The State of New York Workers' Compensation Board placed a stop-work order on the entrance of Erie County Democratic Committee headquarters earlier this month, according to a source familiar with the situation.
- Quick reaction one day after the stop-work order was issued
- Attorney points toward person no longer employed there
- Has something similar happened before?
The same person provided a photo of the notice, which was issued on April 3, just a day before the deadline to submit designated petitions. It's one of the busiest times of the year for the party. According to the notice, the employer, ECDC, had failed to secure Workers' Compensation coverage and had outstanding penalties for failing to secure both Workers' Comp and Disability Benefits coverage.
According to state records, the committee's Workers' Comp policy through the State Insurance Fund was canceled on November 9, 2018. A new policy with Security National Insurance Co. began on April 4, a day after the stop-work order was issued.
ECDC attorney Margaret Murphy said the situation came about because a disgruntled former committee employee stopped opening mail at headquarters. The committee didn't find out until after that employee had stopped working there.
Murphy said ECDC also was not aware its insurance had lapsed because it never got a notice and received a new policy premium of a little more than $1,000 in February. It paid that bill in March and she said the check cleared and came out of the committee account.
In total, there appears to be a 146-day lapse in which the committee's two full-time employees and one part-time employee did not have coverage. Murphy said no employee was injured or filed a claim during that time.
The state requires employers to maintain a policy, with limited exceptions, and can impose fines of $2,000 for every ten-day period of non-compliance. The attorney for the Dems said the penalty they're facing is not that harsh but is substantial for the party.
"It's a shame because we could use that money a lot better to get a candidate elected than paying it to the State Insurance Fund," Murphy said. "I am negotiating with the Workers' Comp board to try to bring it down, but ultimately, we will pay what we are required."
State records also indicate ECDC went without Disability Benefits Coverage and Paid Family Leave for more than five years. Its previous policy ended at the end of March 2014 and a new one did not begin until April 4, 2019 as well. The Workers' Comp Board website notes there are more fines associated with failure to provide disability benefits, but it is also a misdemeanor.
Murphy said she is still investigating and doesn't know all the details about that particular situation yet.
However, when it comes to Workers' Comp, she said the committee immediately hired a payroll service and secured private coverage. Another local attorney who deals with workers' comp and asked not to be named, said the board can negotiate with businesses when it comes to fines but is typically less lenient to repeat offenders.
It does appear the committee is a repeat offender. The State Insurance Fund policy lapsed once before, with the committee without coverage from October 2013 to June 2014.
In its most recent BOE filing in January, ECDC reported a more than $170,000 balance. It also shows the committee spent more than $10,000 while it was without Workers' Comp coverage, including more than $6,000 on a holiday party.