THE DANGER IN the workers' compensation bill on the D.C. Council's calendar today is that it will further estrange the city's business and labor communities and run afoul of the financial control board without effectively solving the problem that gives rise to the legislation in the first place. The problem lies in the expense of a program that pays long-term worker benefits far out of line with those paid in competing area jurisdictions. Members must decide today whether a bill that fails to reduce major employer disincentives in the District's program is as bad as having no bill at all.

Nearly eight months ago, the control board recommended that the mayor and council bring the city's workers' comp law and practice, as well as benefit levels, into line with those of Maryland and Virginia. The board's reasoning tracked with the views of many in the business community and knowledgeable council members such as Jack Evans (D-Ward 2) and Charlene Drew Jarvis (D-Ward 4). They believe the District's higher worker compensation costs contribute to the exodus of business from the city.

Unfortunately, when council members took action on a bill last month, a majority flinched when the time came to put a cap on the length of time an injured employee can collect benefits. It mattered not that 48 states cut off benefits after a certain period, or that the control board recommended limiting benefits to 500 weeks or that the business community has warned repeatedly that the District system is a major disincentive to doing business in the city. The council, by a 10-2 vote, was willing to settle for a "reform" bill that trimmed benefits for some workers' comp cases, would sweep more injured workers into managed-care programs and cut some administrative costs. But it ignored criticism that the bill would not significantly reduce employer premiums or keep and attract business.

At today's second reading, the council can make a weak bill better. Says Mr. Evans: "If we're not interested in being competitive, then we do what we're doing and we can sit back and complain when businesses don't come here."