Tuesday, May 13, 2008

US Employers Aren’t Paying Accident Insurance

It was recently revealed that thousands of workers in New Jersey are getting hurt at work and finding out that their employers have not taken out insurance to cover their injuries. The Star Ledger reported that the problem is a “small but growing slice” of the state's litigious system which pays out a total of $1.8 billion a year in accident claims.

Experts say that the uninsured workers are an unnecessary burden on hospitals, charities and other social services. It is posited by the paper that the US government is not doing enough to tackle the issue and that administration is slack. “An uninsured worker who files a claim for benefits faces a complicated, onerous court system where one in 10 such claims [will drag on] for five years.” An article in The Star Ledger says: “Lawyers openly say they are reluctant to take cases involving the uninsured because they and their clients rarely get paid.”

State officials are failing to adequately track cases and have only looked at 10,000 cases in the past 7 years. Shockingly, people who have applied to state funds which were established 20 years ago in order to get help pay for medical treatments rarely receive any money. Only 1% of those who have signed up receive funds are awarded it and it has been admitted by US officials that they cannot afford to pay out for the worst and most incapacitating injuries.

Criticisms are that the state is spending increasingly less time finding and punishing employers who fail to pay their insurance, despite the fact that audits are unearthing more than 25,000 employees without worker insurance each year. Two thirds of businesses in New Jersey are operating without insurance but little is being done to remedy the situation and this leads to lazy employers ignoring regulations and taking chances with the lives of their staff.

In the Star Ledger expose` Bill Burns who works for the state Department of Labor and Workforce Development said: "If [employers] do get caught, they attribute it to the cost of doing business.” But it is clear that for some workers the costs run far deeper.

One man was pleased when his employer agreed to pay him $13 an hour in cash to work as a carpenter. The man was up a ladder in October, 2004 when he slipped and fell. He caught his left foot on the ladder and shattered a lower bone in his leg. The accident left the man destitute and seriously injured; he also spent 5 days in hospital. The cost of the man’s treatment was $47,000. He then spent 4 months on crutches. Because he was unable to work and his employer had not insured him for accident cover, he was unable to pay rent and was evicted. He was then homeless.
Years after the man’s initial fall the case was still officially unsettled. However, more recently a civil court awarded the man $525,000 for an accident claim which he brought against his previous employer.

The problem for many people who are injured while working for uninsured employers is that the system is failing them and that the litigation process is long and drawn out. Accident claims are the only relief for employees who have suffered and these employees continue to suffer by having to deal with shoddy administration and a lack of interest from government agencies.

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Sarah Othman is an author of several articles pertaining to Claims and Insurance. She is known for her expertise on the subject and on other Business and Finance related articles. See www.accidentsdirect.com.

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