When was workers’ compensation developed (and why)?
The state of Georgia enacted its first workers’ compensation statute in 1920.
Prior to enacting this law, an employee’s only avenue to recover for an on-the-job injury was through a lawsuit in the personal injury area. The injured worker would have to prove that the employer was somehow negligent in causing their injuries, as well as prove that there wasn’t “contributory negligence” or assumption of the risk by the employee and the fellow servant doctrine.
Before modern workers’ compensation laws, the bar to financial recovery for an injured worker was very high. If the injured worker could meet this burden, the exposure for the employer was quite tremendous.
Texas currently has a system where an employer can “opt out” of workers’ compensation. This means that employers can choose to purchase workers’ compensation insurance or choose not to carry workers’ compensation insurance. If the employer chooses not to carry workers’ compensation insurance, injured employees can sue them in a tort—similar to the system Georgia had prior to 1920.
For instance, the Dallas Cowboys chose not to provide workers’ compensation coverage. In 2009, two coaches were injured in a workplace accident and ended up settling for $5 million each.
Georgia’s first workers’ compensation law
Georgia’s initial Workers’ Compensation Act of 1920 created an Industrial Commission and specified that an employer had to have at least 10 employees to be subject to the Act. However, this Act was optional. Employers could opt out if they had 10 or more employees, or opt in if they had less. Employers who were exempt from this initial Act were farm laborers, domestic servants, railroad employees and non-profit organizations.
Benefits were very limited as to what an employee could recover, with a maximum temporary total disability rate of $12 per week. Medical expenses to be paid were also capped. Death benefits were also limited $4,000 and $100 for burial expenses.
Over the next 50 years, there were some small changes made to the Act, but it basically remained the same.
Small updates to Georgia’s workers’ compensation system
In 1943, the Industrial Board was abolished and the State Board of Workers’ Compensation was created. The average weekly wage calculation was also established.
In 1955, the temporary total disability rate was changed from 50 percent to 60 percent. The maximum temporary total disability rate gradually increased over time as well.
Significant changes to Georgia’s law protecting injured workers
In the 1970’s, the Georgia legislature made several significant changes to the law that still apply today.
First, it repealed the portion of the Act that allowed employers to opt out of providing workers’ compensation insurance to its employees. Workers’ compensation became mandatory in Georgia.
The legislature also repealed the limits on medical expenditures and raised the temporary total disability rate to two thirds (⅔) of the average weekly wage, which still applies today.
The next major change took place in 1992. During that session, the legislature capped the number of weeks an injured worker could receive benefits at 400 weeks for non-catastrophic injuries. Attorneys’ fees were capped at 25 percent of the claimant’s award.
Another change that took place in 1992 was the abolishment of any medical privilege of confidentiality relating to the claim or history of treatment of the injury. This allowed insurance carriers and employers greater ease in obtaining medical records.
In 1994, the legislature allowed aggravations of pre-existing conditions to be considered an injury for workers’ compensation purposes.
The state legislature also expanded the number of doctors required on a panel of physicians from 4 to six 6, and the time allowed to request an independent medical evaluation from the last day of receipt of indemnity benefits increased from 60 to 120 days.
Modern version of Georgia’s Workers’ Compensation Act
The last significant change to workers’ compensation occurred in 2013.
During this session, the legislature amended the statute to place a $400 week cap on medical treatment to the injured worker if the case was not deemed to be catastrophic. The current maximum temporary total disability rate is now $675 per week and the maximum temporary partial disability rate is $450.
If you have any questions about workers’ compensation in Georgia, please don’t hesitate to contact the lawyers at Gerber & Holder.