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Workers' Comp Costs Are Forcing Businesses To Abandon California; Originally "No-Fault' System; Fraud, high medical costs and lawyers' fees among items weighing heavily.(A)
Byline: GLORIA LAU
Mitchell Greif, 44, is a Southern California native who loves the Los Angeles beaches and the lifestyle the city has to offer.
But fed up with skyrocketing costs at his plastic-bag making company, Coast Converters, he's packing up to go.
This past December, Greif received notice of the huge premiums he'd have to pay for his employees' 2003 workers' compensation insurance.
He doesn't own a big business with deep pockets. He employs just 150 workers, and in recent years rising workers' comp premiums have driven his profits down.
In 2001, he paid $225,000. That rose to $330,000 in 2002. This year, he's paying $570,000; if he stays in L.A., his rate would be $700,000 next year. These hikes keep coming -- even with a discount he gets for providing a safe work environment.
So what's Greif doing to fix this? He's taking his firm to Las Vegas -- four hours up the Interstate 15. Nevada has far lower workers' comp and other business taxes.
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