Reforming the Nigerian Workmen Compensation and Factory Act as a Social

Reforming the Nigerian Workmen Compensation and Factory Act as a Social-Justice Development Plan

Kayode Oladele

Participants at the just concluded Workshop on “Workers’ safety and compensation in Nigerian Industry” organized by the House of Representatives’ Committee on Labor, Productivity and Employment, in collaboration with Friedrich Ebert Stiftung (FES) in Makurdi, Benue State from May 30 - 31 2006 in their communiqué stressed the need for an amendment to the current Workmen Compensation and Factory Acts which they considered as inadequate, outdated, and faulty in several respects. Participants were particularly worried about section 3 of the Act which defines compensable injuries as injuries that occurred by accident leaving other injuries not compensable. Another area that makes the Act worrisome is the utilization of regular court system for worker’s compensation hearings. According to the communiqué, regular courts are unable to satisfactorily resolve matters relating to Compensation, Health and safety of workers and the legal processes are often cumbersome, protracted and frustrating thereby making the entire exercise futile and practically unobtainable.

In May this year, I was contacted by a reputable law office in Nigeria to assist the firm in filing a worker’s compensation claim in the U.S on behalf of a Nigerian lady who worked with one of the multinational corporations in Nigeria for injuries which she suffered while working as a secretary with the multinational company in Nigeria. The oil company has its corporate head office in the U.S. The lady worked as a secretary with the corporation but she was laid off due to work related injuries having suffered from carpal tunnel syndrome.

During my initial interview with this lady, she stated that she worked for the oil corporation for several years as a secretary. However, due to repetitive hand and wrist action, she developed a carpal tunnel syndrome. In most cases, carpal tunnel syndrome is due to work-related cumulative trauma of the wrist. It is commonly caused by strain placed on the hand, for instance gripping and typing, which are usually performed repetitively in a person's occupation. The condition was first diagnosed in Australia in the 80s when musicians started to use synthesizers heavily and people using these instruments started to get hand and wrist pain. The syndrome is much more common in women than it is in men. Symptoms range from a burning, tingling numbness in the fingers (especially the thumb and the index and middle fingers) to difficulty gripping, making a fist, or dropping things. Most early sufferers mistakenly blame the tingling numbness on their sleeping position, thinking their hands have had restricted circulation and are "falling asleep". If left untreated the symptoms often progress to intense pain which restricts hand functionality. It is known as a hidden disability, because people can do some things with their hands and appear to have normal hand function, but often live with severely restricted hand activity due to the pain.

According to this lady, she had spent substantial sum of money visiting hospitals both in Nigeria and the U.S on her medical condition to no avail. Unfortunately, her former employers would not compensate her due to the lacuna in the Nigeria legal systems even though, similarly situated employees of the same corporation in the U.S are being compensated for the same injury.

This woman’s case depicts a typical example of what many workers in Nigeria are going through today due to the inadequacy of the law in this very important area of human Endeavour. It is however gratifying to note that the House Committee on Labor is showing some interest in this matter and might consider possible amendment to the Act. This paper will therefore deal with a general overview of workers compensation law and practice in other jurisdictions such as the U.S.

As a prelude, workers’ compensation hearings are not suitable for regular court system. The very nature of the hearing itself calls for prompt and efficient adjudication of cases in order to quickly rehabilitate the injured worker who may be out of work and in dire need of a regular income. The court system is usually overcrowded, causing long delays.

In Michigan State for example, the body saddled with the workers’ compensation hearing is the Worker’s Compensation Board of Magistrates. The Board was created by the Legislature as an autonomous entity in the Department of Labor consisting of 30 member-magistrates appointed by the Governor with the advice and consent of the Senate. The magistrate is primarily responsible for hearing and deciding contested claims and for preparing concise written opinions containing findings of fact and conclusions of law.

The members of the Board of Magistrates are appointed by, and are accountable only to, the Governor. They are not part of a bureaucratic hierarchy. In the exercise of the decisional function, they do not have a supervisor who can tell them how and what to decide. They are therefore "independent." The Board of Magistrates is created separate and apart from the appellate commission and the Bureau of Worker’s Compensation, and accordingly is a separate autonomous entity within the Department of Labor.

A magistrate, in hearing a claim performs the same role as a judge when the judge acts as trier of fact in an action brought to enforce a right created by statute. A magistrate, like a judge, will find the facts with a large measure of finality and apply the law to the facts, and in so doing will often find it necessary to construe the workers’ compensation act. In so construing the act, the magistrate may not have the guidance of reported appellate decisions. The function of a magistrate and of a judge and their authority and power in hearing a statutory claim are essentially indistinguishable. The findings of fact of a circuit judge are subject to reversal if clearly erroneous while a magistrate findings of fact can be reversed on appeal only if there is not substantial evidence on the whole record to support the decision.

The magistrates, in addition to presiding over worker's compensation contested hearings, sometimes engage in informal settlement discussions with the parties and their attorneys regarding cases assigned to other magistrates. For example, a magistrate assigned to hear a case may believe that this procedure will enhance the likelihood of a settlement. If the parties wish to engage in further negotiations, the magistrate in such a case may ask the litigants and/or their attorneys to permit another magistrate, who has no involvement with the case, to facilitate informal settlement discussions. If they agree, the unassigned magistrate may informally meet with the litigants and/or their attorneys to discuss a possible settlement. If the unassigned magistrate’s efforts are successful, the case continues before the assigned magistrate who presides over a redemption (settlement) hearing; if the unassigned magistrate‘s efforts do not achieve a settlement, the case proceeds to trial and adjudication before the assigned magistrate.

However, where a mediation conference proves unsuccessful in resolving a case, the claim shall be submitted to the Worker's Compensation Board of Magistrates for a contested hearing under section 847, or, if the claim is less than $2,000.00, to the Worker's Compensation Bureau's Small Claims Division.

There is also a special case called the 60 day case. That is where a person was receiving workers’ compensation benefits and was cut off by the insurance company and the injured worker files their Petition within 60 days of the cut off date. This allows them a fast track trial date, although does not guarantee a trial on the first time up.

However, unlike in the regular court system, if an employee wins his case at trial and the insurance company/the file an appeal against the decision, the prevailing employee will start receiving seventy percent of his or her weekly compensation benefits while the case is on appeal, but any past due monies that were awarded for weekly wages or past due medical bills are held and not paid until after the appeal is over. It is the goal of workers' compensation to return the injured employee quickly and economically to the status of productive worker without unduly harming the employer's business.

According to legal encyclopedia by Thomson Gale, Workers' compensation laws in the United States developed during the early 1900s as a result of the industrial age and growing numbers of industrial injuries. Before these laws were developed, workers injured on the job often found themselves without remedy against their employer or their fellow workers. The law of vicarious liability was first developed in England in or about 1700 to hold the employers, liable for the acts of their employees or servants. But in 1837, the British Court in Priestly v. Fowler, 3 M. & W. 1, 150 Reprint 1030, created the fellow servant exception to the general rule of a master's vicarious liability; no longer would the master be held liable for an employee's negligence in causing injury to a coworker.

After Priestly, courts in the 1800s continued to develop judicial rules and employer defenses to liability for injured workers. These included: assumption of the risk, allowed employers to escape liability with the dubious reasoning that employees could avoid or decline dangerous work duties; contributory negligence, allowed employers to escape liability, notwithstanding the employer's negligence, where the employee also contributed to his injury due to his negligence. Workers were left with inadequate remedies against their employers for injuries resulting from work and were forced to bear the expense of injury themselves.

This problem was first addressed in Europe during the 1800s, and by the turn of the century the movement spread to North America. Laws were enacted to provide workers injured on the job with prompt, equitable, and guaranteed benefits. Injured workers received medical care and disability income irrespective of fault. Employers, in turn, were protected from potentially catastrophic loss by a stated amount of specific benefits for the injuries suffered by the employee. The worker was prohibited from filing suit while the employer was obligated to pay the mandated benefits.

Workers’ compensation covers both cases of accidents and injury at work or in the course of employment. Injuries are deemed to be work-related and compensable under workers' compensation if they arise out of and in the course of employment. The requirement that the injury arises out of employment ensures a causal relationship between the injury and the job, and it is usually the employee's burden to prove that an increased risk of the job caused a compensable injury.

The injury does not have to be caused by an accident to be covered by workers' compensation. The benefits are most commonly provided to workers who are injured by a specific accident on the job, such as the worker who gets a hand caught in factory machinery. Compensable accidental injury also include an occupational diseases such as an employee's lung disease that resulted from his exposure to asbestos in the workplace and cumulative trauma associated with work duties, such as carpal tunnel syndrome caused by repetitive keyboard work, also are compensable. What is included in the workers' compensation definition of employee remuneration are.

Unlike in Nigeria, in the U.S, Workers' compensation law is governed by statutes in every state. Specific laws vary with each jurisdiction, but fundamental features are consistent and never altered. In addition to state laws, the Federal Employee's Compensation Act (FECA) provides workers' compensation benefits to Federal employees who sustain job-related injuries or illnesses.

An employee is automatically entitled to receive certain benefits when she suffers an occupational disease or accidental personal injury arising out of and in the course of employment. Such benefits may include cash or wage-loss benefits, medical and career rehabilitation benefits, and in the case of accidental death of an employee, benefits to dependents. The negligence and fault of either the employer or the employee usually are immaterial. Independent contractors are not entitled to workers' compensation benefits, and in some states domestic workers and agricultural workers are excluded or only partially covered.

A worker whose injury is covered by the workers' compensation statute loses the common-law right to sue the employer for that injury, but injured workers may still sue third parties whose negligence contributed to the work injury. For example, a truck driver injured in a rear-end collision by an unemployed third party would be entitled to collect workers' compensation and also to sue the third party for negligence. In such cases a plaintiff who recovers money from a third-party lawsuit must first repay the employer or insurer that paid workers' compensation benefits. The plaintiff may keep any remaining money. Many jurisdictions permit the employer or its insurer to sue negligent third parties on the employee's behalf to recover funds paid as workers' compensation benefits.

Workers' compensation is distinguishable from other personal injury laws where negligence is a factor because although the employer is liable for paying injured workers' benefits, the purpose of workers' compensation is not to punish or hurt the employer. For this reason, an integral component of workers' compensation is the requirement that employers purchase workers' compensation insurance, or provide a self-insured fund, to pay the benefits. This way, the employer can pass along the cost of insurance to the purchasers of the employer's product

Workers' compensation provides replacement income in the form of wage loss benefits, compensation for permanent disability and vocational rehabilitation benefits in addition to medical expenses. Wage loss disability pay is generally available either temporarily, while the worker is recuperating from his injury or permanently if he is not able to recover from his injury. However, the amount of the payment a worker receives will depend on the nature and extent of his injuries.

The insurance company will pay 100% of his “reasonable and necessary” medical bills, plus disability benefits according to the states approved formula. In most states, the worker will receive 2/3 of his average weekly wage for the period that he is unable to work due to his injury. If he is only able to work part time, his wage loss benefits will be adjusted accordingly.

The formula to determine wage loss benefits in Michigan is 80 percent of an employee's after-tax salary. In some cases, the wage loss benefit might be two-thirds of the worker's base salary, subject to limitations. When an employee's salary changes from week to week the benefit may be based on the 39 highest weeks of pay during the past year. Normally the 80 percent calculation is more beneficial to the worker. All necessary medical expenses incurred by an injured worker are to be paid for by worker's compensation insurance.

Other examples include: Alabama - for temporary or permanent total disability, an injured worker receives 66 2/3 percent of the wage with a minimum and maximum wages established by law, Arizona -disability rate is 66 2/3 percent of the wage with no minimum weekly payments but maximum payments established by law, New York-disability rate is 66 2/3 percent of wage, Massachusetts-disability rate is 60 percent of wage and Iowa-disability rate for temporary or permanent total disability is 80 percent of "spendable earnings

Remuneration for the purpose of the computation include Wages or salaries; Commissions; Bonuses including stock bonus plans; Extra pay for overtime work, with certain exceptions, payment by an employer of amounts otherwise required by law to be paid by employees to statutory insurance or pension plans, such as the Federal Social Security Act (employer’s contribution not to be deducted from employee’s gross wages);payments to employees on any basis other than time worked, such as piecework, profit sharing or incentive plans; the value of lodging other than an apartment or house, received by employees as part of their pay, to the extent shown in the insured's records; the value of store certificates, merchandise, credits or any other substitute for money received by employees as part of their pay with certain exceptions; payments for salary reduction, retirement plans that are made through deductions from employee’s gross pay; expense reimbursements to employees to the extent that an employer’s records do not substantiate that the expense was incurred as a valid business expense.

Remuneration excludes tips and other gratuities received by employees; payments by an employer to group insurance or group pension plans for employees, the value of special rewards for individual invention or discovery; dismissal or severance payments, except for time worked or accrued vacation; employee discounts on goods purchased from the employee’s employer; expense reimbursements to employees to the extent than an employer’s records substantiate that the expense was incurred as a valid business expense; Sick pay paid to an employee by a third party such as an insured’s group insurance carrier that is paying disability income benefits to a disabled employee etc. Overtime is not counted unless it is a regular part of the job or was required at certain occasions and it then counted at regular time wages.

The Act does not make provision for pain and suffering. However, there may be a lump sum payable for the percentage of permanent disability, if any, that the worker suffers. Often called “permanent partial disability,” this rating is given by a doctor according to your state’s disability tables. The actual amount of the settlement will depend on several factors, such as the doctor’s rating, your wage at the time of the injury, etc. However as stated above, an injured worker is entitled to receive 100% of necessary and reasonable medical expenses incurred as a result of a job-related injury which also include emergency room services, hospital care, physician's fees and prescriptions. Pre-existing medical conditions are taken into consideration in determining the causal relationship of a work-related injury. But if a pre-existing medical condition becomes aggravated, accelerated or exacerbated by a work related injury the workers' compensation carrier is usually responsible for the increased disability, including medical treatment

In conclusion, while these foreign jurisdictions have effective system for ensuring the safety and security of workers, they continue to explore further and better ways of making sure that workers are not deprived of their earnings and earning capacities through work-related injuries by removing both legal and extra legal barriers as stated above. In order therefore, for Nigeria to flow in the stream of these current developments in the law, which started in Germany, Great Britain and the United States in the late 1800s and the early 1900s, Nigeria should amend the Act by making all work related injuries compensable. The country should also set up agencies that would provide workers a fast track for receiving their benefits instead of saddling the regular courts with this onerous tasks.