According to state auditors, the state Workers’ Compensation Commission improperly charged insurers and self-insured employers $450,000 in 2013 in order to recoup a transfer the legislature authorized to Connecticut’s general fund in late 2012.

The commission, however, said the charges were necessary to make sure the Connecticut Workers’ Compensation Administration Fund, from which the transfer was made, had enough money for 2014. The fund pays for the administrative costs of the state's workers’ comp system.

Lawmakers approved the transfer as part of a bipartisan deal to patch a $252 million budget deficit in fiscal year 2013.

Faced with the resulting $450,000 gap, the commission included that amount into its expenses and increased its annual assessments to workers’ comp insurers, and ultimately, employers, in 2013.

But the auditors said the commission should have obtained “express legislative authority” for the assessment and suggested that the commission needs to “strengthen internal controls over the [assessment] calculation.”

Essentially, the transfer amounted to a hidden tax on employers at the expense of injured workers. It’s further evidence that state lawmakers need to do more to get the state’s fiscal house in order rather than look to transfer from one account to another to make ends meet.

For more information, contact CBIA’s Eric Gjede at 860.244.1931 | eric.gjede@cbia.com | @egjede