Kennewick, WA – Cheating the state out of workers’ compensation payments has resulted in a criminal conviction for the owner of a Kennewick auto repair shop.
Rodney Eugene Dietrich, 41, pleaded guilty recently in Benton County Superior Court to employing workers without providing workers’ comp insurance, a gross misdemeanor offense.
The Washington State Department of Labor & Industries (L&I) revoked Dietrich’s coverage in July 2015 after he failed to pay insurance premiums despite repeated notices and warnings.
The Kennewick resident owes L&I more than $40,000 in late premiums, interest and penalties, according to department records. He also owes more than $1,800 in wages and penalties for failing to pay an employee in 2013, and nearly $50 for failing to pay the required fee for a boiler inspection.
The Washington Attorney General’s Office prosecuted Dietrich, based on an L&I investigation.
Changed business names
Dietrich operated at the same location in Kennewick from at least 2004, but changed the shop’s name, business structure, and business license number two times, after each one fell behind on workers’ comp payments. The businesses were called Rods Auto Repair, RODs Cars LLC and, finally, RODs CARS Corporation.
After repeated warnings, L&I revoked Dietrich’s workers’ comp coverage in the summer of 2015, which barred him from employing workers.
An undercover L&I investigation, however, found at least one employee working at Dietrich’s shop in late 2015. The auto technician told an investigator he worked full time, and that Dietrich paid him in cash, charging papers said.
State law requires workers’ comp
Washington employers are required to cover employees with workers’ compensation insurance. The coverage provides medical and other benefits to help employees with workplace injuries heal and return to work.
If employers fall far behind in premiums and refuse to pay, L&I can revoke their coverage. In fiscal year 2016, L&I revoked employers’ coverage 43 times.
“Employers should contact us whenever they have problems paying premiums to prevent their situation from spiraling out of control,” said Elizabeth Smith, assistant director of L&I’s Fraud Prevention & Labor Standards. “We can work out payment plans if employers talk to us as soon as possible.
“But those who ignore their premium notices or try to avoid detection risk receiving penalties and losing the ability to legally employ workers. In the worst cases, they could face criminal prosecution, as in this case.”
Ordered to repay employee
This week, Benton County Superior Court Judge Bruce Spanner sentenced Dietrich to 364 days in jail, but suspended the term for two years on the condition that he commit no crimes and not employ workers unless he provides workers’ comp insurance.
Dietrich also repaid his employee $670 for improper deductions from the worker’s pay, as part of his sentence. He repaid L&I $241 for about two months of workers’ comp premiums he should have paid to cover the employee.
L&I will continue pursuing payment for the remaining tens of thousands of dollars Dietrich owes for past due premiums.
Need help with premiums?
Employers having trouble paying premiums may qualify for the L&I Employer Assistance Program. For information, employers can call the L&I revenue agent assigned to their account or go to www.Lni.wa.gov/News/files/packet/EAPfactsheet.asp.
Source: WA L&I