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(c) 2016 Jon L Gelman, All Rights Reserved.

Friday, May 31, 2013

“Opting Out” of Worker’s Compensation Hurts Workers and Employers

Tom Domer

Guest Blog Authored by Tom Domer, a member of the Wisconsin Bar, of Domer Law.

More than a century ago, Wisconsin’s initial efforts in worker’s compensation led the nation. In 1911 Wisconsin became the first state in the nation to place a broad constitutionally valid worker’s compensation system into operation. 

Recent events, specifically Oklahoma’s passing legislation to allow employers to “opt out” of worker’s compensation (following the “lead” of Texas) calls into question the great bargain made between employers and workers over a century ago. Prior to the enactment of worker’s compensation in the early 20th Century, workers who were injured on the job had to overcome three common law obstacles in order to recover from their employer.

Under contributory negligence, a worker could not recover from the employer if the worker had been negligent in any way and that negligence contributed to the accident, regardless of how negligent the employer may have been.

Under assumption of risk, if a worker knew or should have known of the danger inherent in the task at issue before undertaking it, the employer was not liable for an accident arising from the task even if the employee was not negligent.

Under the fellow servant rule, employers could not be held liable for accidents caused by fellow employees.

The combined effect of these common law defenses served to deny workers adequate remedies for their injuries. On the flip side, employers who were found negligent in causing workers’ injuries were subject to the vagaries of a jury with no limitation on dollar amount recoveries. Wisconsin’s initial attempt at worker’s compensation contained an “opt out” provision, not unlike the “opt out” provisions currently in vogue in Texas and Oklahoma. Within a few years, however, in 1913, spurred by slow employer acceptance of the law, the legislature provided that any employer who did not explicitly opt out of the law would be presumed to have accepted it. In 1919 Wisconsin’s law was extended to cover all employment related injuries whether accidental or not, including occupational exposure claims. Finally in 1931 when worker’s compensation had become a universally accepted part of Wisconsin industrial life, the law was made compulsory for virtually all employers and employees.

Wisconsin’s act is dynamic, reflecting changing trends in employment (temporary help agencies, independent contractors, etc.) and changes in medical treatment, diagnosis, and surgical procedures (for example artificial disc replacement and joint replacements).

Wisconsin’s act is dynamic, reflecting changing trends in employment (temporary help agencies, independent contractors, etc.) and changes in medical treatment, diagnosis, and surgical procedures (for example artificial disc replacement and joint replacements). Proposed provisions to the Act from the worker’s compensation Department and from labor and management sources are funneled through the Worker’s Compensation Advisory Council, which (after significant debate) proposes an agreed upon bill to the legislature every two years. Input to the Council from lawyers, doctors, employers, and insurers on current issues in worker’s compensation makes Wisconsin’s Act responsive to its constituents.

Unfortunately other constituents (like those in Texas and Oklahoma) based primarily on a short sighted and single minded desire to reduce costs for businesses, have passed legislation allowing employers to opt out of worker’s compensation, often with some disastrous results.

Read more about "Opt-Outs" and workers' compensation:
May 07, 2013
Governor Mary Fallin today signed into law Senate Bill 1062, a bill that reforms the workers' compensation system in Oklahoma by removing it from the judicial system and making it an administrative process. The bill, by ...
Jan 19, 2013
The US Transportation Safety Administration (TSA) is following the lead on many other countries, including the European Community, and is removing all Backscatter machines from service. While not admitting to the radiation ...
Nov 16, 2012
An activist movement is encouraging individuals to opt-out of going through airport x-ray scanners during Thanksgiving travel. Health concerns have been raised over the use of machines. Many United States unions have ...
Feb 27, 2012
Over a decade ago Bechtel Corporation initiated an opt-out program that took workers' compensation out of the adversarial system entirely. Shortly thereafter, the concept of universal healthcare emerged as a concept to ...