That is the question in 2007. Or is it? Interest shown by employers and labor in this issue just a few months ago seems to have waned considerably, at least from the employers’ side of the workers’ comp bargaining table. But at whose expense?
Cautious statements about the need to look at both permanent and temporary disability benefit levels and duration early in the California legislative session have given way to a full-blown “over my dead body” grassroots launch by the Chamber of Commerce and other employer organizations decrying how bills by Senate President Pro Tem Don Perata, Speaker Fabian Nuñ, and Assembly Insurance Committee Chair Joe Coto will eviscerate SB 899 and return us to the dark days of the dreaded “job killers.”
Though a careful examination of SB 899, and Gov. Schwarzenegger’s comments when it was signed into law, might lead one to a different conclusion, the popular mantra in the business world is that benefits are adequate and that any adjustments should happen only after empirical data are analyzed and the now-ubiquitous “future earning capacity” (FEC) rating modifier is appropriately adjusted. This, of course, will not happen until 2008 at the earliest.
This is certainly a convenient conclusion in 2007, but regardless of when this happens it also ignores a very fundamental point –FEC, as it is now known, is a measurement of benefit equity, not benefit adequacy. In upholding the permanent disability rating schedule adopted by then-Administrative Director Andrea Hoch, the Appeals Board unanimously held that the rating schedule was valid and that FEC is to adjust ratings equitably based on loss of future income.
It did not hold, RAND has not claimed, and the Division of Workers’ Compensation has never stated, that FEC was an instrument of making sure benefits are adequate.
That little nuance seems to have escaped the grassroots alarms that the business community is sounding for fear that injured workers will get more benefits. They very well may be successful in 2007 in keeping a benefit increase bill of any kind from being signed.
Such “gotcha” politics may play well in Sacramento, but they don’t play well with the legitimately injured worker whose life has been turned upside down because of bureaucratic delays and inability to get back to work with the employer at the time of injury.
“Bargain” usually means that both sides to a negotiation have gained something and lost something. In the workers’ compensation “bargain,” the deal now more frequently becomes taking something back that the other side won when it could. And that doesn’t lead to a very stable system, does it?
Regardless of the dollars involved, workers’ compensation is a signature issue for the business community. Keeping its costs under control is a goal any governor seeks, because it gives him or her flexibility to address far more controversial and expensive issues. This is something Gray Davis learned in the first three years of his first term in office. It appears to those of us seasoned in the ways of Sacramento that this governor is taking a page from the same playbook, and the business community will say “thank you” by the end of the session.
Now that’s what you call ironic.