NFIB

Contact: Riley Johnson, NFIB (406) 443-3797
Elizabeth Gaudio, NFIB Legal Foundation (202) 406-4405
Webb Brown, Montana Chamber of Commerce, (406) 442-3797 ext. 101
Cary Hegreebrg, Montana Contractors Association, (406) 442-4162

HELENA, MONT. -- Calling it a critical case which could have significant financial impact on all employers, employees, and taxpayers in Montana, the Montana Chamber of Commerce, National Federation of Independent Business, and the Montana Contractors’ Association filed a friend-of-the-court brief with the Montana Workers’ Compensation Court.

The Satterlee vs. Lumberman’s Mutual Casualty Company case challenges the constitutionality of state statute passed by the Montana Legislature in 1981.  That statute allows a reduction in workers’ compensation benefits when a claimant becomes eligible for Social Security retirement benefits or an alternative to that plan. If the court rules in favor of the claimants, the cost of compensating everyone collecting permanent disability now and in the future would increase.

“The state is not going to absorb this alone,” said Elizabeth Gaudio, senior attorney for the NFIB Legal Foundation. "Montana’s workers’ compensation rates face the prospect of steep increases if the court rules in favor of the claimants.  These cost increases will be passed right onto small-business owners.  This unwarranted expansion of workers’ compensation benefits will significantly harm small business – the fastest growing sector of America’s economy.”

The total amount of new liability that this case would impose on private carriers and self-insured companies if the claimants prevail is unknown, but it is undeniable that both would incur increased, and unanticipated, liability.  Webb Brown, president of the Montana Chamber of Commerce, said, “What kind of message about the business climate would an adverse ruling send to businesses in Montana and those we would like to start doing business in Montana?” 

“Montana legislators put that statute in place to prevent double dipping.  Workers’ compensation was designed to provide for lost wages.  As a person receives social security retirement benefits, it is appropriate that their workers’ compensation benefits reflect that change,” Brown said.  “Not only was the legislature right in taking those types of retirement benefits into account, it has the authority and responsibility to do just that.”

“The Satterlee case is one in a long line of lawsuits that have seen a chipping away by the courts of the 1987 reforms” said Cary Hegreberg, executive director of the Montana Contractors Association. “Should the court rule in favor of the claimants, I predict an immediate and sharp jolt in workers’ compensation costs.”

The State Fund has estimated this could impose a new liability of about $300 million.  “We all remember the Old Fund Liability Tax that was imposed on employers and employees,” Hegreberg added.  “Is that where we’re headed?”