Oklahoma Workers Comp Rates Among Nation's Highest

For years, Oklahoma businesses and legislators have been calling for reform of the state's workers' compensation system.  As recently as 2011, the Workers' Compensation Act was repealed and replaced with the Workers' Compensation Code.  Despite these reforms, a study by the Oregon Department of Consumer and Business Services shows that Oklahoma continues to have some of the highest workers compensation insurance premiums.  According to the study, which compares the workers comp costs of all fifty states and Washington, D.C., Oklahoma's workers compensation premiums are the sixth highest in the nation, and rates are expected to rise again in 2013. What do these high premiums mean for Oklahoma?  According to many businesses, high workers compensation rates are detrimental to the state's economic growth.  According to responses on a governor's office survey of 5,000 businesses, the greatest challenge to doing business in Oklahoma is the state's workers' compensation system. Workers' compensation is designed to protect both businesses and employees.  According to the Oklahoma Workers' Compensation Court (OWCC) website: "Workers’ compensation is an insurance program that provides compensation for disability, and medical and rehabilitation benefits, for employees injured on the job.  In the case of accidental death of an employee, it includes benefits to the employee’s dependents.  Under workers’ compensation, both workers and employers are protected.  Each covered worker has a right to benefits for a compensation injury.  In return, employers are protected from liability lawsuits outside the workers’ compensation system." Almost every employer, with a few exceptions, is required to carry workers' compensation insurance to provide benefits to employees who are hurt at work, and most workers are eligible for workers' comp benefits in Oklahoma.  Exceptions include:

  • Independent contractors
  • Persons covered for job-related injuries under the federal law
  • Certain agricultural workers
  • Licensed real estate brokers paid on a commission basis
  • Certain persons providing services administered by the Oklahoma Department of Human Services
  • Any person employed by an employer with 5 or fewer employees, all of whom are related by blood or marriage to the employer
  • Any person employed by a tax-exempt youth sports league
  • Sole proprietors, members of a partnership, certain persons who are a party to a franchise agreement, certain members of a limited liability company and certain stockholders of a corporation
  • Any person that provides voluntary service who receives no wages for the services other than meals, drug or alcohol rehabilitation therapy, transportation, lodging or reimbursement for incidental expenses
  • Owner-operators of a truck-tractor
  • Drive-away owner operators.
The high cost of workers compensation premiums may be keeping new businesses out of Oklahoma.  Legislators are pondering a major overhaul of the system in 2013.