Tyson Foods’ Secret Recipe for Carving Up Workers’ Comp

Over the past 25 years, the giant meatpacking company has taken a lead in pushing for changes in workers’ comp in state after state — often to the detriment of workers.

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About five years ago, one of the nation’s largest corporations, Tyson Foods, drew a bullseye on the official who oversaw Iowa’s system for compensating injured workers.

As workers’ compensation commissioner, Chris Godfrey acted as chief judge of the courts that decided workplace injury disputes. He had annoyed Tyson with a string of rulings that, in the company’s view, expanded what employers had to cover, putting a dent in its bottom line.

So when Republican Terry Branstad ran for governor in 2010, vowing to make Iowa more business-friendly, Tyson hosted an event for him at its headquarters and arranged another meeting for him to hear from large companies who were frustrated with the workers’ comp commission.

Within weeks of his victory, Branstad demanded Godfrey’s resignation. When Godfrey refused, the new governor did the harshest thing in his power: He cut Godfrey’s salary by more than 30 percent.

Amid the fallout, Tyson drafted and hand-delivered 14 pages of talking points criticizing Godfrey to help Branstad defend his decision.

Godfrey quickly grasped just how much sway Tyson and other big companies can have over workers’ comp. “It’s just chilling that someone would go to that level to try to influence the system,” said Godfrey, who is now the chief judge of the federal employees’ workers’ comp appeals board.

Tyson’s tactics, pieced together from depositions and documents in a lawsuit Godfrey filed — many of which have never been released — are far from unique to the Hawkeye State. Over the past 25 years, as the Arkansas company grew to be one of the world’s largest meatpackers, Tyson has taken a lead in reshaping workers’ comp, often to the detriment of workers, a ProPublica investigation has found.

Tyson’s story also tells a broader one about American politics: How time after time, one determined company, facing a challenge to its profits, can bend government and the law to its will.

Using its economic leverage — combined with time-honored wining-and-dining and behind-the-scenes arm-twisting — Tyson has helped steer legislative changes through several states in the South and Midwest. It has urged officials, often successfully, to remove or appoint workers’ comp judges. And the company’s lawyers have crafted novel legal arguments for limiting the rights and benefits of injured workers.

Rather than advocating for benefit cuts outright, Tyson has often pushed for subtle changes, such as giving employers more say over medical care, raising workers’ burden of proof or limiting the scope of activities judges have deemed work-related.

These changes have had a comparable effect to cutting benefits, excluding people whose doctors say have legitimate work injuries — especially the costly musculoskeletal disorders like carpal tunnel syndrome that poultry workers are prone to.

Tyson declined to make company officials available for interviews. In response to written questions, the company denied its involvement in workers’ comp was out of the ordinary.

“Like other major companies,” Tyson wrote in an email, “it’s important for us to monitor state regulations that affect how we make sure workers hurt on the job get the care and benefits they deserve.”

Tyson, which supplies chicken, beef and pork to supermarkets and fast-food restaurants like McDonald’s around the world, employs about 113,000 workers at more than 400 facilities and offices.

With job titles that describe a worker’s place in the processing chain, like “live hang” and “throwing jowls,” meat plants like Tyson’s pose an array of risks. Workers face everything from crippling hand injuries from repetitive cutting motions to catastrophic amputations in grotesquely named machines like fat suckers and neck breakers.

Curbing the expense of such injuries is important to Tyson, whose former chairman Don Tyson developed a storied cost-cutting reputation as he built his father’s company into an empire. The company spends about $105 million on workers’ comp every year, according to court documents, making it among the top corporate payers. It’s an amount equal to more than 10 percent, and sometimes nearly 20 percent, of the company’s annual profits.

Over the past year, ProPublica and NPR have examined how many states have been quietly dismantling their workers’ comp systems, leading to cataclysmic consequences for injured workers. The cutbacks, often driven by business, have landed workers on public assistance and forced them to fight insurers for medical care their doctors recommended.

Every state has its own history and politics. Businesses large and small complain about the cost of workers’ comp. Unions lobby to increase benefits and doctors fight cuts in medical fees. Bo Pilgrim, the founder of rival chicken giant Pilgrim’s Pride, once handed out $10,000 checks on the floor of the Texas Senate during a debate over a workers’ comp bill. Even in Iowa, Tyson was far from the only business bending the governor’s ear.

But unlike most companies, Tyson has asserted an unusually high level of control over its workplace-injury program, giving it a nitty-gritty perspective on issues other employers leave to insurance companies.

Tyson self-insures, meaning it pays nearly all of its claims from its own pocket. When workers are injured, they’re usually sent to a Tyson nurse at the plant. Their claims are processed by Tyson adjusters. And in many states, the company even has its own managed-care unit, handpicking the doctors that workers can see and advising those doctors on light-duty jobs injured employees might be able do.

Tyson said the system allows it to provide better medical care for its workers and help them get back on the job.

Worker advocates say Tyson’s approach allows it to deny workers necessary medical care and force them back to dangerous jobs before they’re ready.

A look back on the past quarter-century reveals that Tyson has influenced workers’ comp much in the same way it reshaped the poultry industry, famously steering every step of production from the breeding of the birds to the Chicken McNugget.

Read more of ProPublica’s report on workers’ compensation insurance and Tyson.


Topics: Economy

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