North Carolina Worker's Compensation Check Is in the Mail…or Is It?
If the U.S. Postal Service defaults, what will happen to North Carolina workers’ compensation for postal workers? According to an August 29 article in Reuters, USPS might default on an enormous $1.2 billion payment in 2012, putting postal employees who rely on North Carolina workers’ compensation at risk of a possible loss of benefits. Reuters summarized the sobering news as follows: “The mail carrier, which has been losing billions of dollars each year, has more than 560,000 full-time employees, the largest pool of workers covered by the Federal Employees Compensation Act.”
It may not be time to panic just yet. The Postal Service should have no problem paying these benefits at least through the first three quarters of 2012. But starting in the last four months of fiscal year 2012, more than 2 million federal employees and USPS employees could be impacted.
Fortunately, the Postal Services is not sitting idle. In June, USPS suspended paying into a retirement fund to save approximately $900 million to pay down the workers’ compensation bill due. The agency is dealing with a two-fold problem – a sharp cut in the volume of mail due to electronic communications coupled with “skyrocketing employee costs.” The USPS has begged Congress to overhaul aspects of its business model and also offer some relief from upcoming payments. But the bruising fight over the deficit and debt ceiling may make it difficult for the USPS to get any significant reforms on the floor. Moreover, “the Labor Department said…that there is no penalty if the Postal Service skips the workers’ compensation payment.”
This is all pretty scary news, even if your North Carolina workers’ compensation benefits are in no way tied to the Postal Service or to any kind of federal program. The reason that it’s scary is because it implies that workers’ comp funds may be more brittle and less sacrosanct than hurt and sick workers would like them to be. In other words, we depend on workers’ comp as a kind of crutch to help us get back on our feet. But if/when that crutch gives out – due to poor fund management or some other deep structural flaw in the fund’s business model – then individual beneficiaries could suffer a hard landing.
There are so many aspects of the workers’ compensation system that are way out of your control – the USPS crisis is just one of tens of thousands – so it is important to concentrate on what you can control. Similarly, you want to avoid getting caught up in thinking and worrying about worst-case scenarios and, instead, focus on what you want to occur and what resources you need to achieve your financial goals. To that end, you might find it useful to talk to a North Carolina workers’ compensation law firm about what steps you should (or should not) take to ensure the best outcome for your situation.
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