Home > Press Releases & Case Information > Toledo business owner misclassified employees to lower worker’s comp bill

Toledo business owner misclassified employees to lower worker’s comp bill

Limousine company’s competitor tipped off BWC

COLUMBUS – The owner of a Toledo (Lucas County) limousine company has been ordered to pay restitution to the Ohio Bureau of Workers’ Compensation (BWC) for misclassifying his employees and failing to maintain workers’ compensation insurance coverage.  Ibe Nnaji, owner of Toledo Livery Service, was sentenced in the Toledo Municipal Court last week after a suspicious competitor submitted an allegation of fraud to BWC’s Special Investigations Department (SID).

“As Mr. Nnaji learned, misclassifying employees and failing to maintain coverage can cause concern among competitors who take issue with any unfair advantage these actions may create,” said BWC Administrator/CEO Steve Buehrer. “If an employer provides the tools necessary for workers to complete their jobs and controls the work environment, they cannot claim those employees as subcontractors, and doing so purposely constitutes fraud.”

The case was referred by a local competitor who suspected Nnaji did not have valid BWC coverage. Nnaji did submit a portion of his outstanding payroll reports, but the SID’s Employer Fraud Team investigation revealed Nnaji began reporting his employees as subcontractors in 2003 after reporting them as employees for several years. Nnaji’s policy lapsed in November 2007. Nnaji was audited by BWC in 2008 and placed on notice that he was improperly reporting his drivers as subcontractors.  He was then billed the appropriate premiums.

Nnaji’s policy remained lapsed in 2009 and he was informed he could face criminal charges if he failed to reinstate/maintain coverage.  Nnaji did not comply and was charged in April 2010.  Nnaji finally submitted the remaining outstanding payroll reports after being charged, but again reported his drivers were subcontractors.   An additional BWC audit was conducted and auditors found that Nnaji was again improperly classifying his drivers.

Nnaji pleaded to a fourth degree charge of disorderly conduct October 17 after multiple pre-trial court appearances.  He was ordered to pay $13,612.92 in restitution and sentenced to 30 days in jail, suspended for five years of probation.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com, or visit www.facebook.com/ohiobwcfraud.

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