NCCI recently recommended a 3.5% increase in IL workers' compensation insurance premiums, despite what was calculated to be $300-600 million in workers' compensation cost reductions as a result of the 2011 Amendments to the IL WC Act. NCCI has been asked to explain this apparent inconsistency at the next combined advisory boards meeting to be held on November 30. 2011 at 9:00 a.m. in Room 9-040 of the Thompson Center at 100 W. Randolph Street, Chicago Illinois 60601. This is a public meeting and our readers may be interested in attending this important session which may influence Illinois workers' compensation reform efforts in the future. There has been allotted time after the presentation for questions. This is a link to an article about the rate hikes:
What is NCCI and Why Are They Coming to Chicago?
If you don’t know, NCCI is a privately owned workers’ comp rating service headquartered in Boca Raton, FL. They are basically “stat-rats” for the workers’ comp insurance industry and provide metrics that are considered by lots and lots of folks to properly set WC insurance rates in each of these United States. When they talk, lots of WC people listen.
NCCI looked at the 2011 Amendments to the IL WC Act and initially promulgated a 8.8 per cent decrease in rates. Understanding the total bill for IL WC for state businesses and government bodies is around $3 billion each year, an 8.8 per cent cut would represent several hundred million in savings for all of us. Jubilation was heard in many quarters to hear the business environment in “the People’s Republic of Illinois” might be improving.
However, almost as fast as that advisory rate cut was published, we learned NCCI reversed itself and were now trumpeting a rate increase. When that was announced, the “harrumphing” across the IWCC and ITLA and the forces of Illinois labor was easy to hear. The next thing we knew, the NCCI was called to the carpet to let the “powers-that-be” know what just happened.
Did We Actually “Reform” Anything in IL WC in 2011?
Well, we want to give all of you a hot tip from the defense trenches in this state—we are still concerned to see the three Commission panels are still staffed with the identical political mix we started the year with. On each of three panels, there are two pro-Plaintiff/pro-labor Commissioners with one pro-Defense Commissioner who is allowed to write pithy dissents. In our view, these panels remain liberal to very liberal in their view of the coverage of the Act and when and how much workers should receive when injured. Liberal means more money for injured workers and higher WC insurance rates.
Along with the liberal make-up of the IWCC, as we have advised, the Appellate Court, Workers’ Compensation Division still hasn’t written what most defense observers consider a defense ruling since Airborne Express v. IWCC was signed by a majority about a decade ago. In fact, we think recent rulings appear to strip back the savings initially provided IL business in the Airborne Express ruling. We also note the five-member Appellate panel doesn’t have a strong, moderate or minimally conservative member—in our view, they all typically join each other in writing pro-Plaintiff rulings. For the most part, they don’t waste their time writing dissents to confirm there is an opposing legal concept to a majority ruling.
Why is the panel so uniformly pro-Plaintiff? Well, we recently reported ITLA and its millionaire members just spent about $4 million in campaign donations to retain Illinois Supreme Court Chief Justice Thomas Kilbride. Those folks didn’t donate that much money to have moderate jurisprudence in the personal injury legal industry in this state. Justice Kilbride and his colleagues on the Supreme Court control the make-up of the five-member Illinois Appellate Court, Workers’ Compensation Division. From our view, these facts combine to create a liberal to very liberal appellate panel for most WC claims in this state.
We want our readers to understand there is nothing illegal or the slightest bit unethical about any of it—that said, our main problem is the ability of Plaintiff lawyers to donate literally millions to the judicial campaigns of justices and judges across the state. It is impossible to conceive a judicial candidate can possibly be fair and impartial when they basically owe their position, perks and pensions to the lawyers who got them their jobs.
From an administrative perspective, NCCI has to also be closely watching our state and noting the IWCC and Illinois Department of Insurance are stuck in an administrative quagmire in providing final approval of PPP or preferred provider programs that were supposed to be the cornerstone of the new 2011 Amendments. The reform bill was passed May 28, 2011 and signed into law June 28, 2011. There were PPP’s involving workers’ compensation care for the last several decades in this state. What is the hold-up on providing approval?
So How Does Any of This Relate to so-called “Traveling Employees” in IL WC?
Well, if you have been reading this KC&A Update on a regular basis, we have advised the Blagojevich appointees to the IWCC who are still around did two things to expand the IL WC Act way past its former scope. One of things was to make work itself into an “accident” by expanding “repetitive trauma” to everything a worker does because work is repetitive and aggravates everything, right? Due to space and time constraints, we aren’t going to review that mess in this article.
The second thing we noticed was the enthusiastic expansion of the “traveling employee” doctrine in Illinois. If you aren’t sure what a “traveling employee” is in other states, it was supposed to be:
- A worker who is sent by the employer on a trip—typically an overnight trip;
- The trip is supposed to be to a foreign and possibly dangerous work environment to which they aren’t accustomed;
- The “traveling” worker therefore faces lots of unexpected challenges due to the demands of the trip and the foreign place.
Other states typically extend expanded WC coverage for workers in such settings, due primarily to the hidden dangers of foreign travel—they are covered basically “portal-to-portal” during such a trip for all risks they face. In our view, that makes common sense. If you didn’t know there were holes in the pavement on a business trip to Guadalajara or Saigon and wanted to take a relaxing stroll and walked into one, we think you ought to be covered even if you aren’t actually “working” as you are on a mission to a foreign and dangerous port for your employer.
However, there are members of the IL WC Commission and Appellate Court who adhere to a view of the “traveling employee” concept in a way no other state in the union or actually on this planet views it. We actually consider two aspects of this crazy concept to be constitutionally vague and impossible for veteran WC observers and academics to comprehend.
Please remember workers’ compensation benefits are supposed to be simple and easy to understand for working men and women—if you get hurt at work, you are owed medical care, lost time and maybe a settlement, right? Well the new and expanded “traveling employee” concept is blurring all of that in this state.
From a definitional perspective, we have no idea what these administrators and justices now feel a “traveling employee” might be. They have issued rulings we have reported in which a police officer walking his regular beat is considered to be “traveling” and therefore entitled to WC coverage for anything he/she might do from the moment they leave the door of their home until they go to work, complete their shift and then return all the way back inside their home. Sounds pretty cool, right? From the upshot of this ruling, basically everything any Illinois cop does all day, even before putting their uniform on and after taking it off but not yet home would be covered under WC! Trust us, no state provides such coverage and it is expensive to do so.
The proponents of this impossible-to-understand-but-massively-expanded theory of WC coverage has one other limiting factor—the injury has to come from conduct somehow felt to be “reasonable.” We want our readers to understand there is an IL WC ruling involving two firefighters who “traveled” to what cannot possibly be a foreign and dangerous place—DisneyWorld® in Orlando, FL. In a hotel room, they started to wrestle like school boys and one of them strained his shoulder. Please note the wrestling match had nothing to do with their work as firefighters. Without regard to that undisputed fact, the hearing officers and reviewing justices ruled they were “traveling employees” and their conduct was magically “reasonable” in the Magic Kingdom and thousands in benefits were awarded.
We recently reviewed an IWCC decision where a garbage-man, oops, we mean environmental services worker finished his shift and went out into a public parking lot. He was cleaning ice and snow off his personal vehicle and slipped/fell and broke a bone. The employer and its carrier denied the WC claim and the Arbitrator agreed.
In every state of the United States other than ours, such a worker wouldn’t be “in the course of” employment because he had clocked out and wouldn’t be entitled to benefits. In every state of the United States other than IL, the risks facing such an employee who was cleaning ice and snow off his personal vehicle wouldn’t “arise out of” the employment—it is his own vehicle and lots of us have to seasonally clean snow off our cars, trucks and SUVs, right? Please note the legal reasoning used by the Commission in this claim would also have applied if he/she was in their own driveway at home cleaning their personal car to drive to work.
How did the IWCC reverse such a simple ruling and award thousands in benefits? Well, they brought out their handy “everything-is-compensable-in-IL” concept—they found claimant to be a “traveling employee.” They did that despite the fact he wasn’t “traveling” in an unfamiliar place and his “trip” didn’t take him away from home or keep him overnight. Having made the determination he was a traveling employee, everything he did from the time he left the door of his home until he went back into the home was “in the course of” employment and all “reasonable” risks he faced now mystically “arise out of” the employment.
Last year, we defended, lost and paid a claim where a trucker was off work, in a hotel room and fell taking a shower. He admitted he fell simply because he wasn’t paying attention and stepped on soap out of his own inattentiveness. We pointed out we didn’t pay him to take a shower and provided no training on “safe showering.” Claimant admitted he had taken literally thousands of showers and there was nothing unusual about where he was and what he was doing. If you aren’t aware, lots of folks get hurt taking showers when they aren’t careful. That claim cost that U.S. trucking company thousands of dollars they would not have had to pay in other states.
Isn’t This Global WC Coverage of Everything Everyone Does Every Day They Have a Job? How Would an Employer Defend Such Claims that Clearly Don’t Involve Work-Related Risks?
Yep. The only reason we don’t feel this phenomenon is killing the practice of WC law and litigation in this state is very few people understand how wildly liberal it is. We also think the “powers-that-be” don’t like to rely on it too much and try to sprinkle in other obtuse reasons to find challenging claims compensable to confuse attorneys, adjusters and risk managers. If this view of the “traveling employee” concept reaches broad acceptance, we assure our readers you will never, ever be able to fight any WC accident claim on AOO/ICO (arising out of and in the course of). If every worker is going to be routinely treated as a traveling employee, all technical defenses are over and out.
We also consider the concept of defining a trucker, police officer, firefighter-at-a-conference and environmental services worker to be “traveling employees” to be impossibly vague. We make that statement to assert just about every worker in every profession “travels” as part of their work. Police officers, firefighters, attorneys on both sides, all hearing officers at the IWCC, school teachers/administrators/aides, politicians, truck drivers, construction workers, bus drivers, Indian chiefs, ministers, rabbis, claims adjusters, risk managers, maintenance workers, street cleaners, salespersons, nurses, doctors, translators, photographers, professional athletes, coaches and trainers--literally everyone in Illinois with a job does a lot or a little traveling as a part of their work. We challenge any of our readers to describe a job that doesn’t ever involve traveling. We are all “traveling employees” in some fashion—how much “traveling” is needed to strip out AOO/ICO as a defense and include all injuries coming to and going from work? Does anyone have a clue?
The point we are making is there is no limit to the “traveling employee” concept—if the IWCC is going to radically provide global WC coverage to everyone who ever travels in the slightest way for any risk they face whether at or off work, workers’ compensation benefits in this state will be uniformly available to everyone with a job and an injury.
And the concept of “reasonableness” in analyzing accident risk for such workers is similarly impossible to define or understand. We ask the rhetorical question, “reasonable” in relation to what? In our view, that supposed limiting factor is locked deep within the hidden vault of the brains of the “secret-powers-that-be” because it wasn’t “unreasonable” for firefighters wrestling like school children in a hotel room so as to block benefits. We don’t feel that is reasonable behavior as it relates to their actual jobs of putting out fires. We also don’t think routine and arguably “reasonable” acts of daily life, like cleaning snow off personal cars before driving to or from home has anything to do with work. Is “reasonable” defined as negligent, reckless, intentional, shocking behavior?—where would one go to learn what it might mean? None of this is in the IL WC Act or the Rules—the words “traveling employee” and “reasonableness” are not defined anywhere. Should the Commission hold hearings and make recommendations to the legislature to let us know where this is all going or are we left to guess while they make up the rules as they go along?
We note our legislature recently amended the legislation to specifically state the burden of proof is on the injured worker to show their accidental injury “arose out of” and occurred “in the course of” employment. If that legislative change merely requires them to show they traveled in the last year as part of their job and therefore whatever they “reasonably” do all day is now covered under workers’ comp, the IL WC system hasn’t reformed anything. WC benefits/costs are certain to rise. On behalf of our many defense clients, KC&A is reluctant to go back to the State Chamber, Manufacturers Association and plead for them to restart the WC reform process at the next legislative session but we feel we may have to do so unless and until someone at the IWCC makes sense of this crushing anti-business problem. All we have to do is simply apply the law as written, folks. If we don’t, WC insurance rates are going to keep spiraling.
Our vote for the IL Workers’ Compensation Advisory Board, the IWCC Commissioners, the Appellate Court, Workers’ Compensation Division is to return to sanity and predictability in evaluation of compensability of work-related injuries. In our view, the “traveling employee” concept as currently being implemented is impossibly vague and so overbroad as to be patently ridiculous.
And finally, if the members of the IWCC and reviewing courts disagree and want to continue to provide WC coverage that broad, please don’t complain too loudly to NCCI on November 30, 2011 because the only direction WC insurance rates are going to go is UP!!! We truly don’t think IL WC underwriters and other stat-rats are specifically aware of why or what may be happening but they have to see it in the numbers.