Business Council announces coalition of leading statewide organizations calling for Workers’ Compensation Reform
Coalition members represent tens of thousands of statewide employers, who together employ millions of New Yorkers
Albany, N.Y. – The Business Council of New York State, Inc. today joined with fifty-eight other statewide advocacy groups in calling for immediate and substantial reforms to the state’s excessively expensive workers’ compensation system.
“The current system is too expensive for private and public employers alike,” said Heather C. Briccetti, Esq., president and CEO of The Business Council of New York State, Inc. “Worker’s compensation was created to help injured workers by replacing lost wages and providing needed medical care, but it isn’t working. Major payments are being made in ways never intended by statute. Our Scheduled Loss of Use (SLU) awards pay large sums for minor injuries that lead to little or no missed time from work. We have replaced fairness with chance and moved away from the fundamental goal of workers’ compensation replacement for lost wages. It’s time for a change.”
Current figures show employers across New York are paying nearly $10 billion per year in workers’ compensation costs. Of that amount, roughly $1.2 billion goes directly to SLU payments, over $960 million of which went to pay individuals who did not miss any significant time from work.
In a recent Siena Research Institute survey, 90 percent of upstate business leaders said they supported reducing the costs associated with workers’ compensation insurance. But workers’ compensation costs are impacting the public sector as well.
“We often hear lawmakers talk about mandate relief, yet too little is being done to cut costs for local municipalities,” said Briccetti. “The reforms we’re calling for would provide hundreds of millions of dollars in savings to the state and local governments. That money could then be used to invest in schools, infrastructure and other spending priorities.”
Over the past few weeks a bipartisan group of Senators and Assembly members have introduced legislation that reform key aspects of the workers’ compensation system.
“The workers’ compensation system was designed to replace lost wages, provide necessary medical care, and promote return to work,” Briccetti added. “Our proposed reforms maintain those pillars of the compensation system, while providing significant cost relief for employers.”
- S.4014 (DeFrancisco) / A.5977 (Woerner) would require the Workers’ Compensation Board (WCB) to release and adopt already completed Impairment Guidelines for SLU awards. These guidelines serve as the basis for determining impairment, which is a major determinant in the size of SLU awards. However, the WCB’s current guidelines have not been overhauled since 1983, and reflect thirty-year old medical assumptions. The WCB has developed new guidelines, with input from medical professionals and system stakeholders, which reflect modern medical evidence. Updated SLU impairment guidelines will result in more appropriate calculations of SLU awards.
- S.4554 (Amedore) / A.6218 (McDonald) limits “scheduled loss of use” awards to cases with 85% impairment ratings; in these cases, injured workers would receive the SLU award adjusted for indemnity benefits for lost time. These additional SLU awards have no relationship to lost time or lost earnings. In fact, New York State Workers’ Compensation Board data show that 75 percent of SLU awards are payments in excess of actual lost, while costing the system over $1.2 billion annually. This bill would guaranty that severely injured workers would continue to use the current schedules, while those with less serious injuries, who have missed little time from work, continue to receive workers’ compensation benefits in the exact same way that their colleagues with non-SLU injuries.
- S.4520 (Akshar) / (Assembly bill sponsored by Woerner, introduction pending) specifies that duration caps for permanent partial disability claims will start atthe date of injury. One of the major provisions of the 2007 workers’ compensation reform package was a more than doubling of the maximum weekly benefit, indexed to the average weekly wage, from $400 to now more than $864, to be offset by durational caps on permanent partial disability (PPD) claims of up to ten years. Pre-reform, New York was the only state allowing “lifetime” PPD claims. Unfortunately, the 2007 legislation failed to address the start date for durational caps, and the average time from the date of injury to the date of disability rating (and the commencement of duration caps) in New York had skyrocketed to over eight years after the 2007 reforms. While there has been some reduction in this time delay, this bill will address the gap in the 2007 law and specify that the 10-year duration “clock” start at the date of injury.
Over the next days and weeks the Workers’ Compensation Reform coalition, its employer members and everyday New Yorkers will be interacting with their legislative officials through an aggressive e-advocacy campaign and on social media via the hashtags #CompCrisis and #SaveJobsNow.
“We urge the Governor and both houses of the legislature to include our commonsense proposals in the FY 2017-18 state Budget, which will result in a system that is fair and equitable for all,” added Briccetti.
Members of the media and the general public are encouraged to follow the coalition’s efforts online as we work to make these overdue and necessary changes a reality.