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Employee Retirement In-come Security Act compliance would ensure appropriate care for injured workers if employers could opt out of more state workers compensation systems and establish alternative benefit plans, proponents say.
But that has not always happened in Texas, the only state that allows employers to opt out of its workers comp system, said Richard Levy, legal director in Austin, Texas, for the Texas AFL-CIO.
The opt-out option is “a rigged system set up to serve the financial interests of the employer,” regardless of whether the employer has implemented an ERISA-governed plan, he said.
Private employers who opt out of Texas' workers comp system are not required to establish an alternate benefit plan.
But according to ERISA law, most plans outside of state workers comp systems are subject to ERISA rules, said Bill Minick, president of PartnerSource, a Dallas-based division of Arthur J. Gallagher Risk Management Services Inc.
“An injury benefit plan outside the workers comp system is by definition an ERISA plan,” Mr. Minick said.
But employers can use ERISA to limit injured workers' access to courts and provide benefits inferior to those offered under the state workers comp system, Mr. Levy said.
Trey Gillespie, senior workers comp director in Austin for the Property Casualty Insurers Association of America, agrees.
“In order for injured workers to get any benefits after an accident, they have to sign a mandatory arbitration agreement,” he said. “And the benefits that are usually found in the ERISA programs are traumatic reductions with regard to medical benefits and especially for permanent disability benefits in the event of an on-the-job injury.”
Some large employers want to establish injured worker benefit plans that are governed by the Employee Retirement Income Security Act as an alternative to state workers compensation systems.