6-25-17; Will Democracy be a "FAIL" in Illinois This Friday?; Shawn Biery on Important New Ruling on TTD/MMI; Important Ruling on AG's WC Decision-Making by John Karis and more

Synopsis: Will Democracy be a “FAIL” This Friday in Illinois State Government?

Editor’s comment: As I have told my readers and several national news sources/blogs, our IL State Government has until this Friday, June 30, 2017 at midnight to cook up an annual IL State budget for the coming fiscal year that starts at 12:01am on July 1 and runs until next June 30. If they can’t strike a deal, all sorts of greasy, nasty things will start in relation to our State Gov’t on this Saturday and the days, weeks and months thereafter.

Three Obvious and Immutable IL State Government “FAIL” issues:

1.    If they don’t cobble up a budget, the State’s credit rating is going to move to what Wall Street calls “junk status.” This means the State is basically going to have to pay a giant vigorish or loan-shark-interest-rates to continue to borrow to pay their many pipers, as they have been doing for decades. It is also possible they won’t be able to borrow at all. If you are not sure, the State’s unpaid bills are over $15 billion, yes, billion dollars. Their pension debt is over $130B. When the City of Detroit went to “junk status,” they couldn’t borrow and ended up in Federal Bankruptcy Court and still haven’t emerged years later. The State of IL can’t end up in Bankruptcy Court but the impending inability to borrow is going to stress all relations with all vendors and at some point, they may not be able to make payroll.

2.    Both IL U.S. Senators Durbin and Duckworth have written to confirm federal funds for IL road projects will end to the tune of more than $1B. IL State road jobs are going to shut down but not the site maintenance costs that will come with managing the shut-down work. Road-builders across the State will be laying off lots of workers who are going to then file for unemployment, at a cost to the State and the employers.

3.    Our State is getting kicked out of all the interstate lotteries. This is again going to cost the State of Illinois millions of dollars they need to run our nutty State government.

More Democracy FAIL Issues—Lack of Any Accountability

If you don’t like to see things go to heck in a hand basket, please remember IL taxpayers can’t get rid of the leaders and members of the General Assembly who caused this crisis. These leaders have given away jobs and benefits and more benefits to anyone who worked or now works for them. As one example, Speaker Madigan comes from an Hispanic community near Midway Airport in Chicago. To my knowledge Speaker Madigan no habla espanol but he does give his loyal constituents/supporters and their families two, three and four jobs and an equal number of fake government pensions per family. I am not blaming these constituents who use the system to their benefit, I am pointing out we need to get back to some semblance of what other states call “democracy.” We have what I call a “benefit-ocracy” where State government provides state workers benefits and jobs our taxpayers can’t possibly afford.

On a similar note, do you remember the last time the State of Illinois laid anyone off or had to deal with a union strike? I don’t—the reason why is what I feel is the basis of a benefit-ocracy. When our legislative leaders are using high benefits and unnecessary jobs to cull votes out of present and former government workers, whatever they want is what they get. You don’t lay off your best voters. You also don’t allow your best voters to go on strike—you give them what you want at high cost to IL taxpayers.

On top of that, the “worst” or least funded fake government pension in Illinois is GARS or the General Assembly Retirement Scam, I mean system. This fake retirement system allows a member of the IL House or Senate to contribute as little as about $30,000 in four years of part-time work to then get literally millions of dollars from IL taxpayers the rest of their lives. Notable participants in GARS are former President Barack Obama and former Chicago Mayor Richard M. Daley who each served less than 10 years under Speaker Madigan and are both in line to basically win this version of the IL Lottery to collect millions of dollars from taxpayers over the coming years. It is hard to imagine anyone contradicting or disagreeing with Speaker Madigan when you have a fake and defunded gov’t pension with real gold coming at the end of your short term with the General Assembly.

IL State Democracy FAIL Number Three—Higher Taxes and More New Taxes May Be Coming with No End in Sight

We were mildly surprised to read a letter from Todd Maisch, the brilliant and hard-working President of the IL State Chamber who basically wrote his membership and anyone who will read it to let them know the State Chamber is okay with the IL income tax being raised to around 5%. With respect to President Maisch and the IL Chamber and I am a supporter of the Chamber, he didn’t say “but.” Ii is my view that is shared by lots of veteran State government observers, I don’t feel IL State Government can tax its way out of these issues. IL taxpayers need more than higher and higher taxes and lots of new taxes without something in return—long term change/reduction in State government. To my understanding, the highest income tax rate in the U.S. is California at 13.3%--do we want to keep letting our goofy legislative leaders continue to make gigantic increases in our taxes with no promise to seriously cut spending and make any financial sense of what they are doing?

Our State Government has been aware of numerous ways to save tax dollars. I am not in a position to truly analyze State government but would do so for free. I think our State wastes literally zillions of tax dollars every year. Here are some easy examples:

·         We have 88 State agencies that we could consolidate to half that number or less. All these agencies have directors and assistant to the directors and HR managers and other redundant and unnecessary costs.

·         The late Judy Baar Topinka confirmed the Office of the IL Treasurer and the Office of the IL Comptroller do exactly the same thing and are unquestionably redundant. To get rid of one or the other would save over $10M—what do we need to do to save that money?

·         Last year, we automated one small section of the IL Tollways—our State Government spends over $100M on paying humans to collect road tolls. Why not automate all State tollways right now?

·         Do we need a Lieutenant Governor? Should we give that person an actual job with an actual job description?

·         IL State government has “remote offices’ that are do-nothing jobs that should have been closed decades ago.

My message to President Maisch and all his members and all my readers—if you are going to jack up our taxes or agree to others jacking up our taxes, someone please tell me we are going to start the process of making IL State government efficient, effective and for the lack of another term, cheaper. If you don’t do that, taxes are going to continue to rise and rise until the last person leaving IL should be asked to shut off the lights.

How Do These Democracy FAILS Impact Workers’ Comp?

If you are watching the news, there are a few new IL WC reform proposals that will save IL business a couple of bucks in the years to come. I have literally no idea which one may come through the bigger battles in Springfield. If you want the skinny, read next week’s KCB&A Update.

In the interim, remember in the last year or so, Hoist Liftruck moved more than 500 manufacturing jobs to Indiana last year. .Machine-maker DE-STA-CO moved 100 jobs to Tennessee. Bunge North America shut down its plant in Bradley, Illinois, and laid off 210 workers. General Mills pulled the plug on its manufacturing plant in West Chicago, terminating 500 workers. Mitsubishi Motors closed production facilities near Bloomington ending 918 jobs there. Mondelez (makers of Oreos and Chips Ahoy) laid off 600 manufacturing jobs at its Chicago facilities. Kraft Heinz laid off 700 jobs at Kraft’s Northfield facility. Motorola Mobility cut its workforce in Chicago by 25 percent, eliminating another 500 jobs. More recently, Caterpillar is laying off 800 workers in Aurora, IL and Kellogg is laying off 258 in Woodridge.

When employers and jobs leave because of rising and new taxes, they may never, ever come back. In my view, if we continue to run this hillbilly, dysfunctional State Government, we will lose more jobs and workers. In that setting, our mildly high WC costs aren’t going to be that big a deal.

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Synopsis: Who says you cannot deny TTD when an injured employee is terminated before MMI?  A brave new world or return to sanity?  Analysis and Reporting by Shawn R. Biery, J.D., MSCC.

Editor’s comment: In the recent future post Interstate Scaffolding, we have seen multitudes of cases in which TTD is being paid even after termination for cause based upon the holding which indicated generally that the Appellate Court would not consider the actual details of the cause. In most cases, this was difficult to avoid however we consistently advised clients that certain cases should be considered for litigation back to the Appellate Court to clarify the ruling in particularly egregious cases where payment of TTD really did appear to be unwarranted. Now, we get some case law to support our consistent recommendations to our clients and interested observers.

In Holocker v. IWCC (Komatsu America Corp.), No. 3-16-0363WC, 06/16/2017, the Illinois Appellate Court ruled that a worker who was fired before attaining maximum medical improvement for his industrial injuries was not entitled to temporary total disability benefits after he lost his job.

By way of background, Scott Holocker worked for the Komatsu America on crane duty when a chain broke loose from a crane he was operating September 2012, striking him in the face and chest. The blow knocked out four teeth and caused facial fractures.

Holocker missed one month of work, returning to light duty in October 2012 and full duty in December 2012. However, upon his return, Holocker requested he not be given any crane duties. He was obliged, and assigned to a position as a forklift driver in a building without cranes. Later in May 2013, Holocker was reassigned to a position in the building where his accident had occurred and he reported a panic attack in July 2013 when he attempted to operate the crane which had caused his injuries.

Holocker then asked to be reassigned to a new position, and his employer offered him a janitorial assignment which he refused. In October 2013, Komatsu fired Holocker after he missed three consecutive days of work without calling in sick. While he did undergo dental surgery the next month, his doctor excused him from work between Nov. 13 and Nov. 20 only based upon our reading of the facts.

Holocker proceeded on his WC thereafter and the arbitrator found Holocker was entitled to temporary total disability benefits from the date of his termination through the date of the arbitration but declined to any award of attorney fees or penalties. Both parties appealed, and the Illinois Workers’ Compensation Commission overturned the TTD award however the Circuit court later reinstated the arbitrator’s award.

The Illinois Appellate Court in their decision held the commission’s decision to deny TTD benefits after Holocker’s termination was not against the manifest weight of the evidence even though he had not yet reached maximum medical improvement at the time of his termination and in doing so, the court noted Holocker had been released to full-duty work and was back to work at his old job. It was also noted there was evidence Holocker remained employable, even with his work-related physical and psychological conditions. To quote the court, “Accordingly, there was ample evidence to support the commission finding that, at the time of his termination, the claimant's work-related injuries had stabilized to the extent that he was able to re-enter the workforce, and his injuries had no impact on his employment….”

While we are thrilled to see a common sense decision be made even though it is employer oriented, we also believe it could have been as easily noted that work was available and refused and find it to be an even stronger decision of the Appellate court which we hope is a signal that fair play is back with regard to legitimate issues surrounding disputes on return to work. In cases where an individual is committing theft, threatening co-workers or simply refusing to comply with offered accommodated work offers, we suggest there is new hope that you do not need to simply lay back and accept the non-compliance.

This article was researched and written by Shawn R. Biery. If you have questions about your return to work program or any cases with non-compliance regarding return to work or accommodations, please contact Shawn via email at sbiery@keefe-law.com  or via phone at 312-756-3701.

Synopsis: Appellate Court Says IL Attorney General Can Pick Their Battles

Editor’s comment: The fourth circuit Appellate Court found the U.S District Court did not err in granting the IL Attorney General’s motion to dismiss noting the Attorney General has broad discretion in representing the State in litigation where the State is the real party in interest, and Attorney General’s decision to refuse to raise an argument is within that discretion.

At the crux of the case involves two particular workers’ compensation claims filed by Stephanie Yencer-Price, a personal assistant who sustained injuries while working in a private household in Sangamon County. Because she is employed by a private household as a personal assistant under the Disabled Persons Rehabilitation Act, Yencer-Price claimed she was a “state employee” and entitled to workers’ compensation from the state – rather than from her private employer – for the injuries she allegedly sustained while working for her private employer.

But both state law and court precedent make clear personal assistants are not “state employees” and therefore are not entitled to workers’ compensation from the state.

As a state agency under the governor, Central Management Services (“CMS”) is statutorily tasked with representing the state’s Department of Human Services in workers’ compensation claims brought against the state. CMS’s asked the Attorney General to present its determination that Yencer-Price was not a State employee in proceedings before the Commission. However, the Attorney General refused to present this argument and objected to CMS’s request to choose a special assistant Attorney General to represent CMS before the Commission.

After Madigan refused to defend the state against the workers’ compensation claims, Michael Hoffman, in his official capacity as Director of CMS, filed a complaintHoffman v. Madigan for injunctive and declaratory relief. The complaint, in part, requested (1) defendant, Lisa Madigan, in her official capacity as Attorney General of the State of Illinois, be enjoined from representing CMS before the Workers’ Compensation Commission on cases involving “personal assistants,” based on her refusal to defend CMS’s determination that a personal assistant was not a State employee for purposes of the Workers’ Compensation Act, and (2) a special assistant Attorney General be appointed to represent CMS.

That same month, the Attorney General filed a motion to dismiss alleging the complaint failed to state a legally valid cause of action. In May 2016, the trial court granted the motion to dismiss with prejudice. The court noted the potential for “chaos” if it determined the disagreement as to what argument the Attorney General should raise constituted a conflict of interest such that special counsel should be appointed. The court observed the unique powers and constitutional authority the Attorney General holds which includes the responsibility to decide what arguments, strategies, and litigation tactics to employ. Further the court ruled CMS’s disagreement with the Attorney General’s strategy was not a valid basis to justify the removal of the Attorney General from all workers’ compensation cases involving personal assistants.

CMS appealed, arguing the trial court erred by dismissing its complaint for failure to state a cause of action. Specifically, CMS argued (1) the court erred in its construction and application of controlling precedent and (2) CMS stated a colorable claim that personal assistants are not State employees and the Attorney General’s refusal to raise that claim in workers’ compensation proceedings created a disqualifying conflict of interest such that a special Attorney General should be appointed.

The Appellate court affirmed the trial’s court’s decision to dismiss the matter. The court noted The Attorney General is not individually interested in or a party to the underlying workers’ compensation case, nor is the Attorney General in the position of representing opposing States agencies. The court stated “Although CMS might disagree as to what argument the Attorney General makes, that disagreement is insufficient to qualify as a conflict of interest such that special counsel should be appointed.”

The court further noted Attorney General’s refusal to raise this argument does not constitute an arbitrary interference with CMS’s statutory authority to make the initial determination as to the compensability of personal assistants’ workers’ compensation claims. They went on further stating CMS may continue to make the initial determinations on whatever basis it determines is appropriate.

It doesn’t make sense on why these state agencies can’t get along since they’re on the same team, the same team that protects the Illinois taxpayers. The impact of this case is substantial. Hundreds of workers’ compensation claims have been filed on behalf of personal assistants in the state. When the state is not adequately defended from such claims, millions of taxpayer dollars improperly flow from the state to individuals who are not employees of the state. The state simply cannot afford to lose money.

This article was researched and written by John Karis, JD. You can reach John 24/7/365 for questions that about general liability, employment law and workers’ compensation at jkaris@keefe-law.com.