Government Affairs REPORT

In Labor, Judiciary committees:
Workers’ comp reforms under fire

(March 3, 2006) Proposals being advanced by the legislature’s Labor Committee – again — would undo key jobs-saving reforms of the state’s workers’ compensation system and move the state back to a time when high workers’ comp costs cost the state thousands of jobs.

Specifically, CBIA testified this week against SB-217, which would lift the cap on discretionary awards that only Connecticut awards; SB-25, which would allow claimants to collect both workers’ compensation and Social Security benefits at the same time, and SB-24, which would allow lawsuits to be filed against employers in certain workers’ comp cases.

The bills are perennial efforts by the Labor Committee to repeal the landmark reforms of the early 1990s that finally stopped out-of-control workplace costs and repaired a failed workers’ compensation system. The reforms were highly successful in enabling businesses to grow and create more jobs again and in reviving Connecticut’s failing economy.

House Speaker James Amann (D-Milford), speaking at Connecticut Business Day, said the reforms were instrumental to the state’s economic turnaround in the 1990s.

Trying to undo these key reforms makes little sense because they have made the workers’ comp system fairer, more effective and less costly. And Connecticut workers’ compensation benefits are still among the most generous in the nation.

• SB-217 opens the door to far higher workers’ comp costs. In addition to granting weekly wage replacement, permanent impairment awards and medical benefits, workers’ compensation commissioners may also award what is commonly referred to as “discretionary benefits.” Even though no other state in the nation offers a similar benefit, SB 217 repeals that important reform measure by removing the cap on discretionary awards.
  
• SB-25 repeals another reform by eliminating the Social Security offset for workers’ comp benefits. Offsets are logical and important safeguards to maintain the integrity of the workers’ compensation system, which is a wage-replacement system. Allowing individuals to collect more than their weekly wage replacement, as this bill would allow, creates a significant disincentive for people to return to work.
  
• SB-24 would seriously weaken the state’s workers’comp system by discarding the exclusive remedy doctrine and subjecting employers to a new cause of action. The workers’ comp law is intended to be the only remedy for workplace injuries, and any expansion in opportunities to sue employers will weaken state economic development efforts. Because this measure is a direct contradiction of the no-fault logic of the current system, businesses would be more inclined to look to places other than Connecticut when considering where to locate jobs.
  

Also, the legislature’s Judiciary Committee is considering SB-548, which would repeal a workers’ comp reform by allowing scarring awards regardless of where the injuries are located or the impact they have on the claimant’s earning ability.

Connecticut’s workers’ comp system successfully protects and benefits employees by providing timely, simple, effective and inexpensive relief without assigning blame to any involved party. In exchange, workers’ comp benefits are the exclusive remedy for injured employees.

Any measures that increase employers’ liability or costs would jeopardize Connecticut's still-fragile economy and once again put jobs in peril.

For more information, contact CBIA’s Bonnie Stewart at 860-244-1900 or stewartb@cbia.com.