2-8-12; The never-ending debate on the judicially legislated concept of “odd-lot” total and permanent disability rages

The Workers’ Compensation Division of the Illinois Appellate Court dispatched a rare reversal of the Commission despite the seemingly insurmountable “manifest weight of the evidence” standard. In doing so, the Court defined the limits of the “odd-lot” permanent and total disability theory. In Professional Transportation Services v. IWCC (WCC 3472012 IL), the Appellate Court considered an “odd-lot” permanent total disability award issued by the Commission.

Don’t spend a lot of time trying to find the words “odd-lot” in the IL WC Act

Your editors cannot help to point out the term “odd-lot” appears nowhere in the Illinois Statute. This concept of odd-lot total disability is a creation of our Commission and reviewing courts. In our view, it is a classic example of judicial legislation which permits a windfall of benefits to claimants who are clearly employable but find a way to remain unemployed until their payday hits at the Commission.

Please note the vast majority of Illinois state workers adjudicated to be totally and permanently disabled fall into the “odd-lot” category because our State government won’t defend such claims or offer substitute jobs. We are starting to call this phenomenon “odd-State-lot” claims—all of such claims could be ended immediately at a massive savings to Illinois taxpayers if State government leaders would locate alternate work for them and cut off their “double pensions.” Good luck waiting for that to occur.

That said, we are moderately comforted by the Appellate Court’s reversal of the IL WC Commission here, where the claimant clearly had the ability to work at a sedentary level according to his own doctors and an FCE, and where specific jobs were identified for which he was qualified.

This claimant, Mr. Clarke, was a 64 year old van driver assigned to shuttle workers to and from worksites. The slip and fall accident was not disputed and Petitioner had bilateral knee replacement (one replacement was disputed). Upon MMI, there was a sedentary release per an FCE.

A labor market study was performed by David Wolf, a vocational rehabilitation counselor employed by Respondent Professional Transportation. Wolf found, based on FCE restrictions, the claimant could not return to his employment as a van driver for Professional. He concluded the claimant had no "clear" transferable skills. Wolf believed claimant could perform as an entry-level cashier for an employer that would accommodate claimant's restrictions as to standing, walking, climbing, stooping, reaching, and lifting. Wolf concluded his report by stating, based upon the information provided by claimant, "it appears as if [the claimant] is capable of returning to work in a cashier position at an auto dealership." Jobs at dealerships were specifically identified as well.

At trial, the arbitrator awarded 65% loss of the leg and found claimant failed to prove his entitlement to PTD disability benefits either on the basis of medical evidence or on an "odd-lot" The Commission reversed, finding Petitioner permanently and totally disabled under the odd-lot theory.

Odd-lot Standard and “burden shift”

On appeal, our Appellate Court explained an injured employee can establish entitlement to PTD benefits under the IL WC Act in one of three ways, namely: by a preponderance of medical evidence; by showing a diligent but unsuccessful job search; or by demonstrating because of age, training, education, experience, and condition, there are no available jobs for a person in his circumstance, noting "an employee is totally and permanently disabled” when he is unable to make some contribution to the work force sufficient to justify the payment of wages.

The claimant need not, however, be reduced to total physical incapacity before a total permanent disability award may be granted. Rather, our courts rule a person is totally disabled when he/she is incapable of performing services except those for which there is no reasonable stable market. Conversely, an employee is not entitled to total and permanent disability compensation if they are qualified for and capable of obtaining gainful employment without serious risk to health or life.

Once the employee has initially established they fall in what has been termed the "odd-lot" category (one who, though not altogether incapacitated for work, is so handicapped that he will not be employed regularly in any well-known branch of the labor market), then the burden shifts to the employer to show some kind of suitable work is regularly and continuously available to the claimant.

In applying this standard, the Appellate Court correctly pointed out there was no medical evidence which could support a claim of total disability in this case. To the contrary, Drs. Smit, Michalow, Sheinkop, Cohen, and Fletcher each voiced opinions claimant could work, albeit with varying restrictions. As for evidence claimant engaged in a diligent but unsuccessful job search, the Appellate Court called claimant’s effort “meager” and agreed with the arbitrator, who concluded claimant failed to demonstrate he made diligent but unsuccessful attempts to find work. The Court explained that applying for cashier positions at nine auto dealerships and looking in the Sunday newspaper did not constitute a diligent job search.

The Court was then left then with the question of whether the evidence of record can support the Commission's conclusion: “Because of his age, training, education, experience, and physical condition...” claimant was not regularly employable in a well-known branch of the labor market.

In reversing the IL WC Commission, the Court concluded claimant failed to carry his burden in that regard, as he failed to present sufficient evidence he could not find stable employment. Basically, claimant’s job search was insufficient to prove he was unemployable. While we agree with the decision rendered by the Court, we remain alarmed that under slightly different facts, all this claimant would have to do is demonstrate a bit more effort with his job search and he may have perfected his six or seven-figure odd-lot permanent disability award.

We find it incredible a claimant’s entire team of doctors and a vocational expert can all agree a claimant is employable, yet, our IL WC Commission still reserved the right to declare them totally disabled from all work. Based on the legal analysis of the Court, such an award can be based on a valid but unsuccessful job search alone.

Why is this so alarming?

Illinois residents continue to struggle with 10% unemployment and a sluggish economy. There are tens of thousands of able-bodied, educated folks who cannot find work. Their inability to secure a steady job does not make any one of them regularly unemployable. Rather, many of the unemployed are simply victims of this rotten economy. Similarly, the claimant in this case, as in other alleged odd-lot disability claims, is not unemployable at all. He is very employable based upon unanimous medical and vocational expert testimony. Under such circumstances, we believe no claimant should ever be deemed permanently disabled. We know of no other state workers’ compensation system which affords lifetime disability benefits to a claimant who is medically cleared to work by his entire team of doctors. Only in Illinois!

What does this all mean for your biggest wage differential claims? Claim handlers and risk managers must beware of the otherwise employable claimant with permanent restrictions who trudges along with an “unsuccessful” job search for too long. After six or seven months, if no work is secured, aggressive Petitioner’s attorneys will turn your own vocational efforts against you with a claim of “odd lot” disability, simply because the claimant has had no luck finding work. You need to ramp up decision-making and documentation with your voc specialists.

This article was researched and written by John P. Campbell, Jr., J.D. Please feel free to contact John about it at jcampbell@keefe-law.com.