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LETTER OF TRANSMITTAL

To His EXCELLENCY, JOHN J. CORNWELL,

Governor of West Virginia:

SIR:

Pursuant to the requirements of Section 46 of the Workmen's Compensation Act, I have the honor to submit to you herewith the annual report of this Department for the fiscal year ending June 30th, 1918, including a statement of disbursements from the fund on account of employees injured, also the cost of administration, and a detailed statement of the condition of the fund, receipts, disbursements and investments.

I have also a number of recommendations to make with reference to amendments to the workmen's compensation act. I have reconsidered some of the changes recommended in my last report to you as not being practical at this time, and have added some few others to meet existing conditions. I give you herewith a brief synopsis of the amendments recommended, and a short explanatory note with reference to each section to which an amendment is recommended.

Recommendations

First-Section 2. That the appropriation from the workmen's compensation fund for the payment of salaries and expenses necessary in the administration of the act, be increased to one hundred and forty thousand dollars per annum.

The volume of business being done in this department at this time is practically five times as great as it was five years ago, increasing proportionately each year, the cost of labor and material has increased to such an extent that the present appropriation is quite inadequate for the proper administration of the act, as it is not possible to secure efficient help, nor to extend the work of the department necessary for the successful and satisfactory carrying on of the work.

SECOND—Section 9. Providing for the coverage of employees of the State, County and Municipal corporations, also providing a method for the payment of prescribed premiums and other expense in connection with same.

That the act be made applicable only to employees injured within this state, except as provided in said amendment.

That for the purposes of the act, the principal contractor be considered the employer of any employees of a sub-contractor.

In covering employees of the State, County or Municipal corporations, elective officers should be excluded.

With reference to making our act not extra-territorial, we feel it is an injustice to the industries of this state, to require them to pay for losses which should be chargeable to the industries of the state in which they are incurred, furthermore, if compensation be payable to injured employees regardless as to where the injury is received, makes it in the majority of cases practically impossible to obtain proper evidence or make investigations to insure the employee to proper compensation, likewise to protect the compensation fund from fraudulent claims.

Sub-contractors in may instances are irresponsible, while others refuse to elect to cover their employees under the act, thereby working a hardship upon their employees in case of injury, and in order to place the liability upon a responsible employer, the above amendment is recommended.

Owing to existing conditions in some parts of the state, it is recommended that for the purposes of the act, a mine shall be

adjudicated within the state, when the main opening, drift, shaft or slope is located wholly within the state.

THIRD-Section 18. Providing definitely a method of determining rates applicable to the various industries of the state. The method recommended has been in force practically for the past two years and is working very satisfactorily. The wording of this section in the act at present is somewhat vague, and should be set out more definitely.

FOURTH–Section 20. Owing to the delay incident the present method of handling the monies of the fund, it is recommended that this section be amended so as to insure against the unnecessary delay incident to the present method of handling the monies of the fund. Inasmuch as the compensation fund is a separate and distinct fund and so kept upon the books of the auditor and treasurer, provision should also be made that it be likewise kept as a separate and distinct fund by the state depositories wherein any of the monies of the compensation fund be deposited.

It is also recommended that the commissioner with the approval of the Board of Public Works, have authority to invest the surplus, reserve or other monies of the fund, and that the state auditor be required to give additional bond in the sum of five hundred thousand dollars with sureties to be approved by the governor, conditioned for the faithful performance of his duties as custodian of the investment bonds belonging to the fund.

Fifth-Section 21. That the State Treasurer be required to give an additional bond in the sum of two hundred thousand dollars with sureties to be approved by the governor, conditioned for the faithful performance of his duties as custodian of the workmen's compensation fund.

SIXTH-Section 24. It is recommended that this section be amended so as to provide that the employer pay the total prescribed premium, and not be authorized to deduct any part thereof from his employees. The cost of workmen's compensation should be considered as a part of the cost of production, and so charged to the cost of production. We are of the opinion that such an amendment would meet with the approval of employer and employee.

It is also recommended that the minnimum premium to be paid by the employer for any month be reduced from one dollar, to fifty cents, to enable some employers to obtain the benefit of their merit rate, which they are unable to do at present.

From our experience in the administration of the act, we find it necessary to recommend that failure upon the part of any employer to make his monthly payroll report and pay his prescribed premium on or before the 25th of each month for the preceding month shall automatically terminate his election, also to provide that failure to keep on deposit the amount required by the act shall also terminate his election. It is quite impossible to keep accurately the accounts of the various employers unless provision be made that they comply with the requirements of the act. The provisions of the present act are not such as will compel compliance with its provisions by the employer.

SEVENTH–Section 27. This section as it is in the present act is subject to misinterpretation, or rather subject to various interpretations, and should be amended so as to take care of the needs of injured employees in a manner equitable to the employer, employee and the person or persons rendering the necessary medical, surgical or hospital treatment. It is also recommended that maximum sum payable to medical, surgical or hospital treatment in any one case, be increased, and the commissioner be given authority under certain conditions to make payments in excess of the maximum when in his opinion such an expenditure would be justifiable.

Eighth Section 28. That the commissioner be given authority to require employers to adopt rules for the protection and safety of their employees, and to require such employers to install, use or adopt such protective or safety devices or appliances as in his opinion may be necessary for the protection of employees.

NINTH-Section 31. It is recommended that the weekly compensation payable under this section be changed from a maximum of ten dollars to a maximum of twelve dollars, and the minimum to be five dollars per week in all cases. That awards for permanent disability be computed on a scale of from five per centum to one hundred per centum, allowing four weeks compensation for each per cent of disability determined from five to eighty-five per centum.

It is also recommended that compensation awarded under this section and as may have accrued to the date of death of the injured employee may be paid to the dependents of such employee.

TENTH-Section 33. That compensation be payable under this section in case the injury causes death within the period of one year from the date of injury, instead of twenty-six weeks as is provided in the present law.

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