What is consideredunemployment insurancefraud?

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What is consideredunemployment insurancefraud?

My employer decided that he could no longer afford to pay wages in 10/09 and told us to collect unemployment. However we were still required to report for work everyday. Is this considered UI fraud?

Asked on October 13, 2010 under Employment Labor Law, Wisconsin

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

It most certainly is unemployment insurance fraud--though note that if you participated in it (i.e. you took the UI while working for no wages) you are an accomplice. If you come forward in the correct way to report this fraud, there is a very good chance that you could avoid liability (or at least face only minimal liability), but you should consult with a criminal defense attorney about how best to do this.

Other laws your employer may have broken:

1) Wage and hour laws: employees must be paid for all hours worked. If overtime was worked, nonexempt employees should receive overtime, too. You could potentially recover back wages.

2) Tax laws--getting work for free and may be considered a taxable gain the employer should have paid taxes on.

You definitely should consult with an attorney. If you participated and this comes to light, you could face substantial liability; coming forward in the correct way could minimize your liability and also potentially allow you to recover back wages. Good luck.


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