By Jim Thompson
Des Moines, IA (WorkersCompensation.com) - A crowded field of candidates is vying for governor in Iowa, and changes in the state’s workers’ compensation law are playing a role in the contest.
The Iowa measure was signed by then-Gov. Terry Branstad on March 30. Two months later, Gov. Branstad resigned to accept President Donald Trump’s appointment as ambassador to China, and Lt. Gov. Kim Reynolds, also a Republican, became Iowa’s governor.
Gov. Reynolds is one of three Republicans now seeking the governor’s office, and is supportive of the changes to her state’s workers’ comp regulations.
In a news release, she said, “...Iowa’s compensation system has been plagued with frivolous lawsuits and abuses that drive up the cost of doing business in Iowa. High costs for workers’ compensation makes Iowa uncompetitive, hurts job growth and Iowa’s economy.”
The new law, House File 518, passed the Iowa House and Senate on strictly partisan lines. Republicans unanimously favored the bill in a 55-38 House vote and a 29-21 Senate vote.
According to a Wednesday report in Business Record, as a result of the new law, Iowa’s insurance commissioner is reviewing a proposed 8.7 percent decrease in the state’s workers’ comp rates.
On the other side of the gubernatorial race, where eight Democrats are vying for the office, one candidate has already received the endorsement of the American Federation of State County and Municipal Employees (AFSCME) Council 61 and 17 other labor organizations, based in large part on his opposition to the new Iowa workers’ comp regulations. AFSCME Council 61 represents 40,000 workers in the state’s public sector.
The AFSCME endorsement of state Sen. Nate Boulton (D-Des Moines), comes nearly a year before the June 5 primaries in the governor’s race, and more than a year from the Nov. 6, 2018 general election.
In a July 29 story in the Quad City Times, AFSCME Council 61 President Danny Homan credited Boulton, a labor law attorney, for his work against the law.
Boulton “has just been a fighter for working men and women his entire life," Homan said.
In a July 24 story in the Des Moines Register, Boulton said his support from organized labor “is from the things that I stood up for this past legislative session. I think people within the labor movement wanted to see somebody who was not going to just let this go and be unchallenged.”
Mack Shelley, chairman of the political science department at Iowa State University, said the new workers’ comp law, as part of a number of labor-related initiatives in this year’s legislative session that have chipped away at workers’ rights, likely is part of the reason for the significant Democratic interest in Iowa’s gubernatorial contest.
And, Shelley said, labor organizations like AFSCME Council 61 routinely play a role in Iowa’s electoral politics.
“They’re pretty good about mobilizing members,” Shelley said.
Some of the changes in Iowa’s workers’ comp law, which became effective July 1, include:
- The loss of a shoulder is no longer a BAW (body as a whole) injury, but a “scheduled member” injury, meaning that any compensation is substantially reduced. The law does, however, provide for vocational rehabilitation services for employees with shoulder injuries.
- A positive drug or alcohol test at the time of an accident or shortly thereafter now creates a presumption the worker was under the influence of drugs or alcohol at the time of the injury, and that intoxication was a substantial factor in causing the injury. The new law shifts the burden of proof to the employee to show he or she wasn’t intoxicated, or that intoxication wasn’t a substantial factor in the injury.
- The new law eliminates a prior requirement that an employee wasn’t required to file a notice of injury until he or she recognized the possible impact of the injury on their employment. The law now requires notice within 90 days of when the employee knew or should have known the injury was work-related.
- Attorneys for workers’ compensation claimants can now recover fees based only on the amount of compensation awarded that they can show would not have been paid if they had not been involved in the claim.
Micheal Gruber, president of the Workers’ Injury Law and Advocacy Group, a national nonprofit organization representing the interests of injured workers and their families, told WorkersCompensation.com that there has been a nationwide erosion in workers’ comp benefits, a trend that is continuing.
“States are now considering allowing employers to abandon the workers’ (sic) compensation system altogether,” according to Gruber. “If this were to become a widespread phenomenon, we are in danger of returning to the way things were in the early 1900s when an injured worker’s (sic) only remedy would be to sue their employer for tort liability. This would leave the vast majority of workers who suffer on the job injuries without protection for occupational injuries.”
An October 2016 report from the National Academy of Social Insurance, a nonprofit, nonpartisan organization working to increase public understanding of social insurance, indicates both that benefits are declining and employer costs are increasing in workers’ comp programs across the country.
According to the report, between 2010 and 2014 (the latest data available for the study), “workers’ compensation benefits, coverage, and costs increased in absolute terms. However, as a share of covered payroll over the same time period, employer costs increased but benefits to injured workers decreased.”
According to Gruber, the nation is now “farther away from meeting the 1972 National Commission on Workman’s Compensation Laws’ 19 ‘essential recommendations’ for equitable workers’ compensation systems than we have ever been.”
The commission, created in the 1970 federal Occupational Safety and Health Act, made recommendations for improving workers’ comp programs including “no arbitrary limits on the amount or duration of benefits for permanent total disability or for death,” “full medical and physical rehabilitation services without statutory limits on dollar amount or length of time,” and “full coverage of work-related diseases.”
“It’s sad that workers’ (sic) compensation systems in 2017 are less able to provide adequate protection for injured workers than what was deemed optimal nearly a half century ago,” Gruber said.
