Workers compensation bill SB5566: a step towards Wisconsin?

Is Washington State SB5566, passed in the State Senate Saturday March 5, a dangerous step in the direction of Wisconsin?

The measure, strongly opposed by Labor, would establish an option for lump sum payments.

The text of the bill and the roll call vote are posted here on leg.wa.gov.

Here are some links to articles about the bill:

http://www.seattlepi.com/local/6420ap_wa_xgr_workers_comp.html

http://www.therepublic.com/view/story/b7c287cdfceb4808b261b6446a7ab3fb/WA-XGR–Workers_Comp/

http://www.wslc.org/reports/2011/March/07.htm#JJ

Discussion

The replacement of “sure and certain relief” in the form of a pension by opening the door to lump sum settlements is a drastic change and not a minor adjustment.

Fortunately an attempt to end workers compensation at the age of Social Security or to offer settlements at that age has been deleted from the bill.  Although we hear numerous platitudes alleging that the retirement age for Social Security is 62 or 66, the fact is that the level of benefits one obtains by starting Social Security at those ages is not enough to live on and the adequate level of benefits does not start until the age of 70.  Furthermore, an injured person on workers compensation has not been paying into Social Security at the same rate as someone who has been employed full time over the same years.  Stopping the workers compensation pension would result in an income gap that would leave this population of senior citizens with no resources over a period of years.

It is part of a larger effort by companies to eliminate benefits or eliminate the number of jobs that have benefits.  The irony is that the labor unions are the true fiscal conservatives, since the packages they have negotiated over the long term have emphasized saving and necessities over discretionary cash and spending.  The corporations, which falsely claim to be the conservatives, raised cash salaries during the 1990s in order to recruit young, highly skilled workers in the high tech industry.  At the same time benefits, which the young do not think about and sometimes do not understand, were systematically cut back.  The compensation structure offered by the phony conservatives promotes discretionary spending rather than ensuring medical care and a pension in old age.  We are in an era where the liberals are the real  conservatives and the conservatives are the wild rebels.

The attempt to weaken workers compensation is a part of this overall attack on benefits.

The availability of a settlement option produces the possibility of scams, as the injured worker may believe that a particular sum of money is a large amount and that he or she has had a windfall of wealth, but such individuals may have an incorrect perception in believing that a particular sum is a lot of money.   Furthermore, a private individual may end up with attorneys who are incompetent or unscrupulous.

What is lacking in this debate is the narrative.  Consider the hypothetical case of John Doe, who is a full time worker with an auto loan, a student loan and a modest amount of credit card debt.  Suddenly he has an accident at work and his whole life is turned upside down.  He files a claim for workers compensation.  What happens next?  How is the claim decided?  Under what circumstances would the idea of a settlement arise?  What is the process by which John Doe would be put in the situation of having to fight against an attempt to give him a settlement instead of a pension?  How would the long appeals drag out, as the labor council warns about?  Wouldn’t a decision be required from the state after a fixed number of days?

If John Doe gets a settlement, do his creditors have the right to take it away?  Is the settlement really a means to make sure that the individual has a sum the creditors can go after, while Mr. Doe will be left with nothing?

This really shouldn’t be “about” whether unions are to blame for costs.
This should be “about” what happens to John Doe.

The Seattle PI article states that the long term pensions result in much of the cost of workers compensation.  It is surprising that there would be so many cases of people becoming so disabled that they cannot work, with workplace injury as the cause.  Controlling workplace injuries is not rocket science.  An organization that obtains a standards certification (such as ISO 9000 a decade ago) can create work spaces in which accidents are prevented.  Instead of blaming the costs on the unions, we should be asking why companies are cutting corners on safety and risking lawsuits and workplace compensation costs rather than putting the right preventive procedures in place to begin with.

The following website contains statistics on the incidence of workplace injuries.

lni.wa.gov/ClaimsIns/Insurance/DataStatistics/WorkersCompData/default.asp

One of the disturbing trends in this data is high percentages of complaints in occupations that are populated with Hispanic workers: farm workers, maids and home care aids.  This raises the question of whether the attempt to weaken workers compensation is another form of racial harassment against the Hispanic population.

Another trend in the data is a high percentage of injuries in construction when the company has 1-5 employees.  In other words, the big contractors may have safety practices in place, but there are small firms where the owners are careless or incompetent.  This not only applied to a variety of building trades, but to the cheese and unlaminated plastics industries.

Related to this is a high incidence of injuries in occupations where there is a great deal of self employment: truck drivers, plumbers and pipefitters.  It seems that such people may be overextending themselves beyond what they can handle to earn a living as they get older, or overextending themselves because of the perceived need to earn more at the expense of their health.

I was dismayed at the incidences of injuries among retail sales personnel, although research into the level of seriousness of the accidents might reveal that that this sector is not producing the long term disability cases.

The point is that the way to control the costs of workers compensation is to study this data, determine what industries and occupations are producing the highest cost to the system,  and enforce or reward implementation of the best practices for avoiding injuries, and to crack down on those industries, such as farming, that have a history of abusing their laborers.