Destroying Workers Compensation

Workers compensation is under attack. Although the system has never provided benefits at a level that really makes up for the suffering of an injured worker (the only fair system would be 100 percent compensation for lost wages and benefits) and although the system was designed to protect corporations from workers suing them, it still provides at least some benefits to American workers who get sick or injured on the job.

Not surprisingly, in this New Gilded Age, this system, like the rest of American labor law, is under attack. That attack is being led by corporations such as Walmart, Lowe’s and Safeway.

ARAWC’s mission is to pass laws allowing private employers to opt out of the traditional workers’ compensation plans that almost every state requires businesses to carry. Employers that opt out would still be compelled to purchase workers’ comp plans. But they would be allowed to write their own rules governing when, for how long, and for which reasons an injured employee can access medical benefits and wages.

In recent years, companies have used that freedom to severely curtail long-standing benefits.

Two states, Texas and Oklahoma, already allow employers to opt out of state-mandated workers’ comp. In Texas, the only state that has never required employers to provide workers’ comp, Walmart has written a plan that allows the company to select the physician an employee sees and the arbitration company that hears disputes. The plan provides no coverage for asbestos exposure. And a vague section of the contract excludes any employee who was injured due to his “participation” in an assault from collecting benefits unless the assault was committed in defense of Walmart’s “business or property.” It is up to Walmart to interpret what “participation” means. But the Texas AFL-CIO has argued that an employee who defended himself from an attack would not qualify for benefits.

A 2012 survey of Texas companies with private plans found that fewer than half offered benefits to seriously injured employees or the families of workers who died in workplace accidents. (The state plan, which Texas companies can follow on a voluntary basis, covers both.) Half of employer plans capped benefits, while the state plan pays benefits throughout a worker’s recovery.

With a national right to work bill almost certainly coming the next the Republican Party controls all branches of government, we can expect a legislative gutting of workers’ comp to follow. Already the system is severely weakened from what it once was, with huge disparities between states and workers bearing the cost of being hurt. Existing workers’ comp plans cost companies very little, especially those giant corporations like Walmart. But paying anything at all is too much for corporations and we are seeing that principle reenter American life. Workers will regain the right to sue in federal court if employers opt out of workers’ comp. But how confident are you that they will win the sorts of rewards that will force corporations back into the system?