I’m concerned about my employees potentially abusing our workers’ compensation insurance. What should I look out for?

Workers’ compensation is an employee insurance benefit that covers workplace injuries. Employers are required to carry workers’ compensation coverage for their employees. Unfortunately, of the

$10 billion in workers’ compensation claims filed in California annually, up to

30 percent of those claims may be fraudulent.

My recommendation is that you shouldn’t have employees you don’t trust, and you should strive to keep your employees happy. But beyond that, there certainly are things you can do to prevent fraudulent workers’ compensation claims.

It is illegal to make, or assist someone in making, a knowingly false or fraudulent material statement for the purpose of obtaining or denying workers’ compensation, or to discourage an injured worker from claiming benefits.

What does “comp fraud” look like? If you deny an employee’s vacation request, and the employee suddenly suffers a workplace accident with no witnesses, which coincidentally keeps them out of work during the same days they requested off, you may want to investigate the accident further.

If your employee competes in a volleyball tournament over the weekend and then sprains their wrist at work first thing Monday morning, this could be fraud. In fact, any accident that occurs first thing Monday morning is a little suspicious.

Disgruntled ex-employees are always a red flag. If you are going to terminate an employee, conduct an exit interview and ask whether they have had any on-the-job accidents or injuries.

Another red flag is if your employee has a preexisting condition, such as a bad back, and then claim they sprained their back at work.

Another fraud indicator is when the employee waits several weeks to report an injury. There’s no reason to delay reporting a workplace injury.

Not every suspicious claim is “comp fraud,” but one or more indicators might justify further investigation. Every injury should be immediately and thoroughly investigated. If you are concerned about fraud, communicate your suspicions to your carrier.

The two best things an employer can do is to maintain a safe work environment and ensure that employees understand how accidents at work should be handled. Have a clear and easy procedure for reporting accidents.

The Napa District Attorney’s office enforces workers’ compensation fraud prevention and prosecution. If you know of possible workers’ compensation abuse, please call their Workers’ Compensation Fraud Unit at 253-4059. In addition to criminal prosecution, the district attorney may bring a civil action to collect civil penalties for workers’ compensation fraud.

Mary Luros is a business law attorney with Hudson & Luros, LLP, in Napa, and can be reached at mary@hudsonluros.com or 418-5118. The information provided here is not intended as legal advice, nor does it form an attorney-client relationship with the author. The author makes no representations as to the reliability or accuracy of the above information. In a perfect world we wouldn’t need disclaimers — or attorneys.

I have two employees who have clearly started a romantic relationship. I’m concerned about what will happen if the relationship sours, and I don’t support my employees flirting. What is the difference between innocent flirting and harassment?

This can be a difficult area for employers, as sexual harassment liability can mean the end of a business. A fine line separates a chasm of potential liability between voluntary, consensual romantic relationships and sexual harassment. That line may be crossed after one of them breaks things off and things get “messy.”

Some businesses impose rules restricting co-worker romances or address co-worker dating in their sexual harassment policies. While you have a legitimate interest in avoiding sexual harassment claims created by employee relationships, be careful to balance that interest against your employees’ privacy rights. If you’re going to attempt to jump into employees’ personal lives, you should have justification. Creating an overly restrictive “no dating co-workers” policy might infringe upon employees’ rights.

It might sound silly, but some businesses go so far as to have co-workers document that they are in a consensual personal relationship — a “love contract.” These contracts affirm that employees are in a personal, consensual, romantic relationship at work.

If you decide to use a “love contract,” it should state that neither employee feels compelled to continue the relationship to retain their employment or in exchange for an employment opportunity of some kind. Make sure the contract acknowledges your policy against discrimination, harassment and retaliation. Depending on the working relationship between the individuals, you may want to have a statement about preferential treatment.

Both federal and state law require employers to take preventative steps to make sure their businesses are free of harassment. The most important thing you can do is have a written harassment policy — and follow it.

Your harassment policy should be written in clear and understandable language, and should specify what conduct is prohibited. The policy should require employees to report harassment, and you should thoroughly and confidentially investigate all reports. The policy should also protect “whistleblowers” from retaliation.

Ensure that all of your employees know, understand and follow the rules. Every employee should have a copy of your current policy and should know whom to ask when they have questions.

If you are really concerned about harassment, one of the best things you can do is provide harassment training on an annual basis, and some business liability carriers even provide sexual harassment training materials. This kind of training helps everyone understand the difference between harassment and consensual relationships, and will reinforce your harassment policy.

Mary Luros is a business law attorney with Hudson & Luros, LLP, in Napa, and can be reached atmary@hudsonluros.com or 418-5118. The information provided here is not intended as legal advice, nor does it form an attorney-client relationship with the author. The author makes no representations as to the reliability or accuracy of the above information.