Dive Brief:

• The choice to opt-out of a state's workers' compensation system is causing problems for workers injured on the job, according to a National Public Radio (NPR) report.
• Currently, workers injured at work in Texas and Oklahoma can't rely on state-regulated workers' compensation and, according to the article, the number of workers in that position could rise by millions with more states considering allowing employers the option of providing their own workplace injury plans over state-regulated plans.
• With workers' compensation costs rising, the logic goes, many employers can't afford the current system. And some say federal protection, in the form of ERISA, is there to provide an extra safety net of worker protection, though investigations by NPR and ProPublica, a non-profit news entity, have found otherwise.

Dive Insight:

NPR explains that while defenders of the opt-out system say workers get fair protection from employers, there are reasons why that may not always be true. Injured workers, for example, must go through a mandatory arbitration in which the arbiter is typically compensated by the employer. The article cites a case in which that happened, but the person involved eventually did get a $713,000 award – though his attorney said it would have been much more under the state system.

At this point, the Department of Labor (DOL) has yet to intervene and DOL officials declined to comment on specifics, but a spokesperson did say that so far, they have not received any complaints about the way employers who have opted out of workers' compensation have treated their employees.

Clearly, the situation will change as more states allow opt-out plans, more attorneys get involved on both sides, and the ERISA angle becomes part of the equation.