Thursday, October 20, 2011

Bent: Reform Workers' Comp to Enhance Workplace Safety

BentJason Bent (Stetson) has just posted on SSRN his article on a much-neglected topic of LEL scholarship: workplace safety.  Some of you may recall that he presented it at the Sixth Annual Colloquium on Current Scholarship in Labor and Employment Law.  His article is An Incentive-Based Approach to Regulating Workplace Chemicals, and I hope it will spur some action.

Our system for regulating employee exposures to hazardous chemicals is broken. There is a recognized market failure in the market for workplace safety regarding exposures to potentially hazardous chemicals. Information asymmetries, long disease latency periods, and other characteristics of chemical exposures allow employers and chemical manufacturers to externalize much of the expected cost of workplace exposure. The current U.S. regulatory system, including both Occupational Safety and Health Administration regulations and state workers’ compensation programs, is failing to correct the market failure. The result is a level of chemical exposure risk that is systematically too high, and a level of precaution that is systematically too low.

The proposed reforms offered to date in the employment and environmental law literature are lacking, primarily because they do not sufficiently address the underlying financial incentives of the true least-cost information providers and least-cost risk avoiders: chemical manufacturers and employers. This article takes the search for a solution to the workplace disease problem in a new direction by capitalizing on the incentives of chemical manufacturers and employers. My proposal would amend state workers’ compensation laws in two ways: (1) shift the default burden of proof on the element of causation onto the respondents, in cases where there is no regulatory exposure limit governing the substance in question, and (2) allow employers to include chemical manufacturers as respondents in workers’ compensation claims for purposes of apportioning liability. These amendments could be implemented by convening a new National Commission on State Workers’ Compensation Laws. By focusing on the financial incentives of chemical manufacturers and employers, this proposal will spur the production of chemical toxicity information and lead to adequate compensation for employees who suffer exposure-related illnesses and diseases.

rb

http://lawprofessors.typepad.com/laborprof_blog/2011/10/bent-reform-workers-comp-to-enhance-workplace-safety.html

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Comments

Hello from Virginia, just wanted to drop by to say I enjoy reading your blog and appreciate the insight provided on workers exposed to chemicals. OSHA has been missing the mark on this and other issues the past few years and I'm delighted to see it being addressed.

Posted by: Michele Lewane | Oct 20, 2011 9:35:05 AM

I have worked as a safety professional directly for workers' compensation carriers since 2005 and I agree that hitting the insured and other parties in the pocket book is the way to success. Financial incentive programs have to be managed closely as current incentives such as discounted coverage for having a safety manual are abused and not verified properly.

Posted by: Safety Manual Pro | Nov 12, 2011 6:04:01 PM

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