Employer trade group pushes to privatize workers’ comp — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Employer trade group pushes to privatize workers’ comp

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in Compensation and Benefits,Human Resources

A who’s who of some of the nation’s largest private-sector employers have formed a lobbying group to “advocate for better medical outcomes to injured workers and give employers a choice in how they will manage employee benefits.”

Critics say the Association for Responsible Alternatives to Workers’ Compensation (ARAWC) is out to gut workers’ comp laws.

Formed in December 2013, ARAWC went public in September 2014. In November, an ARAWC representative told The Insurance Journal that the group’s goal “is to advocate in state legislatures for free market alternatives to workers’ compensation.”

ARAWC members, who pay $25,000 per year to belong, include retailers Big Lots Stores, Dillard’s, Kohl’s, Lowe’s, Macy’s, Safeway and Walmart. Several insurance companies are also members.

Workers’ comp insurance provides compensation to employees for loss of income and for medical payments when they’re injured on the job. In exchange, workers agree not to sue their employers for negligence. Most employers are covered by a state workers’ comp law. Benefits are usually funded by state insurance pools.

Only two states—Texas and Oklahoma—allow employers to opt-out of state systems, and instead self-fund their own workers’ comp coverage. That’s the option ARAWC favors.

Tennessee legislators are considering a bill that would allow employers to opt out of that state’s workers’ comp pool.

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