Lynch Ryan's weblog about workers' compensation, risk management, business insurance, workplace health & safety, occupational medicine, injured workers, insurance webtools & technology and related topics

August 11, 2004

The history of workers compensation

I stumbled on an interesting essay at the Florida Department of Financial Services' site...it's an overview of the historical evolution of workers compensation from ancient times to the present, one of the best treatments I've seen on the topic. In addition to exploring the European roots, it presents an overview of the system's development throughout the United States, with particular emphasis on legal developments in Florida.

Some reports state that the move to offer protection for injured workers really had its genesis in the German guilds, a system that might be seen as a forerunner of the modern day labor movement. Things really gathered steam in the mid 1800s, both in Germany and England. Here's an excerpt from the Florida essay about a pivotal point of development in Great Britain:

"Barristers, solicitors and others with legal knowledge and training came forward in increasingly large numbers from 1850 forward and represented the injured workers on a contingency or percentage of what they could collect basis. Although the burden of proof was on the worker as well as other legal expenses, the courts became backlogged and the general public suffered from this unfair and inefficient system as crowded dockets and few judges delayed other civil actions. In the midst of this chaos and confusion, it was noticed that the worker was beginning to prevail in these actions and with the growing legal profession's assistance were tying up attaching machinery, buildings and property of the employers through liens and attachments.

In 1897, England repealed the employer's liability act of 1880 and replaced it with a "workmen's" compensation act. Meanwhile, the storm that swept through Europe during this period of industrialization reached the shores of the United States fueled by the aftermath of the Civil War from 1861-1865."

Here in the United States, workers comp wasn't enacted in this country until 1911. Wisconsin was the first state to adopt a law, and by 1948, every state had some form of "workman's comp." At essence, this social insurance is a pact between employers and employees. Employers are mandated to cover medical care and provide wage replacement for injured workers; in exchange for this protection, the workers compensation becomes the exclusive remedy for workers. Although the courts have upheld this doctrine for nearly a century, in some instances, such as willful intent or bad faith, court challenges have succeeded in piecing the exclusivity.

Related
For history buffs, here's another historical overview entitled Workers Compensation, Federalism, and the Heavy Hand of History (pdf). It's a long and academic treatment that explores why workers comp remains the purview of state rather than the federal government by looking at the system's historical roots. And for our northern neighbors, I present the Evolution of the Workers' Compensation System in Canada.

Posted by Julie Ferguson at 9:09 AM Link to, Comment (0), or E-mail this post
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