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Ray Haynes

Mr. Haynes is an Assembly member representing Riverside and Temecula. He serves on the Appropriations and Budget Committees. [go to Assembly Member Haynes website at California Assembly][go to Haynes index]

Kiss Your Job Goodbye
Jobs are racing out of the state...
[Ray Haynes] 2/24/04

Ask any friend of yours who happens to own their own business, no matter how big or small, what has happened to their worker’s compensation premiums in the last three years. Every one that I have spoken to has told me that their rates have at least doubled, most have seen 300 or 400 per cent increases. This problem has been around for at least two years, when then Governor Davis increased worker’s compensation benefits in March 2002. Soon thereafter, insurance rates began to skyrocket.

For those who do not know, worker’s compensation insurance pays for workers who are injured “on the job.” The problem in California is that we have the highest insurance premiums in the country. You would think that these high premiums would lead to lavish benefits for injured workers, but, interestingly enough, California pays out some of the lowest benefits in the country. The reason? The people who make money off the system milk it for all its worth, and California business owners pay the bill. This week, the California Legislature started hearings to reform the system, since business owners have been complaining about the system for well over a year. Republicans in the Legislature have been calling for reform since August, 2002. Democrats have been stalling on that reform for the same length of time.

Last week, the new Speaker of the Assembly announced that “we need reform” but we “need the time to do it right.” This shouldn’t be rushed, he said, because we “can’t afford” to do it wrong.

I know that the new Speaker has only been around for a few months, so he doesn’t remember how we got into this mess. In March, 2002, in 48 hours, the Legislature, dominated by Democrats, and the Governor, also a Democrat, met with the unions and the trial lawyers (no business owners allowed), cut a deal to increase benefits, and passed the bill. The meetings began Friday night, the deal was cut Sunday, and by Monday at 5:00 p.m., the bill was signed by the Governor. No need to go slow there, the Democrat speaker thought then, the trial lawyers demanded action. They got it, and business owners were forced to pay the freight.

Last Summer, the worker’s compensation crisis reached critical mass. The Republican caucus introduced a comprehensive package of fixes, most of which were killed outright. In September, Arnold Schwarzenneger made reform a keystone of his compaign. Immediately upon taking office in November, Governor Schwarzenegger called a special session of the Legislature to deal with this problem, but they left Sacramento for the year without holding a hearing. In his state of the State address, Governor Schwarzenegger demanded on January 5th that the Legislature act by March 1st. Now, on February 11, the Democrats finally held their first hearing, and said that they needed until April 16 to finish their work.

Gee whiz, thanks guys. April 16 is the last day to qualify an initiative to fix the system if we want to get reform in the next two years. If we wait until then, and the Democrats do nothing, jobs will leave the state in droves, because business owners can no longer afford the insurance. Do you think they picked that date on purpose?

When trial lawyers wanted to stick it to the business owners, they asked the Legislature to jump. The Democrat majority asked how high. Now that the business owners are screaming about how badly they got stuck, the Democrats are saying that they don’t see the knife. We have to study the injury, they say, we need to see if it really hurts, we need to know if that big knife in the back of business is really real.

Meanwhile, California jobs are leaving the state. If we don’t act quickly, the job that leaves might be yours. Your boss might take you with him to Arizona, or he or she might not. Make no mistake, we could fix this tomorrow if the Speaker wanted to—he just doesn’t want to. So if you lose your job because your boss moves to Nevada, you now know why.


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