State agency spared layoffs
CARSON CITY (AP) – Nevada’s state-run workers’ compensation agency has lost business to new competitors, but its manager says he won’t have to terminate employees.
Doug Dirks, chief executive officer of the Employers Insurance Co. of Nevada, says about 250 employees have transferred to other state jobs. A handful have found jobs with competing insurance companies. Dirks has a remaining staff of about 645.
Under a law that took effect July 1, private insurance companies can sell workers’ compensation policies in Nevada for the first time.
Dirks said Thursday he won’t know for several weeks how much business his agency has lost to the private companies. So far, the loss is less than expected.
”It is hard to gauge who is gaining a foothold,” he said.
The agency, formerly known as the State Industrial Insurance System, has been getting about $450 million a year in premiums from companies that use its services to provide workers’ compensation protection for their employees.
Dirks originally expected the transition into a competitive environment would result in employee layoffs starting this month. He also predicted last spring that his agency would control about 35 percent of the workers’ compensation market within five years.
”At this point no layoff is planned,” Dirks said. ”I had felt a layoff was probable. I even told the employees so. We are losing employees faster than we are losing business.”
Before the legislative session ended May 31, legislators agreed that existing Employers Insurance Co. employees would be given hiring preferences if they sought to transfer to fill vacancies in other state agencies.
Dirks said he didn’t anticipate the work force would fall to 645 employees before next June 30.