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Battle Over Workers Compensation Funds Goes to Court

Battle Over Workers Compensation Funds Goes to Court

Estimated read time: 2-3 minutes

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SALT LAKE CITY (AP) -- The state argues its case for ownership of the Workers Compensation Fund before the Utah Supreme Court this week.

Oral arguments are scheduled Tuesday in the appeal of 3rd District Judge Timothy Hanson's ruling that the state has no ownership in the fund other than as one of the 30,000 policyholders.

The Utah Manufacturers, Utah Food Industry and Utah Trucking associations have filed a joint friend of the court brief against the state's claim.

"The State of Utah has shown in lean economic times a propensity to unilaterally attempt to redefine ownership of the Trust Fund," wrote attorney James Black in behalf of the trade associations. "Each time, the effort has been directed toward taking Trust Fund assets to supplement other government agency budgetary shortfalls or to in some other way assert authority and power over the Trust Fund's insurance business operations. Each time the Court has rebuffed the raid."

The fund was created by the state in 1917 as an option for employers, who were being required to obtain insurance for their employees.

Dennis Lloyd, senior vice president and general counsel for the WCF, said the state started WCF with $40,000 in seed money, which was paid back by the fund by 1922.

In 1988, the Legislature gave the fund more independence by giving it quasi-public entity status. They also made it the "carrier of last resort" for employers unable to get coverage by private insurance companies.

The Utah Attorney General's Office has argued that WCF is still a state-created entity and that its assets are not owned by its policyholders. Deputy Attorney General Thom Roberts said the state has no interest in taking the injury fund from policyholders, but said the state believes it has a right to control and manage WCF and the injury fund.

(Copyright 2005 by The Associated Press. All Rights Reserved.)

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