Burr Alert: Employer-Friendly Overhaul Of Tennessee Workers’ Compensation System Passes In The Legislature

The Tennessee legislature has passed a workers’ compensation reform bill that significantly changes the way claims are handled in Tennessee after July 1, 2014. Though Governor Bill Haslam has not yet signed the bill, he is expected to do so soon, as the reform was a major part of his legislative agenda this year. Senate Bill 200 (House Bill 0194), which passed overwhelmingly in both houses, shifts the responsibility for workers’ compensation administration from the state’s court system to an independent administrative judiciary. Significantly, it also rejects the courts’ liberal construction of the workers’ compensation law in favor of injured workers, and replaces it with construction that is “fair,” “impartial,” and “without favor to either employee or employer.” This represents a major and positive change for Tennessee businesses, as it promises to bring cost reductions, quicker claim resolution, and more consistency to the current system.

Oversight of the present system is shared between the state Labor Department, the legislature, and the courts. The new bill consolidates this responsibility into a single separate state division of workers’ compensation, which will operate independently under a governor-appointed administrator. The administrator will select and appoint the first crop of workers’ compensation judges, and retains the power to appoint and remove them from their staggered six-year terms. The law does not set a number of judges as yet – presumably the administrator, once appointed, will perform a needs assessment. The decisions of workers’ compensation judges are appealable to a three-person appeals board, whose members will also be appointed by the administrator. Further appeals of board decisions will continue to be filed with the Tennessee Supreme Court, as they are presently.

Please see full Alert below for more information.

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