Governor Hochul’s Veto Power Can Help Struggling Businesses
In the closing days of the Legislative Session, the Legislature passed over one thousand bills. Among them, there were some that, if signed by the Governor, would be tremendously harmful to businesses and consumers alike. Luckily, Governor Hochul has an opportunity to help struggling small businesses, hospitals, municipalities, and consumers alike, by vetoing these bills that would drastically alter workers’ comp law and civil litigation laws. These bills, in particular, redefining temporary total disability in workers’ compensation and expanding wrongful death claims to include mental anguish for survivors would exponentially increase the costs of insurance – costs that will certainly be passed along to consumers.
(S.768/ A1118/) would completely redefine temporary total disability in the workers’ compensation system and represents a fundamental shift in the definition of disability and the way in which wage replacement amounts are determined in New York. This bill upends the case law definition of a temporary total disability by allowing for unlimited awards at the temporary total rate for employees with mild or moderate partial disabilities should “light duty” work be unavailable. The bill is particularly damaging to small businesses which lack the capacity to create light-duty jobs. These small businesses, pizza shops, florists, hair salons, and thousands of others will face paying lifetime total disability awards to employees who are far from totally disabled. As a result, all businesses in New York will pay significantly higher workers’ compensation rates at a time that they are facing record increases in unemployment insurance, inflation as well as unprecedented labor and supply chain issues.
The second bill, (S.74/ A.6770), would radically expand the kinds of damages recoverable in wrongful death actions, driving up liability insurance premiums for all public and private entities across the state. According to an actuarial analysis by Milliman, Inc., the bill would increase medical professional liability costs by nearly 40%. Automobile liability and general liability insurance would increase by as much as $2.2 billion. The result would be a 12.6% increase in annual premium across the board for residents and businesses.
New York already has some of the highest jury awards in the country and our liability insurance premiums are already some of the highest nationally. For struggling businesses, hospitals and local governments these increases are, in some cases, existential. In our current economic environment, such dramatic increases in liability insurance costs will undoubtedly lead to price increases for consumers and even job losses for some New Yorkers.
Our businesses and our communities are struggling with inflation, labor issues and an all-around unpredictable economy. Governor Hochul has a unique and important opportunity to fight back against these increased burdens that would drastically impact the day-to-day well-being of average New Yorkers by saying no to these tremendously harmful pieces of legislation.
Lev Ginsburg is Senior Director of Government Affairs at The Business Council.