Oklahoma Supreme Court justices peppered attorneys with questions about opt-out provisions in a new workers' compensation law Tuesday during oral arguments on a challenge to the law's constitutionality.
The new law enacted by the Oklahoma Legislature would convert the state from a judicial workers' compensation system to an administrative one.
It would allow employers to opt out of the system as long as they provide coverage for the same injuries as the state-operated administrative system and provide benefits to injured workers that are at least as generous.
Law a high priority
The law was a high priority of Gov. Mary Fallin and Republican legislative leaders, who have said it will help businesses by reducing workers' compensation costs. Opponents claim cost savings will come at the expense of injured workers.
Oklahoma City attorney John McMurry, who is challenging the law on behalf of two state lawmakers and the Professional Fire Fighters of Oklahoma, argued that not all Oklahoma employers and employees would be treated equally under the law.
Employees of companies that opt out of the system would have “fewer rights” than employees of companies that participate in the administrative system, McMurry argued.
An employee of an opt-out company who is dissatisfied with the way the employer has handled a claim would first have to appeal to a panel of three persons appointed by the employer, McMurry said.
Eventually, the employee would be able to appeal a series of adverse decisions to the state Supreme Court, but McMurry argued the standard of review would be different and might not give the court as much latitude to correct an unfair decision.
Oklahoma Solicitor General Patrick Wyrick defended the new law, saying all employers are treated the same because they all have the option of opting out of the administrative system and providing their own system as long as they provide equivalent benefits.
“It applies equally to every employer and every employee,” Wyrick said.
An injured employee of an opt-out company would have to get at least what he or she would have gotten through the administrative procedures act, Wyrick said.
Would it be fair?
Justices voiced concerns over whether employees of companies that opt out of the administrative system would receive fair treatment.
Justice John Reif questioned whether decision-makers are neutral when the employer selects the panel that hears the initial appeal from an employee dissatisfied with a decision.
“To me, that's a very serious problem,” Reif said.
Justice Joseph Watt asked whether 1,500 different workers' compensation systems could crop up if each employer is allowed to develop a different system.
Is that a “potential danger here?” he asked.
Justice Noma Gurich questioned whether now was the proper time to decide the case since administrative rules that will determine how the system is operated haven't been developed yet.
McMurry also argued the new law is unconstitutional because it includes more than one topic, a practice commonly referred to as logrolling. In written arguments, he argued that opt-out provisions, administrative procedures and arbitration procedures written into the law were three separate subjects that shouldn't have been covered in one bill.
Justice Steven Taylor questioned McMurry's argument.
“It has to do with workers' compensation, doesn't it?” he asked.
Attorney Robert McCampbell, who represents the State Chamber of Oklahoma, the Greater Oklahoma City Chamber of Commerce and the Tulsa Regional Chamber of Commerce, urged justices to find the entire law constitutional. If justices find any objectionable provisions, he urged them to use a “scalpel” to remove unconstitutional parts rather than tossing out the entire law.
Justices took the case under advisement, but did not say when they might issue a decision in the case.