August 9, 2007

Christine Baker

CHSWC Approves the Release of the Study on "Split" Class Codes Abuse in Workers' Compensation

OAKLAND –- The Commission on Health and Safety and Workers' Compensation (CHSWC) has approved the draft report " 'Split' Class Codes: Evidence of Fraudulent Payroll Reporting." for distribution and feedback. The study focuses on employers who are acting fraudulently and misreport low-wage workers as high-wage workers so that they slip into a lower premium level, thereby forcing up the premium rates for high-wage workers.

Key findings of the study include that only about two-thirds of wages are being reported in low-wage classes and that there is consistent misreporting of a significant fraction of low-wage payroll in the high-wage, low-premium rate classes.

CHSWC is charged with examining the health and safety and workers' compensation systems in California and recommending administrative or legislative modifications to improve their operation. CHSWC was established to conduct a continuing examination of the workers' compensation system and of the state's activities to prevent industrial injuries and occupational diseases and to examine those programs in other states.

Information about CHSWC and the study on split class code abuse in workers' compensation is available on the CHSWC web site, by contacting CHSWC by writing to 1515 Clay Street, Room 901, Oakland, 94612; by phone at (510) 622-3959: by fax at (510) 622-3265; or by email