Department of Labor & Industries Issues New Checklist for Willful Misrepresentation

The Department of Labor & Industries recently amended the process and published an amended checklist for employers seeking Willful Misrepresentation orders. The Department’s new checklist for reporting Willful Misrepresentation available here.

Pursuant to RCW 51.32.240(5), self-insured employers can demand repayment of any benefits induced by willful misrepresentation along with a 50% penalty payable to the Department’s supplemental pension fund so long as the repayment and recoupment of benefits is demanded within three years of the discovery of the worker’s willful misrepresentation. The statute goes on to explain that “willful misrepresentation” includes willful false statements, omissions, or concealment of any material fact. Additionally, Washington Administrative Code 296-14-4121 provides that the term “willful” means a “conscious or deliberate false statement, misrepresentation, omission, or concealment of a material fact with the specific intent of obtaining, continuing, or increasing workers’ compensation benefits.”

Together, the statute and administrative rule provide employers with some legal teeth to fight back against attempts to obtain fraudulent benefits. However, as many employers know, the Department of Labor & Industries has often applied an inconsistent standard in the review and adjudication of these requests usually based on an alleged deficiency in supporting evidence. The Department’s updated checklist is extensive and requires the submission of material including but not limited to Employment Security Department records, medical records, and worker verification forms in addition to the actual material relating to the willful misrepresentation. Finally, the Department’s internal review procedure was also controversially modified to require that injured workers or their attorneys be notified of the request for the willful misrepresentation order and allowed 30 days to respond before the Department’s adjudicator issues a decision.

Overall, the updated checklist should allow employers to better satisfy the burden of proof in their initial request, but the 30-day response period certainly provides injured workers’ with another forum to argue against willful misrepresentation. Accordingly, it will be imperative that employers exhaust the accumulation of all evidence prior to submitting the request to the Department.

If you have any questions regarding submitting a request for willful misrepresentation or if you need assistance in developing evidence for potentially fraudulent claims, please do not hesitate to contact me via email or on my direct line at (503) 595-6105.