Last May, members of the South Carolina General Assembly introduced S. 674, which would amend the state’s Workers’ Compensation Act and allow employers to provide alternative, private injury plans to workers that are less structured than the state-mandated versions.
In February, the measure was quietly ushered into the Senate Committee on Judiciary. However, the measure has remained untouched in the wake of two key decisions in Oklahoma. That state was one of the two pioneers of the workers’ compensation opt-out system (the other is Texas). Recently, the Oklahoma Workers’ Compensation Commission ruled in Vasquez v. Dillards the 2013 opt-out statute is unconstitutional.
But is that the end of the matter? Not in Oklahoma and not necessarily in South Carolina or in Tennessee, the other state weighing an opt-out option.
To back track, the decision handed down by the workers’ compensation commission in Oklahoma on Feb. 26th held that the opt=out provision is not permissible because it results in the creation of a select group and class of injured workers that receive unequal and unfair treatment.
The underlying case involved a shoe department employee who was injured while lifting boxes. Although the worker did suffer a pre-existing condition, it was aggravated by her current job duties, and that meant her injuries were compensable – or at least they would be under the state option.
However, the opt-out program allows employers/ workers’ compensation insurance providers to predetermine what is considered an “injury” and what isn’t for purposes of coverage. In this case, employer determined that any pre-existing condition was not an “injury” for purposes of coverage.
So in effect, workers employed by this company – and others like it – are at a disadvantage when injuries that would normally be covered by law no longer are. What exacerbates the situation is the exclusive remedy provision. This was part of the “grand bargain” workers reached with employer when the workers’ compensation system was first founded. Exclusive remedy means workers forfeit the right to sue their employer for work-related injuries in exchange for an effective no-fault system of compensation for injuries that occur in the course and scope of work and arise out of the job. But in this case, though the worker was blocked from getting coverage for her work injury, she wasn’t allowed to sue the company either.
The commission ruled that because the plan was more restrictive to workers than the state’s traditional workers’ compensation law, it was inherently unfair.
But now, the Association for Responsible Alternatives to Workers’ Compensation say they intend to fight back. The group insists their opt-out plans have better outcomes for injured workers and result in fewer claim disputes and greater employer cost savings. This may sound great on the surface, though fewer claim disputes likely stems from the fact there are fewer claims overall because workers know their injuries aren’t going to be covered.
What many of these employers aren’t mentioning is that if they truly wanted to drive down their costs and lessen the number of claims, they could invest in improved workplace safety. Instead, they are advocating these counter measures so they won’t be held responsible when workers are hurt.
Although the commission’s ruling hasn’t formally been appealed, it almost certainly will. Of the 62 companies in Oklahoma who chose the opt-out program, all of them were allowed to write their own workers’ compensation plans – which gave them a huge amount of control over what future claims would be deemed valid and paid.
Both sides say the matter will not be settled – in Oklahoma at least – until the state supreme court weighs in.
Meanwhile, the pending bill in South Carolina has not been revisited.
If you have been injured at work, contact the Lee Law Offices at 800-887-1965.
Workers’ comp ‘option’ under fire, March 27, 2016, By Kyle W. Morrison, Safety and Health Magazine
More Blog Entries:
State Workers’ Comp Opt-Out Act Ruled Unconstitutional, March 17, 2016, Anderson Workers’ Compensation Lawyer Blog