The U.S. Department of Labor released a report earlier this month on the workers’ compensation system. Their recommendation is for further exploration into enacting federal oversight and federal minimum benefits for workers’ compensation. Since workers’ compensation is currently regulated at the state level, this could change circumstances significantly for some injured workers.
“Working people are at great risk of falling into poverty as a result of workplace injuries and the failure of state workers’ compensation systems to provide them with adequate benefits,” the report states.
For the past decade, states have enacted new laws, policies and procedures that limit workers’ compensation benefits. It has resulted in more claim denials and discouraged many injured workers from applying for benefits.
“In this critical area of the social safety net, the federal government has basically abdicated any responsibility,” Labor Secretary Thomas Perez said in a recent NPR report. Perez adds that without minimum federal standards, the current system “is really putting workers who are hurt on the job on a pathway to poverty.”
Federal minimum benefits would ensure that workers across the country receive the same level of benefits, and do not miss out simply because of their state of residence. It would keep fewer individuals and families out of poverty, and lessen the burden on other social benefit programs, such as Social Security, Medicare and the Affordable Care Act.
There are those who oppose federal involvement in the workers’ compensation system. Organizations such as the American Insurance Association believe that change should occur, but on the each individual state level where it can be balanced with local economic and budget considerations.