoring data to make sure North Carolina businesses are keeping up with their duty to provide workers’ compensation insurance for their employees.
In addition, the report from state Auditor Beth Wood’s office also said the Industrial Commission needs to ramp up its efforts to collect assessed penalties that fail to comply with the state’s Workers’ Compensation Act.
That act requires most companies doing business in the state to carry worker’s compensation coverage to pay benefits to a worker or a worker’s family if the worker is injured or dies on the job.
“Workers, unfortunately, may not even be aware that their employer is not carrying workers’ comp until they get hurt,” Wood said Tuesday.
By then, she said, it would be too late for that worker.
The audit recommends that the Industrial Commission work with the N.C. Rate Bureau and the Division of Employment Security to obtain “complete, accurate, and reliable data” to match information across agencies so that noncompliant businesses can be identified. It also recommends that the Industrial Commission implement procedures to follow up with businesses that have allowed coverage to lapse, and consider stricter enforcement of penalties assessed to those that do.
“The lack of follow-up could leave North Carolina’s citizens at risk unnecessarily,” the report says.
In addition, the report suggests that the Industrial Commission consider stricter enforcement of penalty assessments and collections for businesses that don’t follow the worker’s comp law.
“If they fine businesses that are not compliant, that money is earmarked for the schools,” Wood said, noting the constitutional provision requiring that all clear proceeds of fines go to the public schools.
In a letter responding to the audit, Staci Meyer, who chairs the Industrial Commission, agreed with the report’s findings and recommendations.
“The Industrial Commission has begun and will continue to take corrective action on all issues identified in your report,” Meyer wrote.
Wood acknowledged the commission’s response, and said her office will maintain a watchful eye on the organization.
“This office will perform a follow-up audit in another year or 18 months to ensure that they really do what they said they’re going to do,” Wood said.
Barry Smith (@Barry_Smith) is an associate editor of Caroilna Journal.