A Constitutional Amendment To Stop The Raiding Of The Second Injury Fund For The General Treasury is Proposed in New Jersey

An amendment has been proposed, which has received bipartisan support, to stop the raiding of the second injury trust funds and their diversion to the general treasury. Senate Majority Leader Stephen Sweeney has proposed a constitutional amendment [SCR-60] requiring contributions collected from assessments on wages to be used for employee benefits and prohibiting use of the contributions for any other purpose.

Over the past years he executive branch has raided the second injury fund trust funds and has diverted the money to the general treasury of the State of New Jersey to cover shortfalls. Second injury fund revenues are collected as a line item surcharge on workers' compensation premiums from all employers of the State of New Jersey. The fund not only supports second injury fund beneficiaries, but it also supports general funding of the New Jersey Division Workers Compensation.

Most states in the United States have eliminated the second injury fund concept. The rationale for elimination of benefits is that the insurance carriers want greater control over the revenue to be paid to beneficiaries involving total disability. Additionally, the second injury fund concept was established in order that employers hire handicapped employees. It is now considered that the Americans With Disabilities Act affords protection to injured workers who have disabilities and the second injury funds are no longer required.

The proposed resolution is receiving bipartisan support and should it be adopted the constitutional question will appear on the ballot as a Constitutional amendment to be voted upon by all citizens of the state of New Jersey.