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What's The True Cost Of Workers' Compensation Reform

2017-01-27

A few months ago we talked about the battle in Illinois over Workers’ Compensation benefits and the costs to employers. Of course the fight is not over and Governor Rauner continues to say that injured people get too much and ought to receive less.

Ask just about anyone who is out of work and trying to get by on temporary disability benefits and they will have a different story. Weekly benefits seldom match up with actual earnings so if you have the bad luck to get hurt in the middle of the construction season when overtime is plentiful and work is good, you are going to lose all that overtime money and get paid at a weekly rate that is based on your whole year and not just what you were making at the time of injury. For most people that means those slow months are averaged in to the good months and the weekly benefit rate is cut. In addition, Workers’ Comp does not pay for health insurance and contributes nothing to pension so all those fringe benefits disappear.

The Republican refrain is that benefits cost too much and Illinois loses employers who don’t want to pay the high cost of comp. The trust is that the rate of injury in Illinois is less than the national average and far less than in our neighboring states of Indiana, Iowa, Wisconsin and Michigan.

In addition to the lower rate of injury, Workers’ Compensation claims are down 16 percent and the amount paid per claim has been reduced by 8 percent from 2009 to the present.

You might think this would all translate into lower costs for Illinois employers but thanks to our insurance industry it hasn’t happened. The national insurance group that recommends rates for almost all states says that rates charged to employers in Illinois should be down 30 percent. But they are only down a small fraction of that amount and the profits of insurance companies have increased 30 fold since 2011. How much did your wages go up over that time?

Speaking of costs to run government, we talked in the past about the Village of Lincolnshire and how its spends taxpayer dollars. Remember that they are the ones who tried to make right to work the law in their community even though it does not exist anywhere else in the state. That waste of taxpayer dollars to print the law ran smack into a federal judge who understood that one little town can’t make law for the whole state and he told the town to forget it.

Instead of getting back to cleaning the streets and fixing sidewalks, Lincolnshire wants to spend more taxpayer money appealing the district court decision to the 7th Circuit Court of Appeals. I guess they can afford it since the household income in Lincolnshire is about 2 times what it is statewide. I guess those that got it want to make sure they don’t have to share it.

Always remember that the bottom line for right to work is that Union members pay the cost for all those who chose not to join or pay dues. And don’t think that the Union can deny the freeloaders full representation because it can’t so you get to pay for someone whose “conscience” says they can’t support the Union.

All the tweets in the world don’t change the facts.

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