Sampson Speaks at Presser Supporting Penalties for Staging Construction Site Accident
At a press conference at the New York State Capitol last Tuesday, ABC Empire State Chapter President Brian Sampson spoke in support of legislation aimed at fighting workers' compensation fraud in New York. The legislation (S.8413/ A898) sponsored by Senator Breslin and Assemblyman Weprin in their respective houses would establish staging a construction site accident as a crime.
Workers' compensation fraud due to faked or staged construction accidents is an epidemic in New York. We've seen thousands of cases where the worker's compensation system has been manipulated by filing a false claim as a means to get to a higher payout under the state's notorious Scaffold Law or LL 240/241 claims. Workers are being used as pawns by trial attorneys and for-profit medical providers who simply want to line their pockets. ABC7 Eye Witness News conducted an investigation in 2023 into these occurrences and found numerous cases of faked construction accidents.
Over the last decade, as fraudulent claims have become more common, workers' compensation rates in the construction industry have increased in excess of 100%, doubling the cost for an average contractor. Correspondingly and not surprisingly, general liability insurance rates have risen by more than 300% compared to bordering states like New Jersey. Some sectors in the industry, such as roofing and structural steel, have higher rates than 1,000%. One would think that, with such high premiums, more carriers would flock to the New York market. The direct opposite has happened. Because of the potential for exposure to LL240 claims, more than 75% of insurance carriers will not write policies in New York.
Experts agree taxpayers are paying hundreds of thousands more for public projects simply because insurance costs are out of control in New York State. This dramatically adds to the affordability crisis all New Yorkers are experiencing. According to the Tax Foundation, 14.1% of New Yorkers' incomes go directly to state and local government, which is by far the highest of any state. In 2022, they concluded that New Yorkers faced the highest tax burden in the nation, with 15.9% of the net product in the state going to state and local taxes. Taking steps to eliminate workers' compensation fraud will help alleviate this taxpayer burden.
Passing this law will protect taxpayers and contractors by establishing the crime of staging a construction site accident, deterring bad actors from taking advantage of our worker's compensation system, and leaving New York taxpayers to pick up the tab. This way, we can also ensure that workers with actual claims get the help and support they need.
For these reasons, ABC strongly supports the passing of this legislation.