Legislative auditors say the Division of Industrial Relations is extremely slow to penalize uninsured employers, to notify insurance companies of its decisions on injury claims and slow to resolve complaints by people seeking benefits.
The division is responsible for making sure employers have proper worker's compensation insurance and for ensuring that employees receive benefits.
According to auditors, the division was also lax in making sure asbestos contractors were properly licensed.
Sen. Valerie Wiener, D-Las Vegas, said the report seemed to spell out a systemic problem within the division.
"These are substantial lag times," said Wiener, a member of the audit subcommittee.
The audit report said a sample of 25 cases where companies were charged with not having industrial insurance showed 19 of them took more than 350 days before a penalty was assessed. Employers who don't have worker's compensation insurance are fined the amount equal to the premium they should have paid during the time without coverage.
Two of those cases, the audit states, took more than two years to resolve.
Auditors said they also reviewed 25 subsequent injury claims and found six instances where the department failed to notify the board or private carrier involved in the required 90-day time period. Those delays, auditors say, reduce the incentive for employers to hire workers with prior injuries because, if the worker is reinjured, they fear being held liable for the full cost of both prior and new injuries.
Similar problems were found in handling complaints. Of 20 cases examined, auditors said the division was late in issuing determinations for 12 injured workers.
"Untimely determinations can result in complainants waiting too long to receive benefits to which they are entitled," the audit report states.
Assemblywoman Sheila Leslie, D-Reno, chairwoman for the legislative audit subcommittee, agreed with Wiener that the delays in handling claims, complaints and in assessing penalties are "unacceptable."
Division Administrator Roger Bremner said the audit was conducted in 2004 and many of the problems have been fixed.
He said some of the delays in handling uninsured companies are caused by the fact his agency has no way to find unlicensed companies doing business in Nevada. When they are found and told they will face penalties, "a lot of them just disappear."
"Sometimes we don't find out about them until there's a claim," he said. "There are a lot of businesses out there that have no business license and no worker's compensation insurance."
He said delays in assessing penalties after the companies are discovered are often extended by appeals.
But he said they are working on the issues and hope to show significant improvement to auditors within six months.
n Contact reporter Geoff Dornan at email@example.com or 687-8750.