Archive for September, 2009

Cavalcade of Risk, dereriorating market, breast cancer, labor unions, and more

Thursday, September 10th, 2009

Cavalcade of Risk #87 is brought to you from the land down under – Andrew of Australia’s OzRisk is this week’s host – check it out!
Deterioration in Work Comp market – In his blog Comp Time, Roberto Ceniceros discusses a grim recent A.M. Best report pointing to deteriorating conditions in the workers comp industry. “According to Best’s composite, consisting of 103 insurers, net premiums written plunged 30% from a high of $20.9 billion in 2004. Insurers also experienced underwriting losses of $1.2 billion in 2007 and $1.5 billion in 2008. Best expects challenging conditions for insurers to continue well into 2010.” Ceniceros also cites other recent reports and economic indicators in his post. Related: Joe Paduda of Managed Care Matters offers his thoughts on the workers comp industry’s fading fortunes. He notes a few positives in the offing: some brokers and agents are expecting the pricing war to taper off, investment returns look to be recovering somewhat, and health reform might relieve cost-shifting.
NIOSH – HHS Secretary Kathleen Sebelius recently announced that John Howard, M.D. has been named new Director of National Institute for Occupational Safety and Health (NIOSH). Dr. Howard served as NIOSH director from 2002 through 2008. He also served as coordinator of HHS’ World Trade Center Health Programs from 2006 to 2008. Laura Walter of EHS Today talks about the ASSE and AIHA favorable reaction to Howard’s reappointment.
Night shift work linked to breast cancer – The BBC reports that the Danish government has begun paying compensation to women who have developed breast cancer after long spells working nights. Authorities acted in response to a study by the International Agency for Research on Cancer (IARC), an arm of the UN’s World Health Organisation. The IARC, which studies and ranks cancer risks, ranks night shift work just below asbestos as a probable cause of cancer. This ranking was based on various studies and reports linking cancer to night shift work hours, including a study published in the Journal of the National Cancer Institute which showed a 36% greater risk of breast cancer for women who had worked night shifts for more than 30 years, compared with women who had never worked nights.
Labor unions and the economy – In response to a recent Gallup poll on labor unions showing support at an all time low, Paul Secunda of Workplace Prog Blog and some of his readers offer thoughts on why a rise in unemployment correlates negatively with support for unions.
Health & Safety Briefs

Study reveals widespread labor law violations for low-wage workers

Tuesday, September 8th, 2009

According to the Department of Labor’s site on the history of Labor Day, the holiday is a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country. But for low wage workers, there isn’t much to celebrate this holiday. A 2008 study of 4,387 workers in low wage jobs in Chicago, Los Angeles and New York – Broken Laws, Unprotected Workers (pdf) – revealed widespread violations of basic wage and labor laws. These violations affected all worker, regardless of legal status, race, or gender. The study found numerous violations of minimum wage and overtime laws; workers who log hours without being paid for their time; workers who are denied earned breaks and meal time; charges illegally deducted from worker pay; retaliation by employers for complaints; and denial of workers’ compensation benefits, including encouraging employees to commit fraud.
Nearly two-thirds of all workers surveyed had experienced a wage violation in the week prior to being interviewed. About one in four had been paid less than the minimum wage the week before being surveyed; about one in seven had worked off the clock; about three in four who had worked overtime were not paid the proper amount.
Stating that the workers’ comp system is not functioning in the low-wage labor market, the report’s executive summary noted the following:

    Of the workers in our sample who experienced a serious injury on the job, only 8 percent filed a workers’ compensation claim.
  • When workers told their employer about the injury, 50 percent experienced an illegal employer reaction — including firing the worker, calling immigration authorities, or instructing the worker not to file for workers’ compensation.
  • About half of workers injured on the job had to pay their bills out-of-pocket (33 percent) or use their health insurance to cover the expenses (22 percent). Workers’ compensation insurance paid medical expenses for only 6 percent of the injured workers in our sample.

The economic toll
Study authors call these violations wage theft and paint a grim picture of the economic toll that these violations impose on the workers and on the communities at large. The average worker lost $51 from an average weekly earnings of $339, or about 15%. Assuming a full-time, full-year work schedule, we estimate that these workers lost an average of $2,634 annually due to workplace violations, out of total earnings of $17,616.
Survey authors estimated that approximately 1,114,074 workers in the three cities combined experience least one pay-based violation per week. Extrapolating from this figure, front-line workers in low-wage industries in Chicago, Los Angeles and New York City lose more than $56.4 million per week as a result of employment and labor law violations.

When impacted workers and their families struggle in poverty and constant economic insecurity, the strength and resiliency of local communities suffer. When unscrupulous employers violate the law, responsible employers are forced into unfair competition, setting off a race to the bottom that threatens to bring down standards throughout the labor market. And when significant numbers of workers are underpaid, tax revenues are lost.

The report recommends three principles that should drive the development of a new policy agenda to protect the rights of workers:

  • Strengthen government enforcement of employment and labor laws
  • Update legal standards for the 21st century labor market
  • Establish equal status for immigrants in the workplace

Health Wonk Review and other news briefs

Thursday, September 3rd, 2009

Jared Rhoads has posted a fresh Health Wonk Review at The Lucidicus Project. There are many interesting posts running the gamut: healthcare reform, home birth, hospice, hypertension and a variety of other topics that the health bloggers found noteworthy in the last two weeks.
Other news notes
Bad Manager of the Month Club – Scott Polston, an employee of Foster Farms Dairy in California, suddenly began getting a series bizarre phone calls and dozens of strangers coming to his home with unusual requests. The callers and visitors were responding to bogus ads that had been placed on craigslist, ads that were subsequently traced back to his supervisor, Michael Odell Simpson. At the time of this report, Simpson was no longer employed by the Dairy and was facing criminal complaints. Polston filed a worker’s compensation claim over stress.
Experts Detail Perils To Comp Insurers – “Unconventional threats to the workers’ compensation system, ranging from Medicare system red tape to recession problems to employers liability difficulties,” – these are all perils for employers and threats to the doctrine of exclusive remedy discussed by panelists at the recent at the Workers Compensation Educational Conference presented by the Florida Workers’ Compensation Institute in partnership with The National Underwriter Company.
Survey: Consumers Would Support TWD Ban – In light of our recent posts on texting while driving this week, we were interested to learn that a recent Harris Interactive survey revealed that 80% of Americans favor a ban on texting while driving, while two thirds favor a ban on cell phone calls, and more than half say they would support a ban on cell phone use altogether.
Labor DayAs the Industrial Revolution took hold of the nation, the average American in the late 1800s worked 12-hour days, seven days a week in order to make a basic living. Children were also working, as they provided cheap labor to employers and laws against child labor were not strongly enforced. With the long hours and terrible working conditions, American unions became more prominent and voiced their demands for a better way of life. On Tuesday September 5, 1882, 10,000 workers marched from city hall to Union Square in New York City, holding the first-ever Labor Day parade. – More at Labor Day History.
Workplace safety – We started the week with a texting-while-driving shock video that has been making the rounds on the Web. Today, we found a more uplifting video highlighting the importance of workplace safety from the Washington Department State Department of Labor & Industries:

California Scheming, Revisited

Wednesday, September 2nd, 2009

State governments are scrambling for cash and looking, it appears, in all the wrong places. Back in April we blogged the abortive attempt by the state of Colorado to use the claim reserves from its state-run workers comp fund to plug the deficit hole: a bad idea that died a quick death in the thin mountain air.
Now California has its eye on a similar prize. They want to sell one billion worth of the best policies from the State Insurance Fund (SCIF) and use the proceeds to plug a bit of the $24B budget deficit. While nowhere near as daft as the Colorado plan, this one has its flaws, too.
Insurance Commissioner Steve Poizner is seeking a court injunction to prevent any sale of SCIF policies. Poizner, like Arnold Schwarzenegger, is a republican. Indeed, he covets the office that Arnold now holds, having set up a committee for a run in 2010. (Under California law, Arnold cannot seek another term.)
Poizner believes that the sell off would violate the state’s constitution as well as lead directly to higher workers comp rates for employers. With its 7,000 (!) employees, SCIF is the largest carrier for comp in the state. They insure roughly 200,000 employers (the total number of policy holders in many states).
While it’s not clear what effect the sell off would have on non-SCIF policy holders, it surely would mean trouble for the many companies insured by SCIF. You don’t peel off your best risks without impacting overall results. It’s safe to assume that the best risks in SCIF balance out the losses among the higher risk companies. The immediate effect of the sell off would be a serious erosion in SCIF’s loss ratio, inevitably leading to higher premiums.
California employers have experienced a painful rollercoaster ride in the price they pay for workers comp: their worst-in-the-country rates have moderated dramatically over the past few years, but once again are trending up. As pressing as the budgetary needs in Sacramento are, this one shot solution will only result in big problems down the road. This is one idea from the Terminator that deserves to be terminated.

Thumbs Down on New York Texting Ban?

Tuesday, September 1st, 2009

As a follow up to Julie Ferguson’s gruesome imagery from Monday’s blog, we find Clyde Haberman’s entertaining piece in the New York Times about the state’s new statute outlawing texting. As of November 1, it will be illegal for anyone to drive and text in the Empire State. Haberman goes on to write:

If any law may be described as a no-brainer, this one is it. You have to be certifiable to think that you can stare at a small screen and thumb-type on a tiny keyboard for five or six seconds while going 65 miles an hour, and not be a potential threat to everyone in your path. In the opinion of many safety experts, self-deluding multitaskers have had their way long enough. It’s time for some multi-tsking to rein them in.

Bravo, Clyde! But Haberman goes on to say that the new law is pretty toothless. “It doesn’t throw the book at texters so much as it tosses a few pages in their direction.” (Shades of Keith Olbermann?)
The problem is in enforcement. The new statute will only receive “secondary” enforcement, which means that a fine may be imposed only if the police find some other violation, such as speeding or running a red light. Beyond that, the maximum penalty is only $150. That’s chump change for the high rolling multi-taskers who clog New York’s multitudinous arteries.
Live Free and Die?
Haberman interviews Judith Lee Stone, president of Advocates for Highway and Auto Safety, a Washington lobbying group. She says “secondary enforcement is not OK, and there’s no reason for it.”
The good folks in New York like to creep up on enforcement. When they first initiated a seat belt law, they began with secondary enforcement and eventually moved to primary status. All states now require seatbelts, with the notable exception of New Hampshire, which exempts adults over 18 from the mandate.
“It must be that “Live Free or Die” spirit,” Haberman quips.
To which Stone responds, “Live free and die, I’d say.”
The low budget ($20,000) video was produced by the Chief Constable of the tiny town of Gwent in SE Wales UK. The video has become a You-Tube sensation. The Insider humbly suggests that New York legislators check it out and then revisit the enforcement section of the new law. No one wants to suffer injury or even death just because some twit can’t wait to for the proper time to communicate something that, in the scheme of things, most certainly can wait.