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Workers Compensation Package Passed by Maine Lawmakers

November 20, 1987

AUGUSTA, Maine (AP) _ The Maine Legislature on Friday reluctantly approved a benefit-curbing Workers’ Compensation reform package designed to head off a withdrawal from the state by major insurance companies.

Despite complaints that injured workers will suffer and that employers will face rate increases anyway, Democrats in control of both houses gave their support to the package backed by Republican Gov. John R. McKernan Jr.

″The crisis is over,″ declared McKernan, who had said cost reductions for carriers in the state’s $360-million employer insurance system were essential to maintain coverage for on-the-job injuries.

Most major carriers of the mandatory, employer-paid insurance for on-the- job injuries said Maine’s system was so generous they could not profitably participate.

The McKernan administration estimated that the industry lost more than $100 million on workers’ compensation policies in Maine last year and, without new savings, would be justified in demanding a doubling of current rates. Administration officials said at least half a dozen major carriers, enough to serve the state, had agreed to stay if the reforms were enacted.

Currently, any employee with a permanent injury receives lifetime payments.

The package limits the duration of future payments for workers with permanent but partial injuries to about 7 1/2 years. In exchange, Democrats won acceptance of requirements for employers to rehire and retrain incapacitated workers.

The package would also impose mandatory deductibles on employers with poor safety records, restore full rate-setting authority to the state insurance superintendent and require additional financial disclosures from the insurers.

A spokesman for an employers’ coalition that lobbied heavily in favor of the reforms expressed satisfaction with the results of a month-long special session.

″Even with the reforms, we must still recognize that Maine still has a progressive system to care for its workers,″ said Edward Johnston of the Maine Forest Products Council.

However, faced with legislatively mandated benefit reductions for the second time in three years, organized labor advocates were bitter.

″A great insult to the workers of the state of Maine,″ said Mickey Meader, a shipbuilders’ union vice president from Bath Iron Works. ″I don’t find anything in the bill that I like.″

Final passage of the measure was marked by the same uncertainty that characterized four weeks of committee deliberations.

Both the House and Senate endorsed the plan overwhelmingly and sent it on to McKernan for his signature. Then it was discovered that last-minute changes had stripped the bill of an emergency provision required to put it into effect immediately. Non-emergency legislation takes effect after 90 days.

McKernan and legislative leaders decided it would be easier to revise a new law than to return the flawed bill to the Legislature for amendment, so the governor signed it. Lawmakers then hastily passed a second measure, in effect restoring the emergency provision.

House Speaker John L. Martin said Friday he was satisfied with compromises in McKernan’s original proposals that would promote retraining and workplace safety.

″It’s not the way I would have written it,″ Martin said, but added, ″it was the best we could do.″

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