Carve-Outs in Workers' Compensation: An Analysis of the Experience in the California Construction Industry

Fed up with soaring medical and indemnity costs, inadequate benefits, and pervasive fraud, employers and unions in several states during the 1990s were allowed to "carve out" their own workers' compensation systems. These innovative reforms gave the parties the right to collectively bargain their own systems outside the statutory systems. In addition, alternative dispute resolution (ADR) systems were implemented in order speed the legal process and reduce litigation costs. This book offers an evaluation of the first few years' experience with these organizational reforms in California. The authors offer lessons important for any groups considering carve-outs as well as for operators of state statutory workers' compensation systems. They also provide insights into how any employer might want to alter their handling of workers' compensation claims and, more generally, into ADR programs and the decentralization of employment regulation.