6-17-13; Massive Employment Law Muddle Might Be Different With Veteran WC/EPLI Defense Approach; Joe Needham on Important Positional Risk Ruling; Shawn R. Biery on Double-Dip PPD Award and much more

Synopsis: IL Employment Law Muddle—When Is a Claim WC, EPLI or a Circuit Court battle? Our vote is to consult with our KCB&A defense team that can handle all such issues in your companies’ best interests.


Editor’s comment: We saw two very different outcomes in two very similar actions across our state in the last couple of weeks. The legal battlefield and potential costs have to make IL risk, safety and HR folks bewildered.


In Holland v. Schwan’s Home Service; No. 5-11-0560, issued May. 30, 2013, Plaintiff alleged his erstwhile employer Schwan's Home Service, Inc. (Schwan's) terminated his employment in retaliation for “exercising his rights” under the Illinois Workers' Compensation Act. After a seven-day trial, a jury returned a verdict in Holland's favor on his retaliatory discharge claim, awarding him a total of $4,260,400 in compensatory and punitive damages. The punitive damages portion of the award was $3.6 million. We consider that amount to be comical, ludicrous—you pick the adjective. Throughout the trial court proceedings in one of Illinois’ notoriously anti-business judicial areas, Defendant Schwan's denied Plaintiff Holland's assertion Schwan’s terminated his employment. Instead, Schwan’s maintained when Holland recovered from his work accident and was ready to return to work, it offered him an available position at the facility where he previously worked but he refused to report for work. At several stages of the lower court proceedings, Schwan's requested the Circuit Court decide the issue of whether it had terminated Holland in its favor as a matter of law, rather than letting the jury decide.


Prior to the trial, Schwan's made this request in a motion for summary judgment the Circuit Court denied. After the conclusion of Plaintiff Holland's case in chief, Schwan’s made the request for a directed verdict. Again, the Court denied the motion. In denying Schwan's motion for directed verdict, the Circuit Court found Holland presented sufficient evidence for the jury to conclude he was terminated. The Court noted Schwan's was "free to argue to the jury" Holland was not terminated but it was "up to the finder of fact to make that determination." Finally, after the jury considered the evidence and entered a verdict in Holland's favor, Schwan's raised this issue again in a post-trial motion requesting the Court enter judgment notwithstanding the jury's verdict and the lower court again denied Schwan's request.


Please note the attorneys or risk managers handling this matter appear to have a challenging understanding of IL WC claims handling. If you look on the IWCC website, Larry Holland settled his WC claim against Schwan’s amicably for a relatively meager 7.5% BAW in 2009. Obviously, they didn’t get a release/resignation as part of that settlement, leaving the option open for Plaintiff to seek millions. If there were disputes about TTD and return to work issues, they should have been compromised as part of that approved settlement. Actually, as you are reading this, we remain puzzled why defense counsel for Defendant Schwan’s haven’t raised that WC settlement as a bar to this seven-figure verdict and judgment. In our view, every aspect of this complaint and law suit presented issues that should have been heard by the Illinois Workers’ Compensation Commission. Return to work issues and the nature of a job offer being bona fide are decided in a routine fashion by our Arbitrators and Commissioners on a routine and daily basis. We cannot tell from the ruling whether that defense was presented to the lower or appellate court. If it wasn’t, it should have been.


Defendant Schwan's appealed the multimillion-dollar judgment entered on the jury's verdict to the Fifth District Appellate Court. They argued their many motions should have been granted. To no one’s surprise, the Fifth District followed the Circuit Court and ruled Plaintiff is entitled to over $4 million dollars despite the strong evidence of a job offer. We hope the IL Supreme Court will consider this appeal. We again urge all of our readers to understand this dispute should have been resolved at the IWCC.


In a starkly contrasting ruling that more closely follows our legal entreaties, in Schroeder v. RGIS; No. 1-12-2483, issued June 7, 2013, Plaintiff Schroeder asserted he suffered from intentional infliction of emotional distress because he was being treated poorly by supervisors due to the fact he is gay. Various epithets are contained in the records and we aren’t going to repeat them here. Defendant RGIS filed a combined motion to dismiss, brought pursuant to section 2-619.1 of the Illinois Code of Civil Procedure, arguing, among other reasons, Plaintiff Schroeder's complaint must be dismissed pursuant to section 2-619 of the Code because his claim of intentional infliction of emotional distress was preempted and, thus, barred by the Illinois Human Rights Act and by the exclusivity provision of the Illinois Workers' Compensation Act.


The First District Appellate Court noted the following issues were:


(1)  Whether Plaintiff was able to establish, independent of any duties created by the Human Rights Act, the elements of the tort of intentional infliction of emotional distress; and

(2)  Whether the exclusivity provision of the Workers' Compensation Act barred Plaintiff's claims.


The Appellate Court ruled the Circuit Court properly dismissed plaintiff's second amended complaint because his tort claim of intentional infliction of emotional distress was inextricably linked to a civil rights violation. They further ruled Plaintiff's claim was preempted and, thus, barred by the Human Rights Act. They also held Plaintiff's alleged injury was compensable under the Workers' Compensation Act. Therefore, Plaintiff's claim was also preempted and, thus, barred by the Workers' Compensation Act.


Our vote for our readers is don’t necessarily assume expensive defense counsel at $300-600 per hour are doing you a favor when the right WC/EPLI defense counsel could get the matter resolved rapidly as part of any resolution of the WC claim. Both of these cases should have the same outcome—resolution of the WC claim should resolve all other possible claims, if at all possible. The great defense team at KCB&A can provide such advice and counsel at rates less than $200 per hour.


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Synopsis: Illinois Appellate Court, Workers’ Compensation Division denies benefits for worker struck by errant vehicle as a neutral risk, while suggesting positional risk evidence may have altered the outcome. Analysis by Joe Needham, J.D.


Editor’s comment: When stray bullets are risks incidental to employment but a cashier’s injuries from being struck at her post by a car driven by the employer’s vendor is not, something is odd about the adjudication of WC liability in Illinois. Is positional risk becoming the new IL WC theory of compensability? 


In 95th Street Produce Market v Illinois Workers Compensation Commissionthe facts involved a cashier at a produce market who was struck and injured when a vehicle driven by a vendor crashed through a store wall and into Petitioner’s work area. A co-worker and three customers were also injured. The facts of the occurrence were not disputed and the only question at trial was whether Petitioner’s injuries were sustained in the course and scope of employment as the consequence of a risk incidental to the employment, or whether it resulted from a risk common to all.


Photographic and testimonial evidence established the exterior of the 95th Street Produce Market and its relation to the roadway. Concrete parking blocks separate a span of pavement abutting the storefront from the parking lot, but were not bolted down and moved when struck by vehicles. Petitioner testified drivers occasionally drove their cars in this paved area abutting the storefront despite it not being a roadway, mistakenly thinking they could leave the parking lot by this route. Upon realizing their error, some drivers simply drove over the grassy parkway to exit the area while others attempted to reverse course by “go[ing] forward, back up, forward, back up, so they can turned [sic] around to go back where they got in through.” Essentially, drivers frequently mistake their avenue of egress and instead drive upon an asphalt area abutting the storefront. Further evidence revealed the offending vehicle properly left the premises and was traveling Eastbound on 95th Street when the driver lost control of the vehicle, left the roadway and drove across the store lot and into the storefront, striking Petitioner and others.


Relying on Brady v. Louis Ruffalo & Sons Construction Co., the Arbitrator denied benefits, finding Petitioner failed to establish her risk of injury “was incidental to her employment or that the work environment increased the risk so that she would be subject to such an accident to a greater degree than that to which other persons on the premises were exposed.” Petitioner was one of five people injured, three of whom were customers. The injury in Brady involved a single employee injured at his work station when an errant vehicle left an adjacent highway and struck the employer’s building. In the absence of evidence the work environment exposed the employee to an increased risk greater than the general public’s exposure, the Brady court found the denial of benefits proper. The knowledgeable Arbitrator followed suit.


Petitioner appealed and the Commission reversed, finding Petitioner’s injury the consequence of a risk incidental to her employment in that it resulted from traffic of the employer’s vendor, present on the premises to facilitate the employer’s business. Because Petitioner’s job duties “required her to spend virtually the entire workday in the front of the store….  the location within the store where [claimant] performed her job duties, namely, in front of the store and in close proximity to large glass windows facing Respondent’s parking lot, exposed her to a greater risk of injury compared to the general public.” That determination was affirmed by the Circuit Court, and the employer appealed.


The Appellate Court, Workers’ Compensation Division reversed the award of benefits, agreeing with the Arbitrator the injury was not sustained in the scope of employment. While acknowledging Petitioner was clearly in the course of employment at the time of the injury, the First District Court found the manifest weight of the evidence affirmed the risk of injury was outside the scope of Petitioner’s employment, and reversed the lower courts to deny benefits to Petitioner. Noting a risk of injury must be peculiar to the work or must be a risk to which the employee is exposed to a greater degree than the general public as a consequence of the employment, the Court identified three categories of risk to which an employee might be exposed: (1) risks distinctly associated with the employment; (2) risks personal to the employee; and (3) neutral risks which have no particular employment or personal characteristics. Illinois Institute of Technology Research Institute v Industrial CommissionCitingIllinois Institute of Technology Research Institute, the Court noted:


·         Risks distinctly associated with the employment are universally compensated, and include “the obvious kinds of industrial injuries” that comes to mind when we think of a work injury.


·         Personal risks include non-occupational diseases, injuries caused by personal infirmities, and injuries caused by personal enemies. While personal risks are generally not compensable, they me be compensated where the employment increased the risk of injury (Id) such as aggravations of systemic disorders like carpal tunnel and myocardial infarction.


·         Finally, neutral risks include stray bullets, dog bites, lunatic attacks, lightning strikes, bombings, and hurricanes; injuries resulting from neutral risks do not arise out of the employment and are compensable only where the risk to which the employee was exposed was greater, as a consequence of the employment, than the risk to which the general public was exposed. Id.


In assessing the type of risk to which Petitioner was exposed, the Court found the facts of the case rendered the risk neutral - errant drivers pose a risk to the public generally -  necessitating Petitioner establish the employment rendered her risk of the specific injury greater than the risk shared by the general public. Because Petitioner presented no evidence on this issue, the Appellate Court found Petitioner failed to establish her neutral risk was heightened by her employment. In denying Petitioner’s employment increased her exposure to the neutral risk of a wayward vehicle crashing through the storefront beyond that to which the public is exposed, the Court discounted Petitioner’s argument the fact the offending vehicle was the employer’s vendor rendered the risk particular to the employment. The Court reasoned because the offending driver had reached the adjacent roadway and entered its stream of traffic before losing control of the vehicle and crashing through the storefront windows, he was no different than any other driver on the roadway and therefore presented a risk no greater than all other drivers on the road and did not present a risk incidental to the employment. Assessing the facts, the Appellate Court agreed with the Commission Arbitrator Petitioner’s risk of injury was not within the scope of Petitioner’s employment.


Distinguishing this case from Illinois Institute of Technology Research Institute v. Industrial Comm’n, and Restaurant Development Group v. Hee Suk Oh, each of which involved claimants working in high-crime areas struck by a stray bullet that breached the work station, the Court noted the 95th Street Petitioner presented no evidence the location of the employment presented an increased risk of injury rendering the neutral risk of an errant vehicle heightened to the point of presenting an employment risk. The court distinguished 95th Street Produce Market from the earlier rulings on the basis each of those claimants presented evidence to support a finding the location of the employment increased the risk of injury to the employee beyond the risk presented to the general public. In both cases claimants submitted police records or testimony showing an increased rate of crime in the area. Because those claimants produced evidence their places of employment were in high crime areas subject to gunfire, the Court reasoned those claimants presented evidence of a neutral gunfire risk specifically heightened by the employment. Essentially, claimants in Illinois Institute of Technology Research and Restaurant Development Group both established the location of their employment presented a heightened risk of injury, and the 95th Street Petitioner did not. While we agree completely with this result, we take issue with the logic employed to reach it.


Here’s our basic problem with the contrast between 95th Street Produce Market and the Illinois Institute of Technology Research and Restaurant Development Group cases. They are essentially the same risk as compared between employees and the area’s general public, with Petitioner denied benefits in 95th Street Produce Market for a risk that is clearly as foreseeable and possibly more-directly related to the employment than the injuries found compensable in the earlier rulings. Both of the earlier rulings involved employees injured as the result of an unforeseen errant bullet, while the risk which injured the 95th Street Petitioner was not only foreseeable based on prior errant vehicles in that very area, but possibly not even unlikely to occur for that same reason. This distinction overlooks what we believe to be an inconsistency in the reasoning to find crime in high-crime areas presents a risk of injuries to employees to a greater degree than the general public. If the employment is in a high crime area, isn’t the employment risk of being struck by a stray bullet in that area just as common as the risk to residents of the area? If the area is one of high crime, how can the employment present a greater risk of injury from that crime than the risk presented to the public? With no evidence as to how the employment created a greater risk of the employee being struck by an errant bullet than to residents and inhabitants in the area, how does the employment increase the neutral risk to an employment risk? And what if evidence established the claimant lived in a higher-crime area than he worked; would that then render the risk of being shot lower as a consequence of the employment? Would the risk fluctuate depending on from where the employee hails?


Our criticism isn’t with the Appellate Court’s determination the 95th Street Petitioner’s risk of injury was not increased beyond the general public’s exposure - it is clear the risk of errant vehicles is common to all in the area, and we submit significantly less common to individuals employed within brick and mortar structures than to those on the roadways and walkways adjacent to the roadway - but with their willingness to find the risk heightened by the employment if Petitioner had presented some evidence the location of the employment offered a heightened risk of injury from an errant vehicle. What about the customers in the store, the pedestrians present and all members of the public in the area; were they not exposed to the same risk regardless of the location of the employer’s shop? How can the risk be greater to the employee than to the customer standing beside her?


This article was researched and written by Joseph Needham, J.D. Please direct complaints/criticism and kudos to Joe at jneedham@keefe-law.com.




Synopsis: Two Accidents Now Seem to Provide a “Double-Scoop” of PPD for IL Claimants. This controversial ruling appears to further extend the intention for Illinois employers to pay, pay, pay. Analysis by Shawn R. Biery, J.D., MSCC.


Editor’s comment: While Illinois courts have already found PPD can be awarded for separate accidents, in the case of National Freight Industries v IWCC et al., 1-2004-3-WCpublished June 13, 2013, the Illinois Appellate Court Workers’ Compensation Division awarded what we feel is “double-PPD” for an old injury to the lumbar spine at L3-4 which was not MMI due to a new injury at L3-4 and L4-5 with a new employer.


In brief summary as noted in the opinion, on December 31, 2008, claimant, Andrew Smith, filed an application for adjustment of claim (08 WC 56873) seeking benefits for injuries sustained in a motor-vehicle accident on December 4, 2008 while in the employ of National Freight Industries. That same day, claimant filed a second application for adjustment of claim (08 WC 56874) alleging the occurrence of a work-related accident on November 6, 2006 (prior to the accident alleged in the first application), while in the employ of Fischer Lumber. Following a consolidated Section 19(b) hearing, the arbitrator determined claimant’s current condition of ill-being was not a natural consequence of the November 6, 2006 injury and the accident of December 4, 2008, constituted an independent, intervening accident that broke the chain of causation—and thus denied Fischer Lumber’s liability for TTD and medical expenses after December 4, 2008. The arbitrator further held National Freight liable for TTD benefits and medical expenses for the period from December 5, 2008, through the date of the arbitration hearing. The arbitrator also determined Petitioner was not entitled to PPD against Fischer Lumber because he had not reached maximum medical improvement prior to the date of the second accident.


The Illinois Workers’ Compensation Commission affirmed and adopted the decision and the circuit court of Madison County confirmed the decision of the Commission. Petitioner and National Freight filed separate appeals, which were consolidated with National Freight arguing the Commission’s finding the December 4, 2008, accident broke the chain of causation from claimant’s prior work accident was both contrary to law and against the manifest weight of the evidence. In his appeal, Petitioner argued the Commission’s finding that he was not entitled to a permanency award from Fischer Lumber was against the manifest weight of the evidence.


The court didn’t agree with National Freight’s argument which argued the motor-vehicle accident merely aggravated the injuries claimant sustained as a result of his initial work injury, while employed by Fischer Lumber—arguing the chain of causation from the November 6, 2006 accident was not completely broken. The Appellate court concluded the record supports a finding the December 4, 2008 motor-vehicle accident, which indisputably occurred while claimant was in the scope of his employment for National Freight, constituted an independent, intervening accident which broke the chain of causation between claimant’s original work-related injury and his current condition of ill-being noting the difference in complaints and distinguishing this case from the Vogel case (which in this writers opinion is mostly distinguishable because Petitioner Vogel didn’t have another employer to pay).


The Appellate Court also cited the language of Section 19(b) as their rationale for awarding permanency with the circular logic that Section 19(b) does not bar further hearing to determine permanency so it wasn’t technically denied. The IL WC Act states in pertinent part…. “The Arbitrator may find that the disabling condition is temporary and has not yet reached a permanent condition and may order the payment of compensation up to the date of the hearing, which award shall be reviewable and enforceable in the same manner as other awards, and in no instance be a bar to a further hearing and determination of a further amount of temporary total compensation or of compensation for permanent disability, but shall be conclusive as to all other questions except the nature and extent of said disability.”


As such, the Appellate court indicated they were sending the case back to award permanency as they had found it had been improper to address the propriety of permanency with respect to the injury claimant sustained while claimant was employed by Fischer Lumber at that stage of the proceedings and they found it would be inconsistent to determine the injury claimant sustained while working for National Freight constituted an independent, intervening cause and award no permanency for the injury claimant sustained while working for Fischer Lumber. The Appellate Court affirmed the findings that  the motor-vehicle accident in which claimant was involved while working for National Freight constituted an independent, intervening cause was based on the finding the second accident resulted in a change to claimant’s symptoms, the pathology of claimant’s condition, the type of surgical intervention, and his ability to work. In other words, the Appellate Court concluded that the second accident did not simply represent a continuation of the injury resulting from the first accident. Rather, it caused a separate and distinct injury that broke the causal chain. Since claimant suffered separate and distinct injuries arising from two different accidents, he should be allowed to seek a permanency award for each accident.


While confusing, the claim finds support for both parties arguments in case law and it is interesting to note our office recently argued a Central Rug case before an Arbitrator and were provided with a distinctly separate opinion than the Appellate Court found here. A jaded observer may see the contrary rulings as the continued reach of the Illinois WC system to provide benefits at a higher level than contemplated by the initial intention of Workers’ Compensation Acts when initially installed over a century ago. This article was researched and written by Shawn R. Biery, J.D. MSCC. Email Shawn at sbiery@keefe-law.com for a copy of this case or with any questions.




Synopsis: KCBA welcomes general liability, employment law and litigation defense specialist Chris St. Peter from the law firm of Winston & Strawn LLP.


Editor’s comment: Keefe, Campbell, Biery & Associates proudly announce the addition of Christopher H. St. Peter, J.D. to our legal team. Chris joins us from Winston & Strawn LLP, where his practice involved all aspects of complex commercial litigation in state and federal court.  Chris graduated with honors from Chicago-Kent College of Law, where he was an executive articles editor of the Chicago-Kent Law Review and an extern for the Honorable Magistrate Judge Arlander Keys in the U.S. District Court, Northern District of Illinois. Chris will focus his practice on a full range of defense work, including general liability, employment law, product liability, and contract disputes.  Chris can be contacted at any time at (773) 301-7244 or cstpeter@keefe-law.com.