11-19-12; Fools Rush In Where Wise Men Fear to Tread--IL WC Voc Rehab May Have Just Changed for the Worse; Shawn Biery on "Suitable Seating" Claims; iRatings for Your IL WC Impairment Ratings and...

Synopsis: Fools Rush In Where Wise Men Fear to Tread—Voc Rehab in IL WC May Have Just Forever Changed for the Worse.

Editor’s comment: We recommend all business observers take a long hard look before you make the decision to appeal WC cases past the Circuit Court level in this state. We are letting our clients know the math on getting a solid defense ruling or even a dissent from an IL WC Appellate panel member are less than one in twenty rulings. In our view, we have to pick our battles very carefully--there is no discernible reason to spend the money to receive an Appellate Court “beat-down” like this one. If things don’t go well in the Circuit Court, adjust around what you have to deal with and make the tough claim decisions. Why have the veteran and knowledgeable Appellate Court justices join together and unanimously “clobber” every single defense issue you raise?

In W.B. Olson, Inc. v. IWCC (No. 11 L 50222, issued November 5, 2012), Claimant was a union construction laborer with a knee injury in 2006. He underwent two knee surgeries and then an unbelievably long period of physical therapy and later work-hardening followed. He later underwent total knee replacement. Claimant underwent two different FCEs that we feel were provided to maximize recovery in this litigation by giving claimant the “golden diagnosis” of permanent restrictions. We also note he was offered clerical work at the company’s headquarters and the treating doctor magically limited his driving to avoid that job and employer accommodation.

In early 2008, the matter was tried on an emergency petition and claimant was awarded 104 weeks of TTD—neither side appealed. Claimant’s counsel then got a voc counselor who met with Claimant and fiddled around for years but never found Claimant work.

On his own, Claimant found a potential job at a trucking company. The problem that arose is Claimant purportedly wasn’t able to get motor vehicle insurance to drive the vehicle because he hadn’t been driving for two of the three prior years. We haven’t heard of that insurance requirement and would love to hear from the insurance brokers among our readers if there is truly such an industry-wide insurance limitation out there. One would have to wonder how anyone might break into the industry with that odd driving/insurance requirement(?).

In late 2009, the employer hired an expert voc rehab counselor and his services were refused at the direction of Claimant’s counsel. Not sure how the employer was barred by the Commission from providing its own voc eval expert at its own cost—there isn’t a Rule or Section of the IL WC Act which precludes it. We will address this issue in further detail below.

In early 2010, the matter was again tried on a 19B petition for TTD. We can’t tell why they had to try it again if benefits were ongoing. After the hearing, another 116 weeks of TTD was awarded. Then the appeals began—the appeals continue to present and, guess what, another 100+ weeks of TTD has to again be pending. We consider it comical/ludicrous/silly to see six-plus years of TTD being paid when this man clearly can do some sort of work and isn’t unemployable. That said, let’s hope the employer, its defense counsel and its TPA/Carrier aren’t going to drag this mess out any longer and take this ruling to the IL Supreme Court and gain even more notoriety.

In summary, this unanimous Appellate Court ruling:

·         Provides Claimant attorneys may unilaterally select and hire the sole voc rehab experts for their clients—in our view, the Arbitrator has to approve it;

·         Provides Claimant attorneys may be able to indiscriminately block IL employers from providing voc rehab counseling at their own expense—again, this is subject to Arbitrator approval;

·         May require IL Employers to pay for the voc counselors selected/hired by Claimant attorneys;

·         Implicitly blocks IL Employers from disputing the length or scope of voc rehab being provided by the expert selected by the Claimant attorney;

·         Implicitly indicates whatever the IWCC does in ruling on voc rehab isn’t appealable—we ask other defense firms to strongly consider/exhaust all other options prior to taking such claims to this appellate panel to reinforce similar rulings.

We dislike every single aspect of this controversial ruling but we caution our issues are not with the members of the IL Appellate Court who simply followed longstanding and well-settled Illinois law. As we outline above, we have no idea why they were even asked to rule. Moving forward, our main problem will be defending such claims after this published ruling before the IL WC Commission and the wildly aggressive Petitioner/Plaintiff lawyers who practice there. We assure our readers this shocking and anti-business ruling may represent a paradigm shift in handling the biggest and most expensive Illinois workers’ compensation claims--“odd-lot” total and permanent disability claims and wage-loss differential claims. Such claims have values starting in the middle six-figures and move rapidly into the middle seven-figures. If there was a goal to cut IL WC costs, this decision doesn’t follow that model. This ruling, in our view, reverses the trend toward even minimal employer control of WC claims and may give complete control to the claimant bar. In our view, this ruling signals exponentially higher IL WC PPD reserves and payouts. We hope someone in the legislature is listening because they are sure to hear moaning and wailing from business leaders about this one.

It is also our opinion there are very questionable ethics present when a Claimant attorney is allowed to select an expert who will undermine the employer’s defenses while forcing the employer to foot the bill for their tormentor. What if the expert charges $5,000 per hour? What if the expert, as happened in this claim, provides never-ending and effectively worthless voc services over several years? There are no cost limitations on voc rehab expert costs in any IL WC fee schedules. There is no stated or recommended duration for voc rehab in any Rule or the IL WC Act. We assume several hundred thousand dollars in TTD/maintenance has been paid in this disastrous claim while this voc expert didn’t get this guy back to work. It is all being left up to the whim of Claimant’s counsel who can continue to get years and years of TTD/maintenance paid by the employer until a giant settlement supplants all of it.

What can we learn from all of this?

v  It is our view voc rehab should be provided much earlier in many IL WC claims. If you have claims where the injured worker is off work and on TTD more than 120 days, we recommend you consider getting a voc plan with your own expert into place. It doesn’t always have to be full voc counseling and job training. Just carefully consider getting a voc plan into place. When you have a voc plan, get together with the other side and bring the plan to the Arbitrator assigned for their guidance. If you move to get voc rehab first, you may be able to get and keep your own expert and not pay to have the other side’s expert shoot your claims/reserves into the heavens.

v  Stop wasting money and time on FCE’s. One of our readers advised this decision stands for the proposition that an IME doctor can’t order an FCE. If you read the decision, it appears the Commission wouldn’t approve a third FCE; we wouldn’t have wasted the time and money on the first two!! We truly don’t care if that is an offshoot of the bigger issues being addressed—we dislike and despise the whole concept of FCEs that are wholly unscientific and many times, silly.

v  In our view, it is very, very rare to see an FCE that provides an unexpected level of work restriction. By that we mean, someone with an operated low back isn’t going to be found to be capable of lifting 100lbs. in an FCE in this state. We assure you we can predict the outcome of most FCE’s and one doesn’t need a crystal ball to do so.

v  Particularly in the construction and trucking industry but in almost all IL WC claims, when the defense side asks for an FCE, it is usually a journey to WC claim disaster. If you aren’t sure, claimants’ counsels love to have the defense industry collectively shoot ourselves in the foot with such “testing.” Claimant counsels very carefully coach claimant on precisely what to do to get the “golden diagnosis” of permanent restrictions.

v  Contact Keefe, Campbell, Biery & Associates and get claims like this audited for free. This is a very significant claim with mid-six-figure exposure. With respect, we feel there may have been numerous mistakes made—we could have provided this employer and its adjusters lots of other options that wouldn’t stall and delay the optimal outcome.

v  Contact Keefe, Campbell, Biery & Associates and get our recommendations for top-notch voc providers who can work with all sides to get folks back to the workforce smoothly or document they aren’t trying.

We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Will California Class Actions Force “Suitable Seating” at Work? Let’s Hope This California Concept Isn’t Coming to a Workplace Near You! Thoughts and analysis from Shawn R. Biery JD, MSCC

Editor’s comment: About four years ago in California, several lawyers came up with the idea to begin lawsuits based upon a decades-old mandate that seats be provided to workers whose jobs do not necessarily require standing. Since 2009 California courts have grappled with a wave of lawsuits and litigation targeting large retailers, groceries and banks for not providing seats to clerks and cashiers. The so-called "suitable seating" cases have yielded conflicting rulings from state and federal courts on class certification and motions for summary judgment. The first trial in a seating class action is starting in San Francisco before U.S. District Judge William Alsup in Garvey v. Kmart, 11-2575. This bench trial will focus on 65 cashiers employed by one Kmart store in the central valley city of Tulare, CA and involves maximum penalties of about $500,000. Judge Alsup is on record indicating he intends to use the case to test the manageability of statewide certification.

The California regulation at issue has been on the books for decades and states in part "all working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats." Even more incentive for the State comes from the recent claims being brought under California's Private Attorney General Act of 2004, or PAGA, which means 75 percent of penalties flow into the CA state treasury for enforcement of employment laws. Prevailing employees are entitled to 25 percent of penalties with attorney fees and costs paid by Defendant employer. Because of these incentives, the lawsuits do not allege damages and instead seek civil penalties established by PAGA of $100 per employee per pay period for a first violation, and $200 per employee per pay period for subsequent violations—THERE IS ALSO NO REQUIREMENT EMPLOYEES PROVE THEY SUFFERED PHYSICAL OR EMOTIONAL HARM!!

Legal observers have noted no state or federal appellate courts appear to have analyzed the language of the rule and whether the work of a cashier or teller can reasonably be performed while seated. From our research it does not appear any court has ruled employers are required to give seats to sales associates or cashiers. A recent San Diego County Superior Court case resulted in a decertification of a class of 15,000 Rite Aid cashiers and clerks, concluding individual analysis of each employee's job responsibilities was preferable to a class action. That Rite Aid ruling referenced a federal judge's termination in May of a similar case against CVS which has been appealed to the U.S. Court of Appeals for the Ninth Circuit.

Judge Alsup is the first federal judge to certify a suitable seating class, finding Kmart had a uniform policy of not providing seats to cashiers in its Tulare store. He also reportedly declined to consider expert testimony from Kmart that some cashiers would be too lazy to stand up to safely lift heavier items and rejected arguments class-action lawyers improperly concocted the lawsuit before they had a single client. In San Jose, U.S. District Judge Edward Davila has followed with an August 2012 order certifying a statewide class of 22,000 Wal-Mart cashiers in a case potentially worth more than $150 million.

There is now a split among District Courts in California, and Wal-Mart has appealed class certification. There is a request to stay proceedings pending a decision from the Ninth Circuit which has not been ruled upon. In a distinct case currently at the Ninth Circuit, U.S. District Judge Manuel Real in Los Angeles dismissed Plaintiffs' claims after finding Bank of America only had an obligation to make seats available to employees to the extent that they want them or request them, not necessarily a legal duty to ensure every employee has a seat, regardless of whether they want one or not. In an amicus curiae brief, lawyers for the California Retailers Association, California Grocers Association and California Chamber of Commerce argued businesses should be able to decide whether an employee sits or stands while on the job.

It appears the upcoming trial will focus on the job duties of a cashier and whether that work reasonably permits the use of seats with ergonomics expert testimony anticipated. Our general advice to clients in all situations where ergonomic issues may arise is to ensure there are written policies regarding work duties and availability of accommodations if necessary which may include providing seating if the job allows and to place seats near employee work areas if necessary. We will keep you updated on developments.

This article was researched and written by Shawn R. Biery JD, MSCC and you can contact him directly with any questions at sbiery@keefe-law.com.

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Synopsis: U.S. WC adjusters should take a look at iRatings for your impairment ratings needs.

Editor’s comment: We met these folks at the National WC Conference in Las Vegas last week and were very impressed. iRatings offers a versatile suite of services aimed at assisting their clients with identifying inaccurate impairment ratings, correcting identified errors and disputing erroneous ratings through litigation or other claims strategies. With this goal, they offer the following services:

ü  Rating Reviews

iRatings will review an impairment rating report and applicable medical records to determine the accuracy of the impairment rating assigned. They will then issue a report identifying any errors found within the rating report, outline the correct methodology under the AMA Guides to the Evaluation of Permanent Impairment and provide a corrected rating. The review and report can be basic, intermediate or complex, based on the nature of the case.

ü  Correspondence

Along with any rating review and report, iRatings can provide the claims examiner or attorney with a letter that can be sent directly to the rating physician. This letter can be used to proactively address the issue of impairment prior to MMI, or can be used to address specific concerns with a rating that has that has already been assigned. iRatings can also respond to correspondence from the rating physician, and can issue addendum reports based on this correspondence.

ü  Consultation

The folks at iRatings want you to know they are here to assist you in obtaining accurate impairment ratings until you have reached full resolution of a claim. This means they are available for email/text/phone consultation prior to depositions or hearings and, if necessary, they can testify as an expert witness at trial or hearing. Through review and consultation, iRatings is committed to ensuring national and regional insurance carriers, third party administrators and employers pay appropriate permanent partial disability benefits based on an accurate impairment rating. The entire team of iRatings is comprised of Certified Impairment Raters with the relevant experience required to maximize their services.

As Illinois WC risk managers and adjusters are new to the impairment rating issue, this could be a very solid source moving forward, particularly if you get into a battle over the accuracy of an impairment rating. Feel free to contact them directly via email to info@iRatings.us or phone: 858-413-RATE, fax: 717-490-7283.

 Synopsis: Welcome aboard, Joseph B. Moore.

Editor’s comment: Keefe, Campbell, Biery & Associates proudly announce the addition of Joe Moore, J.D. to our legal team. Joe is licensed in IL and IN and will focus his practice on defense of folks like you who face the enormous challenge of keeping your company’s costs and reserves low in aggressively defending your workers’ compensation, general liability, employment law and motor vehicle defense. Joe is up for the challenge—feel free to contact him at jmoore@keefe-law.com.

11-12-12; The Day the Republican Party in Illinois Died--What It Means to WC; John Campbell Reviews Religious Discrim Ruling; Sean Brogan analyzes Independent Contractor Claim and much more

Synopsis: The Illinois State Republican Party Died Last Week and is Deader’n a Doornail—What Does It Mean to IL WC?

Editor’s comment: One goal in writing this KCB&A Update for our readers is to remain relatively impartial from the perspective of political parties and politics. We represent government bodies on both sides of the political matrix. Our focus is saving such governments and businesses money in the WC arena. However, we have to call ‘em as we see ‘em, folks. In our view, the evidence is irrefutable. While we aren’t happy at all to see the complete lack of options or the protections a two-party system brings, sometimes you may be better served to face reality and try to adjust.

Chicago has had One Political Party for Years; Now the Whole State of Illinois Does

In taking a bipartisan stance on political issues, we are certain Illinois lost its two-party political situation last week. Most folks know the City of Chicago basically lost any vestige of a two-party system when a crooked Republican political boss named Big Bill Thompson was soundly routed by then-mayoral candidate Anton Cermak. That happened 81 years ago in 1931. Thereafter, Richard J. and Richard M. Daley ascended to the post of Chicago mayor and held the post for about ½ of the 80 or so years of Democrat supremacy in Chicago. Their ascendancy indicates one clear facet or failing of Chicago-style politics that impacts our whole state—our lack of term limits for political posts. Once in power, a smart Illinois politician uses patronage, nepotism, the ability to control government contracts, the capacity to appoint friends/supporters to cushy jobs and control of workers’ compensation/government disability benefits to become entrenched. Once embedded, they can hold the job as long as they like. Please don’t expect the Democrats to bring term limits in to hamstring their potentially unending claim to dominion over this state.

From our perspective, the political disaster that befell the Republican party in Chicago generations ago has expanded to a statewide dilemma—in our view, the Illinois Republican Party is smoked, finis, done, over and out. The Illinois “Blue” team hasn’t just won another election, they have thrown the other “Red” side out with the bathwater. How did we get to this point? Why are we sure of this relatively shocking news?

Well, IL Democrats now completely dominate within numerous voting blocs. It doesn’t take a rocket scientist to notice there were no African-American or Latino candidates slated by the Illinois Republican party and the party did very little to actively woo such voters. Black and Latino voters in Illinois came out and voted overwhelming for Democratic candidates. In a similar vein, many Illinois women voters have long been upset to consider a State Republican party with an open focus on controlling abortion, even in cases of rape and incest. Women voters were stunned to hear impossibly stupid comments on such topics from Republican candidates in other states and vented their dissatisfaction at our polling places. In our view, when Republicans can’t figure out a workable strategy on such an issue that will make women voters happy, voters will figure it out for you. A vast majority of IL women voters, particularly among young women voted Blue. We don’t see that changing any time soon.

The last major group we feel everyone is skipping are “government ghost payrollers.” As we have advised our readers in the past, this group is

·         Almost 800,000 eligible Illinois voters receiving or that will be eligible to receive generous government pensions from the five different poorly funded and almost-broke Illinois state pension plans;

·         Thousands of voters who are receiving lifetime “odd-lot” total and permanent disability benefits from State or City of Chicago governments and their impossibly poorly run WC systems;

·         Thousands of former police and firefighters who are now on lifetime line-of-duty disability pensions for things like runny noses where they can have jobs, run businesses and make money but are still considered “disabled” because their condition no longer allows them to be a police officer or firefighter.

In our view, hundreds of thousands of government ghost payrollers are supporting, donating and voting for one issue—“keep-my-pension/disability/WC-pay-in-place-and-growing.” Political observers are still laughing about Prop. 49, which would have provided such state and local pensions couldn’t be raised without a 3/5’s vote. The proposition failed miserably. We feel this phenomenon demonstrates the power of this heretofore unknown voting bloc. It is our view “government ghost payrollers” raised a campaign fund of about $500,000 and ran a major media blitz designed to let all of us know they don’t want limits on their current and future “rights” for the major taxpayer-paid benefit they receive. IL state pensions go up 3% each year. “Odd-lot” T&P WC benefits get business-funded COLA increases. Don’t expect either rising cost to slow without a major battle or three.

The State of Illinois has been “Gerrymandered” and Will Stay That Way for Ten More Years, Further Blocking a Republican Comeback

Gerrymandering is a practice that locks in a political advantage for a particular party or group by manipulating voting boundaries to create slanted, partisan or incumbent-protected districts. On top of getting slaughtered in double and triple-digits in many defined voting blocs, as we outline above, Illinois State Republicans will struggle with another monster mess for the next ten years—IL State Democrats “took advantage of their advantage” and just redistricted the entire state in their image and likeness. They bolstered Democratic strongholds and combined Republican districts to force Republicans to fight and oust other Republicans. This obvious political manipulation of the state’s election boundaries was attacked in IL state courts. Guess what, IL state judges/justices who have to run for election in the same districts quickly and quietly approved the distorted redistricting that helps them and their supporters stay entrenched. Another aspect of gerrymandering is voters start seeing little chance of their candidates winning and stop voting, making the party in power even stronger. We assure our readers this gerrymandering will insure the State Republican party is decimated and powerless in almost all areas of the state for at least the next decade.

So Where Is Illinois Going? How Will This One-Party Political System Affect Workers’ Comp Claims?

At present, Illinois now has veto-proof Democratic majorities in the state House and Senate. If you aren’t sure, Democratic Governor Pat Quinn just became a figurehead—he can’t stop anything in the legislature as they have the power to overrule him if he doesn’t support a bill. We are sure Senate President John Cullerton and House Speaker Mike Madigan are running things and no one will be able to stop them other than via old age or retirement. Both of them are active, wealthy and healthy men who worked hard to get where they are and appear to want to keep their posts and unsurpassed power.

We are predicting you will see one to three new gambling casinos in Chicago, as Mayor Rahm Emanuel sorely needs the cash for his underfunded City payroll and public school system. The only one who was blocking gambling expansion was Governor Quinn—all he can do now is go on the television and whine about it; he has no power to stop it. The veto session that is starting November 27th has lots of “lame duck” legislators on their last laps; odd and unexpected legislation may happen because outgoing legislators have nothing to lose; they are leaving in January no matter what. Often during lame duck sessions, controversial bills are passed. During 2011’s lame duck session the IL General Assembly passed a 67% income tax hike – the largest tax increase in Illinois history. It is possible an additional tax increase may be passed and all wealthy Illinois citizens are worried state legislators may “occupy” their wallets and savings in the same direction our President is taking to turn around his ballooning and massive federal deficit.

On the workers’ comp front, everyone on the defense side has our fingers crossed Illinois WC reform and progress in cutting costs will stay at the same levels. About two years ago, Senate President Cullerton took an across-the-board review of workers’ comp costs and supported the 2011 reforms that unquestionably trimmed rising costs. As one prominent Plaintiff/Petitioner lawyer put it, “everyone got a haircut” and WC benefits were similarly clipped. The Arbitrators and Commissioners are now very, very professional and most of the defense bar will affirm they are not issuing shocking, pro-Plaintiff/Petitioner rulings and work to be fair to both sides. We are still the fourth-highest WC state in the United States but things have gotten better since the Blagojevich era. That said, we do predict:

·         PPP’s or Preferred Provider Programs are going to be magically and mysteriously tied up in committee for several more years—they were enacted on June 28, 2011 and remain entwined in JCAR or the IL Joint Committee on Administrative Rules 17 months later (if you want our suggestion on what to do about this, send a reply);

·         Impairment ratings will continue to be politely considered but won’t have the impact their proponents wanted in cutting reserves and payouts on permanency;

·         The Illinois Workers’ Compensation Commission’s budget isn’t going to be cut to match the dramatic and continuing drop in new claims;

·         State of Illinois and City of Chicago workers’ comp defense programs will continue to payout hundreds of millions in benefits to political supporters as no one will be able to rein them in.

Whatever happens on the One-Party Political Matrix in Illinois, Keefe, Campbell, Biery & Associates will continue to look out for the interests of Illinois business. If you want thoughts, concepts and strategies to cut your WC, GL, EPLI or MVA budgets and free up reserves, send a reply. We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Employers must be sensitive to the religious practices of employees, but there is a limit to everything. Thoughts from John P. Campbell, Jr., J.D.

Editor’s Comment: We were comforted by this recent decision from our Seventh Federal Circuit, as it reflects a pragmatic and fact-specific analysis of Plaintiff’s claim of religious discrimination. In  Porter v. City of Chicago our U.S. Court of Appeals for the Seventh Circuit found insufficient evidence for Plaintiff to proceed with her claim of religious discrimination, as the employer, City of Chicago, demonstrated sufficient effort to accommodate the request for accommodation.

Plaintiff Porter worked in data entry for the Chicago Police Department. The position required 24hr/7 day per week coverage by those employees, so of course, Sunday shifts were part of the obligation, utilizing rotating and alternating shifts among all assigned workers. Ms. Porter attended Sunday church services regularly and made a prior request for Sundays off. A few years prior to this claim, her request had been accommodated. However, upon her return from FMLA leave, she was placed on a weekend shift which included Sunday work. She again made the request for accommodation for Sunday off, citing her religious obligation. This time however, her supervisor explained she would have to wait for other similarly situated employees to either

(1)  agree to switch shifts or

(2)  for a position to open up on her desired shift schedule.

Also, her supervisor offered to place her on the Sunday afternoon shift, allowing her to attend Sunday morning church services. Ms. Porter was dissatisfied with this offer and her EEOC complaint followed.

Drawing from the legal rule cited in the text of the case:

Title VII prohibits employers from “discriminating against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s race, color, religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a)(1). Title VII defines “religion” as “all aspects of religious observance and practice, as well as belief, unless an employer demonstrates that he is unable to reasonably accommodate to [sic] an employee’s or prospective employee’s religious observance or practice without undue hardship on the conduct of the employer’s business.” Id. § 2000e-(j).These provisions of Title VII prohibit an employer from intentionally discriminating against an employee based on the employee’s religion, and require an employer to make reasonable efforts to accommodate the religious practices of employees unless doing so would cause the employer undue hardship. See Reed v. Great Lakes Cos., 330 F.3d 931, 934-35 (7th Cir. 2003) (citations omitted).

With the affirmation of the summary judgment for the City of Chicago, our Seventh Circuit explained the employer here made a reasonable attempt to accommodate Plaintiff’s request for accommodation, offering an alternate Sunday (afternoon) shift. This shift would have allowed Plaintiff to attend her Sunday services. Also, evidence the supervisor attempted to get co-workers to switch shifts is further evidence a reasonable accommodation was attempted. Plaintiff on the other hand, refused to accept the form of accommodation offered. Therefore, her decision to elect sick leave or vacation days was her own choice, having refused the option to simply work the Sunday afternoon shift.

Although employers may draw solace from the Porter decision, Human Resource directors and managers everywhere should be mindful of similar such requests by employees wishing to meet their religious obligations. As explained in this decision, a routine dismissal of such an employee’s request may very well be met with a valid charge of discrimination unless the employer makes a good faith effort to accommodate. As always, we strongly recommend you document, document, and  document your efforts to accommodate employees if such a scenario should arise.

This article was researched and written by John Campbell, Jr., J.D. Please direct your thoughts and comments to John at jcampbell@keefe-law.com.

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Synopsis: Illinois trucking company unsuccessful in using signed “independent contractor” agreement to establish that status.

Editor’s Comment: We are regularly asked whether an employer or contractor can establish “independent contractor” status and avoid paying WC benefits for an injured worker simply by having a worker sign such an agreement. Our answer is uniformly “no��—you have to look at the bigger picture of the relationship between the two parties. If you truly want anyone providing services for you to be “independent,” make them buy their own WC insurance to protect themselves or assume you are going to have to pay such benefits, if the unfortunate or unforeseen occurs.

In Labuz v. JKC Trucking, both parties appealed an order from the Circuit Court of Cook County which confirmed a decision of the IWCC awarding claimant benefits for neck, back and left shoulder injuries. Among the more pertinent issues on appeal was whether the Circuit Court should have dismissed claimant’s petition for review for lack of subject matter jurisdiction; whether the Circuit Court erred in finding claimant was an employee rather than an independent contractor; and whether the Circuit Court erred in denying penalties and fees against JKC.

JKC argued Claimant failed to effect proper service of the summons related to his petition for review in the Circuit Court as claimant mailed its summons addressed to the Commission generally and not to a particular member of the Commission. Relying on section 19(f) of the Act which notes “[s]ervice upon any member of the Commission or the Secretary or Assistant Secretary thereof shall be service upon the Commission…”, JKC argued the statutory language indicated service on the Commission may be accomplished only by serving a particular Commission Member or the Secretary or Assistant Secretary thereof. Thus, claimant’s general service to the Commission was insufficient to trigger Circuit Court jurisdiction. 

Reading section 19(f) in its entirety, the Appellate Court, Workers’ Compensation Division noted the statutory language immediately following the quoted language goes on to explain service on the Commission is to be effected by mailing notice “to the office of the Commission.” Thus, the Court rejected JKC’s argument reasoning the quoted language in section 19(f) is not a restriction on proper service but an expansion as it mandates service on the named individuals be considered service at the Commission.

The Court also rejected JKC’s independent contractor argument. In so doing, it assigned no weight to the fact Claimant signed a document indicating he was retained as an independent contractor for JKC. Interestingly, JKC was able to successfully argue against penalties and fees based on the same grounds that proved unsuccessful in its argument that claimant was an independent contractor.

While the Appellate Court found there was sufficient evidence to allow a rational trier of fact to conclude Claimant was an employee and not an independent contractor. The Court’s ruling outlined there were reasonable grounds for JKC’s position he was an independent contractor. In addition to the signed document, it was undisputed JKC did not withhold taxes from claimant’s pay checks and there was evidence claimant exercised control over his routes and over which gas stations he used. Thus, JKC’s basis for withholding payment—its argument he was an independent contract and not an employee—was neither unreasonable nor vexatious. 

This article was researched and written by Sean C. Brogan, J.D. He can be reached for questions or comments at sbrogan@keefe-law.com.

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Synopsis: Welcome aboard, Tim O’Gorman.

Editor’s comment: Keefe, Campbell, Biery & Associates proudly announce the addition of Tim O’Gorman, J.D. to our legal team. Last week, Tim was sworn in as an IL lawyer and will focus his practice on defense of folks like you who face the enormous challenge of keeping your company’s costs and reserves low in aggressively defending your workers’ compensation, general liability, employment law and motor vehicle defense. Tim is up for the challenge—feel free to contact him at togorman@keefe-law.com.

11-5-12; Justice John McCullough RIP; Joe D'Amato, JD reviews "intrusion upon seclusion ruling; Matt Ignoffo, JD reviews new WI ruling expanding WC coverage and more

Synopsis: Last week marked the passing of Illinois Appellate Court Justice John J. McCullough.

Editor’s comment: Writing a news article about the passing of this distinguished Justice for a WC business observer and court-watcher is, to say the least, challenging. Justice McCullough proudly served his country in the U.S. Army (1955-57). Following four years in private practice, he was elected county judge in 1962 and Chief Judge of the 11th Judicial Circuit in 1974 and served in that position until his election to the Fourth District Appellate Court in 1984, where he served for the past 28 years.

In addition to his regular judicial duties, Justice McCullough served 22 years on the Workers' Compensation Division of the Illinois Appellate Court and acted as the Presiding Justice of the five-member panel for each of those years. Justice McCullough was the longest serving judge in Illinois history, serving 50 years on the bench.

Our issue with writing about his passing is he was one of the folks who participated in numerous IL WC Appellate Court rulings considered by Illinois business leaders to be anti-business and mildly to wildly pro-labor. At present, we consider current contested WC appellate rulings to have a ratio of 20-1 or higher for Illinois labor. That said, we assure our readers Justice McCullough was professional, business-like and very honest. He was also the leader of a crucially important judicial panel that led the Illinois workers’ compensation system to where it needed lots and lots of reforms to bring it to remain the fourth most expensive WC system for employers in the entire country. It is our hope the next presiding justice of this important Appellate panel steers the members of the Court closer to the mainstream and takes on a focus of fair/reasonable benefits paid to injured workers by cost-conscious Illinois business and government bodies.

For the two decades we have been publishing this Update, KCB&A repeatedly and respectfully criticized the appellate panel Justice McCullough headed for any number of issues we felt were unusual and deserving of comment:

1. This WC appellate panel used to issue many of its decisions in secret. In any ruling of a controversial nature, the Appellate Court, Workers’ Compensation Division could follow Illinois Supreme Court Rule 23 and “non-publish” their rulings, keeping them out of the eyes of the public. Most important, such rulings were kept out of the eyes of the practicing bar. This was supposed to only apply when their ruling was mundane and routine—turns out lots and lots of critically important and lengthy rulings were “non-published.” In our opinion, no one on other side of the bar could tell why or when that might happen.

What the “regulars” or lawyers who practiced at the IWCC a lot learned to do was to quietly pass along the secret rulings to each other to allow them to know what the members of the Appellate Court were thinking when faced with an important situation. We also consider it amusing to see the Illinois State Bar Ass’n would “publish” articles analyzing “non-published” Appellate Court decisions; in our view, such publications would openly contradict the Justices’ determination their ruling was to be kept from “publication.” What is also odd is non-published rulings are now posted on the Appellate Court’s website, making them “published but non-published” rulings!

1. Another odd proclivity of the rules governing the Appellate Court, Workers’ Compensation Division was the members’ singular ability to decide when to make the panel’s rulings “appealable.” If you aren’t sure, the panel continues to have that power, although the Supreme Court rules now require not just one but two of the panel members to certify their ruling for further appeal. We always felt this ability presented was to display a pro-labor bias to the rulings of the panel. What one would see was pro-labor rulings awarding benefits left to be non-appealable by the panel while any defense ruling denying benefits would be certified for further appeal in the hope that our highest Court might reverse. We remain chagrined to remember this Appellate panel didn’t have to certify rulings like Sisbro and Twice Over Clean where they wrote brilliant decisions initially denying benefits. We also will always be amazed to note the panel certified the Interstate Scaffolding v. IWCC ruling for further appeal by our highest Court when the total amount at stake was a mere $5,000 in TTD—cases involving hundreds of thousands of dollars wouldn’t be similarly certified for further appeal.

1. We remain intrigued to recall a lengthy and thoroughly analyzed ruling where the five-member panel decided to issue a “non-published” ruling indicating the decision was somehow routine but all five members of the same Appellate panel certified the same ruling for appeal as critically important for further consideration by our Illinois Supreme Court.

1. Another ruling where Justice McCullough and the appellate panel might be subject to criticism was William G. Ceas & Co. v. Industrial Commission, issued in 1994. The Appellate Court initially issued an initial favorable decision for the defense, resulting in denial of a death claim. For reasons no one may ever know, the members of the Court quickly withdrew it. If you aren’t sure, it is very, very rare for an Appellate Court panel to withdraw a ruling they take the time to vote on, research, write up and then issue for public review. By very, very rare, your editor will assert in more than thirty years of practice and having read literally every published ruling by Justice McCullough’s panel, we can only recall this single ruling where a final decision of the panel was recalled and the majority completely reversed itself. In Ceas, the Court issued a “corrected decision” and a majority of the panel overturned its original denial and awarded full benefits to Petitioner. The only three reasons we can think of for the 180-degree turn around by all the members of the Court would be politics, politics and more politics.

1. Finally, we recall the article written by your editor and Shawn R. Biery, our brilliant law partner in 2008. We analyzed the odd ruling in Smalley Steel Ring where a claimant made a claim for injuries on unquestionably fraudulent grounds—he filed the WC claim in the name of a dead person and the insurance carrier/employer did not learn of the fraud until after the time to appeal had run. The defense side screamed for justice confirming the IL WC Act says the Commission’s ruling is not supposed to be conclusive unless it is issued “in the absence of fraud.” Most observers, including my parents feel it might be fraud to come into court and raise your hand and swear an oath to tell the truth all while using a dead person’s name—do you think that is fraud? Does the legislature have to pass a law stating it is fraud to do so?

The Appellate panel headed by Justice McCullough made the reasoned determination to adhere precisely to the “English language” version of the IL WC Act and allowed the lower court ruling to stand. Shawn and I chronicled how the “English language” was arguably and repeatedly “bent” by our justices in various pro-labor rulings such as Durand, General Tire and Rubber and First Assist. In Smalley Steel Ring, Justice McCullough adhered to a strict construction of the law and wrote “[s]uch deficiencies in the Act should be remedied by the legislature.” With respect to this long-time hearing officer, we feel it would have been easy to openly affirm this august Court and its members shouldn’t have allowed benefits for an unquestioned swindler who clearly had an attorney appear for him, as part and parcel to his unquestioned deceit on the Commission and our courts. With respect to the members of the Court, we wouldn’t metaphorically defer and deflect the duty of dealing with such fraud as the job of the legislature and not the courts.

In closing, we want our readers to understand Justice John McCullough brought his best to the bench every day of his 50-year-career. While we didn’t always agree with him, we remain confident he didn’t always agree with us—that is what creates the need for our judicial system. We had the highest respect for Justice McCullough as performed his sworn duties and handled his post. The lawyers and staff of Keefe, Campbell, Biery & Associates extend our deepest condolences to Justice McCullough’s family and friends across our state.

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Synopsis: Illinois Supreme Court recognizes the tort of “intrusion upon seclusion” and holds an employer liable for acts of an outside private investigator; analysis from Joseph D’Amato, J.D.

Editor’s Comment: We consider this a very important ruling for all Illinois employers and risk managers to be aware of. We are also confident surveillance operatives and investigators across the state should read this case. On October 18, 2012, the Illinois Supreme Court handed down what we believe to be an important decision for Illinois employers who use surveillance to investigate their workers.

In Lawlor v. North American Corporation of Illinois, 2012 IL 112530, issued October 18, 2012, Plaintiff Lawlor filed a claim against Defendant North American Corporation of Illinois (North American) for “intrusion upon seclusion” (more generically known as “invasion of privacy”), alleging her former employer hired investigators to obtain her private phone records.

The ruling indicates in 2005, Plaintiff Lawlor was working as a salesperson for Defendant North American when she accepted a position with Shamrock Companies, a North American competitor. North American became concerned Plaintiff was contacting its customers, possibly violating a non-competition covenant.

In order to investigate whether Plaintiff was communicating with its customers, North American hired a private investigator to obtain her phone records. North American provided the investigative firm with Plaintiff’s phone number, date of birth, social security number and other unique identifiers. The private investigator then engaged in a course of behavior the Court termed “pretexting.” In short, the private investigative firm used the unique identifiers provided to it by North American and pretended to be Lawlor in order to obtain her home phone records from AT&T and her cell phone records from U.S. Cellular. North American then used that information to determine whether Plaintiff had, in fact, contacted its customers.

Plaintiff asserted she “vomited,” suffered “anxiety,” changed her locks and installed an expensive home security system when she learned her phone records were accessed without her authorization. None of these facts were disputed at trial.

Prior to this decision the Illinois Supreme Court had never formally adopted the tort of intrusion upon seclusion, although all five Illinois Appellate districts adopted the theory of liability. In recognizing the tort, the Court adopted the definition given to it by the Restatement (Second) of Torts § 652B (1977). §652B states "One who intentionally intrudes, physically or otherwise, upon the solitude or seclusion of another or his private affairs or concerns, is subject to liability to the other for invasion of his privacy, if the intrusion would be highly offensive to a reasonable person."

North American did not argue Plaintiff’s privacy had not been violated. Rather, North American asserted it could not be held liable for the actions of its private investigative firm, as it was unaware how Plaintiff’s phone records were obtained. Furthermore, North American argued it had no control over the way its investigators obtained the material.

The Illinois Supreme Court agreed there was no direct evidence North American knew exactly how its investigators obtained Plaintiff’s phone records. However, the Court held by providing investigators with non-public information about Plaintiff (including her social security number and other unique identifiers) and asking them to obtain her phone records, a jury could reasonably infer North American was exercising control over the actions of its private investigators, thus creating a principal-agent relationship. As such, the Court reasoned North American could be held vicariously liable for the admittedly tortious actions of its private investigators.

We think this ruling holds important lessons for any Illinois employer utilizing the services of a private investigating firm, lest they face liability for the actions of their investigators.

      Be cognizant of giving out personal and sensitive employee information such as social security numbers and telephone numbers;

      Clearly consult with your investigators as to what types of activities they can lawfully engage in. Although it may seem obvious, make sure your investigators know it is now actionable to impersonate an employee in order to obtain their personal information, as doing so inevitably leads to a clash between your legitimate need for information and an employee’s protected privacy rights and

      Confirm your instructions and discussions with your investigative team in writing. Clear and concise written instructions may help shield you from liability in the event an investigator violates your explicit instructions and unreasonably infringes on the privacy rights of your employees. 

This article was researched and written by Joseph D’Amato, J.D. He can be reached for questions or comments at jdamato@keefe-law.com.

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Synopsis: Watch out employers with Fitness for Duty requirements!!! Wisconsin Appellate Court affirms an award of workers’ compensation benefits to an off-duty police officer injured doing push-ups in his basement.

Editor’s Comment: We consider the theory and ruling in the claim to be shocking and misguided. In a government WC setting, such cases again demonstrate how poorly governments continue to be treated in the WC arena—we assure our readers “global WC coverage” of any injury occurring while off work is going to greatly increase WI WC costs and may cause taxes to rise to pay for the new unexpected costs.

In City of Appleton Police Department v. LIRC and Nofzinger, No. 2011AP2008, Patrol Officer Michael Nofzinger alleged a rotator cuff injury as a result of performing push-ups while off-duty and at his own home. There was no true “accident,” the officer just felt a pull in his shoulder. He argued he was preparing for a mandatory physical fitness test which required him to perform this specific exercise. The Wisconsin WC Commission concluded the injury occurred in the course of Nofzinger’s employment as required by WIS. STAT. §102.03(1)(c).

This section of the Wisconsin Workers’ Compensation Act contains limited guidance regarding what constitutes “service growing out of and incidental to …employment”, but one of the few areas in which the statute provides additional guidance is in reference to an employee’s participation in “well-being” programs, events, or activities:

An employee is not performing service growing out of and incidental to employment while engaging in a program, event, or activity designed to improve the physical wellbeing of the employee, whether or not the program, event, or activity is located on the employer’s premises, if participation in the program, event, or activity is voluntary and the employee receives no compensation for participation.

§102.03(1)(c)3. (emphasis added). The WI Appellate Court noted the logical corollary is an employee is performing services growing out of and incidental to employment if the employee’s injury occurs while participating in a well-being program, event, or activity that is not voluntary or for which the employee is receiving compensation. The Court cited previous case law and noted when the applicability of this section is in question there is a three-part test and the court must ask if:

v  The employee is engaged in an activity designed to improve [the employee’s] physical well-being,

v  [The employee’s] participation is voluntary, and

v  [The employee] receives no compensation for participation.

Only if all three elements are met will the employer prevail. There was no serious dispute element one was satisfied as Office Nofzinger was participating in a well-being program or activity. The issue on appeal involved whether participation was voluntary. The Court upheld the Commission’s decision where it concluded Nofzinger’s push-ups were not voluntary and as such did not address whether he was compensated as all three of the elements must be met for the employer to prevail.

The pertinent facts which were not disputed are as follows:

v  Nofzinger was required to undergo a physical fitness test twice per year;

v  The test included a component measuring how many push-ups he could perform;

v  He received points for each component and a cumulative score;

v  If he failed to maintain an adequate score, he could be subject to disciplinary action; and

v  He was injured while performing a twelfth or thirteenth successive push-up in preparation for one of the tests.

It was held the act of performing push-ups was precisely the type of activity he was required to be tested on and failing to prepare would subject him to discipline. The Court further noted Nofzinger was required to participate in a physical fitness program and it was reasonable to conclude he was complying with this requirement when he was injured.

Please remember the challenge of an “at-home” injury is investigation. In this claim, we do not feel most folks would suffer a rotator cuff tear doing standard push-ups. Risk managers have to carefully investigate and document any claim where the event occurred in the home or away from the workplace.

We find the decision unsettling considering exercising at home or in one’s spare time is something each and every one of us should be doing for our general health. We point to the specific facts of this case and the particular section of the Wisconsin WC Act to hopefully avoid a ripple effect in expanding WC coverage for all injuries which may be found compensable. We assert Officer Nofzinger would make the same claim bowling, playing golf, shooting pool, any off-duty activity where he had a physical problem could possibly be alleged to now be compensable. If you are an employer requiring Fitness for Duty testing you should consider on-duty test preparation time and on-site preparation facilities to limit liability for off-site injuries when preparing for such tests.

This article was researched and written by Matthew Ignoffo, J.D., M.S.C.C. licensed in IL and WI who can be reached at mignoffo@keefe-law.com.

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Synopsis: Welcome aboard, Tim O’Gorman.

Editor’s comment: Keefe, Campbell, Biery & Associates proudly announce the addition of Tim O’Gorman, J.D. to our legal team. Last week, Tim was sworn in as an IL lawyer and will focus his practice on defense of folks like you who face the enormous challenge of keeping your company’s costs and reserves low in aggressively defending your workers’ compensation, general liability, employment law and motor vehicle defense. Tim is up for the challenge—feel free to contact him at togorman@keefe-law.com.