Synopsis: Our Worker Died in the Workplace! What Do We Have to Do?

Editor’s comment: U.S. Bureau of Labor Statistics (BLS) preliminary data show 4,383 workers were killed on the job in 2012, fewer than in 2011 (4,693) and far fewer than in 2008, when there were 5,071 workplace fatalities. The 2012 total represents the second lowest preliminary total since the BLS first started collecting this data in 1992. Experts attribute the significant drop to the poor economy. However, construction industry deaths increased from 738 to 775. We are confident aggressive OSHA enforcement is causing a continued drop in workplace fatalities. While fatalities are dropping, you still need to be prepared, as the Boy Scouts say.

Here is a brief primer on the process of handling workplace fatalities, work-related or not, for risk and safety managers. If you want this article in a PowerPoint format for easy reference, send a reply. If you want help in handling/investigating/reporting/paying out the early, middle or late stages of a workplace fatality, send a reply or see below.

First, get any needed post-mortem attention for Decedent and the workers around him/her. Remember, the workers who saw or “experienced” the event may also bring claims for the sudden and unexpected shock. Consider getting counselors to assist with grieving and mental/physical recovery from the unforeseen event.

Next, once the situation has stabilized, you have to crank up your most thorough accident investigation. If you don’t have a solid accident investigation form/process, send a reply and we will share our documents at no charge. By definition, any fatality is a serious potential claim(s) and generally merits the highest possible level of investigation. You should include

· Statementizing witnesses to include your workers and members of the public who might be in the area;

· Getting the full and detailed story from supervisors;

· Protection/preservation of the site and materials surrounding the worker’s passing including lock-out/tag-out of equipment involved and

· Safeguarding all surveillance/security video of the hours leading up to and after the event. Remember, if you don’t have cameras at your work site, there are still lots of cameras around us—places like banks and schools may have security videos you can ask them to preserve and produce.

When you are investigating something as serious as a fatality, remember you may also want to demonstrate the absence of things that might have caused or contributed to the worker’s passing. You should record the workplace temperature, outside weather if applicable and the lack of emergent circumstances or overtime being worked by decedent or others around him/her. You may need witnesses to prove it was a normal, boring work day if litigation ensues.

When You Are Sure You Have a Complete and Solid Accident Investigation, You Have to Call OSHA.

Federal regs mandate within eight (8) hours after the death of any employee as a result of a work-related incident, you must report the fatality to the Occupational Safety and Health Administration (OSHA). You must report the fatality, inpatient hospitalization, amputation, or loss of an eye using one of the following methods:

· By telephone or in person to the OSHA Area Office that is nearest to the site of the incident.

· By telephone to the OSHA toll-free central telephone number, 1-800-321-OSHA (1-800-321-6742).

· By electronic submission using the reporting application located on OSHA's public Web site at www.osha.gov.

If the OSHA Area Office is closed, under the federal regs, you cannot and should not leave a voicemail message. You must call either their 800 number listed above or use the reporting application located on OSHA's public Web site at www.osha.gov. When you call or use the application, you must give OSHA the following information for each fatality:

· The establishment name;

· The location of the work-related incident;

· The time of the work-related incident;

· The type of reportable event (i.e., fatality, in-patient hospitalization, amputation, or loss of an eye);

· The number of employees who suffered a fatality, in-patient hospitalization, amputation, or loss of an eye;

· The names of the employees who suffered a fatality, in-patient hospitalization, amputation, or loss of an eye;

· Your company’s contact person and his or her phone number; and

· A brief description of the work-related incident.

If the fatality is part of a motor vehicle accident or MVA, you only have to report the fatality if the MVA occurred in a construction work zone. However, even if the MVA occurred on a public street/highway, you have to record it on your OSHA injury/illness records. The same rules apply if the fatality occurred on a commercial or public transportation system.

Please note you still have to report a workplace fatality to OSHA even if the event was an unforeseen from heart attack. If a fatality occurs within thirty (30) days of a work-related incident, you still need to report the passing to OSHA.

If you need assistance at any time in working with OSHA or reporting an event to them, Brad Smith is the KCB&A Defense team leader who regularly deals with OSHA—Brad can be reached 24/7/365 at (312) 756-3714 or bsmith@keefe-law.com.

What Does Your State Require Us To Do/Pay After a Potentially Work-Related Workplace Fatality?

These laws are unique to each state. KCB&A handles only 5 of the 50 states. We strongly recommend you contact our defense team leader for your state if you are dealing with a fatality. You don’t have to hire our team to simply ask questions on how to best handle an undisputed WC death claim—we can guide you through the statutory maze to insure you are properly following the law and paying what is owed to the correct folks.

For IL claims/risk managers, we feel the 2011 Amendments to the IL WC Act made IL WC death benefits higher than what a widow or widower might eventually need. Right now, a beneficiary gets 25 years of death benefits and can receive such benefits even if they remarry over and over again. We suggest legislation be proposed to require the beneficiary of an IL WC death claim to have to return to the IWCC to demonstrate the continuing need for the employer or insurance carrier/TPA to continue to pay the benefit, at an interval of once every ten years or whatever the General Assembly might decide.

Who Do I Call For Legal Assistance on a WC Death Claim in My State?

For Illinois WC Death Claims, you can contact Gene Keefe at 312 907 8226. You can also simply send a reply to this KCB&A Update.

For Wisconsin WC Death Claims, contact Jim Egan at 312-756-3710, office: 312-617-4553, jegan@keefe-law.com or Matt Ignoffo at office: 312-756-3729; cell: 773-992-7030, mignoffo@keefe-law.com

For Michigan WC Death Claims, contact Ellen Keefe-Garner office: 312-756-3716; cell: 734-604-8969; emkeefe@keefe-law.com

For Indiana WC Death Claims, contact Kevin Boyle office: 812-369-7182; cell 312.662.9899; kboyle@keefe-law.com or Pankhuri Parti office 312-756-3746; cell 206-304-0307; pparti@keefe-law.com

For Iowa WC Death Claims, contact Dan Boddicker at 312-756-3721, cell: 312-371-4128, dboddicker@keefe-law.com

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Synopsis: Federal Court Tosses Objections to WC Retaliatory Discharge Claim Due to WC Cause of Action Fraudulently Pled.

Editor’s comment: One of the problems of defending U.S. business in southern IL is the hyper-liberal and Plaintiff-driven circuit courts. These courts are not called “litigation hellholes” without reason. One of the best defense tactics in handling such litigation is to get the claim out of state court and into the federal court via “removal” to the federal Southern District of Illinois when/where possible.

In Faarup v. WW Transport, Inc., Plaintiff Faarup sued Defendant W.W. Transport, Inc. (WWTI) in state court for wrongful discharge in retaliation for filing a workers’ compensation claim under the Illinois Workers' Compensation Act (IWCA), as well as pleading two separate causes of action under the IWCA. Defendant WWTI removed the state action to federal court. WWTI is based in West Burlington, IA and does the normal hauling of flatbed and heavy haul type business, but also specializes in its award winning food grade bulk hauling - both liquid and dry bulk, as well as having a refrigeration division

In considering the objections to removal, the federal court issued an order to show cause why the court should not remand the case to state court, since Faarup had ostensibly pled a cause of action under IWCA and, pursuant to 28 U.S.C. §1445(c), workers' compensation claims are arguably “non-removable.”

WWTI responded that counts I and II, claims for wrongful discharge in retaliation for filing a workers' compensation claim, were removable claims, as the law is clear a claim of retaliation for the exercise of rights under the IL WC Act does not arise under the IWCA but under general tort law. Therefore, if the claim was non-removable under §1445(c), it was because Counts III and IV of the complaint alleged causes of action for refusal to provide workers' compensation benefits. WWTI appropriately responded the court should disregard Counts III and IV because Plaintiff Faarup fraudulently pled those causes of action to avoid removal. WWTI pointed out there was no such civial cause of action in state court for refusal to pay workers' compensation benefits. Instead, the Illinois Workers' Compensation Commission had exclusive jurisdiction to decide whether workers' compensation benefits should be awarded, and Illinois courts are limited to appellate review of those administrative decisions.

Plaintiff Faarup maintained Counts III and IV were properly pled because WWTI failed to comply under its duties and responsibilities consistent with the IL WC Act. The federal district court found Counts III and IV were frivolous because they had no basis in law and served only to frustrate federal jurisdiction. The court held both Counts had been fraudulently pled and disregarded them for the purposes of determining whether removal to the federal district court was proper.

The federal court discharged the order to show cause, dismissed Plaintiff Faarup’s Counts III and IV without prejudice as fraudulently pled, and held removal was proper. The federal court also gave the parties 21 days to update and re-file their state court motions, if appropriate, citing appropriate federal standards and authority.

We strongly agree with this outcome. The ruling can be located online at https://docs.justia.com/cases/federal/district-courts/illinois/ilsdce/3:2015cv00114/69909/17.

Our research also indicates while the claim above was pending, Plaintiff received over $100,000 in several IL WC settlements. The employer should have known what they were getting into when they hired this litigious worker. Do you know how to legally protect your company from repeat claimants? If you are interested, send a reply.

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Synopsis: Paying IL WC Benefits May Not Protect an Employer From A Civil Action Even If “Umbrella” Approach Used. Thoughts and Analysis by Pankhuri K. Parti, JD.

Editor’s comment: In a decision reversing the lower court’s granting of summary judgment, the IL Appellate Court remanded the case for further proceedings based on its decision finding the evidence presented was insufficient to establish a legal obligation to pay workers’ compensation benefits on the part of Defendant. We believe this to be an anti-business outcome because the IL Appellate Court explained the IL WC Act only confers Section 5(a) immunity to direct employers of injured workers and makes no provision for a corporate entity legally distinct from the employer to unilaterally insulate itself against liability for negligence, especially if the actual employer was self-insured and the separate entity could make reimbursement decisions on a case-by-case basis.

In Burge v. Exelon Generation Company, LLC, Plaintiff Burge was a security guard employed by Exelon Nuclear Security or ENS. He was injured and filed a WC claim against Exelon Nuclear Security, his direct employer. He received $180K from that WC settlement.

He sued Exelon Generation Company or EGC for the same injuries and his civil claim was dismissed. He appealed an order from the Circuit Court granting Defendant Exelon Generation Company’s motion for summary judgment. In its motion, Defendant EGC successfully argued Plaintiffs’ exclusive remedy was under the Workers’ Compensation Act and thus their civil case against Defendant EGS was barred by Section 5(a) of the IL WC Act. It was undisputed Plaintiff Burge sustained injuries arising out of and in the course of employment with ENS, which provided security services on Defendant’s premises pursuant to a contract. It was also undisputed Plaintiff filed and settled a workers’ compensation claim against Exelon.

In reaching its decision the IL Appellate Court explained under Section 1(a)(3) of the Act, an employer was liable to pay compensation to its own immediate employees and also to the employees of any contractor or sub-contractor, unless the contractor or subcontractor already had workers’ compensation insurance. As Defendant engaged ENS as a contractor, it argued it was thus the employer who paid the workers’ compensation benefits for Plaintiff Burge. Thus pursuant to Section 5(a) of the IL WC Act Plaintiffs could not maintain a common law action against Defendant. In support of this contention Defendant submitted an affidavit from Christine Wendt, who was the workers’ compensation manager for Exelon. The affidavit stated she oversaw the entire Exelon-related system of workers’ compensation benefits and Defendant used a third-party administrator for workers’ compensation benefits and paid all monies for the Exelon account made to or on behalf of Plaintiff. Ms. Wendt also stated Defendant did so because it was obligated under the IL WC Act to pay for the workers’ compensation benefits for any and all employees of Exelon. Essentially Defendant’s argument was because they had reimbursed ENS for workers’ compensation payments for all Exelon employees, including Plaintiff, and because it had authority to manage Exelon’s affairs, EGC was essentially cloaked with the same immunity as ENS. In a supplemental affidavit Ms. Wendt further stated Exelon was self-insured and through the LLC agreement Defendant paid workers’ compensation benefits of any/all Exelon employees on a reimbursement basis. In our view, Ms. Wendt’s affidavit was intended to cloak their WC responsibilities as an umbrella—the Appellate Court apparently didn’t follow their approach in a fashion with which we disagree.

The Court quickly dismissed one of the arguments of Defendant stating while section 5(a) of the Act did bar lawsuits against an employer’s agent, the facts present before the Court clearly established this corporate Defendant was not ENS’s agent. According to the Court, there was nothing in the LLC agreement which gave ENS any right to “control” Defendant EGC. In fact, the Court’s members felt the opposite appeared to be true.

In determining the next question of whether Defendant EGC was saved via immunity granted by section 5(a) of the IL WC Act because it paid Plaintiff’s workers’ compensation settlement, the Court looked at the precedent of Forsythe v. Clark USA, Inc. and Ioerger v. Halverson Construction Co. The Court explained Defendant in Forsythe was not granted immunity under section 5(a) of the Act even though the employer involved was a wholly owned subsidiary of Defendant. Defendant in that case argued it was merely a holding company and thus owed no duty to the employees of its subsidiary. The Supreme Court of Illinois held when there was evidence sufficient to prove a parent company mandated an overall business and budgetary strategy and carried that strategy out by its own specific direction or authorization, surpassing the control exercised as a normal incident of ownership in disregard for the interests of the subsidiary, then the parent company could face civil liability. In essence, the Court explained in order to avoid liability the holding company was asking to be treated like the injured workers’ employer and thus Defendant was asking to “pierce its own veil.” This practice has been consistently discouraged by the Illinois courts because while on the one hand the employer was asserting it owed no duty because it was just a shareholder, at the same time it was also attempting to invoke the Act’s grant of immunity by characterizing itself as an injured employees’ employer.

On the other hand, in Ioerger the Court held a joint venture was entitled to Section 5(a) immunity from liability for injuries to employees of one of the two corporations engaged in the joint venture. While stating the joint venture was entitled to immunity under the agency relationship, the Court also explained the joint venture should also enjoy immunity because it was obligated under the joint venture agreement to pay workers’ compensation for the employees of both corporations. The Court further explained while allowing a party who had paid nothing toward an injured employee’s workers’ compensation benefits to nevertheless invoke the Act’s immunity and escape tort liability was tantamount to allowing the party to “have its cake and eat it too,” subjecting a party to tort liability when it has already borne the cost of the injured employee’s workers’ compensation benefits would be the same as declaring a party who had paid for “the cake” may neither keep it or eat it.

In reaching its decision the IL Appellate Court, in the present case, agreed with Plaintiff the grant of immunity to an entity different from the direct employer of the injured employee in Ioerger depended on the existence of some pre-existing legal obligation to pay or reimburse another payer. The Court ruled the IL WC Act had no provisions for an entity legally different from the employer to unilaterally insulate itself against liability for negligence and allowing such an entity to do so would become particularly problematic where the employer is self-insured and a separate entity could thus make reimbursement decisions on a case by case basis.

In the end the Appellate Court reversed the grant of summary judgment ruling immunity under Section 5(a) of the Act could not be predicated on Defendant’s payment of workers’ compensation benefits unless Defendant was under some legal obligation to pay. And because evidence until this point had not sufficiently established a legal obligation on the part of Defendant EGC to pay workers’ compensation benefits for Plaintiff’s injuries, the grant of summary judgment was premature.

This article was researched and written by Pankhuri K. Parti, JD. You can reach Pankhuri 24/7/365 for questions about WC at pparti@keefe-law.com.

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Synopsis: Richard “Rick” Kimnach, 62 of Bloomfield, IN, passed away last Saturday July 25, 2015 at his home. The entire IL WC community hopes he will rest in peace. His memory as a quiet and hard-working man will continue.

Editor’s comment: Rick was a defense competitor of our firm and also a very solid advocate for his clients, as both a Petitioner and Respondent lawyer. Rick was born on February 4, 1953 in Needham, MA, the son on Donald and Nancy Sitgreaves Kimnach. Rick was a 1971 graduate of Watseka Community High School. He graduated from the University of Illinois in 1975. In 1980, Rick received his Juris Doctor from Loyola University in Chicago.

Rick actively practiced law in Chicago for 30 years specializing in the area of workers’ compensation. He was admitted to the Illinois Supreme Court in 1980 and the U.S. Supreme Court in 2005. In 2014, Rick earned AV Preeminent status, the highest possible rating in both legal ability and ethical standards by Martindale-Hubbell. Rick remained a true Cubs and Bears fan.

Memorials may be made to Richland Twp. Fire Department or Southern Care Hospice.

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Synopsis: If You Handle IL WC Claims, the WC Rates are Updated again So Get the Updated Version of Shawn R. Biery’s IL WC Rate Sheet.

Editor’s comment: The new IL WC minimums and maximums have been posted and our updated KCB&A IL WC Rate Sheet is now available via email or snail mail if you prefer the fancy laminated version. We note IL WC rates continue to increase based upon the reported increase in the statewide average weekly wage or SAWW and the increase was more significant than the WC rate increase last July.

The reality on the streets still doesn’t seem to match the hefty increase however as noted in the past, since the 1980’s, the IL WC Act provides a formula which effectively insures no matter how poor the IL economy is doing, your WC minimum rates somehow keep climbing.

We caution our readers to pay attention to the fact the IL WC statutory maximum PPD rate is now updated too—the new MAX is $749.06!! The new PPD max rate becomes retroactively effective on July 1, 2015. You have to retroactively change reserves on all claims. If this isn’t clear, send a reply or email IL WC rate wiz, Shawn R. Biery at sbiery@keefe-law.com.

The current TTD weekly maximum is $1,379.73. A worker has to make over $2,069.60 per week or $107,619.20 per year to hit the new IL WC maximum TTD rate.

The new IL WC minimum death benefit is 25 years of compensation or $517.40 per week x 52 weeks in a year x 25 years or $672,620.00! The new maximum IL WC death benefit is $1,379.73 times 52 weeks times 25 years or a lofty $1,793,649.00 plus burial expense benefits of $8,000. These numbers make it very important to keep your workplace safe and free from hazards.

The best way to make sense of all of this is to get Shawn Biery’s awesome and easy-to-understand IL WC Rate Sheet. If you want one, they are free so simply reply or email Shawn at sbiery@keefe-law.com and we will send it along.

If you would like fancy/shiny laminated copies, copy Marissa at mpatel@keefe-law.com and let her know the number of copies and your MAILING ADDRESS!

KCBA Blog

8-3-15; A Worker Died in Our Workplace! What Do We Do?; USDC Tosses Removal Petition Due to WC Counts Fraudulently Pled; Third Party Liability Might Remain Even if "Umbrella" Approach Used and more