Keefe, Campbell & Associates, LLC

Editor’s comment: Human resources and benefits managers across the U.S. are smiling to hear a federal judge in Iowa ordered the Equal Employment Opportunity Commission to pay $4.56 million in attorney fees and expenses to a Cedar Rapids trucking business after dismissing the agency’s sexual harassment lawsuit. A team of attorneys successfully defended CRST Van Expedited in the lawsuit, which was filed in 2007.

The fee award against the EEOC by a federal judge is unusual and may be among the largest imposed by a federal court. They are appealing. The agency alleged CRST’s lead drivers or team drivers subjected approximately 270 female drivers to sexual harassment and a sexually hostile work environment and the company had failed to correct and protect them.

In a series of rulings, Chief Judge Linda Reade of the Northern District of Iowa dismissed the agency’s claims. She previously granted summary judgment on the claim CRST tolerated a “pattern and practice” of sexual harassment against female drivers. The EEOC presented the court with what was felt to be solely anecdotal evidence to show some members of CRST’s management may have occasionally violated CRST’s anti-sexual harassment policy by failing to respond appropriately to sexual harassment in the workplace.

The EEOC did not present the failings of CRST’s managers in any meaningful way to show CRST had a defined pattern or practice of tolerating sexual harassment in its workplace. This summary judgment ruling effectively left 200 or so EEOC claims with nothing in common.

Please don’t hesitate to reply with your thoughts and comments.

Editor’s comment: Last week, we published an article about self-administered MSA trusts. We were stated:

We caution our readers the injured worker has to be advised Medicare Set-Aside monies cannot be used until the worker is eligible for Medicare benefits. Once the worker is eligible to receive Medicare benefits, the monies supplant the federal benefit–the monies have to be used to pay Medicare-covered medical or other expenses related to the work injury or management of the MSA until they are used up. Most important, the injured worker has to annually report what they do with the money to CMS.

Fran Mohrmann of Travelers Insurance who is one of the top Medicare/CMS/MSA folks in the U.S. claims industry pointed out this statement above may have been accurate five years ago but it isn’t accurate now. She cited language from the CMS 2005 memo which states:

Q3. Use of WC Settlement Funds Prior to Medicare Entitlement – May workers’ compensation settlement funds attributable to future medicals be used prior to Medicare entitlement?

A3. For claimants who are not yet Medicare beneficiaries and for whom CMS has approved a WCMSA, the WCMSA may be used prior to becoming a beneficiary because the amount was priced based on the date of the expected settlement. Use of the WCMSA is limited to services that are related to the workers’ compensation claim or settlement and that would be covered by Medicare if the individual were a Medicare beneficiary. The same requirements that Medicare beneficiaries follow for reporting and administration are to be used in the above cases. The CMS will not pay for any expenses related to the workers’ compensation illness or injury until a self-attestation document or a full accounting of all monies expended from the WCMSA are sent to the lead contractor upon Medicare entitlement. At that time, the lead contractor will adjust the WCMSA record to reflect the expenses paid prior to entitlement.

As always, our goal is to get things right and kidding aside, Fran has an almost encyclopedic recall of such government minutiae. We again salute her. If you ever need to contact Fran, send a reply and we will direct it to her for response.

Editor’s comment: This article applies to risk managers, TPAs and insurers across the country. We have received a number of inquiries recently about the required language in your medical releases. If you aren’t aware, U.S. law changed way back in 1996. All current medical releases needed to be updated to comply—a medical release that doesn’t comply with applicable federal law puts you at risk for litigation with your friends in the federal government.

We recently reviewed a medical release from a major U.S. TPA that is very well-known in this industry—their release clearly did not comply with federal law and they are unquestionably violating the law in all of their claims involving use of this release. We have told them it has to be updated. And we just reviewed a medical release from a major Illinois employer and immediately noted a number of deficiencies. We are pretty confident no one in these organizations took the steps necessary to comply with the law more than a decade ago. We have made detailed recommendation on how they should do so and hope they catch up before the Federales catch up first.

HIPAA (it is not HIPPA) is the Health Insurance Portability and Accountability Act. It was signed into law by President Bill Clinton on August 21, 1996. Most healthcare insurance companies and providers were to adhere to the HIPAA regulation guidelines by October 2002. The HIPAA law presents a multi-step approach geared to improve the United States’ health and WC insurance system. One approach of the HIPAA regulations was to protect patient privacy. This provision is in Title IV which defines rules for protection of patient information.

All healthcare providers, health organizations, and government health plans that use, store, maintain, or transmit patient health care information are required to comply with the privacy regulations of HIPAA. We also feel all Illinois and U.S. employers need to create a “HIPAA circle” of the managers who are able to receive, consider and disseminate private health information. To protect your organization, you should consider creating such a “circle” if you haven’t already done so. If you need guidance or counsel on how to set up a HIPAA circle in your organization, send a reply.

One easy step in analyzing all medical releases is to look and see whether the medical release provides the power of revocation. Older releases don’t have such language. Both of the organizations mentioned above presented medical releases that did not allow revocation. When we see a release that doesn’t allow for revocation, we then assume most of the other HIPAA requirements aren’t present.

Here are the HIPAA requirements right out of the applicable Federal Code:

A valid HIPAA authorization under this section must contain at least the following elements:

(i) A description of the information to be used or disclosed that identifies the information in a specific and meaningful fashion.

(ii) The name or other specific identification of the person(s), or class of persons, authorized to make the requested use or disclosure.

(iii) The name or other specific identification of the person(s), or class of persons, to whom the covered entity may make the requested use or disclosure.

(iv) A description of each purpose of the requested use or disclosure. The statement “at the request of the individual” is a sufficient description of the purpose when an individual initiates the authorization and does not, or elects not to, provide a statement of the purpose.

(v) An expiration date or an expiration event that relates to the individual or the purpose of the use or disclosure.

(vi) Signature of the individual and date. If the authorization is signed by a personal representative of the individual, a description of such representative’s authority to act for the individual must also be provided.

Required statements In addition to the core elements, the authorization must contain statements adequate to place the individual on notice of all of the following:

(i) The individual’s right to revoke the authorization in writing, and either:

(A) The exceptions to the right to revoke and a description of how the individual may revoke the authorization; or

(B) To the extent that the information in paragraph (c)(2)(i)(A) of this section is included in the notice required by § 164.520, a reference to the covered entity’s notice.

(ii) The ability or inability to condition treatment, payment, enrollment or eligibility for benefits on the authorization, by stating either:

(A) The covered entity may not condition treatment, payment, enrollment or eligibility for benefits on whether the individual signs the authorization when the prohibition on conditioning of authorizations In paragraph (b)(4) of this section applies; or

(B) The consequences to the individual of a refusal to sign the authorization when, in accordance with paragraph (b)(4) of this section, the covered entity can condition treatment, enrollment in the health plan, or eligibility for benefits on failure to obtain such authorization.

(iii) The potential for information disclosed pursuant to the authorization to be subject to redisclosure by the recipient and no longer be protected by this rule.

Plain language requirement The authorization must be written in plain language. No one knows whether “plain language” relates to folks who have law degrees or folks whose highest grade level was junior high in rural Appalachia.

Copy to the individual If a covered entity seeks an authorization from an individual for a use or disclosure of protected health information, the covered entity must provide the individual with a copy of the signed authorization.

If you need us to review your current medical release, we are happy to do so without charge—send it along. We appreciate your thoughts and/or comments or simply post them on our award-winning blog run by our Blogmaster, Arik D. Hetue at www.keefe-law.com/blog

Editor’s comment: When you see our federal legislative leaders slapping each other’s backs and high-fiving over the U.S. House of Representatives passing their version of government-mandated health care, please remember conventional estimates are your taxes will certainly be raised at least $500 billion over the next decade. The members of the House have also voted to magically “borrow-spend” about $700 billion during the same period despite the fact the U.S. budget deficit is at a record high. When we see the folks in Washington cheering about spending gobs of money they don’t even have on such things, we are reminded of the quote attributed to Margaret Thatcher: “The problem with socialism is that eventually you run out of other people’s money.”

At the same time, we were sent an important thought by one of our knowledgeable readers about the private cause of action in federal Medicare lien recovery. One of the relatively new obstacles to the efficient settlement of workers’ comp and personal injury claims is resolving outstanding Medicare liens. All observers complain about the Center for Medicare Services’ (or CMS’) slow response time and apparent lack of efficiency.

Further complicating matters, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) and the Medicare, Medicaid, and SCHIP Extension Act of 2007 contain important changes that suggest attorneys representing either workers’ comp and personal injury claimants will have to set aside portions of the settlement to reimburse Medicare for future accident-related payments. However, hidden in the headaches that go with resolving Medicare liens is an enforcement provision that gives Medicare beneficiaries a private cause of action allowing the beneficiary to sue for double the amount of what Medicare paid which has not be repaid for the accidental injuries or exposures.

This private cause of action is often over-looked by insurance carriers/TPAs, claims handlers and defense lawyers. If it is not quickly and properly addressed by the knowledgeable risk/claims manager, wily Plaintiff/Petitioner lawyers may use it to increase the value of their cases and bring about higher and more costly settlements. There is also a clear problem that is something of a claims “land-mine”—no one reserves for claims’ mistakes like not reimbursing a conditional payment to Medicare.

The private cause of action is set forth in 42 U.S.C. § 1395y, and provides:

(A) Private cause of action

There is established a private cause of action for damages (which shall be in an amount double the amount otherwise provided) in the case of a primary plan which fails to provide for primary payment (or appropriate reimbursement) in accordance with paragraphs (1) and (2)(A).

The purpose of this private cause of action statute was to help the federal government recover conditional payments from insurers or other primary payers, to encourage private parties to enforce Medicare’s rights, and to save money for the taxpayers. The premises underlying the private cause of action are:

(1) The beneficiary can be expected to be more aware than the government of whether other entities may be responsible to pay medical expenses,

(2) Without double damages, the beneficiary might not be motivated to sue an insurer/TPA because Medicare may have already paid the expenses and the beneficiary would have nothing to gain by pursuing the primary payer, and

(3) With the private right of action and double damages, the beneficiary can pay back the government for its outlay and still have money left over to pay for the litigation.

The 2003 amendments to the MMA were specifically enacted to overturn previous court decisions that limited the effectiveness of the MSP private cause of action. The 2003 Amendments made it easier for injured Medicare recipients to bring these private actions on behalf of CMS-Medicare against an expanded class of entities and individuals with insurance, and clarified when such entities are required to pay the Medicare beneficiary’s medical expenses.

The three critical amendments established:

(A)    All businesses, trades or professions shall be deemed to have insurance regardless of whether or not it carries its own risk.

(B)    Any judgment or payment conditioned upon the recipient’s compromise, waiver or release whether or not there is a determination or admission of liability will demonstrate a plan’s responsibility to reimburse Medicare.

(C)    Reimbursement to Medicare was no longer tied to anticipation of “prompt” payment because the Secretary of Health and Human Services may make conditional payments if a primary plan has not made, or cannot reasonably be expected to make payments with respect to such services promptly.

Prior to the 2003 amendments, it was not clear whether Medicare had a right of reimbursement from certain self-insured defendants. After the amendments, it became crystal clear Medicare’s right of reimbursement applies to practically all tort or workers’ comp settlements in which Medicare payments have been made on behalf of the tort plaintiff.

The key to avoiding exposure—pay Medicare back!! If you learn Medicare made a conditional payment of a medical bill or bills that might or could arguably be reasonable, necessary and related to the covered event, don’t hold it. All relevant case law indicates the cause of action exists when the insurer/TPA was aware of the conditional payment and ignored Medicare’s interest. Then, and only then, can the Plaintiff/Petitioner file to seek double recovery for the unreimbursed payment.

Court decisions decided since the enactment of the 2003 amendments consistently permit the private cause of action to proceed against insurers and similar entities including employers, who are deemed responsible for the tort or workers’ comp victim’s injuries. Lawyers representing tort and workers’ comp claimants may understand the MSP private cause of action and may use it as a tool to advance clients’ interests. Before a case goes to trial, Plaintiff/Petitioner lawyers can now use the threat of a Medicare Secondary Payer private cause of action lawsuit to potentially increase the settlement demand or bring a reluctant Defendant to the settlement table.

Risk/claims managers, insurance carriers/TPAs and defense lawyers should keep in mind that the MSP private cause of action can be brought as a separate count in a personal injury lawsuit, or it can be brought as a separate claim after a judgment is obtained against tort defendants. The timing of when the MSP private cause of action can be brought depends on the facts and circumstances of the particular case.

The MSP private cause of action has been strengthened by recent legislation and court rulings. Plaintiff/Petitioner lawyers are rapidly learning about it and may incorporate the use of its double damages provision to benefit their clients. The sheer number of current and future Medicare beneficiaries and recipients demonstrates how important the MSP private cause of action could be to personal injury and worker’s compensation practitioners. Currently, there are forty-one million (41,000,000) beneficiaries in the Medicare health care system. In the next few years, it is estimated an additional seventy-four million (74,000,000) baby boomers will start entering the Medicare system.  These statistics, coupled with the recent changes to the law that strengthen the MSP private cause of action, require risk/claims managers, insurance carriers/TPAs and defense attorneys to understand how and when the MSP private cause of action can be used.

If you have any questions or comments, please forward them to our resident Blog Administrator, Arik D. Hetue, J.D. who can be reached at ahetue@keefe-law.com or post them later today on our award-winning blog at www.keefe-law.com/blog.

Editor’s comment: “Donning and doffing” refers to the minutes it takes a worker to get into and/or out of work attire. In Pirant v. U.S. Postal Service, the United States Supreme Court declined to grant certiorari to appeal a Seventh Circuit Federal Court of Appeals ruling which held an employee could not count towards the 1,250-hour minimum for Family and Medical Leave Act (FMLA) eligibility the three to five minutes she spent each workday donning and doffing her gloves, shoes, and a work shirt.

The Federal Appellate Court ruled such articles of clothing did not constitute extensive and unique protective equipment that was integral and indispensable to her principal activities as a mail handler for the United States Postal Service. The employee’s petition for certiorari asserted the Seventh Circuit’s holding conflicted with decisions of the Third and Ninth Circuit Courts of Appeals, and with the Secretary of Labor’s interpretation of the Act, as set forth in the Postal Service’s petition for rehearing by the Seventh Circuit.

The petition for rehearing, which disavowed the rationale of the Seventh Circuit’s decision, had been supported by an amicus brief from the Secretary of Labor, according to the employee’s petition for certiorari. (Case below: Even though it was turned back, we consider it amazing to see such a claim make it all the way to the highest court in the land. If you would like the location of the ruling on the web, send a reply.

Editor’s comment: Last week, we reported the $6.2 million levy on one of the world’s largest retailers by the Equal Employment Opportunity Commission. We feel the national and regional directors of the EEOC “held up the scalp” of the vanquished corporate human resources department for everyone to see. We feel other HR and general counsels’ departments of the hundreds of U.S. businesses across the country that employ autotermination policies need to undertake a very cautious review of their policies in light of this consent decree. Actually, this may affect any and all termination policies when it comes to dealing with folks on workers’ comp who want reasonable accommodation under ADA. While the record-high settlement doesn’t actually point to any specific provision of the ADA that was violated and isn’t a ruling from a federal or state court, it does signal the willingness of a federal bureaucracy to employ their unlimited legal budget to sue you and potentially force similar seven-figure settlements.

What is the concern of the EEOC? What started this mess? Well, we call autotermination policies a gender/sex/religion/race/sexual-orientation neutral way to terminate any employee. The simple rule is that if a given employee is off work continuously for either six months or a full year (or some other defined term) for any reason, your organization terminates them without recourse.

One thing that Sears may have done wrong comes from the pleadings. In filing a motion to dismiss, you may note the lead Plaintiff worked as an automotive service technician. He was injured when he fell while on the job in April 2001. Although the lead Plaintiff took leave to recover, his injuries arguably left him substantially impaired in his ability to perform physical tasks. According to the EEOC, within three months after his injury he sought placement in two less physically demanding positions for which he was qualified, but Sears refused to place hire him in either position. As a result, he remained on workers’ compensation leave because he was unable to return to his prior service technician job. Ultimately, his employment was terminated under Sears’ disability or worker’s compensation leave policy that inflexibly mandated the termination of employees on leave for more than one year.

In this factual scenario, it appears clear claimant sought the benefit of ADA—he was arguably a qualified individual with a disability and required reasonable accommodation. From these reports, it appears Sears refused to accommodate while he was off so as to allow him to return to work and get off TTD. It is unclear whether initial accommodation would have allowed him to return to full work at a later time. As a result of the refusal to accommodate, Plaintiff was then left to “dangle” and although he may have received TTD, in the process, he lost his job.

Assuming this scenario is accurate, we are very confident in advising all of our readers such a factual scenario is a clear red flag under this approach when the ADA is going to be enforced by the current administration of the EEOC. If you have an employee who is out on TTD and asks for reasonable accommodation to allow them to return to work consistent with ADA, you had better address the request in a meaningful fashion. If you leave them on TTD until your autotermination period passes and fire them, you are directly in the crosshairs over the gun barrels of the EEOC and don’t forget what happened to Sears.

But there are lots of other situations we all need to consider and we will be writing the EEOC for clarification and report any reply. We are wondering what to do with the panoply of situations in which workers are off work for extended periods and what to counsel you about the numerous factual situations that may arise. A fundamental question not answered by the consent decree is patent—can an employer ever terminate a worker who is on TTD? Does the work injury equal infinite or at least indefinite job security to the extent the injured worker could always later claim the need for reasonable accommodation to allow them to get back into your workforce?

We also ask the obvious questions:

• Do you always have to fire the replacement worker when you return the injured worker to his/her job with accommodation?
• In the alternative, is the injured worker on TTD entitled to priority in being rehired to allow for reasonable accommodation without having to fire someone?

Other pertinent questions that arise include what an HR department should do when and if:

1. The injured worker is off for the entire autotermination period and doesn’t request accommodation until after they have been terminated;
2. The injured worker who is fully recovered to MMI during the autotermination period and then aggravates the injury at a later time, again losing substantial time from work;
3. A union employer is more than willing to accommodate an employee who is ready to return to work before or after the autotermination period has run but the applicable union or their interpretation of their union rules won’t allow it;
4. An employee is off for multiple reasons, some of which are related to injury and some of which are wholly personal and unrelated to the work injury.

One “solution” to this problem is to maintain the status quo, sort of. First, autoterminate everyone consistent with your current policy that isn’t suffering from a claimed work injury. Second, for those with pending workers’ compensation claims, if they ask for accommodation to return to work prior to the running of the autotermination period, actively address the request and keep careful records of both the request and your decision(s) on reasonable accommodation. Third, for injured workers with pending workers’ compensation claims who don’t request accommodation during the autotermination period, when your autotermination period is over, don’t terminate; put them on “inactive” or leave of absence status, pending further action. If such injured workers later request reasonable accommodation due to their work injuries, consider the request, confer with your defense counsel and take whatever action necessary to avoid running afoul of the ADA. If they don’t seek reasonable accommodation, at some distant point, take them off the inactive or leave of absence status.

The other concept EEOC v. Sears, Roebuck will greatly encourage is the coincidental general release/resignation. We are already seeing many companies that will not enter into lump sum settlement agreements unless and until the injured worker coincidentally resigns at the time they depart your organization. To present, we feel such documents have not been exhaustively challenged in the courts by the EEOC or other similar state agencies and we hope they leave it alone and do not start raising challenges. If you need our sample coincidental release/resignation, send a reply.

We are certain this article and the consent decree will create intricate issues for all of us moving forward. As we outline, we are hoping the EEOC has some answers or guidelines on these issues and any further inquiries our readers would like to send along. Please forward your thoughts and comments and questions for the federal regulators.

Editor’s comment: If you have an auto-termination policy for extended absence in place, please read this article!  Please also note this settlement is just what it is; a settlement by the EEOC of a claim against a major U.S. retailer—it isn’t a ruling by a trial or appellate court. However, the settlement indicates the U.S. Government’s anti-business HR-busters are now probably going to be attacking auto-termination policies for anyone who uses them. If you have such a policy in place, we are happy to counsel you on how to best modify it. We caution the worst thing that can happen to an HR department is to be sued by the federal government with their unlimited legal budget.

You can also share the groans of all HR folks to see the settlement fund demanded from Sears is $6.2 million dollars. We consider that absolutely preposterous in light of this new and unprecedented interpretation of the Americans with Disabilities Act by the EEOC. Please also note what Sears was doing was fully sanctioned under Illinois law by the Illinois Supreme Court in their ruling in Hartlein v. Illinois Power.

Auto-termination policies based on extended absence have been in vogue in the HR arena for several decades. The idea is to terminate folks who are off work and out of your work force for months and years on a fully neutral basis—duration of absence only. The concept is that a worker who isn’t at your workplace for a long enough time has to be let go, regardless of the reason. The focus is on neutrality in terminating them.

The problems with a fully “neutral” termination policy are multifaceted. What do you do about a hero? What if you have a worker who risks his/her life and saves five co-workers in a fire and is badly burned? Can you still terminate them if they are off work for a lengthy period of time but later fully recover? The public relations impact of such a termination could be disastrous.

In light of the “hero” model, our focus on such programs is to recommend a management-labor panel review all such individuals and see what the best overall approach might be for your company. You shouldn’t impose a hard and fast line but should have an overall focus of keeping your business competitive while adjusting to the hopefully rare exception to the rule.

In EEOC v. Sears, Roebuck & Co., the consent decree focuses on the disparate impact auto-termination policies might have on workers’ compensation claimants. The U.S. Equal Employment Opportunity Commission obtained a record-setting consent decree resolving a class lawsuit against Sears under the Americans with Disabilities Act for $6.2 million and significant remedial relief. The suit alleged Sears maintained an inflexible workers’ compensation leave exhaustion policy and terminated employees instead of providing them with requested reasonable accommodations for their disabilities, arguably in violation of the ADA.

EEOC Chicago District Director John Rowe said the case arose from a charge of discrimination filed with the EEOC by a former Sears service technician, John Bava. According to Rowe, Bava was injured on the job, took workers’ compensation leave, and, although remaining disabled by the injuries, repeatedly attempted to return to work. Sears followed its policy and did not provide Bava with a reasonable accommodation which would have put him back to work and, instead, fired him when his leave expired. Pre-trial discovery in the lawsuit revealed numerous employees had taken workers’ compensation leave and were terminated by Sears without seriously considering reasonable accommodations to return them to work while they were on leave, or seriously considering whether a brief extension of their leave would make their return possible.

The EEOC outlined inflexible leave policies which ignore reasonable accommodations making it possible to get employees back on the job cannot survive under federal law. In addition to providing monetary relief, the three-year consent decree includes an injunction against violation of the ADA and retaliation. It requires Sears to amend its workers’ compensation leave policy, provide written reports to the EEOC detailing its workers’ compensation practices’ compliance with the ADA, train its employees regarding the ADA, and post a notice of the decree at all Sears’ locations.

We are confident the issues in this case focused on the monster cost of defending EEOC charges and the unbelievably high rates some defense firms charge. If you want more reasonably priced employment law counsel or seek a copy of the consent decree, send a reply.

Editor’s comment: Be sure to try to head this one off at the pass. While in certain settings, employers have always been potentially liable for the intentional torts of their employees, it is not the norm. Usually these situations are reserved to where the employee is authorized to forcefully contact third parties, to “place hands on” another – as in the case of bouncers or security guards at a night club. A recent federal court ruling from earlier this summer, while not specifically holding such, left open the possibility that a new situation could give rise to employer liability for another type of intentional tort – Intentional Infliction of Emotional Distress.

In Virginia Curran v. JP Morgan Chase, a recent case from the U.S. District Court for the Northern District of Illinois, Plaintiff Curran filed a multi-count complaint against both her individual supervisor and JP Morgan Chase as an institution alleging various violations of statute and various tort claims. While the majority of the decision simply addresses the failings of Plaintiff’s complaint, there are several pieces of dicta (statements of law that are not applicable to the case at hand, but nonetheless, potentially precedential) that offer a very intriguing and novel approach in regard to claims of Intentional Infliction of Emotional Distress (IIED).

IIED is not simply an act that embarrasses or frustrates a person. The actual language used as benchmark for what conduct is actionable is “extreme and outrageous.” Only conduct that shocks the conscious is the type of conduct upon which one would be able to base an IIED claim. One interesting thing addressed in Curran was whether this type of claim was pre-empted by the Illinois Human Rights Act when the defendant was the employer of Plaintiff. The court held as to individual persons, extreme and outrageous conduct would create a potential claim independent of the statute, which safeguards employees from various workplace abuses such as discrimination. While certain conduct could satisfy the requirements to be actionable under both the Act and under an IIED claim, that fact should not pre-empt and thereby preclude the filing of a common law tort claim. Only in settings where the actions giving rise to the claim were “inextricably linked to a civil rights violation such that there is no independent basis for the action apart from the [IHRA] itself” are such claims preempted.

A far more interesting and potentially costly issue was raised in relation to the employer, here JP Morgan Chase. The Federal court in Curran held, as to the employer of the manager, who was the actual intentional actor; there was potential liability under a respondeat superior theory. Respondeat superior is the legal name given to the idea that principals are liable for the tortious conduct of agents, as in the case of employers being liable for the car collisions caused by their employees. One of the key elements of the employer having liability in these settings is whether the employee was “acting within the scope of his or her employment.” The issue was only addressed in passing dicta in Curran due to the fact Plaintiff expressly pled her supervisor was acting outside the scope of his employment. Nonetheless, the court stated “Chase could theoretically be held liable for [manager’s] conduct under this theory … if [manager] were alleged to have committed the offending acts within the scope of his employment.”

Up to this point it has always been presumed extreme and outrageous conduct by a supervisor giving rise to an IIED claim would naturally be outside the scope of the supervisor’s employment. Take heart though, as our reasoned legal opinion is if a plaintiff were to prove enough facts to evidence the outrageous actions were within the scope of a manager’s employ, there may be little doubt the employer was not at least partially at fault. Proving it was within the scope of employment would involve demonstrating the employer seasonably knew of the actions of the supervisor and likely either approved or did nothing. That said, defense costs for every claim such as the one brought here will once again rise in the great state of Illinois.

Please remember our longstanding advice in all employment law claims including claims involving IIED—have your defense case-in-chief built before contacting counsel. Have a clear path for your line employees to report harassment, discrimination and “infliction of emotional distress” to your company watchdogs. Document, document, document investigation and curative action. Prepare for litigation at the earliest stage and you will be ready when and if a lawsuit or EEOC/IDHR charge arises.

This article was researched and written by Arik D. Hetue, J.D. If you have thoughts and comments, or would like the citation to the case, please send a reply to ahetue@keefe-law.com.

Editor’s comment: Immigration is a tough issue to tackle, with a lot of nuance and involving a lot of different facets. Beginning with President Bush, and continued by President Obama, this is one “stream-lining” regulation we can get on board with. Whether you agree with it or not, the law of the land requires employers not employ illegal immigrants. Where previously employers were required to have their employees fill out I-9 information forms to have on hand should DHS or USCIS wish to review them,  this process was time consuming, filled with inaccuracies, and allowed a lot of illegal or undocumented aliens to remain employed when the Feds didn’t check their forms. The internet age is making it that much easier to confirm the status of the potential employees, in a concurrent time frame.

From the U.S. Citizenship and Immigration Services’ website: “E-Verify is an Internet-based system operated by the Department of Homeland Security (DHS), U.S. Citizenship and Immigration Services (USCIS) that allows employers to verify the employment eligibility of their employees, regardless of citizenship.  Based on the information provided by the employee on his or her Form I-9, E-Verify checks this information electronically against records contained in DHS and Social Security Administration (SSA) databases.”

On June 6, 2008, President Bush issued Executive Order 13465 which required any contractor entering into a contract with the federal government to agree to the use of an electronic employment eligibility verification system to verify the employment of all persons hired during the contract term who were to perform work in the US, and all persons hired to perform work on the federal contract in question.  Since enactment, various decisions have pushed back the initial date of effect at September 8, 2009.

The Society for Human Resource Management (SHRM) and the other plaintiffs including the Chamber of Commerce of the United States of America challenged the legality of the executive orders and their implementing regulations arguing it was neither legally justified nor practical for federal contractors to implement. In a ruling last week, a federal district court held in favor of the government and ruled the regulation should go forward.

What does this mean? In eight short days, from September 8, 2009 onward, anyone doing business with the federal government and accepting government contracts will have to E-verify the employment status of their employees. Although this will amount to greater cost expenditures for those businesses entering into contracts with the federal government, it does not appear to be a significant one, and it is difficult to fault the government for attempting to streamline a process that will actually make it easier for businesses to comply with the law. Furthermore, we’d like to point out that it isn’t exactly a secret that federal contracts come with strings attached, taking a government contract was never compulsory, and the new string here is that if you want the lucrative government contract, you have to allow them a little more access to your records.

Where it may become an issue, as in any system that grows too large, errors have already been appearing in the E-verify database. In use in other areas of federal law for many years, as of last year, there were nearly 100,000 employers already using the E-verify database verification system. The new rules going into effect next week are estimated to increase the volume of users by another 100,000-150,000 users. As the users grow, and data grow, it may more prevalent to get false reports or inaccurate results from the E-verify database. That remains to be seen, however, and one can always hope the federal government will become efficient in at least one more area.

USCIS has published information and frequently asked questions on its website regarding application of the rule. This article was drafted by Arik D. Hetue, J.D. who is soon to be an attorney with Keefe, Campbell & Associates. Please reply with your thoughts and comments.

Editor’s comment: The American health care expectation is

• Unlimited,
• 100%-paid-for,
• On-demand medical care.

If/when you offer medical health care coverage, the richest and poorest of our citizens don’t just expect such treatment; they are fully prepared to openly and regularly demand it. We feel American citizens of all strata are geared up to make the clarion call of “off with their heads” to any politician, editorial writer, health care insurer, physician, attorney or miscreant who doesn’t wholly and intrinsically support that level of coverage whenever any kind of health care is offered to a U.S. citizen.

If you don’t know it, this precise business/health care model is codified in the Illinois Workers’ Compensation Act. The Illinois Workers’ Compensation Act has no defined limitation on the amount, nature or duration of medical care recommended by a treater to which the injured worker is willing to consent. None. Please don’t mumble anything about the hilarious “two-doctor” rule in Section 8(a-3); that rule is only a potential limitation on rookies or the non-initiated. Any Illinois physician, hospital or health-care provider worth their salt knows you need referrals to keep the “two-chains” running to the end of any selected path of care. If you have referrals in the medical charts, you have unlimited, 100%-paid-for, on-demand medical care codified for Illinois’ injured workers.

If you aren’t sure about the infinite provision of health care in this state at the sole cost of Illinois business, your editor handled a claim where a physician provided about $50K in relatively worthless injections to a claimant’s neck, shoulder and wrist. The patient admitted the “benefit,” if any, of the wildly expensive injections, lasted for a few scant minutes. When we deposed the doctor, he admitted he needed to stop the injections and the patient had undergone more than enough of such care. Following his deposition, in direct contradiction to his own opinions, the physician then provided another $50K in additional injections!! Our Commission and reviewing courts sanctioned all of it to the chagrin of your editor and his client. If you need a copy of the ruling, send a reply.

We want our President to understand unlimited, 100%-paid for, on-demand medical care would work, if we lived in paradise. On this grubby, dusty, imperfect planet, it is certain to bankrupt our society. If they don’t plan ahead, that “bankruptcy-thing” is coming sooner, rather than later.

We are petrified, truly scared-to-death to see the U.S. Government think they can “control” this monster. The special interests are spending billions as you read this to carve out their own little piece of what may be a giant federally-run pie. Within five years, we expect to see total chaos and skyrocketing costs—some folks peg the annual cost to be two trillion dollars per year. That is $2,000,000,000,000.00. Each year.

The current federal debt is a staggering $11.5 trillion — equivalent to over $37,000 for each and every American and one short guy from Croatia. And it’s expanding by over $1 trillion a year. The new health care initiative could triple that debt load.

We also point out every time our federal government tries to take over a business operation; they butcher it to the point of high comedy. We think the only thing the government does even reasonably well is to collect taxes. They do that solely to survive. They don’t have to “survive” in doing anything else.

Therefore, in our view, every other federal business operation could be run better by a sixth-grade class. Consider the creaky rail system, the inefficient postal service, the rapidly-becoming-bankrupt Social Security Administration. Consider the fact the U.S. Government still has elevator operators where all elevators have been running automatically by pushing one of those easy-to-read buttons for about four decades. If you don’t believe us, take a look on the web at: http://www.usajobs.org/listjobs/jobs/80497127/Elevator%20Operator.htm.

When someone starts talking about great presidents who were Republicans or Democrats, we point out Jack Kennedy, Lyndon Johnson, Dick Nixon, Gerry Ford, Jimmy Carter, Ronald Reagan, Bill Clinton, George Bush (H. and H.W.) and Barack Obama all ran or run governments that had elevator operators long after such work was completely automated. It is not possible to claim to run an efficient government when you have to admit you are using taxpayer money to pay people to push buttons and ride up and down all day like morons in new-fangled elevators. Only the shadow knows how many other ways the federal government is blowing money.

Trying to understand what a mess unlimited, 100% paid for, on-demand medical care means:

• We have one claimant who has literally been treating for her entire adult life.
• She is in her mid-fifties.
• She has had over twenty surgeries, many of them major.
• Some of them are arguably “related” to work, some of them are not.
• She is always getting ready for surgery, recovering from surgery or trying to find another area that needs surgery.
• Medical care for her is well into the millions—the cost has been split between various health care insurers and workers’ comp policies.

• We have another claimant who has had at least 40 surgeries to her internal organs.
• She injured her low back in the earlier 1990’s.
• Medical care is well into the millions and is still cooking with a “pain physician” recommending lots more.
• The most recent MSA value is well over $500K.
• We inherited the file about six months ago; the case is almost two decades old and still pending.

These sorts of folks have to be reined in with some meaningful objective guidelines. If the feds aren’t prepared to slow them down and sign up for all of it, the taxpayers better start expecting giant tax increases.

Looking at these folks from the perspective of Illinois WC, it is our assertion that, if a nutty claimant had the “right” claimant lawyer in front of the “right” arbitrator, they could legally “force” an Illinois employer or insurance carrier to pay for such unlimited medical care. The only limitation would be on the interest level of the claimant lawyer who would eventually grow tired of the game and tell the claimant to settle so they would be paid for their patience and efforts.

Most Illinois employers don’t like the basic IWCC model that controlling otherwise unlimited medical costs is left up to non-medical professionals who may become friends with or at least cordial to the many attorneys who appear before them. We don’t care if it is Republicans, Democrats or Independents; we are going to need some clearly defined way to control skyrocketing medical costs. We need it in Illinois workers’ compensation and we are going to need it in the federal health care system.

We think the best possible concept is utilization review. We learned about it from a claimant attorney who brought it to our state. We are certain UR is controversial, like the so-called “death panels” that are being ballyhooed in the press. But you have to draw a line somehow and somewhere. Medical care has to be limited in a fair and impartial fashion. If you have a concept better, faster and/or cheaper than UR, please send a reply and we will share it with our readers.