Synopsis: When Can An Employer Safely Fire Someone in the New Human Resources Alphabet Soup?
Editor’s comment: Considering the “Alphabet Soup” of FMLA, ADA, STD, LTD and Workers' Comp, you will note they may all be involved when an employee misses work due to a physical malady, work-related or not. Understanding how all of these laws and employment rights interact when considering termination is a continuing challenge.
We reported a $2.5M runaway jury award against a major Illinois employer last week. We wanted to circle back on our best legal advice with thoughts about canning, oops, we mean firing, workers to minimize your civil and, sometimes, work comp liability in doing so.
What is Short Term Disability or STD and Are Jobs Protected While on STD?
Short term disability is paid for by some employers as a work benefit. Short term disability provides wage protection and payments but comes with no job security. The term Short-Term Disability ("STD") refers to insurance payments made to employees who have to miss work due to a non-work-related physical infirmity. STD insurance (or self-insurance) is typically purchased by the employer. Employees may be required to contribute some of the premium payment to be entitled to coverage. One's right to STD benefits is usually determined by the insurance company from whom the policy is purchased. In a self-insured setting, the employer may pay some or all of the benefit out of their corporate funds. While an employee may have to make his/her interest in STD benefits known to the company's HR Department, the company has no say into whether an employee is entitled to the relevant benefits, the decision may be made by the STD insurance carrier or the self-insured employers inside or outside claims staff.
STD payments are made by the STD insurance carrier and are typically the equivalent of about 60% of one's regular salary—the benefits are taxable. STD benefits are usually payable for ninety days or six months. If you are not recovered after the STD period, if the employer offers it, the employee must file for Long-Term Disability benefits. LTD benefits generally bring the same legal rights and duties of STD. An employer can terminate a worker on LTD.
Can an employer fire an employee while they are receiving STD or Short Term Disability?
It is not illegal to fire someone who is out on short-term disability. Their jobs may be at risk. Stated otherwise, an employer does not have to hold open or “save” an employee's job merely because he/she is receiving STD benefits. STD benefits are monetary payments for a non-work-related condition, and do not provide employees with any current statutory right to job reinstatement upon recovery.
Can an Employee Take FMLA or Family Leave and Receive STD Too?
As a general rule, the only federal law that expressly prohibits terminating an employee who is out of work due to a physical condition is FMLA. Leave from work under the Family and Medical Leave Act is unpaid - the purpose of the statute is only to provide a right to job reinstatement provided that the employee returns prior to the expiration of the FMLA leave period.
However, if an employee has to miss work due to his/her own physical condition, the employee may obtain STD benefits while out on FMLA. Accordingly, by exercising one's rights to FMLA leave and Short-Term Disability benefits in tandem, an employee secures both job reinstatement rights and a portion of one's normal wages.
Can Sick Leave be a Reasonable Accommodation Under the Americans With Disabilities Act or ADA?
A possible source of job security if one is suffering from a health condition causing absence from work is the ADA. There is typically little question that a person missing work due to an ADA disability will qualify for STD benefits. In such cases, if FMLA leave is available, the employee has to be offered such leave.
If, an employee is not entitled to FMLA leave, or is unable to come back to work when FMLA leave expires, then applying for leave as a "reasonable accommodation" under ADA may be appropriate. However, one may expect leave from work as a reasonable accommodation under ADA would be of a shorter duration than the 12 weeks leave provided for under FMLA. If one needs a week or two to fully recover from the onset of an acute problem arising out of a disability, a strong argument can be made such leave is a required reasonable accommodation for an employer to make under ADA. As an example, if a person who suffered a non-fatal cardiac event needs two more weeks after FMLA Leave expire to achieve full recovery and return to work without restrictions, such leave may be a required accommodation under ADA.
Can an Employer Deny STD If A Work Comp Claim is Filed?
In simplest terms, yes. The standard STD insurance policy provides workers' compensation insurance must provide wage reimbursement where work-absences arise out of work-related injuries. Consequently, if one is approved for work comp benefits, one should be ineligible for STD benefits. If, however, an employee's Workers' Compensation claim is denied, the application for STD benefits should be considered. In such a setting, work comp attorneys in IL will ask for a letter consistent with Rule 7110.70 denying coverage of an accident under work comp to facilitate a claim for STD.
What is Workers’ Comp Insurance/Self-Insurance?
Workers' Compensation insurance protects workers from loss of wages, medical expenses and provides permanency/impairment due to serious work-related accidents and injuries. Work Comp laws are enacted by states and typically managed by state agencies. If an employee is injured while performing his/her job duties, a right to workers' compensation benefits arises. The typical employer purchases workers' compensation insurance from an insurance company, which in turn may adjust claims themselves or hire a TPA or third party administrator that has expert claims staff to decide claim compensability and pays benefits where appropriate. Most workers' comp insurance policies or self-insured programs pay employees approximately 2/3rds of their regular wage, pursuant to state laws, and also pay for all medical bills consistent with medical fee schedules. Work comp benefits typically aren’t income taxable.
Can An Employer Fire a Worker Who is Off Work On Workers’ Comp Benefits?
Again, in simplest terms, yes. Workers' Comp statutes typically do not provide for any job protection or right to job reinstatement upon the employee's release to return to work. Thus, in theory, an injured work may be fired while out of work due to a work-related injury absent FMLA protection. However, Circuit Courts in many states have held that it is illegal to fire an employee because he/she was injured or has filed a work comp claim. An employer doesn’t want to fire the worker for the fact of the injury or for an employee seeking work comp benefits to which they are entitled. If that was allowed to occur, few workers might ever seek such benefits.
In our view, if a company is going to fire someone who has filed a Workers' Compensation claim, they typically want to
· Wait for the running of what we call an “auto-termination” period or
· Wait until the person is released back to work.
Auto-terminations policies come with some challenges. If you fire someone after a six-month or one-year waiting period, you have to fire anyone in the organization who is off for such time. This means if a worker is a hero and saves the lives of hundreds of people but is injured and still off for the auto-term period, you have to fire them! Please also remember if a worker seeks reasonable accommodation under ADA during the auto-term program to allow them to return to work, you have to consider such requests and perhaps hold off termination to adjust to the requested accommodations.
Many employers note that if they fire an employee who is out of work while receiving workers' comp benefits will have the likely effect of prolonging the former employee's recovery period, which in turn has the effect of increasing the company's workers' compensation insurance or self-insurance costs. A similar problem with firing a worker while they are receiving work comp benefits is you can offer light work to bring them back into the workforce more rapidly.
Can an Injured Worker Receive FMLA Leave and Work Comp Benefits at the Same Time?
Another short answer—yes. If it mildly confusing but it is possible to get “unpaid” FMLA leave and paid WC leave simultaneously. FMLA provides another layer of job security, and may be taken when one is required to miss work due to a work-related injury. In our view, employers want workers to exhaust FMLA eligibility while getting TTD or temporary total disability. If you want advice on how to do so, send a reply.
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Synopsis: Consider Rating our IL WC Arbitrators.
Editor’s comment: The IWCC used to work behind a veil and if you didn’t like an outcome, there was no one who cared. We salute current IWCC Chair Joann Fratianni and her team for asking you and everyone involved to rate the IL WC Arbitrators.
We copied and pasted below the link to the Arbitrator Evaluation Survey. Arbitrators are to be rated only on the basis of your personal knowledge. It is possible that you will not be able to rate all of the Arbitrators or answer all of the questions for each arbitrator on the evaluation form.
If you have specific knowledge as to the qualifications of an arbitrator to give a fair, informed opinion as to those qualifications, please respond to the questions for that arbitrator by answering “Y” (Yes) or “N” (No) to the questions asked. If you have no opinion on a particular question, the question should not be answered and will be tabulated as a “No Opinion” response that will not affect the arbitrator’s rating. Specific instructions on form completion and submittal are available on the link.
If you do not have specific knowledge as to the qualifications/actions of a specific Arbitrator please skip that arbitrator and move on to the next Arbitrator. Forms must be submitted to the Commission by next Monday, March 28, 2016.
Synopsis: Is Statutory Notice a Valid “Defense” to IL WC claims?
Editor’s comment: We received this question from a reader and wanted to provide our thoughts. We assure everyone, the “45-day rule” is a valid and vibrant defense in this state. We also feel it works best when you can demonstrate no one in your facility knew of any injury or disability when one is later reported.
The relevant statutory language reads:
“(c) Notice of the accident shall be given to the employer as soon as practicable, but not later than 45 days after the accident. Provided:
(1) In case of the legal disability of the employee or any dependent of a deceased employee who may be entitled to compensation under the provisions of this Act, the limitations of time by this Act provided do not begin to run against such person under legal disability until a guardian has been appointed.
(2) In cases of injuries sustained by exposure to radiological materials or equipment, notice shall be given to the employer within 90 days subsequent to the time that the employee knows or suspects that he has received an excessive dose of radiation.
No defect or inaccuracy of such notice shall be a bar to the maintenance of proceedings on arbitration or otherwise by the employee unless the employer proves that he is unduly prejudiced in such proceedings by such defect or inaccuracy. Notice of the accident shall give the approximate date and place of the accident, if known, and may be given orally or in writing.”
This notice requirement applies to employees who suffer repetitive trauma injuries. Three “D” Discount Store v. Industrial Comm'n (1989). The date of such an accident, from which notice must be given, is the date when the injury “manifests itself.”
Regarding notice, the statutory element of undue prejudice to the employer is pertinent only where some limited notice is given in the first place. The purpose of the notice requirement is to enable the employer to investigate the employee's alleged industrial accident. Seiber v. Industrial Comm'n (1980).
The last Appellate Court ruling on this issue was an affirmance of denial of benefits due to lack of statutory notice in White v. Workers’ Compensation Commission, decided by a unanimous IL Appellate Court, WC Div. in 2007. If you want to review this important decision, it is online at http://caselaw.findlaw.com/il-court-of-appeals/1364752.html
In short, the statutory notice defense remains alive and “works” if your defense counsel knows the rules and follows them. If you don’t feel an accident was reported, one of the best follow-up defense techniques is to pull time sheets or security video of the worker after the event to demonstrate they were able to work without restriction or assistance in the days, weeks and months following the alleged injury.
We appreciate your thoughts and comments. Please post them on our award-winning blog.