What action characterizes employer fraud?

Lowering payroll to decrease premium payments is a clear indication of employer fraud because it involves intentionally manipulating payroll data to reduce insurance premiums or other costs. This action misrepresents the actual financial status of the business and undermines the statistical assessments that insurance companies rely on to calculate risk and premium rates. By reducing reported payroll, employers can lower their exposure to liability and reduce the costs associated with workers' compensation insurance or other employee-related premiums.

In contrast, reporting accurate payroll data, providing accurate employee status, and improving work conditions for safety all represent lawful and ethical business practices. Accurately reporting payroll ensures compliance with tax and labor laws, while maintaining accurate employee status is essential for regulatory purposes. Improving work conditions demonstrates a commitment to employee safety and well-being, representing a responsible approach to management. These actions do not violate trust or manipulate financial obligations, thus distinguishing them from fraudulent activities.