States Monitor Chrysler’s Impact on Workers’ Comp

As Chrysler LLC files for bankruptcy, states are carefully monitoring the case for its possible impact on workers’ compensation fund.

Michigan Attorney General Mike Cox stated that Michigan’s Self-Insurers’ Security Fund could face insolvency as a result of Chrysler’s April 30th Chapter 11 filing. Michigan’s workers’ compensation guaranty fund for self insured employees would be exhausted if Chrysler reneges on its promise to keep paying workers’ comp claims despite selling it’s assets to Italian automaker Fiat S.p.A.

In other states where Chrysler self-insures its comp liabilities are also keeping a close eye on the proceedings despite assurances from Chrysler that it will continue to pay. A spokesman for the company said the automaker has court authority to keep paying workers’ comp liabilities owed to injured employees across the country.

Cox filed a motion in the U.S. Bankruptcy Court for the Southern District of New York which is handling the Chrysler case. The filing objected to some language in the Chrysler papers. Cox says the filings show there is potential for Chrysler and a buyer of its assets to disregard the auto manufacturer’s existing workers’ comp obligations.

If you or someone you know has been injured on the job, please contact the Raleigh workers’ compensation attorneys of Scudder Seguin, PLLC by calling (919) 851-3311.