Morse and Cremona Inc. continually monitors the workers' compensation expenditures they incur and takes several precautionary measures to ensure that the compensation claims filed are not fraudulent. Why is the company carefully monitoring all procedures?

a. Employers monitor claims to avoid being fined by the OSHA during audits,

b. False workers' compensation claims can cost employers billions of dollars annually,

c. Employers have to document all claims and report the expenditure to OSHA annually.

d. Employers have to document all claims and report the expenditure to the respective state governments annually 

Answer:

The correct answer to the asked question is option b. The reason why we say this is because false claims can add up to the cost of production which ultimately might lead to increase in price of product and services. Also it encourages unethical behavior in the company and can affect the reputation of the company negatively. If proper monitoring is not done more and more employees can indulge in the practice and can make situation worse.

Now let's understand why others are false statements:

Option a OSHA stands for Occupational Safety and Health Administration which comes under  United States Department of Labor and is responsible for maintaining safety and health standards at workplace. Workers compensation is an internal matter of a company and is not governed by OSHA. Hence the statement stands false.

Option c Employees have to document all claims and report the expenditure to OSHA annually again is a false statement because workers compensation claims are not governed by OSHA. There are certain documents which companies need to submit with OSHA but those are:

• Control of Hazardous Energy
• Occupational Noise Exposure
• Personal Protective Equipment (PPE)

Option d Employees have to document all claims and report the expenditure to the respective state government annually again is a false statement because there is no provision as such according to labor law.