Synopsis: Neither Borrower or Lender Be???--In Illinois, Staffing Temp Workers Can't Bring Suit Against 'Borrowing' Employer for Motor Vehicle Accident.
Editor’s comment: The Illinois Appellate Court ruled two staffing workers sent from a temporary agency could not sue their staffing employer's client, nor an employee of the client for alleged civil damages from motor vehicle accident that occurred within the course and scope of their employment. I strongly agree with this ruling.
In Morales v. Herrera, issued 12/07/2016, Claimants Morales and Sanchez both worked for Express Employment Professionals, a temporary employment agency. In April 2010, Express assigned them to work for their account, Radio Flyer Inc.
The two women suffered injuries in a car accident traveling between from one Radio Flyer facility in Chicago to another facility in Elwood, IL. There was no question they were in the course and scope of continued employ during the trip. At the time of the accident, they were riding as passengers in a vehicle being driven by another Radio Flyer employee who arguably contributed to the accidental event.
Prior to filing suit to recover for their injuries at the Circuit Court, it was undisputed Morales and Sanchez collected workers' compensation benefits from Express. Having received WC benefits, they also sued both the borrowing employer, Radio Flyer and the co-employee driver for negligence.
In response, Radio Flyer moved for summary judgment to summarily dismiss the claims against it. The company argued Claimants Morales and Sanchez were "borrowed employees" and that it was immune from civil liability. The trial judge agreed and granted Radio Flyer's motion to dismiss.
The Illinois Appellate Court said the fact Morales and Sanchez were offered and appropriately collected workers' compensation benefits, which are payable only for injuries that occur within the scope of employment, meant they could not now claim the accident fell outside the scope of the IL Workers' Compensation Act.
The Court also said the record clearly established Morales and Sanchez were "borrowed employees" of Radio Flyer, so Section 5 of the IL Workers' Compensation Act barred them from seeking additional compensation/recovery from the company or their co-employee, Herrera.
The rule in IL WC is both the borrowing and lending employers are fully responsible for work injuries suffered by staffing workers. The IL WC Act indicates which company may be primarily liable and which company may be secondarily liable but they are both “on the hook” during the relationship. If you have questions or concerns about primary liability, send a reply.
Other than for arguably intentional injuries, a staffing workers injured during the course and scope of work performed for either company should only be able to recover WC benefits. They are barred from common law claims.
To read the decision, click here. We appreciate your thoughts and comments. Please post them on our award-winning blog.
Synopsis: Simple OSHA Update for U.S. Risk/WC/Safety/Claims Managers
Editor’s comment: We are getting lots of questions about OSHA issues during the current transition between Presidential administrations. Here are some thoughts about OSHA's electronic reporting, retaliation and “blanket” post-accident drug testing rules.
We want our readers to understand we do lots of OSHA consulting and defense work at rates that are half of what the national firms over-charge, ooops, we mean charge.
In short, Occupational Safety and Health Administration (OSHA) standards cover everything from port-a-potties to fall protection, and tracking all of OSHA’s specific guidelines can be difficult for employers.
OSHA rules now include two components: anti-retaliation, which went into effect Dec. 1, 2016, and electronic injury and illness reporting, which takes effect in 12 days on Jan. 1, 2017. OSHA reasons that the anti-retaliation component must be put in place first, because the outbound administration feels it is necessary so U.S. employers will provide accurate data under the reporting component.
The anti-retaliation component includes these provisions:
Ø U.S. Employers must inform employees of their right to report work-related injuries and illnesses, free from supposed retaliation. Employers can fulfill this obligation by posting the Job Safety and Health — It’s The Law poster - https://www.osha.gov/Publications/poster.html
Ø OSHA also recommends employers make it clear in your employee handbooks and new employee orientation materials your employees have the right to report workplace injuries to OSHA.
Ø OSHA leadership feels an employer’s procedure for reporting work-related injuries and illnesses must be “reasonable” and must not deter or discourage employees from reporting. For example, procedures that do not allow a reasonable amount of time for an employee to supposedly “realize” they suffered a work-related injury or illness could violate their views, resulting in enforcement procedures. This OSHA administration dislikes and may sanction “same-shift” or same-day reporting of work accidents.
Ø Finally, this administration feels a U.S. employer may not retaliate against employees for reporting work-related injuries or illnesses. OSHA cites three types of policies they consider retaliatory under this provision:
§ Disciplinary policies
§ ”Blanket” drug-testing policies and
§ Anti-accident safety or incentive policies.
The rule does not prohibit a U.S. employer from disciplining employees for violating legitimate safety rules, even if the employee was injured as a result of the violation. The rule does, however, prohibit retaliatory action against an employee as a result of reporting a work-related injury or illness. Examples include suspension, harassment, reassignment and termination.
Their rule does not prohibit employee safety incentive policies, but it does prohibit incentive programs that deter or discourage an employee from reporting an injury or illness. They feel anti-accident Incentive programs should encourage safe work practices and promote worker participation in safety-related activities.
The new rule does not prohibit “blanket” post-accident drug testing, but it does provide if an injury or illness is very unlikely to have been caused by employee drug use, or if the method of drug testing doesn’t identify impairment but only use at some point in the recent past, a drug test might inappropriately deter reporting.
The electronic injury and illness reporting component requires certain employers to electronically submit the injury and illness information they are already required to keep under OSHA regulations. OSHA designed this component to increase accountability and prevent injuries. As stated above, the electronic submission requirements take effect Jan. 1, 2017, but OSHA will phase them in over time.
As we outline above, if you need help dealing with these issues or anything related to OSHA, send a reply.
Synopsis: IL WC Insurance Dispute/Coverage Doesn’t Work Out Well for Staffing Insurer.
Editor’s comment: In LM Insurance Corp. v. B&R Insurance Partners, LLC, issued December 13, 2016, Defendant B&R Insurance Partners, LLC (B&R), entered into client agreements with Southern Illinois Workers Inc. and Speed SEJA School District 802 whereby B&R would obtain workers’ compensation insurance on their behalf. Plaintiff LM Insurance Corporation issued a policy naming B&R as the insured and extended WC coverage through policy endorsements to those employees of B&R’s that had been leased to B&R’s clients.
Plaintiff LM subsequently cancelled the policy and retroactively removed B&R’s clients from the policy’s endorsements after B&R informed LM that none of its clients’ employees were on B&R’s payroll. Meanwhile, the individual defendants, all of whom were employees of B&R’s clients, filed workers’ compensation claims with the IL Workers’ Compensation Commission alleging injuries suffered during the course and scope of their employment.
Defendant B&R tendered the claims to Plaintiff LM Insurance, since the alleged injuries occurred during a time when the policy was still in effect. LM then filed this declaratory judgment action. The amended complaint sought a declaration LM Insurance had no duty to defend or indemnify against the individual defendants’ claims. The trial court denied LM’s motion for summary judgment and granted summary judgment in favor of Defendants. LM timely appealed.
The Appellate Court noted Plaintiff insurance company issued their WC policy naming Defendant B&R, which entered into agreements with staffing clients to obtain workers' compensation insurance on their behalf, as insureds. They also extended coverage through policy endorsements to employees that had been leased to its clients.
Plaintiff filed this declaratory action seeking a court declaration that it had no duty to defend or indemnify Defendant in workers' compensation claims filed by employees of Defendant's clients. Court properly found Plaintiff had duty to defend, as all WC claims fell within or potentially within policy coverage.
The Appellate Court further noted the Circuit Court's finding that Plaintiff has duty to indemnify was premature and must await a final determination by Workers' Compensation Commission. The Appellate Court further noted the Circuit Court erred in granting summary judgment in favor of Defendant B&R on Plaintiff's claim for rescission, as it required a factual determination as to whether Defendant actually leased any employees.
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Synopsis: Merry Christmas and Happy Holidays to all of our readers, clients and friends from the Defense Team at Keefe, Campbell, Biery & Associates!!
Thanks to all of you for another great and prosperous year!!