s
324.786
S2I
1914
NO. 7
Initiative Measure No. 7
RELATING TO COMPENSATION OF WORKMEN
INJURED IN EXTRA-HAZARDOUS INDUSTRIES.
To Be Voted Upon at the General Election,
November 3, J9J4
ARGUMENT IN BACK OF PAMPHLET
Pablishcd by the Secretary of State
i9H
Monlana State bbrary
illll
3 0864 1004 2484 8
THE NUMBER AND FORM IN WHICH THE
QUESTION WILL BE PRINTED ON A
SEPARATE OFFICIAL BALLOT
ARE AS FOLLOWS:
Initiative Measure No* 7
A BILL
To Propose by Initiative Petition :
An Act Entitled: "An Act relating to comipensation of in-
jured workm;en, and compensation to their dependents where
sucih injuries result in death, creating an industrial insurance de-
partment, pro\ading for the creation and disbursement of funds
for its administration and for the compensation and care of work-
men injured in extra-hazardous employment, providing penalties
for mo'n-obseirvance of regulations for prevention of injuries and
for violaJtion of this Act, asserting the police power, and, except
in certain cases, abolishing the doctrine of negligence as ground
for recovery of damages, and depriving courts of jurisdiction of
such controversies."
□ For the Initiative Measure No. 7.
Relating to Compensation of Workmen Injured in
Extra-Hazairdous Industries.
D
Against Said A'Teasure No. 7.
"Section iii, Revised Code as Amended:
"The manner of voting on measures submitted to the peo-
ple shall be: By marking the ballot with a cross in or on the
diagram opposite and to the left of the proposition FOR WHICH
the voter desires to vote."
Published by the Secretary of State,
June, 1914.
INDEPENOeNT PUILISHINQ CO. '
HELEKA, MoriTAhA
A BILL
To Propose by Liitiative Petition
An Act Entitled: "An Act relating- to compensation of in-
jured workmen, and compensation to their dependents where
such injuries result in death, creating an industrial insurance de-
partment, providing for the creation and disbursement of funds
for its administration and for the compensation and care of work-
m,en injured in extra-hazardous employment, providing penalties
for non-observance of regulations for prevention of injuries and
for violation of this Act. asserting the police power, and, except
in certain cases, abolishing the doctrine of negligence as ground
for recovery of damages, and depriving courts of jurisdiction of
such controversies."
BE IT ENACTED BY THE PEOPLE OF THE STATE OF
MONTANA:
Section i. Declaration of Police Power.
The common law system governing the remedy of workmen
against employers for injuries received in hazardous work is in-
consistent with modern industrial conditions. In practice it proves
to be economically unwise and unfair. Its administration has
produced the result that little of the cost of the employer has
reached the workman and that little only at large expense to the
public. The remedy of the workman has been uncertain, slow and
inadequate. Injuries in such works, formerly occasional, have
become frequent and inevitable. The welfare of the state depends
upon its industries, and even more upon the welfare of its wage-
workers. The state of Montana, therefore, exercising herein its
police and sovereign power, declares that all phases of the prem-
ises are withdrawn from private controversy, and sure and certain
relief for workmen, injured in extra-hazardous work, and their
families and dependents is hereby provided regardless of questions
of fault and to the exclusion of every other remedy, proceed-
ing or compensation, except as otherwise provided in this act; and
to that end all civil actions and civil causes of action for such
personal injuries and all jurisdiction of the courts of the state over
such causes are hereby abolished, except as in this act provided.
— 3—
Section 2. Enumeration of Extra-Hazardous Works.
There is a hazard in all employment, but certain employments
have come to be, and to be recognized as being inherently con-
stantly dangerous. This act is intended to apply to all such in-
herently hazardous works and occupations, and it is the purpose
to embrace all of them, which are within the legislative jurisdic-
tion of the state, in the following enumeration, and they are in-
tended to be embraced within the term "extra-hazardous" where-
ever used in this act, to-wit: Factories, mills and workshops
where machinery is used ; printing, electrotyping, photo engraving
and stereotyping plants where machinery is used ; foundries,
blast furnaces, mines, wells, gas works, water works, reduction
works, breweries, elevators, wharves, docks, dredges, smelters,
powder works, laundries operated by power, quarries, engineering
works, theaters using moving picture machines operated by elec-
tric current, logging, lumbering and ship building operations ;
logging, street and interurban railroads ; buildings being con-
structed, repaired, moved or demolished ; telegraph, telephone,
electric light or power plants or lines ; steam heating or power
plants, steamboats, tugs, ferries and railroads, not specifically ex-
empted herein. Tf there be or arise any extra-hazardous occupa-
tion or work other than those hereinabove enumerated, it shall
come under this act, and its rate of contribution to the department
funds hereinafter established, shall be determined by the depart-
ment hereafter created, upon the basis of the relation which the
risk involved bears to the risks classified in section 4.
Section 3. Definitions.
In the sense of this act words employed mean as here stated,
to-wit: Factories mean undertakings in which the business of
working at commodities is carried on with power-driven machin-
ery, either in manufacture, repair or change, and shall include the
premises, yard and plant of the concern.
Workshop means any plant, yard, premises, room or place
wherein power-driven machinery is employed and manual labor
is exercised by way of trade for gain or otherwise in or in-
cidental to the process of making, altering, repairing, orna-
menting, finishing or adapting for sale or otherwise any article or
part of article, machine or thing, over which premises room
— 4—
or place the employer of the person working- therein has the right
of access or control.
Mill, means any plant, premises, room or place where
machinery is used, any process of machinery, changing, altering
or repairing any article or commodity for sale or otherwise, to-
gether with the yards and premises which are a part of the plant,
including elevators, warehouses and bunkers.
Mine means any mine where coal, clay, ore, mineral, gypsum
or rock is dug or mined underground.
Quarry means an open cut from which coal is mined, or clay,
ore, mineral gypsum, sand, gravel or rock is cut out or taken
for manufacturing, building or construction purposes.
Engineering work means any work of construction, improve-
ment or alteration, or repair of buildings, structures, streefts. high-
ways, sewers, street railways, railroads, logging roads, interurban
railroads, harbors, docks, canals, electric, steam or water power
plants ; telegraph or telephone plants and lines ; electric light or
power lines, and includes any dther works for the construction, al-
teraition or repair of which machinery driven 1->y mechanical power
is used.
Except when otherwise expressly stated, employer, means any
person,' body of persons, corporate or otherwise, and the legal per-
sonal representatives of a deceased employer, who employ one or
more workmen engaged in this state in any extra-hazardous work.
Workman means every person in this state, who, after March
1st, 1915, is engaged in the employment of an employer carrying
on or conducting any of the industries scheduled or classified in
section 4, whether by ways of manual labor or otherwise, and
whether upon the premises or at the plant, or he being in the
course of his employment, away from the plant of his employer;
provided, however, that if the injury to a workman occurring
away from the plant of his employer is due to the negligence or
wrong of another not in the same employ, the injured workman,
or if death result from the injury, instantaneously or otherwise,
his widow, widower, children, or dependents, as the case may be,
shall elect whether to take under this act or seek a remedy against
such other, such election to be in advance of any suit under this
section, and if he take under this act, the cause of action against
— 5—
such other, shall be assigned to the state for the benefit of the ac-
cident fund; if the other choice is made, the accident fund shall
contribute only the deficiency, if any, between the amount of re-
covery against such third person actually collected, and the com-
pensation provided or estimated by this act for such case.
Any such cause of action assigned to the state may be prose-
cuted, or compromised by the department, in its discretion. Any
.compromise by the workman of any such suit, which would leave
a deficiency to be made good out of the accident fund, may be
made only with the written approval of the department. Any in-
dividual employer, or any member or officer of any corporate
employer who shall be carried upon the pay roll at a salary or
wage not less than the average salary or wage named in such
pay roll and who sihall be injured, shall be entitled to the benefit
of this act as and under the same circumstances as and subject
to the same obligations as a workman.
Dependent means any of the following named relatives of a
workman whose death results from any accident or injury and
whoi leaves surviving no widow, widower, or dependent child, viz :
Dependent child, father, mother, grandfather, grandmother, step-
father, step-mother, grandson, granddaughter, step-son, step-
daughter, brother, sister, half-sister, half-brother, niece, nephew,
who, at the time of the accident are dependent, in whole or in
part, for their support upon the earnings of the workman.
Beneficiary means a husband, wife, child or dependent of a
workman, in whom shall vest a right to receive payment under
this act.
Invalid means one who is physically or mentally incapaci-
tated from earning.
The word "'child" as used in this act, includes a posthumous
child, a child legally adopted prior to the injury, and an illegiti-
mate child legitimated prior to the injury.
A dependent child means an invalid child of whatever age, a
male child until he shall have reached the age of sixteen years,
and a female child until she shall have reached the age of eighteen
years.
The word injury or injured, as used in this act, refers only
to an injury resulting from some fortuitous event as distinguished
from the contraction of diseases.
Section 4. Schedule of Contribution.
In so m'uch. as industry should bear the burden of the cost of
its accidents, each employer shall, prior to November 15th of
each year, pay into the state treasury, in accordance with
the followino^ schedule, a sum equal to a percentage of his
total pay roll for that year, to-wit : (The same being deemed the
most accurate method of equitable distribution of burden in pro-
portion to relative hazard.)
CONSTRUCTION WORK.
Tunnels, bridges, trestles, sub-aqueous works, ditches and
canals (other than irrigation without blasting), dock
excavation, fire escapes, sewers, house moving, house
wrecking 085
Iron or steel frame structures or parts of structures 100
Electric light or power plants or systems ; telegraph or tele-
phone systems, pile driving, steam railroads ' 075
Steeples, towers, or grain elevators, not metal framed ; dry-
docks without excavation, jetties, breakwaters, chimneys,
marine' railways, waterworks or systems, electric railwavs
with rock work or blasting, erecting fireproof doors or
shutters, blasting 075
Steam heating plants, tanks, water towers or windmills, not
metal frames 060
Shaft sinking 100
Concrete buildings, freight or passenger elevators, fireproof-
ing of buildings, galvanized iron or tin works, gas works
or system, marble, stone or brick works, road making
with blasting, roof work, safe moving, slate work, outside
plumbing work, metal smoke stacks or chimneys 075
Excavations not otherwise specified, blast furnaces 060
Street or other grading, cable or electric street railways with-
out blasting, advertising signs, ornamental work in
buildings 050
Ship or boat building or wrecking with scaffolds, floating
docks 065
Carpenter work not otherwise specified 055
Installation of steam boilers or engines, putting up belts for
machinery, placing wire in conduits, installing dynamos,
marble, stone or tile settino:, inside work, mantle set-
ting, metal ceiling- work, mill or ship wrighting, painting
of buildings or structures, installation of automatic
sprinklers, ship or boat rigging, concrete laying in floors,
foundations or street paving, asphalt laying, covering
steam pipes or boilers, installation of machinery not
otherwise specified 050
Drilling wells, installing electrical apparatus or fire alarm
sy^tems in bui'ldings, house heating or ventilation sys-
tems, glass setting, building hot houses, lathing, paper
hanging, plastering, inside plumbing, wooden stair build-
ing, road making 030
OPERATION (Including Repair Work) of (All Combinations of
Material Take the Higher Rate When Not Otherwise Pro-
vided.)
Logging railroads, railroads other than those specifically ex-
empted herein, dredges, interurban electric railroads using
third rail system, dry or floating docks 075
Electric light or power plants, interurban electric railroads
not using third rail system, quarries 060
Street railways, all employees ; telegraph or telephone systems,
stone crushing, blast furnaces, smelters, coal mines, gas
works, steamboats, tugs, ferries 045
Mines, other than coal, steam heating or power plants 050
Grain elevators, laundries, waterworks, paper, or pulp mills.
garbage works 030
FACTORIES USING POWER DRIVEN MACHINERY.
Stamlping tin or metal 065
Bridge work, railroad car or locomotive making or repairing,
cooperage, logging with or without machinery, sawmills,
shingle mills, staves, veneer, box, lath, packing cases, sash,
door or blinds, barrel, keg, pail, basket, tub, woodenware
or wooden fibre ware, fibre ware, rolling mills, making
steam shovels or dredges, tanks, water towers, asphalt,
building material not otherwise specified, fertilizer, ce-
ment, stone with or without machinery, kindling wood,
masts and spars with or without machinerv, canneries,
metal stamping extra, creosoting works, pile treating
— 8—
works * 0371;
Excelsior, iron, steel, copper, zinc, brass or lead articles, or
wares not otherwise specified, working- in wood not other-
wise specified, hardware, tile, brick, terra cotta, fire clay,
pottery, earthenware, porcelean ware, peat, fuel bricketts .030
Breweries, bottling works, boiler works, foundries, machine
shops, not otherwise specified 030
Cordage, working in foodstuffs, including oils, fruit, and
vegetables, working in wool, cloth, leather, paper, broom,
brush, rubber or textiles not otherwise specified 025
Making jewelry, soap, tallow, lard, grease, condensed milk 025
Creameries, electrotyping, photo engraving, engraving, litho-
graphing, printing 015
MISCELLANEOUS WORK.
Stevedoring, longshoreing (longshoring) 025
Operating stock yards, with or without railroad entry, pack-
ing- houses 0375
Wharf operating, artificial ice, refrigerating or cold storage,
plants, tanneries, electric systems, not otherwise spec-
ified 030
Theater stage employes 025
Fireworks manufacturing 075
Powder works i^o
DATE OF APPLICATION OF ACT.
The application of this act as between employers and work-
men shall date from and include the first day of March, 1915.
The payment for March, April and May of 191 5. shall be prelim-
inarily collected upon the pay roll of the last preceding three
months of operation. At the end of each year an adjustment of
accounts Shall be made upon the basis of the actual pay roll.
Any shortage shall be made good on or before December ist,
following. Every employer who shall enter into business at any
intermediate day shall make his payment for the initial year or
portion thereof, before commencing operation ; its amount shall be
calculated upon his estimated pay roll, an adjustment shall be
made on or before January 2d, -jf the following year in the
manner above provided.
For the purpose of such payments accounts shall be kept with
each industry in accordance with the classification herein pro-
vided and no class shall be liable for the depletion of the acci-
dent and administration funds from accidents happening in any-
other class. Each class shall meet and be liable for the accidents
occurring in such class. There shall be collected from each
class as an initial payment into the accident and administration
funds as above specified on or before the 1st day of March, 1915,
one-fourth of the premium of the next succeeding year, and one-
tw^elfth thereof at the close of each month after May, 1915. Pro-
vided, any class having sufficient funds credited to its account
at the end of the first three months or any months thereafter, to
meet the requirements of the accident and administration funds,
that class shall not be called upon for such month.
In case of accidents occuring in such class after lapsed pay-
ment or payments said class shall pay the said lapsed or deferred
payments commencing at the first lapsed payment, as may be
necessary to meet such requirements of the accident and adminis-
tration funds,
CREATION OF "ACCIDENT" AND "ADMINISTRATION"
FUNDS.
The funds thereby created shall be termed the "Accident fund"
and the "Administration fund" and shall be devoted exclusive-
ly to the purposes specified for them in this act. In the division
of moneys accruing to these funds, the "Accident fund" shall
receive eighty-five per centum (85%) and the "Administration
fund" shall receive fifteen per centum (15%) of all contributions
paid by the employers in the several industries ; the history of
state insurance showing that the cost of economical administra-
tion need not exceed fifteen per centum.
i\t the close ot each fiscal year any surplus moneys that may
have accumulated in the Administration fund during the period
last past, in excess of the actual and economical cost of adminis-
tration of the Industrial Insurance Department shall be trans-
ferred from the Administration fund to and become a part of the
Accident fund.
In that the intent is that the funds created under this section
shall ultimately become neither more or less than self-supporting
the classifications are subject to re-arrangement by the Industrial
Insurance Commission following any relative increase or decrease
of hazard shown by experience. Notice of any change in clas-
sifications or premium rates shall be given by publication in two
daily newspapers of general circulation for a period of four calen-
dar weeks.
It shall be unlawful for the employer to deduct or obtain any
part of the premium required by this section to be by him paid
from the wages or earnings of his workmen or any of them, and
the making or attempt to make any such deduction shall be a mis-
demeanor. If, after this act shall have come into operation, it is
shown by experience under the act because of poor or careless
management, any establishment or work is unduly dangerous in
comparison with other like establishments or works, the depart-
ment may advance its classification of risks and premium rates in
proportion to the undue hazard. In accordance with the same
principle, any such increase in classification or premium rate, shall
be subject to restoration to the schedule rate. Any such change
in classification of risks or premium rates, or any change caused
by the change in the class of work, occuring during the year
shall, at the time of the annual adjustment, be adjusted by the de-
partment in proportion to its duration in accordance with the
schedule of this section. If, at the end of any year, it shall be
seen that the contribution to the accident and administration funds
by any class of industry shall be less than the drain upon the
funds on account of that class, the deficiency shall be made good
to the funds on the 2d day of January of the following year by
the employers of that class in proportion to their respective pay-
ments for the past year.
For the purpose of such payments and making good of de-
ficits the particular classes of industry shall be as follows :
CONSTRUCTION WORK.
Class I. Tunnels, sewer, shaft sinking, drilling wells.
Class 2. Bridges, mill wrighting, trestles, steeples, towers,
or grain elevators not metal framed, tanks, water towers, wind-
mills, not metal framed.
Class 3. Sub-aqueous works, canal other than irrigation or
docks with or without blasting, pile driving, jetties, break-waters,
marine railwavs.
— II —
Class 4. House moving, house wrecking, safe moving.
Class 5. Iron or steel frame structures or parts of structures;
fire escapes, erecting fire proof doors or shutters, blast furnaces,
concrete chimneys, freight or passenger elevators, fire proofing
ol buildings, galvanized iron or tin work, marble, stone or brick
work, roof work, slate work, plumbing work, metal smoke stack
or chimneys, advertising signs, ornamental metal work in build-
ings ; carpenter work not otherwise specified ; marble, stone or
tile setting, marble setting, metal ceiling work, painting of build-
ings or structures, concrete laying in floors, or foundations ; glass
setting; building hot houses, lathing, paper hanging, plastering,
wooden stair building.
Class 6. Electric light and power plants or systems ; tele-
graph or telephone systems ; cable or electric railways with or
without rock work or blasting; water works or systems; steam
heating plants; gas works or systems; installation of steam boil-
ers or engines; placing wires in conduits; installing dynamos;
putting up belts for machinery; installation of automatic sprink-
lers; covering steam pipes or boilers; installation of machinery
not otherwise specified ; installing electrical apparatus or fire alarm
system in buildings; house heating or ventilating systems.
Class 7. Steam railroads, not specifically exempted herein,
logging railroads.
Class 8. Road making; street or other grading; concrete
laying in street paving; asphalt laying.
Class 9. Ship or boat building with scaffolds; ship wright-
ing; ship or boat rigging; floating docks.
OPERATION (Including Repair Work) of:
Class 10. Logging; saw mills; shingle mills; lath mills;
planing mills ; masts and spars with or without machinery.
Class 12. Dredges ; dry or floating docks.
Class 13. Electric light or power plants or systems ; steam
heat or power plants or systems ; electric systems not otherwise
specified.
Class 14. Street railways.
Class 15. Telegraph systems; telephone systems.
Class 16. Coal mines, washers, tipples, etc.
Class 17. Quarries; stone crushing; mines other than coal.
— 12 —
Class i8. Blast furnaces; smelters; rolling mills; reduction
work for treatment of ore.
Class 19. Gas works.
Class 20. Steamboats; tugs, ferries.
Class 21. Grain elevators.
Class 22. Laundries.
Class 23. Water works.
Class 24. Paper or pulp mills.
Class 25. Garbage works; fertilizer.
FACTORIES (Using Power Driven Machinery).
Class 26. Stamping tin or metal.
Class 27. Bridge work, making steam shovels or dredges;
tanks ; water towers.
Class 28. Railroad car or locomotive making or repairing.
Class 29. Cooperage ; staves ; veneer ; box ; packing cases ;
sash, door or blinds; barrel; keg; pail; basket; tub woodware or
wood fibre ware; kindling wood; excelsior; working in wood
not otherwise specified.
Class 30. Asphalt.
Class 31. Cement; stone with or without machinery; build-
ing material not otherwise specified.
Class 32. Canneries of fruit or vegetables.
Class 33. Canneries of fish or meat products.
Class 34. Iron, steel, copper, zinc, brass or lead articles
or wares; hardware; boiler works, foundries; machine shops not
otherwise specified.
Class 35. Tile, brick, terra cotta ; fire clay ; pottery ; earthen-
ware ; porcelain ware.
Class 36. Peat fuel; briquettes.
Class 37. Breweries ; bottling works.
Class 38. Cordage, working in wool; cloth, leather, paper,
brush, rubber or textile not otherwise specified.
Class 39. Working in foodstuffs, including oils, fruits, vege-
tables.
Class 40. Condensed milk, canneries, creameries.
Class 41. Electrotyping; photo engraving; engraving; litho-
graphing; making jewelry; printing.
Class 42. Stevedoring; longshoreing; (longshoring) ; wharf
operation.
—13—
Class 43. Stockyards, packing houses; making soap, tallow,
lard, grease, tanneries.
Class 44. Artificial ice; refrigerating or cold storage plant.
Class 45. Theater stage employees; moving picture machine
operators.
Class 46. Fireworks manufacturing; powder works.
Qass 47. Creosoting works ; pile treating works.
If a single establishment or work comprises several occupa-
tions listed in this section in different risk classes, the premium
shall be computed according to the payroll of each occupation if
clearly separable; otherwise an average rate of premium shall be
charged for the entire establisihment, taking into consideration
the number of employees and the relative hazards. If an em-
piloyer besides employing workmen in extra-hazardous employ-
ment shall also employ workmen in employments not extra
hazardous the provisions of this act shall apply only to the
extra hazardous departments and employments and the workmen
employed therein. In computing the pay roll the entire com-
pensation received by every workmen employed in extra-
hazardous employment Sihall be included, whether it be in the
form of salary, wage, piece work, overtime, or any allowance
in the way of profit sharing, premium or otherwise, and whether
payable in money, board or otherwise.
Section 5. Schedule of Awards.
Each workman who shall be injured, whether upon the
premises or at the plant, or, he being in the course of his em-
ployment, away from the plant of his employer, or his family or
dependents in case of death of the workman, shall receive out of
the accident fund compensation in accordance with the following
schedule, and, except as in this act otherwise provided, such pay-
ment shall be in lieu of any and all rights of action whatsoever
against any person whomsoever.
COMPENSATION SCHEDULE.
(a) Where death results from the injury, instantaneously or
otherwise, the expenses of burial shall be paid in all cases, not to
exceed One Hundred Dollars ($100) in any case, and (i) if the
workman leaves a widow or invalid widower, a monthly payment
of Thirty ($30) Dollars shall be made throughout the life of the
—14—
surviving spouse, to cease at the end of the month in which re-
marriage shall occur; and the surviving spouse shall also receive
Seven dollars and. fifty cents ($7.50) per month for each dependent
child of the deceased at the time of the occurrence of the accident
or injury until such child shall cease to be a dependent, but the
total monthly payment under this paragraph (i) of subdivision (a)
shall not exceed Fifty-two dollars' and fifty cents ($52.50). Upon
re-marriage of a widow she shall receive, once and for all, a lump
sum equal to twelve times her monthly allowance, viz: The sum
of Three hundred and sixty ($360) dollars, but the monthly pay-
ments for the child or children shall continue as before.
(2) If the workman leaves no wife or husband, but a de-
pentlent child or children, a monthly payment of Seventeen dollars
and fifty cents ($17.50) shall be made to each such child until
such child shall cease to be a dependent, bur the total monthly
payments shall not exceed Fifty-two dollars and fifty cents
($52.50). and any deficit shall be deducted proportionately among
the beneficiaries.
(3) If the workman leaves no widows widower or depen-
dent child, but leaves a dependent or dependents, a monthly
payment shall be made to each dependent equal to fifty per cent
of the average monthly support actually received by such de-
pendent from the workman during the twelve months next pre-
ceding the occurrence of the injury, but the total payment to all
dependents in any case shall not exceed Thirty ($30) dollars per
month.
The payment to any dependent shall cease if and when, under
the same circumstances, the necessity creating the dependency
would have ceased if the injury had not happened.
If the workman is under the age of twenty-one years, and
unmarried at the time of his death, the parents or parent of the
workman shall receive Thirty ($30) dollars per month for each
month after his death until the time at which he would have ar-
rived at the age of twenty-one years.
(4) In the event a surviving spouse receiving monthly pay-
ments shall die, leaving a dependent child or children the sum he
or she shall be receiving on account of such child or children
shall be thereafter paid to the child increased one hundred per cent
but the total to all children shall not exceed the sum of Fifty-two
—15—
dollars and fifty cents ($52.50) per month.
(b) Permanent total disability means the loss of both legs
or both arms, or one leg and one arm, total loss of eyesight,
paralysis or other condition permanently incapacitating the
workman from performing any work at a gainful occupation.
If the workman receive a permanent injury, the nature of
which demands constant attention which he, on account of the
nature of said injury, is unable to administer to himself, then the
department, as herein created, may furnish an attendant in ad-
dition to any compensation enumerated herein.
When permanent total disability results from the injury the
workman shall receive monthly during the period of such dis-
ability:
(i) If unmarried at the time of the injury, the sum of
thirty ($30) dollars.
(2) If the workman have a wife or invalid husband, but no
dependent child the sum of Thirty-five ($35) dollars. If the hus-
band is not an invalid, the monthly payment of Thirty-five ($35)
will be reduced to Twenty-five ($25) dollars.
(3) If the workman have a wife or husband and a dependent
child or children, or being' a widower or widow, have any such
child or children, the monthly payment provided in the preceding
paragraph shall be increased to Seven dollars and fifty cents
($7.50) more for each such child until such child shall cease to be a
dependent, but the total monthly payment shall not exceed Fifty-
two dollars and fifty cents ($52.50).
(c) If the injured workman die during the period of total
disability, whatever the cause of death, leaving a widow, invalid
widower or dependent child, the surviving widow or invalid wid-
ower shall receive Thirty dollars ($30) per month until death or
re-marriage, to be increased Seven dollars and fifty cents ($7.50)
per month for each dependent child, but if such child is or shall
be without father or mother, such child shall receive Seventeen
dollars and fifty cents ($17.50) per month. The total combined
monthly payment under this paragraph shall in no case exceed
Fifty-two dollars and fifty cents ($52.50). Upon re-marriage the
payments on account of a child or children shall continue as be-
fore to the child or children,
(d) When the total disability is only temporary, the sched-
—Ins-
ula of payment contained in paragraphs (i), (2), and (3), of the
foregoing subdivision (b), shall apply so long as the total dis-
ability shall continue, increased fifty (50) per cent for the first
six months of such continuance, but in no case shall the increase
operate to make the monthly payment exceed sixty (60) per cent
of the monthly wage (the daily wage multiplied by twenty-six) the
make the monthly payment exceed sixty (60) per cent of the
monthly wage (the daily wage multiplied by twenty-six) the
workman was receiving at the time of his injury. As soon as re-
covery is so complete that the present earning power of the work-
man, at any kind of work, is restored to that existing at the
time of the occurrence of the injury the payments shall cease. If
and so long as the present earning power is only partially
restored the pa3'^ments shall continue in the proportion which the
new earning power shall bear to the old. No compensation shall
be payable out of the accident fund unless the loss of earning
power shall exceed five (5) per cent.
(e) For every case of accident or injury resulting in death,
instantaneously or otherwise, or permanent disability it shall be
the duty of the department to forthwith notify the state treasurer,
and he shall set apart out of the accident fund a sum of money for
the case, to be known as the estimated lump value of the monthly
payments provided for it, to be calculated upon the theory that
a monthly payment of Thirty dollars ($30) to a person thirty
years of age, is equal to a lump sum payment, according to the
expectancy of life as fixed by the American Mortality Table, or
Six Thousand dollars ($6,000), but the total in no case to exceed
the sum of Six thousand dollars ($6,000). The state treasurer
shall invest said sum at interest in the class of securities pro-
vided by law for the investment of the permanent school fund,
and out of the same and its earnings, shall be paid the monthly in-
stallments and any lump sum payment then or thereafter arranged
for the case. Any deficiency shall be made good out of, and any
balance or over-plus shall revert to the accident fund. The state
treasurer shall keep accurate account of all such segregations of
the accident fund, and may borrow from the main fund to meet
monthly payments pending conversion into cash of any security^
and in such case shall repay such temporary loan out of the cash
realized from the security.
—17—
(f) Permanent partial disability means the loss of either one
foot, one leg, one hand, one arm, one eye, one or more fingers,
one or more toes, any dislocation where ligaments are severed, or
any other injury known in surgery to be permanent partial dis-
abilit)'-. For any permanent partial disability resulting from an
injury the workmen shall receive compensation in an amoimt
equal to fifty (50) per centum of his wages for the periods stated
against such injuries; provided, however, that in computing the
compensation for permanent partial disability as provided for in
this section, that the average monthly wage of the injured employe
shall be considered to be not less than One hundred dollars ($100)
per month: In cases of:
The loss by separation of one arm at or above the elbow joint
or the permanent and complete loss of the use of one arm, sev-
enty-two months.
The loss by separation of one hand at or above the wrist
joint, or the permanent and complete loss of the use of one hand,
fifty-seven months.
The loss by separation of one leg at or above the knee joint,
or the permanent and complete loss of the use of one leg, sixty-
six months.
The loss by separation of one foot at or above the ankle joint,
or the permanent and complete loss of the use of one foot,
forty-eight months.
The permanent and complete loss of hearing in both ears,
seventy-two months.
The permanent and complete loss of hearing in one ear,
thirty-six months.
The permanent and complete loss of the sight of one eye,
thirty months.
The loss by separation of a thumb, thirteen months ; a first
finger, nine months ; a second finger, seven months ; a third finger,
six months; a fourth finger, five months.
The loss of one phalange of a thumb or two phalanges of a
finger shall be considered equal to the loss of one-half of a thumb
or finger, and a com.pensation for one-half of the above periods
shall be payable.
— 18—
The loss of more than one phalang-e of a thumb and more
than two phalanges of a finger shall be considered as the loss
of an entire thumb or finger.
The loss by separation of a great toe, nine months ; any
other toe four months.
Compensation for any other permanent partial disabilit}' shall
be in the proportion which the extent of such disability shall bear
to the maximum, said maximum being fifty (50) per centum of
wages for a period of seventy-two months. If the injured work-
man be under the age of twenty-one years and unmarried, the
parents or parent shall also receive a lump sum payment equal to
20 per cent of the amount awarded the minor workman.
(g) Should a further accident occur to a workman already
receiving a monthly payment under this section for a temporary
disability, or who has been previously the recipient of a lump
sum payment under this act, his future compensation shall be
adjusted according to the other provisions of this section and with
regard to the combined effect of his injuries, and his past receipt
of money under this act.
(h) If aggravation, diminution, or termination of disability
takes place or be discovered after the rate of comj)ensation shall
have been established or compensation terminated in any case
the department may, upon the application of the beneficiary or
upon its own motion, readjust for future application the rate of
compensation in accordance with the rules in this section pro-
vided for the same, or in proper case terminate the payments.
(i) A husband or wife of an injured workman, living in a
state of abandonment for more than one year at the time of the
injury, or subsequently, shall not be a beneficiary under this act.
(j) If a beneficiary shall reside or remove out of the state
the department miay, in its discretion, convert any monthly pay-
ments provided for such case into a lump sum payment (not in
any case to exceed Six thousand dollars ($6,000), upon the theory,
according to the expectancy of life as fixed by the American Mor-
tality Table, that a monthly pa3'^ment of Thirty dollars ($30) to a
person of thirty years of age is worth Six thousand dollars
($6,ooa), or, with the consent of the beneficiary, for a smaller
sum.
—19—
(k) Any court review under this section shall be initiated in
the county where the workman resides or resided at the time of
the injury, or in which the injury occurred.
Section 6. Intentional Injuries — Status of Minors,
If injury or death results to a workman from the deliberate
intention of the workman himself to produce such injury or
death neither the workman nor the widow, widower, child or de-
pendent of the workman shall receive any payment whatsoever out
of the accident fund. If injury or death results to a workman
from the deliberate intention of his employer to produce such in-
jury or death, the workman, the widow, widower, child or depend-
ent of the workman shall have the privilege to take under this
act and also have cause of action against the employer, as if this
act had not been enacted, for any excess of damage over the
amount received or receivable under this act.
A minor working at an age legally permitted under the laws
of this state shall be deemed sui juris for the purpose of this
act, and no other person shall have any cause of action or right
to compensation for an injury to such minor workman except as
expressly provided in this act, but in the event of a lump sum
payment becoming due under this act to such minor workman,
the management of the sum shall be within the jurisdiction of
the public administrator or court the same as other property of
minors.
Section 7. Conversion Into Lump Sum Payment.
In case of death or permanent total disability the monthly
payment provided may be converted, in whole or in part, into a
lump sum payment (not in any case to exceed Six thousand
dollars ($6,000), on the theory, according to the expectancy of life
as fixed by the American Mortality Table, that a monthly pay-
ment of Thirty dollars (S30) to a person thirty years of age is
worth the sum of Six thousand dollars ($6,000) in which event
the monthly paym'ent shall cease in whole or in part accordingly
or proportionately. Such conversion may only be made after the
happening of the injury and upon the written application of the
beneficiary (in case of minor children, the application may be by
either parent) to the department and shall rest in the discretion of
the department. Within the rule aforesaid the amount and value
— 20 —
of the lump snm payment may be agreed upon between the de-
partment and the beneficiary.
Section 8. Defaulting Employers.
If any employer shall default in any payment to the funds
hereinbefore in this act required, the sum due shall be collected
by action at law in the name of the state as plaintiff, and such
right of action shall be in addition to any other right of action or
remedy. In respect to any injury happening to any of his work-
men during the period of any default in the payment of any prem-
ium under section 4 the defaulting employer shall not, if such
default be after demand for payment, be entitled to the benefits
of this act, but shall be liable to suit by the injured workman (or
the husband, wife, child or dependent of such workman in case
death result from the accident), as he would have been prior to
the passage of this act.
In case the recovery actually collected in such suit shall equal
01 exceed the compensation to which the plaintiff therein would
be entitled under this act, the plaintiff shall not be paid anything
out of the accident fund; if the said amount shall be less than
such compensation under this act, the accident fund shall con-
tribute the amount of the deficiency. The person so entitled under
the provisions of this section to sue shall have the choice (to
be exercised before suit) of proceeding by suit or taking under
this act. If such person shall take under this act, the cause of
action against the employer shall be assigned to the state for
the benefit of the accident fund. In any suit brought upon such
cause of action the defense of fellow servant, assumption of risk,
and the doctrine of contributory and comparative negligence shall
be inadmissable.
Any such cause of action assigned to the state may be prose-
cuted or compromised by the department in its discretion. Any
compromise by the workman of any such suit, which would leave
a deficiency to be made good out of the accident fund, may be
made only with the written approval of the department.
Section g. Employer's Responsibility for Safeguard.
If any workman shall be injured because of the absence of
any safeguard or protection required to be provided or main-
tained by, or pursuant to. any statute or ordinance, or any depart-
—21 —
ment regulation under any statute, or be, at the time of the in-
jury, of less than the maximum age prescribed by law for the
employment of a minor in the occupation in which he shall be
engaged when injured, the employer shall, within ten days after
demand therefor by the department, pay into the accident fund, in
addition to the sum required by section 4 to be paid:
(a) In case the consequent payment to the workman out of
the accident fund be a lump sum,, a sum equal to fifty (50) per
cent of that amount.
(b) In case the consequent payment to the workman be
payable in monthly payments, a sum equal to fifty per cent of the
lump value of such monthly payment, estimated in accordance
with the rule stated in section 7.
The foregoing provisions of this act shall not apply to the
employer if the absence of such guard or protection be due to the
removal thereof by the injured workman himself, or with his
knowledge, by any of his fellow workmen, unless such removal
be by order or direction of the employer or superintendent or
ioreman of the employer, or any one placed by the employer in
control or direction of such workman. If the removal of such
guard or protection be by the workman himself or with his con-
sent by any of his fellow workmen, unless done by order or direc-
tion of the employer or the superintendent or foreman of the em-
ployer, or any one placed by the employer in control, or direc-
tion of such workman, the schedule of compensation provided in
section 5 shall be reduced ten (10) per cent for the individual case
of such workman.
Section 9^^. First Aid or Treatment Cost of An Injury to
Workmen.
In all cases of injury to a workman known in this act as
permanent total, permanent partial, and temporary total, he shall
receive, in addition to the compensation provided in this act,
proper and necessary medical, surgical and hospital services and
Seven dollars and fifty cents ($7.50) per week as compensation,
said Seven dollars and fifty cents ($7.50) to be paid at the end
of each week for a period of not exceeding twenty-one days,
whether the disabilit}'- be temporary or otherwise. Provided, how-
ever, that where the employees of the employment wherein the
injury occurred, prior to the adoption of this act, owned and
— 22 —
operated their own co-operative hospital or hospitals, then the em-
ployer shall not be required to pay for such hospital services.
It shall be the duty of the employer to see to it that imme-
diate medical and surgical services are rendered, and transporta-
tion to hospital provided, and all costs for said First Aid or Treat-
ment to injured employees, as eniimerated in this section, shall be
borne by the employer, by whom said workman was employed
when the injury occurred.
For failure to comply with the provisions of this section on
the part of the employer, the department may take such steps as
they deem advisable in the premises.
In all cases wherein the nature of the accident is such as to
raise a reasonable doubt in the mind of the attending physician
or physicians, as to the ability of the workman to continue
work, then no compensation shall be paid for the first seven
days immediately following the injury.
Section lo. Exemption of Awards.
No money paid or payable under this act out of the accident
fund shall, prior to issuance and delivery of the warrant therefor,
be capable of being assigned, charged, nor even be taken in
execution or attached or garnished, nor shall the same pass to
any other person by operation of law. Any such assignment or
charge shall be void.
Section ii. Non- Waiver of Act by Contract.
No employer or workman shall exempt himself from the bur-
den or waive the benefits of this act by any contract, agreement,
rule or regulation, and any such contract, agreement, rule or regu-
' lation shall be pro tanto void.
Section 12. Filing Claim for Compensation.
(a) Where a workman is entitled to compensation under this
act he shall file with the department, his application for such,
together with the certificate of the physician who attended him,
and it shall be the duty of the physician to inform the injured
workman of his rights, under this act and to lend all necessary as-
sistance in making this application for compensation and such
proof of other matters as required by the rules of the department
without charge to the workman.
(b) Where death results from injury the parties entitled to
compensation under this act, or some one in their behalf, shall
—23—
make application for the same to the department, which applica-
tion must be accompanied with proof of death and proof of rela-
tionship showing- the parties to be entitled to compensation under
this act, certificates of attending physician, if "any, and such other
proof as required by the rules of the department.
(c) If change of circumstances warrant an increase or re-
arrangement of compensation, like application shall be made there-
for. No increase or re-arrangement shall be operative for any
period prior to application therefor.
(d) No application shall be valid or claim thereunder
enforceable unless filed within one year after the day upon which
the injury occurred or the right thereto accrued.
Section 13. Medical Examination.
Any workman entitled to receive compensation under this act
is required, if requested by the department, to submit himself for
medical examination at a time and from time to time at a place
reasonably convenient for the workman and as may be provided
by the rules of the department. If the workman refuse to submit
to any such examination, or obstructs the same, his rights to
such monthly payments shall be suspended until such examina-
tion has taken place, and no compensation shall be payable during
or for account of such period.
Section 14. Notice of Accident.
Whenever any accident occurs to any workman it shall be the
duty of the employer to at once report such accident and the in-
jury resulting therefrom to the department, and also to any local
representative of the department. Such report shall state:
1. The time, cause and nature of the accidents and injuries,
and the probable duration of the injury resulting therefrom.
2. Whether the accident arose out of or in the course of the
injured person's employment.
3. Any other matters the rules and regulations of the depart-
ment may prescribe.
Section 15. Inspection of Employer's Books.
The books, records and pay rolls of the employer pertinent to
the administration of this act shall always be open to inspection
by the department or its traveling auditor, agent or assistant, for
the purpose of ascertaining the correctness of the pay roll, the
—24—
men employed, and such other information as may be necessary
for the department and its management under this act. Refusal
on the part of the employer to submit said books, records and pay
rolls for such inspection to any member of the commission or any
assistant presenting written authority from the commission, shall
subject the offending employer to a penalty of One hundred dol-
lars ($ioo) for each offense, to be collected by civil action in the
name of the state. All sums collected under this section shall be
paid into the accident fund, and the individual who shall person-
ally give such refusal shall be guilty of a misdemeanor.
Section i6. Penalty for Misrepresentation as to Pay Roll.
Any employer who shall misrepresent to the department the
amount of pay roll upon which the premium under this act is
based shall be liable to the state in ten times the amount of the
difference in premium paid and the amount the employer should
have paid. The liability to the state under this section shall be
enforced in a civil action in the name of the state. All sums col-
lected under this section shall be paid into the accident fund.
Section 17. Public and Contract Work.
Whenever the state, county or any municipal corporation
shall engage in any extra-hazardous work in which workmen are
employed for wages, this act shall be applicable thereto. The em-
ployer's payments into the department fund shall be made from
the treasury of the state, county or municipality. If said work is
being done by contract, the pay roll of the contractor and the sub-
contractor shall be the basis of computation, and in the case of
contract work consuming less than one year in performance, the
required payment into the accident and administration funds shall
be based upon the total pay roll. The contractor and any sub-
contractor shall be subject to the provisions of this act, and the
state for its general fund, the county or municipal corporation
shall be entitled to collect from the contractor the full amount
payable to the Industrial Insurance department, and the con-
tractor in turn shall be entitled to collect from the sub-contractor
his proportionate amount of the payment. The provisions of this
section shall apply to all extra-hazardous work done by contract,
except that in private work the contractor shall be responsible,
primarily and directly, to this department for the proper percentage
—25—
of the total pay roll of the work and the owner of the property af-
fected by the contract shall be surety for such payments. When-
ever and so lone;; as, by state law, city charter or municipal ordi-
nances, provision is made for municipal employees injured in the
course of employment, such employees shall not be entitled to the
benefits of this act and shall not be included in the pay roll of the
municipality under this act.
Section i8. Interstate Commerce.
The provisions of this act shall not apply to any workman en-
gaged in the actual movement of trains upon railroads engaged in
interstate or foreign traffic. Workmen engaged in the actual
movement of trains, include only those employed in the engine,
train and switching services.,
Section 19. Elective Adoption of Act.
Any employer and his employees engaged in works not extra-
hazardous may, by their joint election, filed with the department,
accept the provisions of this act, and such acceptances, when ap-
proved by the department, shall subject them irrevocably to the
provisions of this act to all intents and purposes as if they had
been originally included in its terms. Ninety (90) per cent of the
minimum rate specified in Section 4 shall be applicable to such
cases until otherwise provided by law.
Employers not electing to accept the provisions of this act,
and engaged in works not extra hazardous, shall display in a con-
spicuous manner about their works, and in a sufficient number of
places reasonably to inform their workmen of the fact, printed
notices stating they are not contributors to the fund.
Section 20. Court Review.
Any employer, workman, beneficiary, or person feeling ag-
grieved at any decision of the department affecting his interests
under this act may have the same reviewed by a proceeding for
that purpose, in the nature of an appeal, initiated in the district
court of the county of his residence, except as otherwise provided
in subdivision (i) of section numbered (5) in so far as such de-
cision rests upon questions of fact, or of the proper application of
the provisions of this act, it being the intent that matters resting
in the discretion of the department shall not be subject to review.
—26—
The proceedings in every such appeal shall be informal and sum-
mary, but full opportunity to be heard shall be had before judg-
ment is pronounced. No such appeal shall be entertained unless
notice of appeal shall have been served by mail or personally
upon some member of the commission within twenty days following
the rendition of the decision appealed from and communication
thereof to the person affected thereby. No bond shall be required,
except that an appeal by the employer from a decision of the de-
partment under section 9 shall be ineffectual unless, within five
days following the service of notice thereof, a bond, with surety
satisfactory to the court, shall be filed, conditioned to perform the
judgment of the court. Except in the case last named an appeal
shall not be a stay. Either party shall be entitled to a jury trial
upon demand. It shall be unlawful for any attorney engaged in
any such appeal to charge or receive any fee therein in excess
of a reasonable fee, to be fixed by the court in the case, and, if the
decision of the department shall be reversed or modified, such fee
and the fees of medical and other witnesses and the costs shall be
payable out of the administration fund, if the accident fund is
affected by the litigation. In other respects the practice in civil cases
shall apply. Appeal shall lie from the judgment of the district
court as in other civil cases. The attorney-general shall be the
legal adviser of the department and shall represent it in all pro-
ceedings, whenever so requested by any of the commissioners. In
all court proceedings under or pursuant to this act, the decision
of the department shall be prima facie correct, and the burden of
proof shall be upon the party attacking the same.
Section 21. Creation of Department.
The administration of this act is imposed upon a department
to be known as the Industrial Insurance Department, to consist of
three commissioners to be appointed by the governor, within
thirty days after the passage of this act, not more than two of
whom shall belong to one political party. One of them shall hold
office for the first two years, another for the first four years, and
another for the first six years following the passage of this act.
Thereafter the term shall be six years. Each commissioner shall
hold until his successor shall be appointed and shall have quali-
fied. A decision of any question arising under this act con-
—27—
curred in by two of the commissioners shall be the decision of
the department.
Inasmuch as the duties to be performed by such commis-
sioners, vitally concern the employer and employees, as well as
the people of the whole state, it is hereby declared to be the pur-
pose of this act that persons be appointed as commissioners who
shall fairly represent the interests of all concerned in its adminis-
tration. No corhmissioner shall hold any other office or position
of profit or pursue any other business or vocation, but shall de-
vote his entire time to the duties of his office.
The governor may at any time remove any commissioner for
inefficiency, neglect of duty, or malfeasance in office. Before
such removal he shall give such commissioner a copy of the
charges against him and shall fix the time when he can be heard
in his own defense, which shall not be less than ten days there-
after, and such hearing shall be open to the public.
If such commissioner shall be removed the governor shall file
in the office of the secretary of state, a complete statement of all
charges made against such commissioner and his findings thereon,
with a record of the proceedings.
Before entering on the duties of his office, each commissioner
shall take and subscribe to an oath or affirmation that he will
support the constitution of the United States and of this state
and faithfully and honestly discharge the duties of such office of
commissioner; that he holds no other office or position of profit,
and that he pursues and will pursue while such commissioner no
other calling or vocation, and that he holds, and while such com-
missioner will hold, no other position under any political party,
which oath or affirmation shall be filed in the office of the sec-
retary of state.
Each of the .commissioners shall also, before entering upon
the duties of his office, execute a bond payable to the state of
Montana, in the penal sum of Ten Thousand Dollars ($10,000)
with sureties to be approved by the governor, conditioned for the
faithful discharge of the duties of his office, which bond, when so
executed and approved, shall be filed in the office of the secretary
of state. The commission shall select one of their members
as a chairman. The main office of the commission shall be at the
—28—
state capitol, but branch offices may be established at other places
in the state. Each member of the commission shall have power
to issue subpoenas requiring the attendance of witnesses and the
production of books and documents.
Section 22. Salary of Commissioners.
The salary of each of the commissioners shall be three thous-
and dollars ($3,000) per annum, and he shall be allowed his actual
and necessary traveling and incidental expenses; and any assist-
ant to the commissioners shall be paid for each full day's service
rendered by him, his actual and necessary traveling expenses and
such compensation as the commission may deem proper, not to
exceed six dollars ($6) per day to an auditor, or five dollars ($5)
per day to any other assistant.
The salaries and all other expenses of the administration of
the department shall be paid out of the administration fund cre-
ated herein.
Section 23. Deputies and Assistants.
The commissioners may appoint a sufficient number of audi-
tors and assistants to aid them in the administration of this act,
at an expense not to exceed three thousand dollars ($3,000) per
month. They may employ one or more physicians in each county
for the purpose of official medical examinations, whose compen-
sation shall be limited to five dollars ($5) for each examination
and report therein. They may procure such record books as they
may deem necessary for the record of the financial transactions
and statistical data of the department, and the necessary docu-
ments, forms and blanks. They may establish and require of all
employers to install and maintain a uniform form of pay roll.
Section 24. Conduct, Management and Supervision of De-
partment.
The commission shall, in accordance with the provisions of
this act:
1. Establish and promulgate rules governing the administra-
tion of this act.
2. Ascertain and establish the amounts to be paid into and
out of the accident fund.
3. Regulate the prrvrjf of accident and extent thereof, the
proof of death and the prcof of relationship and the extent of
dependency.
—29—
4. Supervise the medical, surgical and hospital treatment to
the intent that same may be in all cases suitable and wholesome.
5. Issue proper receipts for money received, and certificates
for benefits accrued and accruing.
6. Investigate the cause of all serious injuries and report to
the governor from time to time any violations or laxity in perfor-
mance of protective statutes or regulations coming under the ob-
servation of the department.
7. Compile and preserve statistics showing the number of
accidents occuring in the establishment of works of each em-
ployer, the liabilities and expenditures of the accident fund on ac-
count of, and the premium collected from the same, and hospital
charges and expenses.
8. Make annual reports to the governor (one of them not
more than sixty nor less than thirty days prior to each regular
session of the legislature) of the workings of the department and
showing the financial status and outstanding obligations of the
accident and administration funds and the statistics aforesaid.
Section 25. Medical Witnesses.
Upon the appeal of any workman from any decision of the
department affecting the extent of his injuries or the progress of
same, the court may appoint not to exceed three physicians to ex-
amine the ph)'-£ical condition of the appellant, who shall make to
the court their report thereon, and they may be interrogated be-
fore the court by or on behalf of the appellant in relation to the
same. The fee of each shall be fixed by the court, but shall not
exceed ten dollars ($10) per day each.
Section 26. Disbursement of Funds.
Disbursement out of the funds shall be made only upon war-
rants drawn by the state auditor upon vouchers therefor trans-
mitted to him by the department and audited by him. The state
treasurer shall pay every warrant out of the fund upon which it is
drawn. If, at any time, there shall not be sufficient money in the
fund, on which any such warrant shall have been drawn where-
with to pay the same, the employer on account of whose workman
it was that the warrant was drawn shall pay the same, and he
— 30—
shall be credited upon his next following contribution to such
fund the amount so paid with interest thereon at the legal rate
from the date of such payment to the date such next following
contribution became payable, and if the amount of the credit shall
exceed the amount of the contribution, he shall have a warrant
upon the same fund for the excess, and if any such warrant shall
not be paid, it shall remain, nevertheless payable out of the fund.
The state treasurer shall to such extent as shall appear to him
to be advisable, keep the moneys of the unsegregated portion of
the accident fund invested at interest in the class of securities
provided by law for the investment of the permanent school fund.
The stnte treasurer shall be liable on his official bond for the
safe custody of the moneys and securities of the accident and admin-
istration funds in the manner provided by the laws of the state
of Montana. "An act to provide for state depositories and to
regulate the deposits of state moneys therein," shall be applied to
said moneys and the handling thereof by the state treasurer.
Section 27. Test of Invalidity of Act.
If any employer shall be adjudicated to be outside the lawful
scope of this act, the act shall not apply to him or his workmen,
or if any workman shall be adjudicated to be outside the lawful
scope of this act because of remoteness of his work from the haz-
ard of his employer's work, any such adjudication shall not impair
the validity of this act in other respects, and in every such case
an accounting in accordance with the justice of the case shall be
had of moneys received. If the provisions of Section 4 of this
act for the creation of the accident and administration funds or
the provisions of this act making the compensation to the work-
man provided in it exclusive of any other remedy on the part of
the workman shall be held invalid the entire act shall be thereby
invalidated except the proAnsions of Section 30, and an accounting
according to the justice of the case shall be had of moneys re-
ceived. In other respects an adjudication of invalidity of any
part of this act shall not affect the validity of the act as a whole
or any other part thereof.
Section 28. Statute of Limitations Saved.
If the provisions of this act relative to compensation for in-
juries to or death of workmen become invalid because of any ad-
—31—
judication, or be repealed, the period intervening between the oc
currence of an injury or death not previously compensated for
under this act by lump payment or completed monthly payments
and such repeal or the rendition of the final adjudication or in-
validity shall not be computed as a part of the time limited by
law for the commencement of any action relating to such injury
or death;
Provided, that such action be commenced within one year
after such repeal or adjudication ; but in any such action any
sum paid out of the accident fund to the workman on account
of injury, for whom the action is prosecuted, shall be taken into
account or disposed of as follows : If the defendant employer
shall have paid without delinquency into the accident fund the
payment provided by Section 4, such sums shall be credited upon
the recovery as payment thereon, otherwise the sum shall not be
so credited but shall be deducted from the sum collected and be
paid into the said fund from which they had been previously dis-
bursed.
Section 29. Safeguard Regulations Preserved.
Nothing in this act contained shall repeal any existing law
providing for the installation or maintenance of any device, means
or method for the prevention of accidents in extra-hazardous work
or for a penalty or punishment for failure to install or maintain
any such protective device, means or method.
Section 30. Distribution of Funds in Case of Repeal.
If this act shall be hereafter repealed, all moneys which are
in the fund at the time of the repeal shall be subject to such dis-
position as may be provided by legislation, and in default of such
legislative provision distribution thereof shall be in accordance
with the justice of the matter, due regard being had to obligations
of compensation incurred and existing, and, provided, further,
that if Section 4 of this act shall be held invalid that on and after
the date of such adjudication, in any suit brought by a workman
against an employer to recover damages for personal injury, or
in case of his death, instantaneously or otherwise, by a dependent
of said workman for compensation, the defense of fellow-servant
and assumption of risk, and the doctrine of contributory and com-
parative negligence shall be inadmissable in the courts of the
—32—
state of Montana as a defense in any such cause of action.
Section 31. Saving Clause.
This act shall not affect any action pending or cause of action
existing on the ist day of March, 191 5.
Section 32.
All acts and parts of acts in conflict with this act are hereby
repealed.
ARGUMENT
(Affirmative.)
Submitted by the Peoples' Power League of Montana in
Favor of the Measure Proposed by Initiative Petitions and
Designated on the Official Ballot as Follows:
D
For the Initiative Measure No. 7.
Relating to Compensation of Workmen Injured in
Extra-Hazardous Industries.
D
Against Said Measure No. 7.
The following list gives the names of the officers and mem-
bers of the committees of the Peoples' Power League :
OFFICERS.
President, Miles Romney, Hamilton, Montana ; Secretary, M.
McCusker, Livingston, Montana.
EXECUTIVE COMMITTEE.
Miles Romney, Hamilton, Montana; M. McCusker, Livings-
ton, Montana ; John Blewett, Fromberg, Montana ; R. N. Suther-
lin, Great Falls, Montana; W. K. Harber, Fort Benton, Mon-
tana; Albert Michaud, Miles City, Montana; D. J. Donahue. Glen-
dive, Montana; James Holland, Havre, Montana; John F. Duffy,
Kalispell, Montana; Edwin K. Cheadle, Lewistown, Momtana;
Walter S. Hartman, Bozeman, Montana; James A. Jergenson,
Whitehall, Montana; T. J. Walsh, Helena, Montana; D. J. Fitz-
Patrick, Missoula, Montana; W. E. Nippert, Thompson, Montana;
John C. Lowney, Butte, Montana; H. W. Nelson, Billings, Mon-
tana; Henry Drennan, Big Horn, Montana; Adam Wilkerson,
Roundup, Montana; J. B. Rankin, Anaconda, Montana; Harvey
Coit, Big Timber, Montana.
WAYS AND MEANS COMMITTEE.
Dennis Murphy, Miners Union, Butte, Montana,
Henry Drennan, President, District No. 27, United Mine
Workers of America, Billing's, Montana.
M. M. Donoghue, President, and O. M. Partelow, Secretary,
Montana Federation of Labor.
J. B. Rankin, President, Mill and Smeltermen's Union of
Anaconda.
M, McCiisker, Affiliated Railway Trades, Livingston, Mon-
tana.
Miles Romney, Hamilton, Montana.
The Peoples' Power League of Montana is a non-partisian
organization. Its object is to extend and perfect the direct
power of the voter over their state and local governments — that
the people may rule.
We believe that the approval of the Initiative Measure No.
7 relating to the Compensation of v\ orkinen injured in extra-
hazardous industries will redound In Ihc. welfare of the state in
a marked degree. Conservation in tlif tjljj^hcst sense is the object
of this bill. Conservation of the lives of the wage-workers,
upon whom finally rests the prosperity of the state.
INITIATIVE MEASURE NO. 7.
Relating to Compensation of Workmen Injured in Extra-
Hazardous Industries.
Coupled with the farm-loan bill and advocated by the Peo-
ples' Power League, is Initiative Bill Number 7, which provides
for the care and compensation of injured workmen. Forty-seven
classes are listed as extra-hazardous in this bill. Farming, stock-
growing, merchandizing and other relatively non-hazardous oc-
cupations are not included. Chief among the occupations that
the experience tables have demonstrated are extra-hazardous,
are: Mining, smelting, lumbering and other occupations where
power-driven machinery is used. Railway men engaged in
interstate commerce are not inckided, for the reason that they
are cared for under a federal statute.
This bill provides an industrial insurance, administered by a
state commission, representative of the employee, the employer
and the public. The entire cost of the department, both of in-
surance and of administration, is met by assessments upon the
pay rolls of the industries affected, which are classified upon a
basis of relative hazard. Not one penny comes from the gen-
eral tax payer. The cost of administration cannot exceed 15
per cent.
The Montana bill is modeled from the Washington indus-
trial insurance or workmen's compensation act. The Washing-
ton act has worked smoothly for several years past, winning the
enthusiastic commendation of a great majority of the employers
as well as the employees of the state of Washington. For more
extended reference to the Washington law the reader is advised
to write the industrial insurance department, Olympia, Wash-
ington, for copies of the annual reports.
The idea of industrial insurance is borrowed from Ger-
many, where a system of workmen's compensation was promul-
gated in August, 1871, by William I. and Bismarck. Following
Germany, most of the enlightened nations of Europe abandoned
the negligence-litigation system in favor of compensation, re-
gardless of fault. And New Zealand, Canada and many of the
American states have adopted the compensation plan, although
the state of Washington, in 191 1, was the first to enact a com-
pulsory insurance act.
"SAFETY FIRST."
Under the Washington-Montana plan, "Safety First" is the
slogan. Authoritative statistics prove conclusively that from
75 to 90 per cent of accidents may be prevented by proper pre-
cautions and safeguards. And it has been demonstrated that the
most effective way to prevent accidents is to render it cheaper
to provide safety devices than to kill and maim men and women
employed in the industries.
With this in view and to afford a fair and adequate com-
pensation, the rates in the proposed bill are higher than in the
Washington law. It is believed, however, that the effect of such
enforcement of precautionary measures will be to automatically
lower the rates. Under the Montana bill, "First Aid Treatment"
is provided. This is a just and humane provision, that is being
generally adopted in all the states.
The cry for just and equal compensation for workmen in-
jured in extra-hazardous industries has long gone unheeded in
the state of Montana. Relief has been promised in the plat-
forms of the several parties but in every instance it has been
denied by the legislature. The Murphy bill, of which this bill
is as nearly identical as the initiative laws will permit, passed
the house of representatives of the Thirteenth Assembly with
but three dissenting votes, but was strangled in the senate.
Despairing of relief from this quarter the workmen of Montana
propose to carry their appeal direct to all the people.
The Washington plan of compulsory industrial insurance
having been adopted, the voter will be interested in the opera-
tion of the plan in that state.
Mr. John H. Wallace was a member of the state commission
that prepared the original draft of the Washington law and he
is now a member of the State Industrial Commission that is so
efficiently administering the law.
"CARRIES MORE SUBSTANTIAL JUSTICE THAN THE
WASHINGTON LAW."
The following letter addressed to Miles Romney, President
of the Peoples' Power League, dated, Qlympia, Wash., Oct. 15,
1913, is encouraging to say the least. Mr. Wallace says in part:
"In answer to yours of the 12th inst., I am forwarding an an-
nual report of Washington State Industrial Commission, together
with such other literature as may be of service in studying the
compensation system of this state. The copy of your proposed
law received and I am pleased to know that you are endeavor-
ing to initiate a law modeled after the Washington Act, which
carries with it, and rightfully so, more substantial justice than
the Washington Act. * * * Your schedule awards will be
a great inducement to prevent accidents by compelling employers
to provide safety devices wherever practicable to escape the
heavy drain incident to the maiming and killing of workmen."
The report of the first yea'r operation of the Washington
law recites that, "the employers of the state of Washington, their
employes under the Act and the general taxpayers, are so nearly
unanimously satisfied with the principles demonstrated work-
able during the past year, that, it is believed, a referendum sep-
arately put to each interest would result in an overwhelming in-
dorsement of the law and a tribute to the constructive genius of
the profound student of industrial problems and constitutional
law, who was the author of the Washington Compensation Act,
Mr. Harold Preston."
And among the results confidentially predicted by the spon-
sors for the Act the annual report of the Washington Industrial
Commission claims that the following has been accomplished:
1. Furnish certain, prompt and reasonable compensation
to the victims of work accidents and their dependents, 80
per cent of whom have heretofore had no right to redress under
common law rules.
2. Free the courts from the delay, cost and criticism incident
to the great mass of personal injury litigation heretofore bur-
dening them.
3. Relieve public and private charity of much of the des-
titution due to uncompensated industrial accidents.
4. Eliminate economic waste in the payments to unneces-
sary lawyers, witnesses and casualty corporations and the ex-
pense and time loss due to trials and appeals.
5. Provide a method whereby one hundred cents shall go
to the injured workm.an out of every dollar paid out by the em-
ployer for that purpose, premium rates automatically adjusted
to actual cost.
6. Supplant concealment of fault in accidents by a spirit
of frank study of causes; resulting in good will between em-
ployer and operative, lessening the number of preventable acci-
dents, and reducing the cost and suffering thereby.
7. Home rule of compensation funds, same being invested
in bonds of Washington municipalities, etc., instead of being
drained out of the state by premium remittances to eastern
financial centers.
8. State control of statistical information and education in
accident prevention.
ARGUMENT
SUBMITTED BY M. McCUSKER IN FAVOR OF INITIA-
TIVE MEASURE NO. 7, RELATING TO THE COM-
PENSATION OF WORKMEN INJURED IN EXTRA-
HAZARDOUS WORK.
FARM LABORERS EXEMPTED.
The Workman's Compensation Act herewith presented does
not include farm laborers, clerks or office employees, but only
those employees eng-aged in extra-hazardous employments as
enumerated in Section 2 of the accompanying bill.
EMPLOYEES ENGAGED IN INTERSTATE COMMERCE
EXEMPTED.
The Workman's Compensation Act herewith presented does
not include employees engaged in interstate commerce because
the United States Government has original jurisdiction over all
interstate employees and has seen fit to exercise this jurisdiction
by the passage of a National Employers' Liability Act. Hence,
we exclude them from our bill by Section 18, which reads:
Section 18. Interstate Commerce.
"The provisions of this Act shall not apply to any
workman engaged in the actual movement of trains upon
railroads engaged in interstate or foreign traffic. Work-
men engaged in the actual movement of trains includes
only those employed in the engine, train and switching
service."
TO THE TAX PAYER
The passage of the enclosed Workman's Compensation Bill
will not cost the tax payers one cent in any way, but will actually
be a saving to the State and counties by forcing industry to care
for those injured or made dependent, instead of as now throwing
them into our charitable institutions.
TO THE RETAIL BUSINESS MAN.
At the present time the business men of this state are carry-
ing on their books thousands of dollars of debt contracted by
employees engaged in extra-hazardous occupations and if one of
those are injured the retail merchant loses the account. Under a
Compensation Act this would not occur because the injured
employee could meet his obligation out of the compensation
awarded him.
DIVISION OF INDUSTRY INTO CLASSES.
Each class of industry under our Act is put into a separate
class and the different branches of these industries into sub-classes,
and each one is charged a separate insurance rate depending
upon the hazard of that class. The money thus derived from the
premiums of each class goes to pay the awards of that class and
none other. As an illustration : LAUNDRIES ARE IN CLASS
22, and take a rate of 3 per cent, but in the actual operation of
the Act in Washington they are only assessed 43c per $100 of the
pay roll. It will cost that same class approximately 64y2C per
$100 of the pay roll in Montana. The money so derived in the
State of Washington, and the same will hold true under our Act,
went to pay for accidents occuring in the laundry business alone.
The statutory rates set in all such bills is far higher than
necessary. Under the Washington Act laundries carry a statu-
tory rate of $2 per $100 of the pay roll, but this class only needed
43c per $100 of the pay roll to pay all awards approved up to
October ist, 1913.
Actual cost to coal operators under our Act will be approxi-
mately $2.89M> per $100 of the pay roll.
Mines other than coal, approximately $2.65 per $100 of the
pay roll.
Lumber business, approximately $2.65^ per $100 of the pay
roll. Which when figured on the actual labor cost of 1,000 feet
of lumber amounts to about iSc per 1,000 feet.
The above figures are based on the actual experience of the
State of Washington plus 50 per cent and are approximately
correct. Any other employers desiring to know exactly what it
will cost him will be furnished that information by writing to M.
McCusker, Secretary-Treasurer of the Peoples' Power League,
Livingston, Montana.
WORKMEN'S COMPENSATION— WHAT IT IS AND
WHAT IT ISN'T.
Workmen's Compensation is State accident insurance. It has
been in operation in every civilized country for years. It is now
in active operation in 22 states of this Union. Its principle is
that industry should bear the loss caused by industrial accident
the same, and in the same spirit, that it now bears the loss caused
by the breakage or depreciation of machiner}^ or plant. And
that the money so paid by the employer shall go to the injured
employee, or their dependents, and not as now be eaten up by
costly litig-ation.
It is an exclusive remedy. That is, when an employer has
paid his insurance his obligation is discharged and he cannot be
sued for more damages.
The enclosed "Bill also provided that a careless employer,
who does not provide necessary safeguards is assessed an extra
amount, over careful employers, and in this way we hope to ma-
terially reduce industrial accidents.
OUR ACT AND THE REASON IT WAS DRAFTED.
There has been much comparing of figures to prove that our
Act is higher than similar Acts in other States, and particularly
the Washington Act. I wish to state frankly that we pay an
amount 50 per cent higher than the Washington Act. I state this
frankly and also with a certain amount of just pride simply be-
cause the Washington Act does not, and it is recognized that it
does not pay a just compensation. But as we did not arbitrarily
raise the Washington rates, I will state clearly, just why they
were raised.
"Compensation" must do out thing, and that is to adequately
compensate. Any Act which purports to do this but does not, is
not a "Compensation Act," but a fraud and a cheat. This being
true let us either pass a "Compensation Act," or else forget the
subject in its entirety.
What is an "Adequate Compensation?" Is it possible to "ade-
quately compensate" a man (or woman) for the loss of an arm
or a leg? Plainly not. For we might give him a railroad or a
mine, but still he would be minus that arm or leg and would feel
its loss equally as keen. Neither can we ever hope to "ade-
quately compensate" a wife for 'the loss of a husband she loves.
We might give such a woman the entire world, and the little
stars, then throw in golden chains to hang them in her hair with
and still that would not be an "adequate compensation."
This being true we must either give up or else discard all the
sentiment connected with the question. After ihe sentiment has
been discarded there, alone remains the cold, and yet clear, matter
of equity and justice.
WHAT IS JUSTICE?
lit is doing unto others as we would be done by.
WHAT IS EQUITY?
It is that which appears to every unbiased mind as fair and
honorable.
This is the path we have followed in drafting the Bill under
consideration. We have honestly tried to hew as near to this
line of justice and equity and fairness as is humanely possible,
wavering neither on one side nor on the other.
The conclusion we came to were these : That in all cases of
minor accidents — and by minor accidents we mean such as do not
leave any permanent defect — the injured employee should be re-
turned to his work in as good financial condition as when he was
injured. In other words his medical and hospital bills should be
paid and his family cared for.
Some there are who lintend to attack this measure because it
contains a section known as FIRST AID TO THE INJURRD.
I will quote the following from the Washington Report of 1912:
"There can be no' question but thalt there is an insist-
ent demand on part of injured workmen, their families and
friends for some amendment to the Act whereby victims
of work accidents will be given immediate and thoroughly
competent medical attention after an injury: and that the
cost of such treatment be either paid by the employer
directly, or by the State out of some fund, or indirectly
by an increase in the scale of awards sufficient to cover
the cost in all cases."
Is it necessary to add anything to this?
In cases of permanent partial disability, such as the loss of
an arm, he should receive such an amount as to enable him to
compete in the labor market with able-bodied men. And we pay
for such an injury — the loss of an arm — not less than $3,000.
But why this particular amount? Some will contend that it is
not enough, and others that it is too much. Then why $3,600?
Was this a compromise? No! It is a matter of cold equity and
justice.
It is this: A conservative estimate of the average monthly
earning of workmen in Montana would be $50 per month. This
is low.
The average expectancy of life of a workman is twenty-five
years.
The loss of an arm is everywhere recognized as a 60 per cent
disability.
$3,600, if invested, should pay, besides taxes, 6% per annum,
or $216, which amounts to $18 per month, but if the injured work-
man was earning $50 per month, his loss, caused by the 60 per
cent disability, would amount to $30 per month. He draws $18,
which leaves a loss of $12 per month. But he has been paid a
lump sum of $3,600, which represents his loss of $12 per month for
25 years.
$12 X 12 equals $144.
$144 X 25 equals $3,600.
That is cold equity and justice.
This same method has been followed in figuring all such
permanent partial disabilities.
In cases of total disability, such as the loss of both feet, both
hands, both eyes, one foot and one hand, total paralysis, or an
injury to the brain which results in imbecility, we allow the sum
of $30 per month if unmarried at the time of the injury, and $35
if married, and $7.50 per month for each child, but all awards not
to exceed $52.50 per month.
In cases of death from accident, while at work, we allow
the widow $30 per m.onth as long as she lives or until she re-
marries, and $7.50 per month for each child, but recognize only
three children. We are forced to recognize that many; one to
take the place of the father, one to take the place of the mother,
and one for the legitimate increase of the human race.
But why did we decide to give the widow $30 per month?
Was it becouse the figures 3 and o held some peculiar fasci-
nation for the men who drafted this measure? No. Again
"Justice and Equity" appear and demand that this ^voman who
has lost a husband through an industrial accident be maintained,
neither above nor below, the "bread line." And I maintain that
no woman can be "kept" in Montana in a condition conductive to
health on a sum less than $30 per month, nor children on less than
$7.50 per month.
Those who are willing- to take a contract to keep a woman
on $30 per month and children on $7.50 are few, but few or many,
they are the only ones entitled to object to this section as being
too high.
There is some talk at the present tim.e, by a few employers,
to the effect that if this Bill is defeated "they will see to it" that
a "just bill" is passed by the next Legislative Assembly. Now T
am forced to inquire as to what a "just bill" is? And my curios-
ity also prompts me to inquire as to who these employers are who
so boldly assert that they control the legislative machinery of this
State to the degree where they are able to confidently assert that
they can pass any measure they desire. Surelv for once these
employers have over estimated their strength. There are two
sides to this controversy — the employer and the emplo3^ee. There
are some employees Avho asssrt that for the loss of an arm they
should be compensated to the extent of being given the plant, the
mine or the railroad, wherein the accident occurred. And then
there are some employers who assert, and equally as boldly that
an injured employee should receive nothing, or at most only a
small sum, for an accident. Both are wrong, and wrong in exactly
the same degree.
Theoretically "industry should bear the burden of the loss
caused by the industrial accidents to their machinery or plant."
And why not; is not a man as good as a machine? That is cold
"equity and justice."
But right here a fear seizes the heart of men lest "cold
equity and justice" traverse the line of fairness. Nt^w what is
fairness? "Do unto others as you would be done by." That
means when taken into consideration the present question that
each should recognize the right of the other. There is a dif-
ference of opinion and I wish to say to you, Mr. Employer, and
also to you, Mr. Employee, that "Fairness" demands that you split
the difference. This is what we say in our Bill and this is the
proof :
In estimating last year's accidents in the State of Washing-
ton (from the report of the Washington Compensation Commis-
sion of 1913) in units of one man's labor for one vear, and as-
suming that the average year of labor consists of 300 work days,
and that the expectancy of a workman's life is 25 years, which is
a very conservative estimate, I find that the loss in years of labor
has been as follows:
From fatal cases 8,225.0
From temporary total disability 1,135.8
From permanent partial disabilities .... 4,131.2
From permanent toital disabilities 325.0
Total from all injuries 13,817.0 yeairs
This means that the accidents of the State of Washington
lessened the productive capacity oi that commonwealth to the
extent of the perpetual labor of an industrial army of 13,817 men.
Without any remedial legislation, either in the form of em-
ployers' liability acts, or compensation laws, all this loss would
be borne by the employees. Some states by passing certain laws
have stated that certain proportions of this should be borne by
each, but I find that invariably the employees are forced to stand
by far the greater portion of this loss. In our law we have frankly
stated that each should bear half. That is fair.
In Washinerton we find that it is divided as follows : (Wash-
ington reports of 1913.) :
Per cent of loss borne by industry .... 28.3%
Per cent of loss borne by employees. . . . 71.7%
That is not splitting the difference. That is not fair. And
that is the reason that there is sucih an insistent demand on the
part of injured employees to have the law amended.
Under the Act herewith presented we pay an average of ap-
proximately 50 per cent more compensation. Hence: 28.3 per cent
borne by Washington employers x 1V2 equals 42.45 per cent bo ..e
by Montana's employers.
71,7 per cent borne by Washington employees minus 14.15 per
cent, equals 57.55 per cent borne by Montana's employees.
The employers under this arrangement have the better of
"Cold Equity and Justice," by 57.55 per cent, for industry, theo-
retically should stand all the burden, and the better of "Fairness,"
which is splitting the difference, by 7.55 per cent.
COLD BUSINESS.
The Bill presented here is an insurance law. It insures an
employer in exactly the same degree that it insures an em-
ployee.
A small coal operator who has perhaps worked all his life to
build up a business suffers a catastrophe in his mine. Under the
present system that man would be ruined and the dependents of
those killed would in most instances be thrown on public charity,
for the entire property would not perhaps be sufficient to pay
jury awards, but under this bill an assessment would be levied
upon the pay roll of all concerns engaged in coal mining within
the State, and out of this the' awards would be paid, and the oper-
ator would co'ntinue his business. The principle involved in this
insurance is the same as mutual fire insurance; a certain number
of men band themselves togetheir in a mutual fire insurance com-
pany to insure each other against loss caused by fire, and wihen
one has fire they are all assessed a certain amount and this goes
to cover the loss.
Every employer at the present time fears damage suits. And
in order to protect himself from them he insures himself in some
casualty insurance company. "Casualty insurance" is this : An
employer pays a premium to this company to protect him from
personal damage suits. The casualty company agrees to fight all
such suits in court' and pay all judgments against the employer up
to and including $5,000, but no more. (This is a general state-
ment.) This compensation law says that these employers shall
pay to the State Industrial Insurance Department instead of to a
private casualty company, a certain amount of his pay roll. But
instead of promising to fight the injured employee in court they
contracL to pay him a certain definite sum for every class of in-
jury.
But "Cold Business" demands to know which is the most
expensive method. To illuminate the matter, I, submit the follow-
extract from the first annual report of the Industrial Insurance
Department of the State of Washington. (I am forced to use the
Washington statistics on this matter, owing to the fact tnat Mon-
tana has never collected any information on this point.)
The real burden of Industrial Insurance. (Report 1912, p.
275)-
"That the fear of an intolerable premium burden on
the industries was unfounded is clearly demonstrated by
the experience of even one year, in which collections have
naturally been incomplete and in a few classes more funds
were accumulated on the first quarter's call (required
by law) than was required.
"The table following- from sworn official report shows
that over $900,000 was paid in casualty premiums alone,
the great preponderance doubtless being expended to
cover risks in "extra-hazardous" employments, during
1910.
"While the industries under the compensation act
contributed $1,000,000 in premiums during the year only
about $700,000 was actually required to pay cash awards
and set aside reserves. The remaining $300,000 was on
hand Oct. i, [912.
"Under the common law system, to the $900,000 an-
nual premium drained for court protection (with casualty
rates continuously being increased"), there must be added
a chain of indirect cost; jury verdicts in excess of $5,000
which was the usual limit of a policy's protection, retain-
ers, paid law^'ers, transportation furnished witnesses
and their hotel bills, reduced productii>n in plants by the
emplo,ver's enforced absence and that of his foreman,
etc.. attending court: the time, expense and worry of fer-
reting out and keeping in touch with witnesses, misunder-
standing and suspicion of other workmen resulting from
pending litigation, the danger of bankruptcy thiough vin-
dictive jury verdicts and the impairment of credit at
banks, incident to considerable litigation; the "settle-
ments" by self-insurers like the coal and street railroad
corporations, and the numerous contractors who "took
their chances."
"Probably the annual drain on industries of Wash-
ington under the common law system would aggregate
not less than $1,250,000.00.
This is interesting ; it costs the employers of Washington
$700,000 (not counting reserves) to protect themselves from in-
dustrial accidents during 1912, and this sum went direct to their
injured employees, while under the common law system it cost
these same employers $1,250,000 for this same protection in 1910,
a saving of $550,000 in one year.
The Act presented here is 50 per cent higher than the Wash-
ington Act and upon that basis I figure $700,000 x i>4 equals $1,-
100,000. $1,125,000, that it cost employers of Washington in 1910
minus $1,100,000 equals $150,00, which represents the approximate
saving to the employers of Montana by the passage of this Act.
And still there are some so easily frightened as to think that
the passage of this Act will injure business in this state.
This is our side of the case. We h-ave been honest, frank
and fearless in presenting it. We are equally as honest, frank
and fearless in drafting the measure. We are proud of our work
and we submit it to the people of this State with absolute confi-
dence in the outcome.
(Signed) M. McCUSKER, Sec.-Treas.,
Peoples' Power League of Montana.
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