What's New

Zack Hutchins
Director of Communications

March 23, 2004

Governor Pataki, at Small Business Day, unveils workers' comp reform proposal

Speaking at The Business Council's annual Small Business Day, Governor Pataki today proposed a workers' compensation reform package that would increase benefits while enacting reforms that would ultimately cut employers' costs by 15 percent.

"We know that enacting tax cuts and lowering the cost of doing business is a proven way to create new jobs," the Governor said. The workers' comp reforms championed by the Governor in 1996 have helped, he added, thanking The Business Council for its role in helping him enact those reforms.

"But that was 1996, and it's now 2004. And I know we can't simply say, 'Look at what we did back then,'" he added. "We do understand that high workers' comp rates are part of the problem you face in your desire to grow."

"A 15 percent improvement in costs would be welcome news for the business community and would show the type of progress are have long sought from workers' comp reforms," said Business Council President Daniel B. Walsh. "We look forward to working with the Governor and the Legislature to achieve real reform again this year."

The Governor's proposed changes include:

Workers' compensation is a system of employer-funded "no fault" insurance designed to ensure that workers injured on the job receive both medical assistance and weekly support payments, generally until they can return to work. Under the agreement, which was established in 1914, employers assumed all liability, regardless of fault, for all job-related injuries. But the law also set monetary limits on employers' liability. Workers receive prompt, specific and adequate payment for injuries, but relinquish the right to sue for more.

In 1996, New York State lawmakers enacted historic reforms to workers' compensation that were championed by Governor Pataki and strongly supported by The Business Council. These reforms were designed to rein in New York's workers' compensation costs, which then were some 56 percent above the national average, while preserving fundamental protections for workers.

The 1996 reforms limited the ability of third parties to sue New York State employers, mandated safety programs for some employers based on safety records, created new anti-fraud protections, and helped reduce costly delays in the workers' comp system.

The Business Council has identified further workers' comp reform as one of its top legislative priorities. The Council is strongly supporting a bill (S.5320-Libous, A.8862-Schimminger) that would:

To advance its case for workers' comp reform, The Council this spring has launched a new Web-based electronic-advocacy campaign to urge lawmakers to reject a costly union-backed bill and support cost-cutting workers' compensation reform. As of Wednesday, March 17, more than 1,200 visitors to The Council's Web page (or to the Web pages of more than 50 participating regional chambers around the state) had generated more than 6,000 letters to elected officials in Albany urging them to enact cost-cutting reforms, and to reject a benefit-increase bill that proposes no meaningful reforms.

The Council is also strongly opposing a bill (S.6135-Velella/A. 9736-John) that would raise benefits substantially without enacting any of the critical cost-cutting reforms. The Council's preliminary estimate is that this bill would worsen employers' cost burden by 25 percent or more.

Also at Small Business Day: