Trump and Workers Comp: Mountain Climbing in a Fog

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As Donald Trump settles into the Oval Office, we think it's a good time for a little speculation about his potential impact on workers comp. First, the obvious: workers comp is a state-based program; Trump will have no inclination whatsoever to federalize it, nor will he have any interest in revisiting the long-dormant issue of national standards.

As Donald Trump settles into the Oval Office, we think it’s a good time for a little speculation about his potential impact on workers comp.

First, the obvious: workers comp is a state-based program; Trump will have no inclination whatsoever to federalize it, nor will he have any interest in revisiting the long-dormant issue of national standards.

Deregulating

With his profound aversion to regulations, Trump is likely to dramatically reduce the federal involvement in safety. OSHA mandates will be replaced – or not – by state-level initiatives. He is likely to rescind the recent changes in OSHA reporting (some of which will not be missed). We wonder whether the federal government will be interested in generating national data on injuries and fatalities in the workplace. To be sure, workers will still “drop a dime” on employers with lax safety practices; the question is whether anyone on the federal end will answer the phone. If and when federal standards erode, accidents – and workers comp costs – are likely to go up.

Through the Fair Labor Standards Act and the EEOC, the feds play a prominent role in overseeing employment practices in the private sector. We can probably assume that Trump appointees will try to give employers significantly more leeway in how they manage their employees. There will be less friction, and, in all likelihood, substantially less focus on the many faces of discrimination.

Where the Jobs Are

If Trump moves ahead with his massive infrastructure program (federal, state and private), we can anticipate an increase in injuries, as infrastructure work is inherently high risk. Due to their lack of conditioning and possible lack of experience, the long-term unemployed who sign up for these jobs – key Trump supporters – will be at elevated risk for injury as they re-enter the workforce into jobs they have not specifically been trained for.

As Trump tightens standards for immigration, there will be potential problems at both ends of the employment spectrum: high tech companies may struggle to continue their innovations due to the scarcity of highly skilled foreign workers and farmers will likely have difficulty finding crews for the harvest. Workers who have been left behind by the end of manufacturing in the rust belt will likely have little interest in the back-breaking work of the fields.

Speaking of manufacturing, I have difficulty sharing Trump’s vision of a return to early 20th century industrial methods. The new assembly line workers are going to be robots; jobs for humans will mainly involve the use of iPads to control, supervise and maintain production lines. (3D printers are already building houses from scratch!)

Health Insurance and Workers Comp

The big Kahuna is the Affordable Care Act (AKA Obamacare). Trump is seeking a quick repeal (easier said than done) and a quick replacement (borderline impossible). When the Act was first implemented, there was much conjecture concerning its impact on workers comp: a healthier workforce would theoretically have fewer injuries. Recent trends have shown a reduction in frequency, but it is too soon to know how much of this can be attributed to the ACA. As we transition out of the ACA, there will be lots of turmoil: in the insurance markets, in payments for medical services, and in the basic health of workers. And we might well envision an increase in “Monday morning” injuries, where people without health insurance who are injured on the weekend drag themselves to work in order to file a comp claim.

In all these critical areas impacting workers comp, we are climbing a mountain in the fog. We cannot see where we are headed, so all we can do is place one foot in front of the other and hope that we are still on the path. Eventually the fog will lift, revealing whether we have reached the summit or wandered off into the impenetrable woods.

 Jon Coppelman
Senior Workers Compensation Consultant

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About Renaissance Alliance

Renaissance Alliance is the premier alliance for independent property casualty agencies. Founded by agents for agents in 1999, we are a pioneer in agency groupings, offering far more than expanded markets and profit share. Distinct from agency aggregators, we provide state of the art technology solutions, a full-time staff of more than 90 industry experts and a proprietary agency growth acceleration process that delivers superlative results.

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