California Pays the Most in Worker’s Compensation

Governor Jerry Brown and the legislature made a major reform to the system that compensate for work-related illnesses and injuries about two years. This reform aimed to reduce overhead and increase disability payments. Despite this attempt at fixing the system, California employers have the nation’s highest costs in workers compensation.

According to the Oregon Department of Consumer and Business Services, California’s employers pay $3.48 per $100 of payroll on average which translates to 188 percent of the national median among the 50 states and the District of Columbia.

The high costs in worker’s compensation pushed California from ranking #3 in the 2012 survey to now being ranked #1 followed by Connecticut, New Jersey, and New York. The state that paid the lowest in worker’s compensation was North Dakota. In North Dakota, they paid 88 cents per $100 of payroll.

work related injurie

The 2012 reform did reduce litigation and medical costs yet it increased payments to disabled workers. The change in legislature maintained a once-a-decade reform pattern of worker’s compensation reforms, which demonstrated the complexity of the multi-billion dollar system’s political matrix which encompasses not only employers but labor unions, medical and physical therapy providers, insurers, and attorneys who represent disabled workers in their claims.

Workers’ Compensation Action Network stated that the Oregon Survey shows how employers continue to pay large sums of money in worker’s compensation which inefficiently gets directed towards ligation and other expenses rather than the actual injured worker.


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