Sunday, February 17, 2013

Oklahoma's Workers' Compensation Board: To judge or not to judge

In local news, the state legislature is planning to overhaul the workers' compensation system after a trend revealed that employee rewards were politically motivated. It has absolutely nothing to do with fraud or maneuverings of any sorts. But it turns out that the amount of compensation awarded varied by the appointed judges' political affiliation.

Republicans are apparently much more fiscally frugal than their Democratic counterparts. Judges who were elected by Democratic governors awarded more money to injured workers than did judges elected by Republican governors.

Four of the newly elected compensation judges had awarded permanently injured employees 15.6 percent less than the judges they replaced. The new judges were appointed by Republican Gov. Mary Fallin.

There is another factor at play here though. Since 2010, there have been changes made to the maximum amount of awards parties with certain injuries can receive.

But it appears that this isn't necessarily news. Attorneys had been aware of this trend for quite some time and have used it to influence campaigns. They are paid as a portion of the reward, so they naturally have a vested interest in settlement amounts. Some attorneys were donating as much as $5,000 to the campaigns. In 1993, several attorneys were indicted with then Democratic Gov. David Walters on an illegal contributions case.

This story poses several problems. First, any time a monetary reward is politically influenced it creates opportunities for fraud, as the 1993 incident demonstrates. Second, such a trend negatively impacts business practices. The uncertainty can make it difficult for companies to design strategies that influences their growth. Third, such a  wide fluctuation is a symptom of a broken system.

There may not be cause for alarm yet. As stated earlier, there were changes made and regulations introduced to curtail the amount of money awarded to injured workers. As Judge Bob Burke stated, "We should not rush to change a system that has been recently overhauled. The changes are working." We shall wait and see.

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