David Rau, 49, has been charged with a felony based on allegations that he didn't report his employees' work hours in an effort to avoid paying workers compensation to the state Department of Labor and Industries.
Rau pleaded not guilty to false reporting Thursday in Snohomish County Superior Court. He remains free pending trial.
Rau came to the attention of state officials in 2001 after a state audit. The probe found that Rau, who owns Davey's Roofing, hadn't reported that he employed 13 workers, court papers said. He was fined about $3,000 and received information about his responsibility to pay premiums for his employees.
State officials opened another investigation in 2010 after a man working for Rau fell from a roof and sought benefits through the state's Department of Labor and Industries fund. Officials allege that Rau hadn't reported any employee hours and hadn't paid any worker premiums for about nine years.
A 2011 audit found that Rau owed about $150,000 in premiums and penalties.
In addition, the state has paid out more than $72,000 to the injured worker. The man was seriously hurt and continues to need ongoing medical treatment. The state also may be on the hook for more if the man is eligible for permanent disability payments, court papers said.
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