Workers Comp Opt Out is bad for Wisconsin employees and employers. For more than a century, the work injury compensation system, first established in Wisconsin, has been the reality in the United States. For all this time, government mandated worker’s compensation has brought stability and fairness for industry and labor, to the benefit of American society.
At the heart of the traditional state-based workers’ compensation system is a “grand bargain.” Workers receive medical treatment and wage replacement benefits if they are injured on the job, regardless of whether or not they or their employers are at fault for the injury. In return, employers receive statutory protection against liability lawsuits filed by employees for on-the-job injuries – workers comp is the “exclusive remedy” injured employees have against employers. On the other hand, the wage replacement benefits are less than the actual economic losses the employee suffers and there is no compensation for pain and suffering.
In order to increase their profits, some, mostly self-insured, employers have sought to replace to the traditional worker’s compensation system with a private insurance scheme similar to a short- or long-term disability plan. This private plan is referred to as Opt Out because the laws passed enabling it allow employers to ‘opt out’ of the traditional system.
In one state that has passed Workers Comp Opt Out legislation, employers have three choices:
1. Join the traditional workers’ compensation system and abide by its laws and government oversight
2. Opt-out of the statutory system and create their own private work-injury compensation program
3. Opt-out and offer no workers’ compensation benefits or protection at all and risk tort liability. Unfortunately, its the injured employee who actually risks the catastrophic loss since the irresponsible employer is not likely to have any resources to pay the injured employee tort damages
All opt-out work-injury programs share these characteristics changing the rules:
1. Reduce temporary and permanent defined wage loss benefits to injured workers and medical costs by directing care to employer picked doctors
2. Eliminate government enforcement that employers will pay workers comp benefits
3. Eliminate the use of state administrative or civil courts to resolve disputes, instead having private arbitrators be the final word
4. Exclusive remedy protection of employers is potentially gone, however, existing state tort law effectively insulates employers much like in the 1800’s before workers compensation
McCormick Law Office attorneys in Milwaukee, Wisconsin are committed to fighting for injured workers and employees by opposing any opt out legislation in Wisconsin. We join many of the other good workers compensation law firms in Wisconsin doing everything we can to get the truth out about the attempts to turn the clock back over 100 years on workers’ rights.