Earlier this week, leaders of California’s business community announced they would fight any efforts to reverse the workers’ compensation reforms enacted in 2004 (Senate Bill 899). The group announced the formation of a committee to oppose three pending workers’ compensation ballot initiatives that would enrich plaintiff lawyers at the expense of California’s economy.
IBA West Board of Directors ahas greed to join the committee, Californians Against the Job Killer Initiative (CAJKI), which has hired an experienced public affairs firm to manage the campaign. CAJKI is co-chaired by Allen Zaremberg, president and CEO, California Chamber of Commerce; Joel Fox, president, Small Business Action Committee; and Suzanne Guyan, director of employee benefits for Costco Wholesale Corp.
“The passage of workers’ compensation reform in 2004 was a critical step forward for small businesses in California and helped produce and preserve thousands of jobs in our state,” Zaremberg said. “The ballot initiatives would eviscerate those reforms, resulting in massive increases in worker’s compensation costs, and send our economy into a tailspin. We will rally California’s entire business community to preserve the reforms and will wage a vigorous campaign against these job killer initiatives.”
SB 899 was enacted in 2004. Prior to its passage, workers’ comp costs soared to record levels due to skyrocketing medical costs and manipulation of the system by plaintiff attorneys. Since SB 899 was enacted, insurers have reduced the rates they file with the Department of Insurance by a cumulative 37.7 percent, according to IBA West.
“It’s not just businesses that are hard hit when workers’ compensation costs climb,” said Joel Fox, president of the Small Business Action Committee and Co-Chair of CAJKI. “School districts, cities, counties and non-profits are also damaged whenever costs go up. We expect all these groups to be involved in our campaign. If any of the three initiatives were to pass, every employer in California would feel the pinch.”
Three versions of workers’ comp initiatives have been filed and are pending Title & Summary by the Attorney General. All three would undo major elements of SB 899 that have contained out-of-control costs. Two versions would allow plaintiff attorneys to sue employers in addition to pursuing a workers’ comp claim. Even though the legislature just raised benefits in 2002, one of the measures would force employers to pay for another benefit increase.
“We knew opposition groups would launch a major assault on the reforms,” said Stewart Sawyer, IBA West President, “We cannot afford to let these groups turn the clock back on reform. The result would be devastating to the state’s economy.
“This is precisely why we have re-capitalized our California First Advocacy Fund so we can participate in this kind of coalition,” said Sawyer.
Source: IBA West
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