"Our system for regulating employee exposures to hazardous chemicals is broken. There is a recognized market failure in the market for workplace safety regarding exposures to potentially hazardous chemicals. Information asymmetries, long disease latency periods, and other characteristics of chemical exposures allow employers and chemical manufacturers to externalize much of the expected cost of workplace exposure. The current U.S. regulatory system, including both Occupational Safety and Health Administration regulations and state workers’ compensation programs, is failing to correct the market failure. The result is a level of chemical exposure risk that is systematically too high, and a level of precaution that is systematically too low.
"The proposed reforms offered to date in the employment and environmental law literature are lacking, primarily because they do not sufficiently address the underlying financial incentives of the true least-cost information providers and least-cost risk avoiders: chemical manufacturers and employers. This article takes the search for a solution to the workplace disease problem in a new direction by capitalizing on the incentives of chemical manufacturers and employers. My proposal would amend state workers’ compensation laws in two ways: (1) shift the default burden of proof on the element of causation onto the respondents, in cases where there is no regulatory exposure limit governing the substance in question, and (2) allow employers to include chemical manufacturers as respondents in workers’ compensation claims for purposes of apportioning liability. These amendments could be implemented by convening a new National Commission on State Workers’ Compensation Laws. By focusing on the financial incentives of chemical manufacturers and employers, this proposal will spur the production of chemical toxicity information and lead to adequate compensation for employees who suffer exposure-related illnesses and diseases.
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