Federal Oversight


“If you work hard in America, you have the right to a safe workplace. And if you get hurt on the job, or become disabled or unemployed, you should still be able to keep food on the table.” –Pres. Barack Obama

The US Department of Labor alleges there is substantial cause for concern in their recent report entitled: “Does The Workers’ Compensation System Fulfill Its Obligations To Injured Workers”.  According to the report, the financial burden of occupational injuries and illnesses are increasingly being shifted away from employers to workers, their families, and other social benefit systems like SSDI, ACA, Medicare, and disability insurance.  As remedy, they advocate more Federal oversight, an expansion of authority for existing Federal programs, and increased funding for USDOL research.  While the report may not be the cause for alarm that many expected, its message lacked relevancy and understanding of the real issues at hand.

The narrative heavily focused on a 40-year-old commission and set of standards instituted by Congress to encourage a safer environment for US workers.  The National Commission of State Workmen’s Compensation Laws was empowered in 1970 to evaluate the adequacy of individual state workers’ compensation (WC) systems.  The commission found the system to generally be “neither adequate or equitable” and thereby endorsed 19 “essential” recommendations for state’s to comply with by 1975.  Recommendations focused on 6 areas: compulsory coverage, employee choice for filing interstate claims, full coverage for occupational disease, adequate indemnity benefits, and elimination of arbitrary limits on the duration of benefits.  The USDOL reports that notable progress was made over the first few years but waned as the threat of Federal intervention dwindled. 

In the years since, USDOL claims several factors led to erosion in benefits:

  • Exclusionary standards result in increased denial of claims
  • Decreasing adequacy of cash benefits
  • Growth of programs and policies that may discourage reporting of injuries
  • Implementation of restrictions on medical care for injured workers
  • New rules create barriers for worker’ filing claims
  • Elimination of second injury funds create gaps in coverage
  • Opt-out programs restrict benefits
  • Intentional misclassification of independent contractors excludes workers from coverage

USDOL noticeably failed to mention the culture of disability that plagues our workforce, as well as any mention of how to avoid disability after injury or how to return the injured to employment faster.  Instead, they offered the following remedies for exploration:

  • Appointment of a new Federal commission, standards, and oversight
  • Increase authority for existing Federal agencies such as OSHA and SSDI
  • Encourage carriers to assist employers with safety and health management programs
  • Increase funding for USDOL research

The report further exposes our government’s priority of expanding benefits and regulations in a time of fast rising costs. It barely mentions employers or insurers but claims our Federal Government is vital to the wellbeing of America’s workforce.  Readers are subtly fed the notion that our nation’s safety net is deteriorating due to purported failures of our state governments, despite evidence to the contrary such as declining injury rates and indemnity benefits.   It will be interesting to see whether today’s political candidates pick up the USDOL’s charge when they enter office next year.

Click here for a full copy of the report.