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Published: Saturday, February 9, 2013, 12:01 a.m.
Guest Commentary / Washington Legislature

Playing politics with Workers' Comp

The Senate is going on one ideological jihad after another, which will make reconciliation impossible with the House and governor. To paraphrase the 1992 Clinton campaign, their mantra should be, "It's the budget, stupid." If an initiative passes, for two years afterward a super-majority vote is required for legislators to change it. An irony of our Constitution, however, is that if an initiative fails legislators are free to ignore voters.
And so they have with workers' compensation. In 2010, our state's century-old industrial insurance system was challenged by Initiative 1082 -- which sought to partly privatize the system and rescind worker protections. Voters in every county, 59% statewide, rejected arguments that the system was going broke, and accepted the defense of that system. As the voter's pamphlet statement against I-1082 stated, "Washington's workers' compensation system is there when you and your family need it."
That's not as true today. In 2011, legislators adopted a "structured settlement" change on the cynical assumption injured workers would, with no counsel required, cash out pension claims for as little as 80 percent of value. Thus a system designed to make workers whole, and compensate for lost income, was modified with a Las Vegas-style inducement. However, lawmakers at least limited this to older workers – 55-and-older – reasoning they were less likely to return to work.
Rather than let this change and other reforms adopted in 2011 take effect, or Gov. Jay Inslee's new Department of Labor & Industries director (the very competent Joel Sacks) to even settle into his office, the Republican-controlled Senate is now rushing to make even more changes.
Pushed by I-1082's leading Senate proponent, structured settlements would be available to those as young as 40. Profit-motivated, private, third-party administrators would even be able to schedule exams for injured workers. The most sensitive financial and medical records of workers entering into settlements would forever be public.
Far from an evidence-based approach, the latest structured settlement bill passed the Senate with no fiscal note. Why bother with facts before a vote? As the system is self-funded no state costs will be saved. However, state costs could certainly be incurred if younger workers, still unemployed, expend their lump sum settlements and go on welfare. Are not these concerns worth examination?
Washington is the only state where workers pay a share of workers' compensation costs. Because of the worker contribution, as of Jan. 1, 2012, Washington ranked 22nd nationally in employer costs for workers' compensation – behind conservative states like Alabama, Idaho, Louisiana and South Carolina. If workers are to defray employers' costs they should have a say in how the system is reformed. Yet the Senate has entirely ignored organized labor.
The facts have also been ignored. Even after losing, I-1082's proponents predicted rates would go up by 33 percent in 2011. They went up 12 percent. And there were no 2012 or 2013 increases. Today the system doesn't have as healthy a contingency reserve as is desirable. Yet even with no 2013 rate increase the reserve should gain $80 million.
Ironically, with business lobbyists now pushing anti-worker "reforms," it was a business-backed 2007 "rate holiday" that cost $315 million on the eve of a Great Recession that further depleted reserves. And it would be the state's biggest and wealthiest employers that would profit at the expense of workers now.
A Senate charged with meeting its court-ordered duty relative to K-12 funding – requiring new revenue – is instead obsessing over a relatively flush program: A workers' compensation contingency reserve of over $720 million. This is symptomatic of an avoidance of real issues, which has included oddball measures against women's reproductive rights and the United Nations, or a bill exempting charter schools from accountability. Enough ideological wish fulfillment and polarization: The Senate must get to work.

Brendan Williams, a former state legislator, lives in Olympia.

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