Workers Comp Corner December 2016

NFP logo. (PRNewsFoto/NFP)



Workers Comp Corner is sponsored by National Financial Partners: For more information or rates on Workers’ Compensation or any other business insurance contact Chuck Rose at National Financial Partners, 802-775-4443 or


Understanding Misclassification, Miscoding & Fraud Part 2 of 5

Employers who comply with the state’s labor laws should not be put at a competitive disadvantage by businesses that do not adequately insure their employees.

This is why the Department takes seriously accusations of misclassification, miscoding, and fraud committed by employers doing business in Vermont.

A team of trained investigators and attorneys is prepared to respond promptly to complaints filed with the Department. Click here to complete a complaint form.

Our staff will shut-down non-compliant businesses and impose civil penalties, as necessary, but the Department’s primary goal is to educate employers of their legal responsibilities and achieve voluntary compliance. In some cases of non-compliance, the Office of the Attorney General may also seek criminal penalties.


Miscoding means the improper categorization of employees under the National Council on Compensation Insurance (NCCI) worker classification codes. A class code is a four-digit code assigned by NCCI to help differentiate between the various job duties or “scope of work performed” by employees.

There are over 700 unique codes and these determine the pricing and cost of a workers’ compensation insurance policy that a business will purchase through their insurance carrier for to cover their employee.

Miscoding Example

Employer: An employer reports to his insurance agent that he has two clerical workers and three employees performing general residential construction, when in fact he has one clerical worker and four roofers.

Report suspected miscoding by an employer, click here.

Incorrect risk classification by insurance agents and/or underwriters often results in premiums that are higher or lower than they should be for a particular employer.

If you believe that your employees have been miscoded by your insurance agent, then contact the Department of Financial Regulation, Insurance Division Consumer Services Section at
1-800-964-1784 or e-mail