Austin, TX – The Texas Department of Insurance, Division of Workers’ Compensation (DWC) Research and Evaluation Group recently released a report on employer participation in the Texas workers’ compensation system.
The report includes data on employer subscription rates and reasons for not subscribing.
Texas enacted the first workers’ compensation laws in 1913, and since then, it has held fast to the principle that employers should be allowed to choose whether or not to offer workers’ compensation to their employees.
While private employers can choose to provide coverage, public-sector employers are required to provide it. Businesses that do provide workers’ comp coverage are called “subscribers.” Those that do not are called “non-subscribers.”
The first study in Texas to estimate the percentage of employers that are “non-subscribers” to the Texas workers’ compensation system was done in 1993.
Key Findings included:
- Employer subscription rate: The employer subscription rate increased to 75% in 2022 from 72% in 2018.
- Employees working for subscribers: The share of employees that work for subscribers increased to 83%, the highest in 12 years.
- Employer size: Subscription rates among small employers decreased while staying stable for large employers.
- Industry with largest subscription rates: Mining/Utilities/Construction
- Reasons for not subscribing: The most common reason non-subscribers gave for not having workers’ compensation coverage was that they had too few employees.
- Alternative plans: Thirty percent of nonsubscriber employers provided occupational benefits plans in 2022. This percentage has been relatively stable since 2012. Seventythree percent of non-subscriber employees are covered by an occupational benefit plan in 2022. Alternative occupational benefit plans are benefit plans developed by nonsubscribers (in-house or outsourced) that pay medical, wage replacement, or other types of benefits to employees injured on-the-job. These plans are not regulated by the Texas Department of Insurance, Division of Workers’ Compensation.
- Reporting knowledge: About half of non-subscribers said that they are extremely or somewhat knowledgeable about workers’ compensation reporting requirements
Survey Sample and Data Methods:
The Texas Department of Insurance, Division of Workers’ Compensation’s Research and Evaluation Group designed the survey and pulled a random sample (by industry and employment size) of Texas employers from Texas Workforce Commission data. The Public Policy Research Institute at Texas A&M University completed 1,619 interviews with these year-round private-sector Texas employers.
Read the free report: TDI-DWC: Employer Participation in the Texas Workers’ Compensation System (PDF)