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June 29, 2009 -- Press Release

Employers Mobilize to Oppose Millions in New Fees on Workers’ Comp Premiums

SACRAMENTO, Calif. - Members of the Workers' Compensation Action Network (WCAN) today launched a campaign to oppose more than $60 million in new annual workers' compensation assessments. The new assessments are part of a State Budget proposal by the Department of Industrial Relations to shift the cost burdens for the Division of Occupational Health and Safety (Cal-OSHA) and the Division of Labor Standards Enforcement (DLSE) from the cash-strapped state General Fund to California employers.

"This additional burden on California employers couldn't come at a worse time," said California Manufacturers & Technology Association President, Jack Stewart. "The state may be in dire need of funding, but imposing more fees on employers is only going to cost California jobs and make this recession worse. No employer should be assessed additional workers' compensation fees at any time to pay for government programs not directly related to the administration of the state workers' compensation system."

California employers currently pay workers' compensation assessments totaling more than $311 million annually, which provides 100% of the funding for the Division of Workers' Compensation and related programs. Employers that are self insured, including cities, counties and school districts, pay similar assessments based on their payroll and workers' compensation costs. Overall, the current proposal would increase these assessments by 22% to fund the activities of Cal-OSHA and the DLSE.

"We do support full funding for California's workplace safety programs to protect workers and ensure employers are complying with the law," said Ding Kalis, president of Mag-Bit in Sante Fe Springs. "Shifting the cost for these programs to employers, however, will simply kill jobs, further damaging California's economy and state budget." Members of WCAN's employer network are contacting their State Assembly and Senate representatives, as well as the governor's office, urging that the proposal not be included in the final State Budget.

"California approved Gov. Schwarzenegger's reform of workers' compensation in 2004. This successfully reined in uncontrolled insurance costs that hurt not only businesses, but also school districts and nonprofits. Interest groups now are quietly working to roll back these reforms and should not be allowed to succeed."

- San Francisco Examiner, "Five easy ways to boost economy"