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Will New Mexico farm workers finally be covered by workers comp?

Kudos to Workcompcentral for reporting on the struggle to provider workers compensation coverage to farm workers in New Mexico. Failure to cover farm workers is one of the scandals of the current workers comp system in the country (Many states do fortunately cover these workers).

Public interest lawyers filed suit to declare the lack of coverage in New Mexico as unconstitutional.

Read the Workcompcentral article below. Republished with permission, www. workcompcentral.com, a workers' compensation subscription news service.

Farm Labor Comp Exemption Still Being Targeted: Top [2010-12-16]
By Greg Griggs, Editor

A New Mexico lawmaker said Wednesday he's wrestling with whether to reintroduce a bill he's backed for the past two years with no success — a move to require the state's agricultural industry to provide workers' compensation insurance to farm workers.

Rep. Antonio Lujan, D-Las Cruces, said he may decide to hold off on bringing up the bill next month when the Legislature reconvenes in Santa Fe. The bill would apply to farms with three or more non-family employees.

"Truthfully the best we could hope for would be a debate on the House floor and that's as far as it would go," Lujan said. "But I am determined. If they go the litigation route and win, they would still have to provide coverage."

Lujan was referring to a lawsuit filed by the New Mexico Center on Law and Poverty in August 2009 on behalf of several workers, including two who are U.S. citizens, who claim they have gotten little or no assistance for medical bills or lost wages after being disabled by on-the-job injuries.

The lawsuit argues that the state Workers' Compensation Act violates the equal protection clause of the state constitution by excluding farm workers from benefits. The case remains in the discovery phase.

Currently, the state's workers' comp system excludes farm and ranch workers, domestic servants, real estate salespeople and workers in companies with fewer than three employees.

Just last month, the Advisory Council on Workers' Compensation and Occupational Disease Disablement voted to support the Lujan bill to remove the farm worker exclusion. This week, the council voted not to endorse plans to remove the exemptions for domestic workers and real estate agents.

The Center on Law and Poverty, a major backer of Lujan's bill, persuaded council members by asserting that removing the exclusion for farm workers would apply to less than 10% of the state's nearly 21,000 farms. The 1,973 farms that employ three or more people represent 83% of the farm employees in the state and the proposal would add only about $10 million in annual insurance costs.

Three major parts of the agriculture industry have ample cash to cover the costs, according to official statistics gathered at the center. Dairy ranchers had $1.4 billion in cash receipts in 2008; cattle ranchers saw $1.4 billion in gross income two years ago; and chile growers had an estimated crop of more than $57 million last year.

"The numbers seem clear. They should be able to afford to do this like every other employer in our state," said Gail Evans, legal director of the center. "There's been discussion why the restaurants have to provide workers' comp to their employees, but giant diaries do not. It's really nonsensical."

In estimates from two major workers' comp insurers — New Mexico Mutual and Southwest Casualty — the center said costs for insuring a typical farm worker would range from $7.02 to $8.32 per $100 of payroll in the voluntary market. Employers in the assigned risk pool would be charged about $11.32. For dairy workers the rates would be $4.81 to $5.70 per $100 of payroll. Cattle workers would pay the highest rates, as much as $18.12 per $100 for those in the assigned risk pool.

Caren Cowan, executive director of the New Mexico Cattle Growers Association, said those rates are optimistic at best. One ranch that voluntarily offers comp coverage to its workers is paying a rate of about $29 per $100 of payroll, she said.

"The way the system works in New Mexico, everybody would first go into an assigned risk pool and the rates would be the highest amount possible," she said.

Cowan cites a study conducted by New Mexico State University researchers on the topic, which estimated insurance costs just for the cattle industry would be closer to $11.5 million annually. When considered as a percentage of profit, the study concluded that the average profit per cow is $27.15, but that workers' comp costs would eat up $24.98, cutting profits to $2.17 per cow.

"Three to five years at those rates and people would be out of business," Cowan said.

And most ranchers, who generally provide food, lodging and transportation for workers, also assume the cost of any medical treatment required by an accident on the ranch, according to Cowan.

Beverly Idsinga, executive director of the New Mexico Dairy Producers, said the more than 150 dairies in the state are already struggling with low milk prices and will continue to oppose a move to increase their costs.

"The price of feed is going up and the price of milk is going down," Idsinga said. "We already have dairies leaving the state because of the pricing issue."

While only a few of the large dairies provide workers' compensation to their workers, Idsinga said all dairy operations have general liability coverage to provide for workers in the case of a catastrophic injury.

Charlie Marquez, a lobbyist for the New Mexico Chile Association, said the liability insurance issue extends to chile farms and provides adequate protection for laborers.

"We don't understand the need to go to the workers' comp system," Marquez said. "Farmers are, by and large, very responsible and provide for the care of their employees."

To read a draft copy of the Lujan bill, click here: http://www.workcompcentral.com/pdf/2010/misc/nmfarm12162010.pdf.

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