South Carolina’s Workers’ Compensation Laws Have Changed to Benefit the Injured and their Employers

The LAC Audit

The South Carolina Workers’ Compensation Commission is responsible for administering the state’s workers’ compensation laws. The commission ensures the workers’ compensation system meets employees’ needs and monitors payment by the employer or its insurance provider to injured workers.

In 2010, the South Carolina Workers’ Compensation Commission was audited by the Legislative Audit Council (LAC) because of a request by members of the state legislature to ensure the program was operating efficiently and effectively. In the 2010 audit, the LAC reviewed the commission’s efforts in enforcing South Carolina’s workers’ compensation laws.

The LAC’s audit reviewed the commission’s compliance division and its efforts to identify uninsured employers. The compliance division is responsible for finding employers who do not have the requisite workers’ compensation insurance. To identify employers who are not abiding by the workers’ compensation laws, the division compares two databases: a database with employers who employ six to 20 employees and a workers’ compensation database. When these databases locate uninsured employers, compliance officers fine and collect from those employers, bringing more uninsured employers into compliance. Although the division is taking action to find uninsured employers, the audit found their efforts fail to address many of the uninsured because of a shortage of investigating officers employed by the division.

The LAC’s audit also reviewed contested and appealed workers’ compensation cases to be sure they complied with the law. The audit determined the contested and appealed cases were complete and timely filed in compliance with state laws.

The LAC’s 2010 audit made minor recommendations for improvement of the commission for the benefit of employees injured on the job, which brought about changes within the commission. A full report of the 2010 LAC audit can be found on the Legislative Audit Council’s website.

Compliance Issues within the Construction Industry

Many employers fail to comply with the South Carolina Workers’ Compensation Act by falsifying relevant information regarding their employees. A significant percentage of uninsured claims occur within South Carolina’s construction industry because higher tier and general contractors are often uninsured. These employers frequently assert they have no employees or do not have the mandatory number of employees to subject them to the act, claiming they operate mostly through subcontractors. However, these employers frequently have dozens of employees.