Dive Brief:
- An Oklahoma law that gives employers an alternative to being part of the state-regulated workers' compensation program has been struck down by state regulators, according to an NPR report.
- The Oklahoma Workers' Compensation Commission unanimously agreed that the alternative workplace-benefit plans that some employers adopted are unconstitutional.
- While an appeal is expected, NPR reports that it and ProPublica, an investigative journalism entity, believe the U.S. Department of Labor is investigating whether or not so-called "opt-out" plans in Oklahoma and Texas run afoul of federal law as well.
Dive Insight:
For the past three years, Oklahoma employers had the option to create their own workplace injury plans, thereby sidestepping state-regulated workers' comp benefits, which have been in place for decades nationally. According to an NPR and ProPublica analysis of Oklahoma's opt-out plan, most offer reduced benefits, increase the odds of benefit denial, put employers in charge of medical assessment and treatment (as well as appeals) and bully injured workers to accept lump-sum settlements.
Bob Burke, an Oklahoma City attorney who is challenging the opt-out plans, told NPR that the ruling "stops opt-out in its tracks." Michael Duff, a law professor at the University of Wyoming and author of a textbook on workers' compensation law, told NPR that the state regulators' decision is "very vulnerable to appeal" because the state may have overstepped its legal clout in the case.
On the other hand, NPR reports that four other states recently set aside plans to adopt their own opt-out legislation. Primarily, opt-out critics contend the plans violate the Employee Retirement Income Security Act (ERISA), the law that oversees workplace-benefits plans.