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Preparing for People Power in the Bay State
A new change in the Massachusetts workers' comp statute will allow private citizens to take civil action against employers for infractions. Going into effect in November, the bill may do more harm than good.
By JOSHUA CLIFTON, a Chicago-based writer who covers workers' comp and disability issues Workers' compensation legislation aimed at stopping unscrupulous businesses in Massachusetts may lead to costly legal headaches for employers in the state, some analysts believe.
The measure has long been advocated by the Massachusetts AFL-CIO and other labor entities as a way to crack down on employers who misclassify workers as independent contractors. Union representatives said that, by avoiding paying for workers' comp coverage for these individuals, employers are able to deflate their costs and gain an unfair advantage when making bids for projects. However, critics have argued that the bill may serve as a tool for organized labor to target its nonunion competitors. Vanessa Hackett, associate at the Boston office of law firm Littler Mendelson PC, said the change represents a monumental shift in the way state statutes are enforced. "Historically, only the state (through the Massachusetts Department of Industrial Accidents) has the authority to investigate alleged violations," she said. "Now, any three individuals, who are not required to even have a relationship to the employer, can bring a civil action against an employer who they suspect is violating workers' comp laws. It is almost like the state granting power to private citizens to issue parking tickets." Carie Torrence, also an associate at Littler Mendelson PC, said allowing private individuals to enforce a state statute is almost unprecedented. The amendment, she said, provides a financial incentive for plaintiffs, who stand to collect thousands in monetary awards, compensatory and liquidated damages, and attorney's fees if they show that the employer failed to adhere to the state's workers' comp statute. "When the state investigates allegations of violations, they are conducted by government individuals with a certain level of expertise and the administrative process is relatively short," she said. "However, now there is no longer that gatekeeper. And in litigation, the cost of defending such a claim is high and the timeframe can be lengthy." The statute contains a provision that allows the court to impose attorney's fees on plaintiffs if it deems a claim frivolous, according to Hackett. Yet, she added, courts have been very reluctant to pursue this course of action. PEOPLE POWER PROTECTION Hackett and Torrence said that there are several ways that employers can reduce potential liability under the new changes. First, employers should conduct a full audit of their employee classifications. "Make sure that everyone is properly classified to protect yourself against costly claims," Torrence said. Hackett recommended employers establish clear policies regarding the reporting of work-related injuries. Employers ought to ensure that their policies prohibit retaliation against an employee who files a claim or reports an injury to their healthcare provider or government agency, she said. Lastly, according to Torrence, employers must check to make sure that they are withholding the correct state and federal taxes from employees' paychecks, some of which are made to the state Workers' Compensation Trust Fund. Hackett said awareness among employers about the new changes is low, but she anticipates opposition may increase when the law goes into effect in November. Read more at the WorkersComp Forum homepage. September 16, 2010 Copyright 2010© LRP Publications |
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