The Minnesota Worker’s Compensation Advisory Council (WCAC), which advises the commissioner of the Department of Labor and Industry about workers’ compensation matters, met yesterday to discuss proposed changes to the workers’ compensation statutes.

At the meeting, DOLI Commissioner Steve Sviggum and the committee members handed out a 47-page booklet outlining various recommendations concerning the Minnesota workers’ compensation system.

Commissioner Sviggum said he wants “comprehensive balance” in the system. He also said the system was “more confrontational than need be.”  He said his main concern was balancing the interest of the injured worker and the employer while being “responsive to the injured worker.”

What he proposes is to eliminate benefits for undocumented workers. Commissioner Sviggum intends to hold a vote at the next WCAC meeting on January 14, 2009. Read on for more on the proposed changes.

The proposed changes are drastic. After listening at the meeting and reviewing the proposals, I have several concerns.

It is Commissioner Sviggum’s intent to prohibit undocumented workers from receiving full benefits. Wage loss benefits, rehab, and other workers’ compensation benefits would not be available to an injured undocumented worker under Commissioner Sviggum’s plan.

No benefits for undocumented workers

Commissioner Sviggum attempted to rationalize this in his proposal:

Let me be as bold to say, illegal aliens should not be awarded full workers’ compensation benefits. Such policy discriminates unfairly in favor of the undocumented worker, unjustly requiring the employer to pay more than he or she should to, essentially, reward that person for the illegal work activity.

When an illegal alien enters into the system, however, the principal objective of workers’ compensation is lost and only the illegal alien benefits from workers’ compensation programs. When applied to cases involving illegal aliens, the way in which workers’ compensation statutes determine an injured employee’s capacity to return to work is fundamentally flawed to privilege the undocumented worker.

Compared to American or documented workers, of whom 75 percent return to work in less than a month following the injury, the legal reemployment rate for undocumented workers is zero percent, an unambiguous and costly discrepancy.

Employers do not pay more for undocumented workers

The contention that the employer has to pay more then he or she should is absurd. Employers pay the same whether their employees are documented or not.

It is fair and just to compensate all workers for their work-related injuries

One of the biggest holes in this reasoning is the argument that this type of policy “unjustly” favors the undocumented worker. Where is the “reward” to the injured worker? Lower wages? The chance they will be injured and unable to pay their bills? Compensation for a work-related injury is no reward; it is just. No injured worker is ever “rewarded” under the workers’ compensation system.

In fact, the employer receives all  the benefit, especially where undocumented workers are concerned. They get cheap labor, and, under the proposed changes, could place that cheap labor in a dangerous environmen with no consequences for the employer or insurer. Sviggum’s plan would actually provide incentives for companies to hire more undocumented workers.

If Commissioner Sviggum wants to curb illegal immigration, the workers’ compensation system is the wrong place to start, because whether injured workers should be compensated for their medical bills when they are injured has nothing to do with their immigration status.

In workers’ compensation, employers take the employee as they find them. This should also apply to undocumented workers.

Impact on the workforce

The proposed changes would leave thousands of injured undocumented workers without the ability to become “whole” (or close to whole) after an injury. As I wrote earlier concerning the impact of illegal immigrants on the workforce, these policies would have drastic effects on the economy. I will keep talking about this issue in future posts.

Other proposed changes

Here are some more highlights from the proposal. These proposals will have a drastic impact on employees, employers, medical providers, QRCs, medical providers, and attorneys if passed. I plan on addressing many of these recommendation over the next few weeks as well. Stay tuned.

• Job placement services would be limited to 6 months, and the placement service house limited to no more than 20 per month.
• Passive treatment for 24 treatments or 12 weeks while requiring a treating physician to make medical referral and recommendation for further passive care.
• One independent medical examination per accident and it must be performed at a licensed medical facility.
• If a treating physician is prescribing narcotics and a subsequent urine tests indicate non-usage, the employer is not liable for future similar prescriptions.
• If an employee is impaired from alcohol and the alcohol concentration is over .08, only medical is compensable.
• Increased benefits for resolution of cases that avoid attorney fees.
• Retraining: in order to receive reimbursement, all classes must be directly related to their current position or advance the employee’s potential.  The injured worker must also receive a grade of “C” or better to receive reimbursement.
• Mandatory alternative dispute resolution including binding arbitration.