3-12-2018; Can An IL Employer/WC Claims Handler Bring Claimant Back to Light Work At a Charity?; Matt Wrigley JD Reports on an Important Federal EPLI Ruling and more

Synopsis: Can An IL Employer/WC Claims Handler Bring a Claimant Back to Transitional Light Work At a Charity? Can You Cut-off TTD If They Refuse?

Editor’s comment: I am asked this question all the time. We had a reader send us a brilliant article by an excellent IL defense attorney, Jessica Bell that was published in the Illinois Association of Defense Trial Counsel Quarterly. I salute her hard work and acumen in this growing area of U.S. workers’ compensation law.

This situation arises when an employee is injured at work and cannot immediately return to their former job due to medical restrictions resulting from the work injury. The employer or claims manager assumes the work restrictions are temporary and should be lifted as the worker’s medical condition improves, enabling the employee to return to his former job at the same employer or possibly another available position. In the interim, some employers, particularly in union settings, have many hurdles to accommodate restricted work.

Getting the injured worker back to any work is better than letting them sit home and watch the television. In my experience, many injured workers try to “disappear” and stay out of view. This “charity-volunteer-job” situation offers benefits to the employer and the employee, ranging from reduced workers’ compensation for the employer, to getting an injured work to take a shower, travel to work with others and remain somewhat off the dole. To me, the concept is a win-win for everyone.

The article mentioned above reviewed whether an Illinois employer may effectively offer transitional light duty work through another entity, say, such as a charity while also paying TTD. Many IL Claimant attorneys support the concept and want their clients to cooperate. Sadly, some Claimant attorneys are willing to fight over it to see what the Arbitrator and IWCC might do.

Other states have examined this scenario and several have adopted what is commonly referred to as temporary transitional employment (TTE) provisions, whereby the employer is permitted to return the employee to light-duty work with another business while the employee’s condition heals. Ms. Bell’s research documented at least eight states have already adopted specific TTE or similar programs via statute, while other states permit TTE programs based on their workers’ compensation statute’s current wording. We hope the secret-powers-that-control-the-IWCC consider enacting legislation to incorporate or delineate a rule about it and avoid confusion and unnecessary litigation.

One important aspect of this TTE concept is to consider obtaining the opinions of a certified vocational rehab counselor or CRC who is familiar with the idea and can provide an expert report backing up the concept. The CRC report doesn’t need to be 500 pages—short and to the point works best. Please remember the IL WC Act/Rules contemplate a “120-day” voc rehab rule, requiring both sides to agree on a voc plan to get a moderate to severely injured worker back to any work. The plan is supposed to be considered by both sides and approved via the Arbitrator. Anyone off 120 days on a continuous basis after an accident is, in my view, a moderate to seriously injured worker. If you have an expert report from a CRC or certified rehab consultant confirming the worker can and should be doing something, even in a charity setting, and get them off their couch, you have a much better shot at Arbitrator approval.

The article mentioned above carefully chronicles widely differing IL WC outcomes and this concept is going to remain a transitional idea in our nutty State for the time being. Under the current administration, I do feel a well-documented TTE offer could “work” and many Arbitrators might informally confirm their concerns or formally deny disputed TTD benefits if the worker remains adamant about staying home with their TV remote and won’t volunteer at a charity while getting TTD. I am somewhat sad to report if a Democrat moves into the Governor’s mansion in the fall, TTE may disappear for four years.

If you want defense legal guidance on implementing a TTE program including referral assistance or experts, reply or call me. I appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Document, Document, Document Employee Absences—It Takes 1 Minute. Employee Fails to Establish her Termination Violated the FMLA, ADA, and Rehabilitation Act. Research and analysis by Matthew Wrigley, J.D., licensed in IL and MI.

Editor’s Comments: In Guzman v. Brown County, No. 16-3599 (March 7, 2018) E.D. Wisc. Affirmed, a telecommunications operator previously diagnosed with sleep apnea was terminated by her employer after repeatedly failing to report for work when scheduled. The employer maintained a progressive disciplinary system which escalated from verbal warning to written warning, suspension, and termination. Under this policy between 2004 and 2013 the employee received nine verbal or written warnings regarding use of vacation or casual time, failing to complete proficiency tests, and failing to report for work. Due to two additional infractions which included tardiness and failure to report for work the employee was suspended and eventually terminated.

The employee sued the employer under the Family and Medical Leave Act (FMLA), the Americans with Disabilities Act (ADA), and the Rehabilitation Act alleging interference, retaliation, and discrimination. The trial court granted the employer’s request for summary judgment finding no genuine dispute as to any material fact. This resulted in judgement for the employer, and a dismissal of the suit. The employee appealed this decision to the Seventh Circuit Court of Appeals, which affirmed summary judgment in its entirety. 

The Seventh Circuit initially addressed the employee’s charge of FMLA interference and found she failed to introduce any evidence to show she suffered from a “serious health condition” at the time of her infractions. In addition, the Seventh Circuit found no evidence to establish the employee provided either actual or constructive notice of her asserted need for FMLA leave. Finally, the Seventh Circuit found it undisputed the decision to terminate the employment relationship was made before the employer had knowledge of any serious health condition or request for FMLA leave.  With regard to the charge of retaliation under the FMLA, the Seventh Circuit held the employee failed to present evidence her termination constituted an “adverse employment action” which occurred because she requested or took leave. In other words, the Seventh Circuit found that the employer had no prior knowledge of the employee’s health issue to link up the employee’s claim of retaliation for requesting FMLA leave. 

Addressing the discrimination charges under the ADA an Rehabilitation Act the Seventh Circuit held the employee failed to present evidence to show her termination was a result of an alleged disability rather than her violations of the progressive disciplinary system. With regard to the employee’s charge of failure to accommodate, the Seventh Circuit held no evidence was presented to show the employer was aware of an alleged disability prior to the termination. The Court specifically held “after the fact requests for accommodation do not excuse past misconduct.” Finally, with regard to the charge of disability retaliation under the ADA the Seventh Circuit held the employee presented no evidence to establish a causal connection between her engagement in a statutorily protected activity and an adverse employment action. 

The research and writing of this article was performed by Matthew Wrigley, JD. He can be reached regarding employment law or workers’ compensation issues that you face at mwrigley@keefe-law.com

EVENT

Dealing with Employees from Application to "Z" you Later | March 19 | 12-2pm | Johnson & Bekk, Ltd., Chicago

Who Should Attend?

HR professionals, employment lawyers, and anyone who manages personnel are invited to Dealing with Employees from Application to "Z" You Later on March 19 where our speakers will discuss how and where to advertise for positions, the do’s and don’ts for selecting and interviewing candidates, proper considerations for hiring decisions, how to properly document performance and other disciplinary issues, and when and how to terminate employment.

Schedule

11:30 a.m. - 12:00 p.m. Registration and Light Lunch

12:00 - 2:00 p.m. Dealing with Employees from Application to "Z" You Later

Presented by: Kimberly Ross, FordHarrison LLP and Bradley Smith, Keefe, Campbell, Biery & Associates, LLC

The program will review through the “life” of an employee from a management perspective. Many employers hire managers and supervisors of employees who know the business end of the job, but who have no training or experience in managing people. Many employers also think about the life of an employee in terms of hiring and firing only. This program will explore the infancy of the employment relationship, beginning with proper advertisement for the position, soliciting, collecting and reviewing applications, interviewing, hiring, performance reviews, disciplining, and termination. We will discuss state and federal laws that must be considered, as well as general best practices. We will also explore some of the pitfalls that may be encountered with social media and the Internet, including a discussion of the type of information employers can and cannot consider when making employment decisions. 

CLE Credit

The IDC has also been approved for 2.0 hours of CLE credit for this program in the state of Illinois. We will apply for the following CLE credit in other states:

• Indiana 2.0 CLE; 0.0 Professionalism
• Iowa 2.0 CLE; 0.0 Professionalism
• Missouri 2.4. CLE; 0.0 Professionalism
• Wisconsin 2.4 CLE; 0.0 Professionalism

Registration

This event will be held at the offices of ISBA Mutual Insurance Company, 20 N. Clark Street, Ste 800, Chicago and via TELECONFERENCE. Please indicate your attendance method (in-person or via teleconference) on your registration form. Registration for this event is $25 for IDC members (Non-member $50).

3-5-2018; Birth Defect Claims by Children Not Blocked by WC "Exclusive Remedy" Proviso; Wisconsin Legislature Moves Rapidly to Block Appellate Court Ruling about Coverage for Temp Workers and more

Synopsis: Birth Defect Claims by Kids Based on Exposure to Parents at Work Not Blocked by WC “Exclusive Remedy” Proviso.

Editor’s comment: We consider this article required reading for the insurance/claims industry. In a ruling with potentially far-reaching implications, two Illinois teenagers who claimed to have suffered life-long birth defects because of their fathers' workplace exposure to toxins are not blocked by the concept of their parent’s WC “exclusive remedy” under Section 5 of the IL WC Act. In short, the children can and will pursue a civil suit against their parent’s employer, Motorola for millions in damages.

I assume these sorts of claims will potentially bring billions in new liability exposure to U.S. employers, as birth defects are lifetime medical/physical problems, causing decades of misery. Juries are generally very amenable to finding causation and awarding box-car verdicts.

In these claims, the Appellate Court of Illinois ruled workers' compensation was not the exclusive remedy for 18-year-old Claimant Finzer and 17-year-old Claimant Hardison, because they were seeking damages for their own injuries, not their parents. The decision reversed the Circuit Court of Cook County, which granted Motorola's motion to dismiss, following that legal concept.

Motorola successfully argued because “the children’s injuries were … derivative of a work-related injury to their fathers’ reproductive systems,” they should be required to adjudicate their claims through the IL workers’ compensation system, like their fathers would have had to. But this argument ignored the fact the children weren’t employees of or otherwise paid by Motorola, and they were suing over their own injuries, not their fathers.

“Because minor plaintiffs seek to recover not based on workplace injuries sustained by their employee-fathers, but for their own personal injuries, the exclusive remedy provisions of the Arizona and Texas workers’ compensation laws do not apply,” Justice Mary Anne Mason wrote for the unanimous three-judge Appellate Court panel.

In contrast, the circuit court reasoned because the validity of these claims depended on the validity of their fathers’ claims, the workers’ compensation exclusivity provision applied to the teenagers’ claims as much as it would have to their fathers.

The appellate court found no basis for this legal argument. The ruling compared these claims to a personal injury lawsuit brought by a Claimant named Woerth in 1984. Woerth was a Kentucky man who contracted hepatitis from his wife, a nurse who allegedly got it from work. “The court specifically noted that ‘[w]hile Woerth’s hepatitis may derive from his wife as a matter of proximate cause, his cause of action does not,’” Mason wrote in Ledeaux v. Motorola. “Because Woerth was not seeking relief relating to his wife’s injuries, his claim for his own injuries was not barred by the exclusive remedy provision.”

Claimant Finzer’s father worked at Motorola’s manufacturing plant in Mesa, Arizona, from 1997 to 1998. Finzer was born in April 1999 with a club foot.

Claimant Hardison’s father worked at Motorola’s manufacturing plant in Austin, Texas, from 1991 to 2001. Hardison was born in April 2000 with an underdeveloped jaw.

In 2010, alongside almost two dozen other plaintiffs, Finzer and Hardison filed a combined complaint against Motorola, claiming negligence, willful and wanton misconduct, abnormally dangerous activity and loss of child consortium. They alleged their fathers sustained injuries to their reproductive systems as a result of exposure to toxic chemicals on the job. They also alleged that Motorola knew that its “limited environmental and biological sampling” did not comply with federal occupational safety guidelines.

The lawsuit further alleges “high-level corporate employees” knew reactions between the chemicals used during Motorola’s manufacturing process and machinery at the plants “dramatically increased and/or compounded the likelihood of resultant injury to workers and their unborn children.”

When the lawsuit arrived at the 1st District Appellate Court, the court had to decide how Finzer's and Hardison’s claims compared to the concept of a “derivative claim,” or a claim that “would not exist in the absence of the injury to the employee.” Common derivative claims include loss-of-consortium and wrongful death claims, which are generally resolved through the workers’ compensation system.

The Appellate Court ruling decided the teenagers’ claims were not derivative claims, because they were claims for “injuries personal to them that exist apart from and regardless of a work-related injury sustained by their parent.”

You can review the opinion here. We appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Wisconsin Legislature Acts Fast to Overturn Recent Appellate Court Case Addressing Remedies for Injured Temp Workers. Research and analysis by Matthew Ignoffo, J.D., M.S.C.C

Editor’s Comment: A month ago we reported on the January 2018 ruling in In Re the Estate of Carolos Esterley Cerrato Rivera v. West Bend Mutual Insurance Company and Alpine Insulation, No. 2017AP142. The Appellate Court held because a deceased temporary employee’s Estate had not made any claim for workers’ compensation medical or death benefits, it was not barred from pursuing tort claims against the borrowing employer and its insurer.

In less than a month after the court’s ruling, Senate Bill 781 was introduced and three weeks later it was enacted into law. It was published March 1, 2018. This bill changes the language of Section 102.29 of the Wisconsin Worker’s Compensation Act from an employee who “makes” a claim for compensation to an employee who “has the right to make” a claim for compensation.

The pertinent discussion in Rivera focused on the fact the decedent’s estate had never made a claim for WC benefits. Under the amended Act the fact the estate had the right to make a claim means it cannot pursue a tort action against the employer who accepted the loaned employee’s services.

We suspected the legislature would not let the ruling stand for long and applaud it for quickly addressing the matter as the amendment is a welcome relief to staffing agencies, their clients, and their insurers.

This article was researched and written by Matthew Ignoffo, J.D., M.S.C.C., who is licensed and practices in Illinois and Wisconsin. Matt is one of KCB&A’s top Medicare Set-Aside experts.

Please feel free to contact Matt on a 24/7 basis at mignoffo@keefe-law.com.

2-26-2018; Are You Interested in Interest? IL WC App Court Clarifies Post-Decision Interest for IL WC; John Karis on Important EPLI Claim with Bankruptcy Twist; IL Senate Subcomm Hearing--Wassup?

Synopsis: Are You Interested in Interest? IL WC Appellate Court Clarifies Post-Decision Interest for Your IL WC Claims.

Editor’s comment: I admit to being mildly surprised by this important ruling and I think our IL WC textbook might need updating.

In Dobbs Tire & Auto v. IWCC, Nos. 5-16-0297WC and 5-16-0342WC, issued 2/16/2018, the IL Appellate Court, WC Division reviewed claims by two Claimants who separately obtained decisions from IL WC Arbitrators awarding significant workers’ compensation benefits. The first Claimant received his award in January 2010, and the second received her award in March 2013.

Their respective employers appealed but were unable to obtain relief or any significant change from the Illinois Workers’ Compensation Commission, the Circuit Court or the Appellate Court, WC Division. In such a setting, I have been teaching students and lawyers of my opinion interest was due at the rate set by the Arbitrator during the appeal from arbitration to the Commission and after the Commission ruled, “judgment interest” at 9% was then due.

I want all my readers and colleagues to understand the legal advice above was incorrect and should no longer be followed. It is difficult for me to admit I was incorrect but let’s all update our handling and recommendations moving forward. I salute the august justices of the Appellate Court, WC Division for this ruling that provides clarity on this topic that is important to all IL WC system participants.

In Dobbs, at the end of all appeals, the employers or their insurance carriers timely paid the final WC awards to both Claimants, plus interest at the relatively low statutory rate set by the Arbitrator in the arbitration decision. The first Claimant’s employer attached interest of 0.11%, and the second employer attached interest of 0.13%, pursuant to Section 19(n) of the Workers’ Compensation Act. As I indicate above, that is a relatively low interest rate and it is what the IL WC Act provides.

Claimants both objected and filed motions under Section 19(g) of the IL WC Act to enforce their final awards but adding a new claim for “judgment interest” at the much higher rate of 9% on the second half of the appeals, with the first Claimant proceeding in the circuit court of Fayette County, and the second proceeding in the circuit court of St. Clair County.

The trial judge in Fayette County found the first Claimant’s employer had fully satisfied her final award in a timely fashion and dismissed the complaint, but the trial judge in ultra-liberal St. Clair County ruled the second Claimant’s employer should have paid him interest from the date of the IWCC decision to the end of the claim at 9%. The employer appealed. The first Claimant separately appealed the dismissal of her complaint against her employer, but the Appellate Court consolidated her case with the appeal from Adams’ employer.

The IL Appellate Court, WC Division explained the Illinois Code of Civil Procedure Section 2-1303 provides judgments recovered in any court will draw interest at a rate of 9% per year until satisfied. However, Section 19(n) of the IL Workers’ Compensation Act provides IWCC decisions reviewing an arbitrator’s award “shall draw interest at a rate equal to the yield on indebtedness issued by the United States government with a 26-week maturity next previously auctioned on the day on which the decision is filed.” This interest, that I characterize as “post-Arbitration interest” is per statute “drawn from the date of the arbitrator’s award on all accrued compensation due the employee through the day prior to the date of payments.”

The Appellate Court ruling explained an injured worker becomes eligible for interest under Section 2-1303 of our Civil Code only “if and when the arbitrator’s award or commission’s decision becomes an enforceable judgment,” because the employer failed to pay any benefits due.

An employer that makes payment of an award, accrued installments and Section 19(n) interest before the injured worker files a motion to enforce will not be subject to interest under Section 2-1303, the Court said.

Since both employers tendered payment of what was owed to both Claimants before they filed motions for enforcement, the Appellate Court ruled the circuit court of Fayette County did not err in refusing to award interest to the first Claimant pursuant to Section 2-1303, but the circuit court of St. Clair County erred in awarding such interest to the second Claimant.

Please update your handling instructions to reflect the clarity provided in this decision. To read the decision, Dobbs Tire & Auto v. IWCC

We appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Claims Adjuster Can Proceed on Personal Employment Claims Despite Failing to Report them on Bankruptcy Petition. Analysis and research by John Karis, J.D.

Editor’s comment: A federal trial court judge in Illinois ruled an insurance adjuster can proceed with his claims of discrimination and workers’ compensation retaliation against his former employer.

In the federal case of Buhe v. Amica Mutual Insurance Co., Timothy Buhe began working for the Amica’s Mutual Insurance Co. in 1994. His job involved investigating claims stemming from auto accidents and property damage to homes.

Buhe fell from a policyholder’s roof in February 2013, suffering injuries to his knee, ankle and shoulder. His supervisor informed Amica’s workers’ compensation insurance provider of the accident.

At the time of his injury, Buhe was on “probation” with Amica, having received an written warning of potential termination for dress code violations; missing an after-hours call while on on-call duty; slowness in completing auto expense reports, estimates and assignment downloads; and lax documentation in the claims files assigned to him.

In March 2013, Buhe requested an eight-week disability leave. In May, he requested an extension of his leave until late summer or early fall.

In September 2013, Amica contacted Buhe and informed him he had exhausted the six-months of disability leave allowed under the company’s leave policy, which was laid out in the employee handbook. Since Buhe had provided no indication that he might be able to return, Amica requested that he sign a separation agreement, resigning his position.

Buhe responded that he thought workers could obtain an extension of leave. Amica responded that it needed to fill his position soon and requested that he provide medical documentation to establish an anticipated date of return.

Buhe complied and verbally confirmed that he intended to return to work after his knee surgery in December 2013.

In November 2013, an adjuster from the comp carrier contacted Amica and reported that Buhe appeared to be working for Electra Mortgage Solutions (“EMS”). Buhe was the president and owner of EMS, which was in the business of originating mortgage loans. He had been operating the business as a second job since 2007, unbeknownst to Amica.

Amica asked Buhe about his operation of EMS. Buhe told Amica that he did not directly oversee EMS’ office activities and said he was unwilling to further discuss the matter without speaking to his attorney first. Amica later terminated Buhe for violating its policies on outside employment. It was noted in the last ten years, Amica had terminated two other employees for violating its policies on outside employment and holding an outside broker’s license. 

In October 2014, Buhe filed complaints with the Equal Opportunity Employment Commission and Illinois Department of Human Rights, asserting that Amica had discriminated and retaliated against him.

Three months prior to filing his complaints, Buhe filed a Chapter 13 bankruptcy petition. He did not disclose his discrimination claims against Amica in the bankruptcy proceedings, although he did disclose his workers' compensation claim. Buhe’s bankruptcy was discharged in July 2016.

After learning of the bankruptcy, Amica filed a motion for summary judgment dismissing Buhe’s claims of discrimination and retaliation, since he had failed to disclose them to the bankruptcy court. Buhe filed a motion to reopen his bankruptcy case, which the bankruptcy court granted. U.S. District Court Judge Jorge Alonso denied Amica’s motion for summary judgment, finding a triable issue existed as to whether Buhe had intentionally concealed his claims from the bankruptcy court.

Alonso further found there was a triable issue as to whether Amica had discriminated again Buhe by refusing to grant a reasonable accommodation. The judge said a rational jury could find that the extension of leave Buhe had requested was not excessive, as Amica had previously allowed other employees an extension of their disability leaves.

Alonso also said there was a triable question as to whether Amica’s stated reason for firing Buhe was a mere pretext for discrimination and retaliation, since there was evidence that the company did not always terminate employees for undisclosed outside employment that did not present a conflict of interest with Amica’s business.

The judge said Amica was entitled to summary judgment on Buhe’s claim of promissory estoppel, but only because Buhe requested dismissal of this claim.

As we have stated throughout our blogs it is always important to be consistent with how you treat employees. In this case the court found Amica’s history with other employees critical in finding a reasonable jury could conclude based on the company’s history that it may have discriminated. Furthermore, this court also found that simply failing to disclose employment claims during a bankruptcy proceeding is not enough for summary judgment. You have to show undisputed facts that these omissions were intentional to have judicial estoppel apply. 

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

Synopsis: IL Senate Subcommittee Meeting with IL WC Arbitrators???

Editor’s comment: It is an enigma, wrapped in puzzle surrounded by a conundrum. In short no one knows why 5 of our newest Arbitrators were called into a hearing in Chicago last week.

We are later advised by a reliable source Arbitrators Harris and Luedke will be appearing before the IL Senate Committee in Springfield on Feb. 27 or this Tuesday.

I am sure these are not confirmation hearings. These Arbs were appointed by the Governor and were confirmed and are now hearing claims and making important rulings.

In short, nobody knows what’s up.  

As this column is WC gossip central—if you know anything, please, please share!!!