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North Carolina Workers Compensation Laws Are in Danger

North Carolina Workers Compensation Laws are danger because of pressure from large companies to reduce their labor costs.  These large companies lobby states to become more business friendly.  The companies argue that the state should allow the companies to create their own worker’s compensation programs.  The loser in these situations is always the worker and the  taxpayer.

North Carolina Workers Compensation Laws Benefits

Prior to passage of workers compensation laws, injured workers often had little remedy if they were injured on the job.  If the worker had medical bills or lost income due to missed work, the worker would bear all the costs associated with the injury.  Courts would bar injured workers from collecting against their employers if the worker assumed the risk of working around dangerous machinery or chemicals, if the worker’s injury was caused by a fellow worker, or if the worker was in any way to blame for his accident.  Injured workers could be fired simply for being injured.  The worker and his families would often be forced  to accept charity and/or welfare to survive.

North Carolina Workers Compensation Law History

In 1929, North Carolina passed its first worker’s compensation laws.  The laws have evolved over the past century.  The workers compensation laws currently provide protection to injured workers.  These protections include a no-fault system in determining when a claim falls under the act, immediate medical care for compensable claims, and wage replacement for out of work employees at two thirds of their normal wages.  If the employer and injured worker have a disagreement about what benefits must be provided, a separate and independent court system exists to mediate the dispute.  The system has provided a good compromise between business and injured worker’s interests.  These laws prevent North Carolina tax payers from paying welfare for workers injured on the job.

Workers Compensation Law Changes Due to Business Lobby Interests

This balance is changing in several states as big businesses attempt to cut costs.  These companies are cutting costs by eliminating worker’s compensation protections for workers.  In Texas and Oklahoma, large industries have lobbied for and won new laws that allow them to exempt themselves from workers compensation laws. These companies are allowed to set up their own compensation program.  In these states these companies may write their own rules for paying worker’s compensation.  Companies such as Wal-Mart, Costco and Lowes are lage enough to absorb the cost of directly paying worker’s claims. Under this opt-out system, large employers replace the protections of the worker’s compensation act with their own self-written plans.  These plans almost always result in decreased wage replacement periods, decreased compensation for loss of body parts, exclusions of occupational diseases (like hearing loss or carpal tunnel syndrome), decreased time limits for reporting claims (sometimes as short as a few hours), and the creation of hundreds of new excuses for an employer to completely deny a claim (like being late to a doctor’s appointment).  The plan may offer no protection against retaliation for injured workers.

Mediation under these employer plans is heavily weighted in favor of the employer. If there is a dispute between the worker and the employer, the case is no longer heard by an independent court.  The case is heard by the employer’s own review committee, resulting in a hearing biased toward the employer.  In an interview with ProPublica, Bill Minick, whose business promotes the opt-out system, brags that large industries have saved billions of dollars by gutting worker’s compensation plans.

The billions of dollars saved by Minick’s large business clients come directly at the expense of injured workers and their families, like Bill Walker.  In 2012, Bill fell 180 feet from a cell phone tower and was killed.  His wife, Meloy, was left widowed, and her 4 month old daughter, Kaylee, was now without her father.  Under worker’s compensation laws, Kaylee would have been provided with 75% of her father’s income until she turned 18 or graduated from college.  Instead, as her father’s company had opted out of worker’s compensation laws, and then filed for bankruptcy, the family lost their protection.   Meloy and Kaylee now live off of social security survivorship benefits and are applying for food stamps.

Workers Compensation Laws also Protect the Taxpayer

As demonstrated by the Walker family’s circumstances, aside from redistributing billions of dollars from injured workers to business, the opt-out program has also shifted the cost of caring and providing for disabled injured workers onto the backs of taxpayers.  With no worker’s compensation benefits, permanently disabled workers now collect social security disability, Medicare and Medicaid.  Some opt-out plans (Home Depot for example) require their injured workers to file for social security disability as part of their worker’s compensation claims.

Bill Minick wants to expand the opt-out system beyond Texas and Oklahoma.  With other business lobbyists, Minick has formed a group called the Association for Responsible Alternatives to Worker’s Compensation (ARAWC).  Wal-Mart’s senior director of risk management chairs the new group, with Lowe’s top officer for risk management acting as vice president.  The group has stated that it plans to go state by state to achieve opt-out legislation.  In 2015, Tennessee legislators introduced an opt-out bill into their general assembly.  The bill has failed to pass after an independent advisory board refused to endorse it.  The ARAWC has vowed to try again.  In South Carolina, meanwhile, another opt-out bill is being attempted.

 

North Carolina Opt-Out Status

Currently in North Carolina there is no introduced opt-out bill, but given ARAWC’s push through the south and the pro-business control of both houses of the legislature, North Carolina’s turn to consider an opt-out bill is only a matter of time.   The ARAWC has stated that North Carolina is one of their top targets.  The ARAWC has reportedly hired Tom Fetzer, a long-time Raleigh insider, to  lobby in North Carolina’s legislature.    While large industrial and retail businesses have millions of dollars to spend on lobbying and advertising, North Carolina citizens should expect radio and TV advertisements touting the great benefits of gutting the protections offered by the worker’s compensation system.  Hopefully, the citizens of North Carolina will be vigilant in protecting the rights of their workers and tax payers.

For more information about the campaign to replace worker’s compensation laws, visit

Corporate America’s Plan to Ditch Worker’s Compensation.