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Two years ago,
Jim Randall was grappling with rising workers'
compensation costs.
"It was
out of control," said Randall, president
of Allfast Fastening Systems Inc. in Industry.
Allfast provides the rivets that are used to
hold most military and commercial aircraft
together.
"It was
out of control for many years, but now our
expenses are decreasing," Randall said.
"The state has finally got a handle on
workers' comp claims - and we feel good about
it. We've saved $180,000 over the last two
years."
Randall,
whose company employs nearly 300 workers,
attributes the reduction to more stringent
safety precautions at the company's
120,000-square-foot Industry plant and to
Senate Bill 899, which was passed two years
ago.
SB 899 was
designed to produce billions of dollars in
savings, protect workers and root out fraud
and waste in the workers' compensation system.
A new survey
by the Workers' Compensation Action Network
reveals California employers are seeing
positive changes as a result of SB 899.
Out of 267
respondents, 83 percent feel the reforms have
had a positive impact on their business, with
43 percent reporting that the reforms have had
an "extremely positive" impact.
More than
two-thirds of respondents (68 percent) have
seen a reduction in their workers' comp costs,
with one-quarter of the respondents
registering cost decreases of more than 25
percent.
"We
definitely see workers' comp costs moving in
the right direction," said Ellen Frost of
Hallmark Lighting in Chatsworth, which has
seen a 47 percent reduction in its workers'
comp costs.
"Not
only did our rates decrease by a significant
amount, but we were also awarded one of only
eight excellence awards from our new insurance
provider."
The survey
said employers have reinvested the savings in
their businesses and employees by:
- Providing
raises to their employees (25 percent);
- Expanding
their business (19percent);
- Adding
employees (16 percent);
- Providing
benefits such as health insurance (8
percent);
- Changing
plans to lay off employees (6 percent);
- Changing
plans to leave California (6 percent).
"There
were always opportunities to expand the store,
but now we'll actually have the cash to do
it," said John Quintanilla, owner of
Golden Rose Florist of Rosemead. "Now, we
are extending hours and purchasing new
products, all because of lowered workers'
compensation rates."
The survey
also showed a dramatic turnaround in how
California employers view California's
workers' compensation system.
When asked to
describe their satisfaction with the system
prior to reform, 86 percent said they were
dissatisfied.
But since the
reform, 83 percent of respondents said they
are now satisfied with the system.
The Workers'
Compensation Action Network is a statewide,
grass-roots coalition of employer and insurer
trade groups, businesses, nonprofit
organizations and public entities working to
ensure successful implementation of reforms to
restore predictability and stability to the
workers' comp system, reduce costs for
employers and improve services to injured
workers.
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