Workers’ Comp Rate Goes Into Effect
Total Costs Resulting From Court Rulings to Top $1.5 Billion
Today, December 1, 2016, workers’ compensation rates will increase by 14.5 percent for all new and renewal policies, an increase which equates essentially to a $1.5 billion transfer of wealth from Florida businesses to trial lawyers the Florida Chamber of Commerce said.
“Today, job creators across Florida are opening their doors and facing a $1.5 billion tab that is not about employee safety or protecting workers, but about increasing compensation for plaintiff trial lawyers,” said CAROLYN JOHNSON, Director of Business, Economic Development & Innovation Policy for the Florida Chamber of Commerce.
Prior to the Thanksgiving holiday, a Leon Circuit Court judge voided the 14.5 percent rate increase under the grounds that the National Council on Compensation Insurance and the Office of Insurance Regulation did not follow the requirements of the “Sunshine Law.” This decision has since been appealed, meaning the rate increase will take effect today.
“Many businesses are telling us they will be forced to delay hiring, or even cut existing jobs, in order to cover this increase in their premiums,” said JOHNSON. “A rate like this puts Florida’s competitiveness and job creation directly at risk.”
According to research from a Florida Chamber Workers’ Compensation Task Force survey, of the businesses impacted by the rate increase, 90 percent said the impact is significant. An overwhelming 96 percent of those surveyed believe that the Florida Legislature should take action to remedy the Supreme Court decisions that resulted in a 14.5 percent increase.
This $1.5 billion increase is the result of two Florida Supreme Court decisions earlier this year declaring portions of Florida’s workers’ comp system unconstitutional. In one case in particular, the plaintiff argued that the plaintiff trial lawyer should receive $38,000 in attorney fees for a case in which the injured worker was awarded only $800. That’s $800 for the injured worker and $38,000 for the trial lawyer. This accounts for nearly two-thirds of the rate increase. And although the rate officially increases today, since the decision in April, the number of lawsuits and trial lawyer pay-days have already increased.
The Florida Chamber has a long history of helping to keep Florida’s workers’ comp system working. As a result, workers’ comp rates were lowered by more than 60 percent in the last 13 years, and injured workers returned to work 10 days faster. Those efforts continue today with the Florida Chamber’s Workers’ Compensation Task Force, which is working to secure a legislative fix.
In Case You Missed It:
- Let’s Fix Workers’ Comp in Florida, (Tampa Bay Times, September 30, 2016)
- Florida’s Supreme Court Rulings Are Wrecking Workers’ Comp System (Bradenton Herald, October 8, 2016)
- Rising Workers’ comp Rates Hurt Businesses (Florida Politics, October 10, 2016)
- Judge voids 14.5 percent workers’ comp rate increase (Florida Politics, November 23, 2016)
- Senator Bill Galvano and Representative Kathleen Passidomo Discuss Workers’ Comp (Florida Chamber’s Bottom Line, September 29, 2016)
Division of Workers’ Comp Wants Your Input on Rate Increase
$1.5 Billion Workers’ Comp Increase Takes Effect December 1
December 1, workers’ compensation rates will increase by 14.5 percent for all new and renewal policies, an increase which equates essentially to a $1.5 billion transfer of wealth from Florida businesses to trial lawyers. This is your chance to share with the Division of Workers’ Comp your thoughts on how to fix Florida’s current workers’ comp system. If the business community does not weigh in, plaintiff trial lawyers, not job creators, will inform the Division’s proposed recommendations. Please take a few minutes to provide your feedback. The survey closes Thursday, December 8, 2016.
This $1.5 billion increase is the result of two Florida Supreme Court decisions earlier this year declaring portions of Florida’s workers’ comp system unconstitutional. In one specific ruling, the Court said a plaintiff trial lawyer could receive $38,000 in attorney fees for a case in which the injured worker’s injuries totaled $800. That’s $800 for the injured worker and $38,000 for the trial lawyer and higher rates for everyone.
Prior to the Thanksgiving holiday, a Leon Circuit Court judge voided the 14.5 percent rate increase under the grounds that the National Council on Compensation Insurance and the Office of Insurance Regulation did not follow the requirements of the “Sunshine Law.” This decision has since been appealed, allowing the rate increase to take effect today, as planned.
While a delay sounds like it would have been great for businesses, the reality was that a rate increase was looming on the horizon. As I told the media last week:
“This might sound like a victory, but Florida businesses shouldn’t be fooled by this classic trial lawyer tactic. The rates may not go up on December 1st, but this is only temporary. What won’t stop, however, is that trial lawyers will use this time to continue enjoying the benefit of unlimited legal fees in workers’ comp cases, while they are also seeking higher attorney fees for claims retroactively impacted as far back as July 2009. It’s a lucrative deal for billboard trial lawyers.”
Join the Florida Chamber Workers’ Comp Task Force:
The Florida Chamber remains committed to addressing the Supreme Court’s decision when the Florida Legislature convenes in March. The Florida Chamber Workers’ Comp Task Force has been working on this remedy, as well as educating businesses on this rate increase.
17.1% Workers’ Comp Rate Increase Will Harm Florida’s Economy/Job Growth
Florida Chamber of Commerce Urges State Leaders to Put Small Businesses and Injured Workers Ahead of Personal Injury Trial Lawyers
IF RATE IS APPROVED, FLORIDA WILL HAVE THE HIGHEST RATES IN THE SOUTHEAST
TALLAHASSEE, FL (May 27, 2016) – With job creators facing a 17.1 percent workers’ compensation rate increase, the Florida Chamber of Commerce today encourages the Florida Legislature to put small businesses and injured workers before personal injury trial lawyers through whatever means necessary.
The recommended 17.1 percent workers’ comp rate increase, announced earlier today by the National Council on Compensation Insurance (NCCI,) the industry’s provider of workers’ comp analysis and rates, primarily results from a recent Florida Supreme Court ruling that deemed Florida’s attorney fee provision unconstitutional.
The high court’s April 28th action threw out Florida’s attorney fee structure which was originally established in 2003. The 2003 reforms were put in place to help stabilize out-of-control workers’ comp rates which at the time were the highest in the country, and during the last 13 years have helped lower rates nearly 60 percent.
By putting job creators and injured workers first, lawmakers can help prevent businesses from being forced to pay higher rates, and avoid harming Florida’s growing economy and private-sector job growth. With Florida small businesses creating two of every three jobs, this is particularly important and can help prevent employers from choosing between hiring a new worker or paying increased workers’ comp rates.
“We’ve led efforts for more than 10 years to help lower workers’ comp rates by almost 60 percent, and now that personal injury trial lawyers and an activist court are forcing rates to likely skyrocket, we’re not about to back down,” said Mark Wilson, President and CEO of the Florida Chamber of Commerce. “The Florida Chamber will lead the charge to ensure small businesses aren’t crushed under the weight of increased workers’ comp rates, and that workers’ have access to quality healthcare so they can return quickly back to work.”
The Florida Chamber is actively leading the charge to keep workers’ comp working. In fact, the Florida Chamber’s Workers’ Comp Task Force is preparing a legislative remedy, and is coordinating with the best legal minds, along with communicating with legislative and executive leadership.
The Florida Chamber looks forward to continuing to work with Governor Rick Scott and the Florida Legislature to craft a solution to the Florida Supreme Court’s ill-advised and overreaching attempt to legislate from the bench.
The NCCI rate increase recommendation would take effect August 1, 2016 following approval by the Florida Office of Insurance Regulation.
The Florida Chamber of Commerce is the voice of business and the state’s largest federation of employers, chambers of commerce and associations, aggressively representing small and large businesses from every industry and every region. The Florida Chamber works within all branches of government to affect those changes set forth in the annual Florida Business Agenda, and which are seen as critical to secure Florida’s future. The Florida Chamber works closely with its Political Operations and the Florida Chamber Foundation. Visit www.FloridaChamber.com for more information.