In Texas, You May Not Be Covered By Workers’ Compensation
Dec. 22, 2016
Workers’ compensation is the insurance system that replaces lost wages and provides medical benefits when workers are injured on the job. In forty-nine of the fifty states, employers must carry workers’ compensation insurance. In exchange for workers’ comp benefits, injured workers waive their right to sue employers for negligence and personal injury. Texas is the only state in the nation – and one of the few remaining places in the civilized world – that does not compel employers to provide some type of minimal workplace-injury coverage. About 470,000 workers in this state are entirely without coverage if they are injured while at work.
More than a million other Texas workers are covered by “non-subscriber policies” that basically allow employers to make their own rules. Under workers’ compensation, it does not matter who is responsible for causing a workplace injury. If you are a chef and you burn your hand while working in a kitchen, workers’ comp covers you, but a non-subscriber plan may provide no coverage unless your employer is directly responsible for your injury. And if someone dies on the job, according to the Texas Department of Insurance, the families of more than half of the employees covered by non-subscriber policies in Texas will receive nothing.
Workers under non-subscriber plans receive very little legal protection under Texas law. Nothing in state law, for example, stops a non-subscriber employer in Texas from firing a worker who has reported an injury or filed a claim. Richard Levy, the secretary-treasurer of the Texas AFL-CIO, says, “It’s absolute corporate control with no oversight or accountability.” Employers whose Texas employees are covered by non-subscriber plans rather than workers’ compensation include nationally-known retailers like Costco, Home Depot, Macy’s, Taco Bell, Wal-Mart, McDonald’s, Dollar General, Lowe’s, Target, and Kroger.
WHY DOESN’T TEXAS HAVE WORKERS’ COMPENSATION?
How did Texas become the only state in the nation that fails to require workers’ compensation? Workers’ comp provides immediate medical care and financial relief to injured workers without anyone having to prove who was at fault for the injury. It also protects employers against costly lawsuits. Workers’ comp tries to balance the interests of all parties involved and offer a just resolution without requiring lengthy and costly claims and trials. Back in 1972, the National Commission on State Workmen’s Compensation Laws recommended that workers’ comp should be mandatory in all fifty states. Only Texas has never made workers’ compensation mandatory.
Trey Gillespie, speaking for the Property Casualty Insurers Association of America, points out that when Texas employers opt out of the workers’ compensation system, those costs are usually shifted to the taxpayers through Medicare and Medicaid or through higher private insurance premiums and higher hospital bills. Others insist that this rarely happens and that employers with non-subscriber plans must make safety a priority because – unlike the employers who are covered by workers’ compensation – employers with non-subscriber plans may have the risk of liability and the possibility of facing personal injury lawsuits.
WHEN CAN A TEXAS EMPLOYER BE SUED FOR WORKPLACE INJURIES?
In other words, employers who opt out of the workers’ compensation system can be sued – sometimes – if a workplace injury can’t otherwise be resolved. Some employers choose workers’ compensation rather than a non-subscriber plan because they can’t risk being sued, but large Texas employers – like the retailers listed above – can afford the risk. However, a Houston personal injury attorney would point out that even when a personal injury lawsuit prevails, it could be two or three years after an injury before a worker actually receives the compensation he or she needs and deserves.
Another problem, however, is that non-subscriber policies usually require employees to sign away their right to sue. Instead, they must take any disputes to arbitration, where employers pick and pay the arbitrators. Despite the evidence from forty-nine states, some Texas employers still maintain that mandatory workers’ compensation would be the “demise of the Texas economy.” Cathy DeWitt, who is the vice-president of the Texas Association of Business, says if employers did not have the chance to opt out of workers’ comp, they would leave the state instead. Ms. DeWitt says, “I think it’s unfair to businesses for there to not be that choice.”
And according to research conducted and published in 2010 by Stanford University law professor Alison Morantz, 89 percent of non-subscriber employers in Texas list “cost savings” as a leading reason for opting out of the workers’ compensation system. And even if you consider the advantages of non-subscriber plans, those advantages do not change the reality that injured workers can still be fired as soon as they report an injury under those plans. In 1998, the Texas Supreme Court upheld an employer’s right to terminate an employee as the result of a workplace injury dispute – precisely because that employer had opted out of workers’ compensation.
WITHOUT WORKERS’ COMPENSATION, WHO PAYS?
Trey Gillespie, at the Property Casualty Insurers Association of America, says, “The public policy behind workers’ compensation is for the employer to take responsibility for the cost of these losses – not transfer them back to injured workers or taxpayers. Non-subscription skirts all of that.” Gillespie says that non-subscriber plans force taxpayers and injured workers to cover more than $20 million in uncompensated workplace injury treatment costs every year in this state.
Even when employees are covered by workers’ compensation in Texas, it’s not much. Texas employees receive the lowest workers’ comp benefits in all fifty states. One workers’ comp lawyer says Texas practices “the worst possible treatment of injured workers anywhere in the world.” Anyone who is injured at work in the state of Texas should consult immediately with an experienced Houston personal injury attorney. Most workers who are injured on the job in Texas have to fight for compensation, and they need all of the help that they can get.
In an ideal world, if you were injured at your job, you wouldn’t need a lawyer. You would be reimbursed fairly and immediately. But in this world, in Texas, workers receive very little legal protection, and only a few rare voices demand justice for the victims of workplace injuries. It does not matter if an injured worker is covered by workers’ comp, a non-subscriber plan, or has no coverage at all. When employees are injured at work in the state of Texas, those workers will need experienced legal counsel to handle their claims and to help them obtain the full compensation – as well as the justice – that they need and deserve.
By: Joseph Onwuteaka
Joseph Onwuteaka has spent more than three decades studying the practice of law and the many different specialized areas of litigation. He draws from this knowledge and experience to advise his clients with their best interest in mind, and nobody else's. His motives are genuine and his expertise is apparent in the courtroom. You can trust Joseph Onwuteaka, P.C., to handle all of your legal matters so that you can move on with your life.