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Published online by Cambridge University Press: 20 January 2009
From an examination of the available data it appears that the present Workmen's Compensation system in the United States is providing a deprivation livelihood for the work-injured and their survivors and is failing to meet its objectives as a service delivery system because it results in a gross misallocation of public costs. It is not providing coverage at all to many workers most exposed to industrial injury and is not getting benefits to an important proportion of those entitled to them. At the same time, it is providing dependable but undisclosed profits to private insurance carriers.
1 Exceptions, of course, are the federal Workmen's Compensation programmes for the Longshoremen and Harbor Workers, Federal Employees and the victims of pneumoconiosis, a miners' lung disease.
2 The Report of the National Commission on State Workmen's Compensation Laws. Washington, D.C.: Government Printing Office, 07 1972, pp. 117–19, 122.Google Scholar
3 Ibid., p. 119.
4 If, in fact, the employer carries Workmen's Compensation insurance. In 1972, 83 per cent of the U.S. work force was employed by insureds. In most states, Workmen's Compensation laws are not compulsory, and most exempt the coverage of domestics, farm labour and the employers of less than three workers.
5 This is an account of how Workmen's Compensation operates from the workers' point of view. For a thorough discussion of the Workmen's Compensation system as it operates from the employers' or the insurance companies' point of view, see Williams, C. Arthur, Insurance Arrangements Under Workmen's Compensation, U.S. Department of Labor, Wage and Labor Standards Administration Bulletin No. 317, 1969, pp. 1–16.Google Scholar
6 Cheit, Earl F., Injury and Recovery in the Course of Employment, New York: John Wiley and Sons, 1961, p. 11.Google Scholar
7 Somers, H. M. and Somers, A. R., Workmen's Compensation, New York: John Wiley and Sons, Inc., 1954, p. 26.Google Scholar
8 Ibid., p. 28.
9 Larsen, Arthur, ‘Compensation Reform in the United States’, in Cheit, Earl and Gordon, Margaret, Occupational Disability and Public Policy, New York: John Wiley and Sons, 1963, p. 17–19.Google Scholar
10 Skolnik, Alfred M. and Price, Daniel M., ‘Another Look at Workmen's Compensation’, Social Security Bulletin, 10 1970, p. 12.Google Scholar
11 Ibid., p. 15. The average length of a temporary disability from work injury in 1972 was 18 days according to the 1973 Sholnik and Price study cited above.
12 Ibid., p. 13, Chart no. 3.
13 Analysis of Workmen's Compensation Laws, Washington, D.C.: U.S. Chamber of Commerce, 1969 edition.Google Scholar
14 Ibid.
15 The Report of the National Commission on Workmen's Compensation, op. cit., p. 65.
16 Ibid., p. 64.
17 Ibid., p. 72.
18 Op. cit., p. 101. Cheit's study is now rather old, but still relevant because Workmen's Compensation benefit schedules have not changed that much and inflation has severely reduced benefit gains in real dollar terms in any event.
19 Ibid., p. 109.
20 Ibid., p. 115.
21 Ibid., pp. 130–2.
22 Ibid., p. 135.
23 See Haber, Lawrence D., ‘The Chronology of Disability’, in Somers, Gerald (ed.), Proceedings of the 24th Annual Meeting of the Industrial Relations Research Association, 1972Google Scholar. Data taken from unpublished tables sent by personal communication to the author
24 Cheit, , op. cit.Google Scholar, Table 5.1, p. 132; Table 4.11, p. 118. This figure is nearly three times greater than that which applied to such widows only two years after the fatal accident.
25 Haber, , op. cit.Google Scholar, and unpublished data sent by personal communication to the author.
26 Brittain, John A., The Payroll Tax for Social Security, Washington, D.C.: The Brookings Institution, 1972, p. 79–80.Google Scholar
27 Skolnik, and Price, , op. cit., p. 21.Google Scholar
28 U.S. Chamber of Commerce, op. cit., p. 41. States with exclusive state funds are Nevada, North Dakota, Ohio and Washington. States with competitive state funds are Arizona, California, Colorado, Idaho, Maryland, Michigan, Montana, New York, Oklahoma, Oregon, Pennsylvania and Utah.
29 Skolnik, Alfred M. and Price, Daniel M., ‘Workmen's Compensation Payments and Costs, 1971’, Social Security Bulletin, 01 1973, p. 34Google Scholar. The same comparison over a 19-year period 1950–68 yields the same figure (17.4 per cent), so 1971 is not an isolated example. (See Skolnik and Price, 1970, op. cit., pp. 21–2.)
30 Skolnik, and Price, , 1970, op. cit., p. 25.Google Scholar
31 Williams, C. Arthur, Insurance Arrangements Under Workmen's Compensation, U.S. Department of Labor, Wage and Labor Standards Administration, Bulletin no. 317, 1969, p. 198.Google Scholar
32 Ibid., Table 7.1, p. 199 and Table 3.12, p. 66.
33 Williams, , op. cit., pp. 109–11.Google Scholar
34 Ibid., pp. 69–70.
35 Ibid., Table 3.16, p. 87.
36 Skolnik, and Price, , 1970, op. cit., p. 21.Google Scholar
37 Williams, , op. cit., Table 3.16, p. 86.Google Scholar
38 Ibid., Table 3.17, pp. 88–9.
39 Riesenfield, Stefan A., ‘Efficiency and Costs of Workmen's Compensation’ in Cheit, Earl and Gordon, Margaret, Occupational Disability and Public Policy, New York: John Wiley and Sons, Inc., 1963, pp. 312–13.Google Scholar
40 Ibid., Table 10.5, p. 308.
41 Ibid., p. 306.