Tennessee to Study Workers’ Compensation System

By Michael Adams | January 18, 2012

Tennessee state officials, business groups, labor leaders and legal experts are lining up to study the state’s workers’ compensation system, although it may be 2013 before any legislative deals are struck.

Tennessee Gov. Bill Haslam has decided that for now, the state legislature is best served by continuing to study the workers’ compensation as part of his goal to make the state more business-friendly.

And for now lawmakers and Lt. Gov. Ron Ramsey are going along with Haslam.

Haslam spokesperson Yvette Martinez in a statement said, “The governor and administrative officials continue to discuss workers’ compensation issues with business leaders across the state. He believes that there are things we can look at improving on the administrative side of the program verses legislatively at this time.”

The Tennessee General Assembly meets the second Tuesday in January for a 15-day organizational period. It then can meet 90 legislative days over a two-year assembly period.

The House Republican Small Business Task Force, which held a round of hearings on workers’ compensation in 2011, has singled out a number of issues for potential consideration.

Of particular concern of the task force and insurance companies is the practice of employers misclassifying employees in order to pay lower workers’ compensation premiums. Also a problem in many states, there is concern over companies abusing “contractor exemptions” to avoid paying premiums altogether.

The task force found that unscrupulous employees face little chance of being caught and the financial penalties are minor.

Lt. Gov. Ramsey said he is supporting a commission system to hear workers’ compensation cases in the state, a measure supported by business groups that say it would speed up the resolution of cases and at a lower cost.

Tennessee is one of the last states that sends workers’ compensation cases through the regular court system, although a 2004 law did require insurance companies and injured workers and their attorneys to go through a mediation conference before accessing the courts.

There is some disagreement, however, on whether the mediation conferences have lowered litigation costs or just added an extra hurdle at an additional cost to resolve cases.

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