Florida Chamber Jobs Agenda Seeks Workers’ Comp Fix
As a business leader, you know all too well the fight for free enterprise never ends. The cost of doing business is a daily reminder of the challenges job creators face.
Florida’s business community has faced a $1.5 billion impact from workers’ compensation rates that remain 14.5 percent higher than they should be. Florida’s bottom five legal environment is an open invitation for “gotcha” lawsuits that cost Florida families an average of $3,400 each year in lawsuit abuse costs. And discouraging and discriminatory tax policies, like the Florida-only business rent tax, are uncompetitive.
Despite the economic, political and demographic shifts that have placed Florida in a fragile position, I believe Florida’s best days are yet to come. By reducing the cost of living and cost of doing business, redoubling efforts on workforce and investing in infrastructure, Florida’s economy will continue to strengthen jobs, wages and opportunities for Floridians.
Year after year, the Florida Chamber has been at the forefront of solving issues that impact the competitiveness and future of Florida’s business climate. And the Florida Chamber’s 2018 Jobs Agenda – reinforced by the united support of Florida’s business community – once again will be the driving force to create economic opportunity and grow jobs.
Legislative leaders, including House Speaker Richard Corcoran, former House Speaker Will Weatherford, more than a dozen members of the Florida Senate and House of Representatives, along with Florida Chamber Board Chair Bob Grammig joined us at Florida’s Capitol recently as we unveiled the jobs agenda, and called on lawmakers to strengthen Florida’s economy, spur smart growth, and create jobs and economic opportunity.
Among the 41 priorities on the 2018 Jobs Agenda is a fix to Florida’s workers’ comp system. By addressing the true cost drivers of the system, including attorney fees, Florida can experience stability to the system and lower unnecessary costs.
See What Others Are Saying
“I think workers’ comp is one of the biggest issues facing the state of Florida, especially if you put it in the context of working families. There is a tremendous amount of pressure for companies, like mine, that provide basic services to keep wages low.” – Senator Keith Perry, Florida Chamber Bottom Line.
“A competitive and predictable workers’ comp system that protects workers and job creators is vital to making Florida more competitive. Lawmakers should consider the long-term ramifications for the future of the state if they fail on reform this session.” – Carol Roberts, President and CEO, Bay County Chamber of Commerce.
“When it was first developed it had a good purpose. But, by the time you allow government to take over and attorneys to get involved, it has been completely run amuck. – Todd Gates, Southwest Florida Region Chair, Florida Chamber Board of Directors and Founder and Chairman of GATES.
Workers’ Comp Task Force
The 2018 Legislative Session begins January 9, and the Florida Chamber and its Workers’ Comp Task Force will once again be leading the charge to reform Florida’s broken workers’ comp system. As a leader in Florida’s business community, your help is needed.
Here are three ways you can help:
- Share this message,
- Join our Worker’s Comp Task Force,
- Engage with our lead lobbyists on this issue, Carolyn Johnson (firstname.lastname@example.org) for in-depth legislative details.
As always, thank you for your support of the Florida Chamber of Commerce.
Tentative Workers’ Comp Rate Proposal Announced
On August 28, 2017, the National Council on Compensation Insurance (NCCI) recommended a 9.6 percent workers’ comp rate decrease to Florida’s Office of Insurance Regulation, effective January 1, 2018. If approved, this decrease is temporary relief for Florida job creators who faced a 14.5 percent increase that took effect earlier this year.
While we are still reviewing the specifics of the rate proposal, of particular interest to job creators is the decision by NCCI to only utilize 2014 and 2015 claims data for this rate proposal. This means that claims from 2016, which were not subject to trial attorney fee caps overturned by the court in last April’s Castellanos decision, are largely not included in the rate proposal.
In April 2016, Florida’s activist Supreme Court ruled against small businesses and injured workers and in favor of trial lawyers in Castellanos. By throwing out Florida’s attorney fee structure, the cost of lawsuits have increased significantly, and in some instances, trial lawyers are receiving attorney fees as high as $400 an hour.
During the 2017 session, the Florida Legislature failed to pass meaningful workers’ comp reform, despite the $1.5 billion cost this rate increase had on job creators, their employees and customers. The Florida Chamber’s Workers’ Comp Task Force has been working over the summer to improve upon last year’s legislation in the hopes of getting the Legislature to act in 2018. Unfortunately for businesses, until the Legislature passes reforms, costs can continue to increase. And while a rate decrease would be great news for businesses, it doesn’t make the chances of meaningful workers’ comp reform next session more favorable.
This rate still must be approved by the Office of Insurance Regulation. The Florida Chamber will continue to keep you informed of ongoing ratemaking process and legislative action.
Here Are Two of the Ways You Can Make Your Voice Heard
- Join the Florida Chamber Workers’ Comp Task Force to help move Florida business in the right direction.
- Register for the annual Insurance Summit and engage with Florida’s top legislative leaders, insurance executives and political insiders on the issues that matter to you.
House and Senate Release Draft Workers’ Comp Plans
Florida Chamber’s Workers’ Comp Task Force Needs Your Review and Feedback
The Florida House and Senate have both released early details of their workers’ compensation plans ahead of Tuesday’s start of the 2017 Florida Legislative Session. Full drafts of these bills are expected later today or before Tuesday, March 7, 2017.
The Florida Chamber of Commerce’s Workers’ Comp Task Force is seeking your input on these draft proposals. Please send the below links to your General Counsel or risk management team member for their immediate review and feedback.
The House will workshop their draft proposal on Tuesday, March 7, 2017, in the House Insurance and Banking Subcommittee. It’s unknown at this point when the Senate will workshop or hear their workers’ comp proposal.
Links to the proposals can be found here:
The Florida Chamber Workers’ Comp Task Force reconvened last year to address rising workers’ comp costs as a result of the Florida Supreme Court’s decisions in Castellanos and Westphal. On December 1, 2016, for all new and renewal policies, workers’ comp rates increased by 14.5 percent, with the majority of that rate increase due to the removal of attorney fee caps.
Email me at email@example.com with your company’s thoughts on the House and Senate proposals.
Workers’ Comp Rate Increase to Stay in Effect During Appeal
Yesterday evening, the First District Court of Appeals ruled that the 14.5 percent rate increase will continue to be in effect while the Office of Insurance Regulation (OIR) and National Council on Compensation Insurance (NCCI) appeal a case from the Leon Circuit Court last month. This case, brought forward by a trial lawyer, argued that the rate-making process violated Florida’s Sunshine Law. The DCA also granted NCCI’s motion to expedite the case, and set the following timeline:
- January 11, 2017
OIR and NCCI must file arguments on the merits of the case
- January 23, 2017
James Fee, the trial attorney who brought forward the case, must respond to OIR and NCCI’s filing, and
- February 2, 2017
Final briefs must be filed.
What This Means for Florida Businesses:
The Leon Circuit Court in its decision invalidated the rate increase, but the District Court of Appeals allowed the rate to take effect on December 1 for all new and renewal policies. This case is a red herring, meant to distract from the real problem- increased attorney fees as a result of the Castellanos v. Next Door Company Florida Supreme Court decision. In fact, claimant attorney fees are up over 20 percent since the Supreme Court’s decision in April.
Today, the Florida Chamber will testify before the Florida Senate’s Banking & Insurance Committee to fight for a workers’ comp system that works. Share your story with us by contacting firstname.lastname@example.org today.
Learn how the Florida Chamber of Commerce Workers’ Comp Task Force is working on a legislative solution to the $1.5 billion increase to Florida’s business community.
Florida Chamber of Commerce Testifies in Support of Job Creators and Injured Workers During Workers’ Comp Rate Increase Hearing
Cautions Regulators That a 19.6% Rate Increase Could Harm Florida’s Job Growth Competitiveness
TALLAHASSEE, Fla. (August 16, 2016) – The Florida Chamber of Commerce today testified at the Office of Insurance Regulation’s (OIR) Workers’ Compensation Rate Increase Hearing and warned that a proposed 19.6 percent rate increase will impact Florida’s business friendly climate and harm Florida’s competitiveness.
Today’s hearing was prompted by a workers’ comp rate increase recommendation by the NCCI after the Florida Supreme Court threw out portions of Florida’s workers’ comp system in two separate cases. During the rate hearing, Mark Wilson, President and CEO of the Florida Chamber of Commerce said the pending workers’ comp rate increase will substantially impact injured workers and job creators throughout Florida.
In addition to the recommended 19.6 percent workers’ comp rate increase, NCCI estimates that the combined total statewide unfunded liability related to the high court’s rulings could potentially exceed $1 billion. The increased costs will be borne in large part by job creators.
“It’s a lucrative deal for personal injury trial lawyers, but a raw deal for injured workers who won’t gain a dime, and may even be out of work longer,” Wilson said during the insurance regulatory rate hearing. “Florida businesses care about their injured workers and want to make them whole. But now, thanks to the Supreme Court and plaintiff trial lawyers, its ok to collect fees nearly 50 times as much as the injured workers judgement.”
If OIR approves the 19.6 percent workers’ comp rate increase, it will be the highest rate in the Southeast. And as experts across the industry agree, this rate increase will likely only be the first of many attempts to further increase rates, and therefore put Florida back on the path toward having the highest workers’ comp rates in the United States.
The Florida Chamber’s Workers’ Comp Task Force has heard from businesses across Florida that have said increased rates could force them to choose between paying higher rates and hiring additional employees.
“It would prevent a company that has 150 workers from hiring one more,” according to Florida Chamber Workers’ Comp Task Force Co-Chair Debbie Harvey, President and Chief Operating Officer of Ron Jon Surf Shop. “What businesses are worried about is this is just the start. You could have another 15 percent later on top of a 19 percent increase. It’s a compound effect.”
“Look at all the small and medium-sized businesses and multiply that by 19.6 percent. If you do the math, that’s $714 million. That’s going to leave a mark on the economy,” Steve Knopik, Florida Chamber Workers’ Comp Task Force Co-Chair and CEO of Bealls Inc.
The Florida Chamber’s Workers’ Comp Task Force looks forward to working with the Office of Insurance Regulation, the Division of Workers’ Compensation, and the Florida Legislature on developing a remedy to the Supreme Court’s decision.
Keep Florida’s Workers’ Comp Working
Florida’s business climate is in jeopardy due to recent Florida Supreme Court decisions that could result in a nearly 20 percent workers’ comp rate increase for Florida job creators. This significant increase could mean the difference between hiring a new employee, increasing employee benefits, or paying higher workers’ comp premiums. Business growth requires workers’ compensation premiums to be fair and not inflated by unnecessary costs. An improved business climate overall will allow Floridians to get back to work and reduce the cost of living for families and small businesses. Lowering the cost of business in our state is what will continue to attract and retain the top industries and professionals, and allow existing businesses to grow.
Keeping our workers’ comp system fair and not inflated by trial lawyer tactics and other unnecessary costs will help lower the cost of doing business in Florida. The Florida Chamber has led the effort to help lower workers’ comp rates by nearly 60 percent in the last 10 years. Workers’ comp rates are now spiraling in the wrong direction, due to cases ruled by the Florida Supreme Court (Castellanos v. Next Door Company and Westphal v. City of St. Petersburg). Workers’ comp rates are proposed to increase by 19.6 percent on October 1. The Castellanos case threw out the current cap on attorneys’ fees and, in this particular instance, the attorney was seeking $38,000 in fees for securing $800 in benefits for the injured worker. Plaintiff attorney maneuvers like we’re seeing with workers’ compensation are reflective of a larger lawsuit abuse problem in Florida. In fact, a national survey released in shows Florida’s lawsuit climate worsening – ranking at an all-time low 44 out of 50 states, or in the bottom 10. And that’s important, because 75 percent of companies surveyed say a state’s lawsuit environment is likely to impact important business decisions at their company, such as where to locate or whether or not to expand.
With rates going up significantly, the Florida Chamber is leading the effort to mitigate the Florida Supreme Court’s decision before the Legislature. To secure Florida’s future, we must keep Florida’s workers’ comp system working. How would increased workers’ comp rates impact your business? Let us know by contacting Carolyn Johnson.
Choose Between Paying Higher Workers’ Comp Rates and Hiring New Employees
19.6% Workers’ Comp Rate Increase Could Impact You
It’s time for a legislative solution.
Today, the National Council on Compensation Insurance (NCCI) announced a recommended 19.6 percent workers’ comp rate increase, proposed effective beginning October 1.
If the rate filing is approved as filed increasing rates by 19.6 percent, Florida will have the highest premiums in the Southeast.
The increase results from two recent Florida Supreme Court rulings that deemed Florida’s attorney fee provision unconstitutional (Castellanos v. Next Door Company), and declared the current cap for temporary total disability (104 weeks) unconstitutional (Westphal v. City of St. Petersburg). According to the release by NCCI, “NCCI estimates that the impact of Westphal will be an increase in overall Florida workers compensation system costs of +2.2%.”
The Florida Chamber believes the Florida Legislature must address this rate increase to avoid harming Florida’s growing economy and private-sector job growth.
The Florida Chamber’s Workers’ Compensation Task Force has been engaging Florida’s highest elected leaders since last year, preparing them for this outcome, and advocating for a legislative solution. We need your voice to help find a solution. Learn how you can join the Florida Chamber’s Workers’ Comp Task Force.
Read the Florida Chamber’s full release on today’s workers’ comp recommendation.
Read Mark Wilson’s, President and CEO of the Florida Chamber, article in the Naples Daily News, Let’s Keep Florida’s Workers’ Comp System Working.