TRENTON, N.J., September 17 – An insurance expert told a special legislative committee that New Jersey government employees have one of the worst accident rates in the country, and that is costing taxpayers millions of dollars in workers compensation and sick leave injury benefits.

David N. Grubb, executive director of the Municipal Excess Liability Joint Insurance Fund, reported the figures to a special legislative committee looking for ways to cut state spending.

Grubb also told the lawmakers the state is buying excess insurance to cover property risks already covered by FEMA.

Grubb is the top official of the fund composed of 372 municipalities, 73 utility authorities, and 81 housing authorities that is one of the three largest municipal self-insurance pools in the country.

N.J., N.Y., Conn. Among the Worst

He said New Jerseys costly state government accident rate is one of the three worst among state governments, about equal to the accident rates of Connecticut and New York.

He reported the state employee accident rate is 45 percent high than the national average. The New Jersey rate was five accidents per 100 employees in 2003, and 4.3 accidents per 100 in 2004.

Grubb said if the state had a coordinated safety program, it could cut that accident rate, and both the existing $70 million annual workers compensation costs, and $35 million annual sick leave injury costs by 30 percent.

Grubb added that the state currently lacks the management structure for a successful managed care program.

He said nothing will happen until the states senior management acts. For any safety program to work, senior management must communicate the priority and establish a structure to consistently monitor and follow up on results.

Frivolous Litigation Another Source of Waste

Another area where money could be saved, he said, is changing the law to reduce lawsuits.

Grubb said millions of dollars are being wasted each year on frivolous litigation.

For example, he said attorney fee shifting under New Jerseys law against discrimination, the Conscious Employer Protection Act, and similar laws have made it very difficult to defend governments at all levels against employee liability claims.

As a result, the cost of employment litigation has increased over 500 percent the past decade, and 70 percent of these costs are legal fees, Grubb said.

Every little employment squabble is now an expensive lawsuit, he told lawmakers.

Grubb recommended that a limit be placed on the fees awarded to the plaintiffs attorney in a manner similar to other litigation.

He cited, as an example of employment-generated litigation, the consolidation of the fire departments in Hudson County that led to phenomenal litigation.

Grubb opined, Any time you consolidate anything, its massive lawsuits.

He said the problem is that attorney fee shifting creates an incentive for plaintiffs attorneys to make unreasonable demands, thus increasing the hours they spend on a case.

He added that, under existing law, there is no relationship between the fee awarded to the attorney by the court, and the damages awarded to the plaintiff by a jury.

Unneeded Excess Coverage

Grubb reported government in New Jersey is buying excess insurance coverage for losses that are supposed to be paid by FEMA, the federal emergency management agency enacted to cover losses caused by natural or manmade disasters.

He explaineed, In other words, we are spending money to protect the federal government instead of New Jersey taxpayers.