A key battle in workers’ compensation ended last week with the removal of a bill endorsing the opt-out model in Tennessee.
The state was the latest of several in the southern US to consider legislation that would have allowed private employers to “opt out” of the state workers’ compensation system. The bill originated almost a year earlier, sponsored by State Senator Mark Green and Representative Jeremy Durham – both Republicans – but hit a snag when the Tennessee Advisory Council on Workers’ Compensation unanimously decided against recommending it.
Then, last week, the Tennessee House Consumer Affairs Committee canceled a hearing related to opt out legislation and took Green and Durham’s bill of “notice.” That means it has been removed from the legislative calendar for the year and is unlikely to come up for a vote.
The bill, The Tennessee Employee Injury Benefit Alternative, borrows language from Oklahoma – which passed opt out legislation in 2013 – and Texas, which has allowed private employers to opt out of buying workers’ comp insurance for more than 100 years.
The defeat is a significant one for proponents of opt out legislation, who targeted Tennessee as a state likely to embrace the concept.
However, according to frequent workers’ compensation blogger Robert Wilson, “the sentiment toward the concept has been shifting away from opt out for several months,” particularly as positive effects from 2013 reforms “become more apparent and the concerns about the real effect of opt out received more publicity.”
Green has said he does not expect movement on the legislation until next year.
Enthusiasm for opt out legislation has waned elsewhere as well. South Carolina was due to consider a similar proposal, allowing employers to provide injury benefit plans that are less comprehensive than state-mandated workers’ comp insurance, but the bill – introduced last May – has not been revisited so far this year.
Proponents of opt out legislation have not given up, however. The Association for Responsible Alternatives to Workers’ Compensation, the lobbying group that worked with legislators in Tennessee to draft the bill, said the group will “continue to have conversations with legislators about the benefits to employees and employers of enacting a Tennessee option,” with the goal of “complement[ing] the workers’ compensation reforms enacted in 2013.”
Even so, the group concedes 2017 is the earliest Tennessee is likely to revisit the concept.
