Is it time to scrap the exclusive remedy?

The future of Michigan workers’ compensation after 2011 legislative reforms and possible tort alternative.

Business Insurance has a great article about the exclusive remedy provision and how it is under attack in several states. Reform efforts have cut benefits nationwide and people are looking for other means of recovery. A Miami judge even found Florida’s workers’ compensation law to be unconstitutional saying it no longer provided a reasonable alternative to civil court.

Attorneys in Michigan have been discussing this same reality for years. Michigan’s law has become so lopsided that it does not provide adequate protection for claimants. A challenge under federal law is being openly considered. Could Michigan be the next state to find its workers’ compensation law declared unconstitutional?

Michigan adopted its first workers compensation law in 1912. It was designed as a grand bargain between employees and employers. It was intended to provide medical treatment and lost wages for people hurt on-the-job. In exchange for these automatic benefits, employers get protection from civil lawsuits. Workers’ compensation is the exclusive remedy.

Special interest groups have been advocating for workers’ compensation reform ever since. This is done under the appearance of protecting “job creators.” Each state in a fierce competition to lower its workers’ compensation rates to entice business. This has created a race to the bottom mentality.

Legislative reforms in 2011 have gone to the extreme. Insurance companies are now permitted to reduce weekly checks based upon phantom wages. Some claimants are even told they can earn more money after they get hurt. It does not matter if a real job has actually been offered.

Scrapping the exclusive remedy provision is a possible solution. An employee should be allowed to opt-out of the workers’ compensation system under limited circumstances. For example, when the weekly rate is reduced to less than 25% of pre-injury earnings based upon wage earning capacity.

Michigan Workers Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled workers exclusively for more than 35 years. Call (855) 221-2667 for a free consultation today.

Related information:

Why your “wage earning capacity” matters under Michigan workers compensation

Photo courtesy of Creative Commons, by Images_of_Money.

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