5-12-2014; Make WC Settlements With MSA's Crystal-Clear; Recent Federal Ruling Reaffirms Need for a Drug and Alcohol-Free Workplace; Retraction/Thoughts about Last Week's Article and much more

Synopsis: All Sides in a WC Settlement Need to Make MSA Settlement Language Crystal-Clear or It May Be “Unsettling.”

Editor’s comment: We consider this article required reading for all claims adjusters, risk managers, defense lawyers, WC hearing officers across the country. In Paluch v. United Parcel Service, Inc., the IL Appellate Court reversed and remanded a claim finding the workers' compensation settlement agreement was ambiguous as to total amount employer owed to employee. The unanimous Appellate Court remanded the case for an evidentiary hearing as to what the settlement might actually be. It appears the six-figure settlementagreement was unclear, ambiguous, contained conflicting clauses and was open to more than one interpretation.

Following contract approval, the employer and its carrier interpreted the agreement as requiring a single lump-sum payment of $400,000 for both the WC settlement and Medicare Set-Aside amount. In contrast, the employee and his attorney interpreted the agreement as requiring a lump-sum payment of $400,000, in addition to separate payment of a Medicare Set-Aside, in annuity form. The amount in dispute is an additional $181,580.96. Ouch.

The agreement states:

Respondent agrees to pay and Petitioner agrees to accept $400,000.00 in a lump sum plus payment of a Medicare Set-Aside (MSA), in annuity form, in full and final settlement of all claims for benefits past, present and future based on injuries arising out of an accident on or about July 11, 2006. This settlement represents as a compromise of wage differential benefits in the amount of $218,419.04 under Section 8(d)(1) of the Workers' Compensation Act, plus funding of an MSA in the amount of $148,790.00, direct reimbursement of BCBS lien in the amount of $31,135.82 and direct reimbursement of AETNA lien in the amount of $1,655.14. Respondent will pay all necessary and related medical expenses pursuant to the fee schedule or negotiated rate, whichever is less, that have been submitted to Respondent prior to contract approval and that contain all the required data elements necessary to adjudicate the bills pursuant to Section 8.2(d). Petitioner is responsible for payment of any and all medical expenses not submitted prior to contract approval. Petitioner hereby foregoes any right to review or reopen the settlement and agrees that all rights under Section 8(a) and 19(h) are expressly waived unless otherwise retained under the terms of this contract. The parties have taken Medicare’s interests into consideration and included with this settlement is a proposed MSA with initial funding of $106,650.00 and an annuity providing $3,329.87 per year continuing for life for a total proposed MSA of $148,790.00. The MSA shall be submitted to CMS for approval. Should CMS determine the MSA to be insufficient, the Respondent reserves the right to appeal the decision, and Respondent agrees to either modify the MSA consistent with CMS recommendations or elect to allow Petitioner to retain his medical rights under Section 8(a). If the MSA is approved, then petitioner’s rights under section 8(a) will cease upon funding of the MSA and the matter will be finalized with no futher [sic] activity necessary at the Commission.

The next paragraph states:

·         Total Amount of Settlement

$400,000.00

·         Deduction: Attorney's Fees

$43,600.00 reduced from $80,000.00

·         Deduction: Medical reports, X-rays

$2,611.84

·         Deduction: Other (explain)

$[blank]

·         Amount employee will receive

$353,788.16

There were arguments going in both directions outlined in the Appellate Court’s well-reasoned ruling. We note it is unusual but not impossible for a Plaintiff-Petitioner attorney to take a legal fee on the Medicare Set-Aside value—stating the attorney fee was reduced from $80K should indicate the employee was intended to receive $400K as a compromise of permanency. We also note there was Social Security spread language calculated on the amount the “employee will receive”—we agree with the trial court, it would be inconsistent to consider the MSA value as part of the spread language. We have no idea what the eventual facts will bear out or what the outcome will be. We are certain the defense side is expending legal fees they didn’t plan on expending and Petitioner/Plaintiff counsel is spending legal time they aren’t going to get any more money for. While we don’t know for sure, we can’t imagine Petitioner Paluch is happy about any of it.

Our message to our readers and clients who are handling such claims is patent—we have several MSCC certified attorneys at Keefe, Campbell, Biery & Associates, including our name-partner Shawn R. Biery. As you can see from this ruling, it is crucially important to have settlement language be crystal clear or you won’t have a settlement and may continue to waste time and money to litigate such “unsettling” claims moving forward. Before you go ahead with a workers’ comp claim settlement involving an MSA consider having us take a rapid look at it to insure you are doing precisely what you intend to do.

We appreciate your thoughts and comments. Please post them on our award-winning blog. For MSA issues, you can reach our experts Shawn R. Biery at sbiery@keefe-law.com and Matt Ignoffo at mignoffo@keefe-law.com.

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Synopsis: Recent Federal Ruling Points the Way Toward Testing for Alcohol, Opioid and Medical Marijuana Issues in Your Workplace.

Editor’s comment: U.S. employers can demand drug and alcohol testing and win dismissal of retaliatory discharge claims when your drug and alcohol-free policy is applied in a non-discriminatory fashion. In Phillips v. Continental Tire The Americas, LLC, the United States Court of Appeals for the Seventh Circuit reviewed the following facts. Plaintiff Phillips sued Continental Tire alleging the employer retaliated against him for seeking workers’ compensation benefits. The employer has a tire manufacturing facility in Mt. Vernon, Illinois where Petitioner worked for 22 years. The employer also had a local medical facility to provide medical services to sick or injured workers.

Continental Tire had a comprehensive written drug and alcohol-free policy that covered:

•      Drug testing for pre-employment testing,

•      Random drug testing for the first 12 months of employment,

•      For-cause drug and alcohol testing,

•      OSHA recordable accidents,

•      Transportable injuries,

•      Serious equipment/property damage incidents; and

•      Mandatory testing whenever a workers’ compensation claim was reported.

The employer’s policy provided refusal to submit to drug and alcohol testing was cause for immediate suspension pending termination. According to their policy, an injured employee could receive needed medical treatment in the medical services facility and return to work without taking a drug test if the employee did not seek to initiate a workers’ compensation claim and if the situation causing the need for medical care did not fall within one of the other categories listed above.

In Phillips v. Continental Tire, Plaintiff presented to the company’s medical services facility complaining his fingers were going numb at work and outlined his intention to make a workers’ compensation claim for that problem. Consistent with company policy, Petitioner was advised he had to submit to a drug test before he could initiate a workers’ compensation claim. Petitioner was also advised if he failed to submit to a test, his employment would be terminated. Petitioner refused and was terminated. Petitioner filed a workers’ compensation claim which appears to have been later settled for 20% of the left arm, based on our research. We consider it odd to see such a settlement that didn’t incorporate closure of the expensive Federal litigation, as we would have recommended.

The Federal Appellate Court acknowledged Illinois substantive law recognizes a cause of action for retaliatory discharge where an employee is terminated because of actual or anticipated exercise of workers’ compensation rights. In order to establish a retaliatory discharge claim, Plaintiff in such a case must prove they exercised a right pursuant to the Workers’ Compensation Act and was discharged for reasons related to the filing/prosecution of the workers’ compensation claim. The Federal Appeals Court found Plaintiff failed to show his discharge was causally related to the exercise of a protected right as causation requires more than a coincidental discharge in connection with filing a workers’ compensation claim.

In this record, it appears the parties stipulated the employer terminated Plaintiff solely because he refused to take a drug test upon initiation of a workers’ compensation claim. It was also established the employer consistently applied its drug and alcohol testing policy. They were able to demonstrate they had discharged other employees who refused to submit to drug testing. The Court also noted other employees had initiated workers’ compensation claims in the past, had participated in testing and had not been similarly discharged. The decision also confirms Plaintiff admitted if he had taken the drug test and passed, he would not have been terminated.

The Federal Appellate Court also noted the recent enactment in year 2011 of Section 11 of the Illinois Workers’ Compensation Act which created a rebuttable presumption the employee was intoxicated and intoxication was the proximate cause of the employee’s injury if the employee refused to submit to drug or alcohol testing. The Court’s august members noted this recent legislation further demonstrated an IL employer was not out of step with public policy by requiring drug testing under certain circumstances.

The Federal Appellate Court was also confirmed drug and alcohol testing in employment was not against Illinois public policy. The Court confirmed this position by referencing the Compassionate Use of Medical Cannabis Pilot Program Act which provides nothing shall prohibit an employer from enforcing a policy concerning drug testing provided the policy is applied in a nondiscriminatory manner.

This important federal decision affirms U.S. employers’ rights to drug and alcohol testing and confirms such on-the-job testing is not against public policy. Based on this decision and recent legislation, employers in Illinois should implement drug and alcohol testing assuming it is applied across-the-board and in a nondiscriminatory manner. Our concern about medical marijuana and the use of any opioid or alcohol in the workplace is simple—don’t wait for the first “Denver Brownie” user to cross your threshold before starting a drug and alcohol-free workplace program. If you wait, there is a much higher chance that person might sue you. Keefe, Campbell, Biery & Associates has a draft drug and alcohol-free program you can start with—we have great lawyers who can help you finalize it. All you need to do is send a reply and ask and we will send it right back!

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

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Synopsis: We Retract One Sentence from Last Week’s KCB&A Update and Give Our Readers Some Additional Thoughts.

Editor’s comment: Last week, we reviewed an IL WC Arbitrator’s ruling in Perkins v. Turner Industries Group #09 WC  44791. We included this sentence: “If he isn’t finding work, it is because he is being coached on how to avoid work.” We have to retract and apologize for that comment, as we have no true idea if Petitioner was coached on how to avoid work. Please accept this as our apology and retraction of the statement.

As to the rest of this ruling we provide these opinions based on the facts we reviewed in the decision:

•      Petitioner is a union carpenter who had shoulder surgery;

•      He was released some time ago with a 50lb. or 53lb. lifting restriction;

•      In our view, there is ample work in the larger labor market around his home for a person with that background and training—as we indicated last week, “there is work at hardware stores, retail, coffee shops, gas stations, car lots etc. and we find there to be something wrong with a system that can find such an individual truly unemployable.”

•      The Americans with Disabilities Act requires almost any U.S. employer to reasonably accommodate such a worker in returning them to the workforce;

•      Petitioner was provided job placement assistance from April 2011 to January 2013—in our view, no claims adjuster should allow voc rehab to continue that long. To do so actually is contrary to your needs/interests and tends to prove unemployability. We are happy to consult with risk managers and adjusters on optimal use of voc rehab providers;

•      The Arbitrator assigned to the matter is one of the top veteran Arbitrators in Illinois and, in our view, is honest, fair and beyond reproach—that said, we respectfully disagree with his finding this man suffered life-changing injuries, is unemployable and is entitled to lifetime benefits as if he were;

•      The term “odd lot” total and permanent disability was created by the Illinois Courts and is legally indefinable because the term “odd lot” doesn’t appear in our IL WC Act. The “odd lot” can be whatever you want it to be—in short, if this man were required by the Arbitrator to return to work, it is our reasoned legal view he would do so and Respondent wouldn’t have to pay an otherwise healthy man several million dollars if this ruling isn’t reversed;

•      One nagging issue about the lack of new construction in Illinois is many construction workers with less-than-life-changing injuries are uniformly seeking very expensive wage loss differential and total-and-permanent disability awards. We have one construction client where literally every claimant is making such a claim.

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

4-28-2014; SB 3287 Redux--What is a Safety Consultant Under the New Proposed Law?; The Wolf of Wall Street Rocks RIMS; Tough Subro Test Question and much more

Synopsis: What is a Safety Consultant Under the New Proposed Law? Will the Entire Claims Industry be on the Hook if SB 3287 Becomes IL Law??

Editor’s comment: Following up on our lead article of last week, we received a large number of inquiries about this new law that has already been passed by the IL Senate and is now pending in the House. We understand it has been referred to committee.

By way of history, on February 14, 2014, Illinois Senator Kwame Raoul introduced Senate Bill 3287, which is proposed legislation amending Section 5 of the IL WC Act and seeks to remove an existing exception in the Workers' Compensation Act providing statutory immunity to outside “safety consultants and service providers” for personal injury claims allegedly stemming or resulting from negligent services provided by those service providers. A link to the full text of the bill is here

http://www.ilga.gov/legislation/fulltext.asp?DocName=&SessionId=85&GA=98&DocTypeId=SB&DocNum=3287&GAID=12&LegID=80445&SpecSess=&Session 

Under current law, if an employee is injured at work and files suit to pursue recovery for his/her injuries from their employer’s outside safety consultant, the outside safety consultant is immune from liability for that claim. Under the proposed legislation, the outside safety consultant would not be immune from liability for that claim, and could be held liable to the injured employee/plaintiff for any judgment rendered against it. The unquestioned impact of the legislation, assuming it passes, will be significantly increased insurance costs for outside safety consultants, and increased safety service and insurance costs for their clients.

As we advised last week, the legislation is being pursued by the Illinois Trial Lawyers Association (i.e. plaintiffs/personal injury lawyers), one of the best funded lobbying forces in Illinois. As outlined above, they are pursuing the legislation because it will allow them the opportunity to pursue civil litigation against an employer’s outside safety consultant for virtually any injury sustained by that employer’s employees.

Please note the important changes to the IL WC Act are underlined:

Sec. 5.  (a) No common law or statutory right to recover damages from the employer, his insurer, his broker, any service organization that is wholly owned by the employer, his insurer or his broker and that provides safety service, advice or recommendations for the employer or the agents or employees of any of them for injury or death sustained by any employee while engaged in the line of his duty as such employee, other than the compensation herein provided, is available to any employee who is covered by the provisions of this Act, to any one wholly partially dependent upon him, the legal representatives of his estate, or any one otherwise entitled to recover damages for such injury.

We are forecasting two major issues for the Illinois claims industry to contemplate in relation to this new bill. First, we assure all of our readers if this bill becomes law and there is a major loss/injury involving death, paralysis or amputation in your workplace, you are certain to see circuit court litigation initiated to allow discovery. The discovery requests are going to routine and will ask risk and safety managers for the names and contact information of anyone who might have provided any safety service, advice or recommendations for your company in the last five years. You are going to have to answer them under oath or be subject to the contempt powers of the Circuit Court judge.

The second major issue to contemplate is trying to define what “safety service, advice or recommendations” might be and who provides it? In our view, such “safety service, advice or recommendations” can be provided to your company by:

·         Your insurance broker;

·         Your insurance carrier/TPA;

·         Your outside safety consultants;

·         Safety trainers;

·         The folks who design, maintain or update machinery or processes used in your business;

·         Treating doctors;

·         Physical and occupational therapists;

·         Nurse case managers;

·         FCE evaluators;

·         IME doctors;

·         CRC’s or certified vocational counselors;

·         Defense attorneys; and

·         Arbitrators/Commissioners at the IWCC.

All of these system participants can arguably be viewed as providing “safety service, advice or recommendations” to IL employers. Isn’t that what we all do? We are all monitoring injured workers/claims and making recommendations on how to smoothly and safely bring them back to work—what if they suffer a breakdown and our “safety advice” on return to work is arguably flawed? Solid human resources, safety, claims and risk managers ask all of us questions and learn from work injuries and modify their processes in light of all the advice they receive—now all of that advice may cause liability for these many component providers.

Have We Revived the Old Scaffold Act in a Much Expanded Form?

In our reasoned legal view, this new bill is going to be a new and improved Scaffold Act. If you don’t remember, the old Illinois Scaffold Act basically made any injury on a construction site a valid common law claim. What ITLA members would do is to sue every business on the site and the various companies would either settle for short money or complete discovery and then file motions for summary judgment to get out of the claim. All of that effort was wasted money and anti-competitive.

What may be coming to an IL Circuit Court near you is a similar situation where anyone who can arguably be responsible for “safety advice” is going to be sued and will then have to either get out for short money or slog through discovery to file a motion for summary disposition.

Illinois also now has a Last Person Standing rule where if everyone else settles and you are stuck as the last Defendant, you can be liable for the entire jury verdict. Again, this ITLA-sponsored concept is going to make this new law a major challenge for our industry to deal with.

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

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Synopsis: Hello From RIMS in Denver—the Highlight of the Party is Jordan Belfort, the Actual Wolf of Wall Street!

Editor’s comment: For the very first time, the U.S. risk/claims community gathered in the Mile High City to experience RIMS 2014 Annual Conference & Exhibition. This industry-leading event features three days of world-class educational sessions, inspiring keynote speakers and an energetic and resourceful Exhibit Hall. The weather is cold and windy but the conference is rocking.

Of the keynote speakers, the one with the most buzz is Jordan Belfort, who was the author of his autobiography, The Wolf of Wall Street. The book outlines his incredible rise from dental school drop-out to head of a billion-dollar stockbroking firm. His personal and financial excesses became the stuff of legend. He crashed multi-million-pound yachts and helicopters and spent millions more on illegal drugs. Chased by the FBI for years, Belfort eluded the law until 1998 when his firm, Stratton Oakmont, was closed down. In 2003 he was jailed for 22 months for securities fraud.

In prison he got clean, wrote his best-selling memoir and now makes a living out of motivational  speeches as well as helping the FBI investigate financial crimes. The 51-year-old father of two claims to be “above reproach” although the US government is still pursuing him, saying the millions he has made from the book and movie rights should go to the thousands of investors he fleeced. Stratton Oakmont specialized in low-cost shares, around $5 to $10, that were generally overlooked by the established Wall Street firms and the financial authorities. What Belfort’s unwitting investors didn’t realize was that he was using their small sums to make millions for himself.

He developed what became known as a “pump and dump” system. He would persuade friends and relatives to act as “rat holes” for him — they would buy stock in their name but using his money, thereby restricting the supply and boosting the share price.

His employees, at one point numbering more than 1,000 — would then sell the shares at the top of the market. The overhyped shares would soon drop in value, leaving investors with huge losses but Stratton Oakmont and Belfort with huge gains. His presentation was clearly a hit.

Next year the RIMS 2015 Annual Conference & Exhibition will be on April 26-29 at the New Orleans Ernest N. Morial Convention Center in New Orleans, LA. The attorneys of KCB&A hope to see you there.

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Synopsis: Here is a tough subrogation test question for our readers to consider. $25 gift certificate for the first correct answer from a claims adjuster or risk manager. If any Arbitrator or Commissioner gets it right, we will donate $50 to their favorite charity with approval from IWCC management.

Editor’s comment: Claimant is a traveling salesperson who is on a lengthy business sales trip for the employer, USA Industries. There is no dispute about employment, jurisdiction, accident or coverage of the IL WC Act. The salesperson was married on the date of loss.

Her plane crashed on April 1, 2014 and she was killed. She was a max rate employee and the WC death benefit plus $8K burial is worth around $1.6M.

At-Fault Airlines settled the GL claim with the widower on April 3, 2014 the second day after the crash for $1M. A Circuit Court judge approved the $1M settlement for the estate and entered an order approving it a week ago today. The risk manager at USA Industries doesn’t want us to appeal approval of the Circuit Court settlement. The widower took the $1M check and cashed it.

The widower files a valid IL WC death benefit claim and wants us to participate in a death prove-up.

You are asked to write the agreed proposed decision. When will (or if) IL WC benefits be first due and payable to the widower? The correct answer will be a date.

4-21-2014; Do We Really Need "Magic Hook" Legislation to Make Safe Workplaces Harder to Achieve?; Putting Away Reflective Triangles is an "Emergency" in IL; Important ADA Ruling of Note and much more

Synopsis: Let No Good Deed by Our Courts Go Unpunished--Another Unnecessary Attack on IL Business from Our Legislature.

Background: In the 2012 ruling by the First District Appellate Court in Mockbee v. Humphrey Manlift Company, Inc. Case No. 1-09-3189, decided May. 18, 2012, Plaintiffs Brenda Mockbee and spouse Michael Merle Mockbee brought a negligence action against Defendants Harris Industries and R. Harris Electric (collectively Harris) and Humphrey Manlift Company after Ms. Mockbee was severely injured in 2002 when she fell into a floor opening that was part of a manlift platform system at the Quaker Oats Company plant in Danville, Illinois, where she worked. Use of the manlift was optional for all Quaker Oats employees; stairs between the floors of the plant were nearby and could have been used.

On June 6, 2002, Brenda Mockbee suffered severe injuries when she fell into the first floor opening of a manlift platform system at the Quaker Oats Company plant in Danville, Illinois, where she worked as an ingredient handler. The severe injuries rendered Ms. Mockbee a paraplegic. There was no guardrail at this floor opening of the manlift. Our research indicates all medical and lost time benefits were accepted and the estate settled the workers’ comp claim with this major Illinois employer for $200,000 in a settlement approved by the Arbitrator assigned in September 2013.

In this third party ruling, Plaintiffs sought to reverse the Circuit Court's grant of summary judgment to Defendants Harris and Humphrey. Plaintiffs contended Harris and Humphrey were safety inspectors of the manlift platform system and owed Ms. Mockbee an independent duty of care and arguably breached that duty when their respective inspections failed to note the need for a safety guardrail required by the Occupational Safety and Health Act (OSHA) (29 U.S.C. § 651 (2006).

The Appellate Court affirmed the grant of summary judgment to Harris and Humphrey, but on the ground that both are immune from liability for injuries sustained by Quaker Oats’ employee Mockbee under section 5(a) of the IL WC Act as providers of safety services to the employer. Basically, the legal ruling puts a safety engineer or inspector into the shoes of the employer and provides protection from a third-party action.

“Magic Hook” Legislation May Create a Cottage Industry of New Third Party Claims

Our legislature, spurred by ITLA, is seeking to overturn this concept via SB 3287. The immediate impact of this legislation is the elimination of the workers’ compensation exclusive remedy/immunity enjoyed by service companies that provide safety consulting unless those companies are wholly-owned by the employer, insurance broker or the insurer. If you don’t understand, if this bill passes, it will create a cottage industry of new litigation for any significant injury in the workplace. While the employer only has to pay IL generous workers’ comp benefits, any safety consultant or inspector will be required to have what we call a “magic hook” or a method to insure no one ever gets hurt because if anyone gets mildly to seriously hurt, the safety consultant is certain to get sued. If the “magic hook” fails and someone falls or otherwise gets injured, wasn’t it their job to globally insure no one ever gets hurt? Massive liability for safety engineers/consultants will be unavoidable and ever-present.

Why is this a poor idea? Well, workplace safety should be everyone’s goal and IL business has made great strides, prompted in part by OSHA, the IWCC and WC costs. Right now, Illinois’ injury rate is 16% lower than the national median. From the Illinois Workers’ Compensation Commission 2012 Annual Report:

Accidents continue to decline. From the FY95 peak of 72,000 cases, fewer than 47,000 were filed in FY12, a 35% decrease. The overall injury rate in Illinois is lower than most states, and the injury rate has declined dramatically over the years: the 2009 injury rate is 64% lower than in 1990.

Do We Really Want to Make It Harder or Impossible for IL Employers to Hire Safety Consultants?

SB 3287 is going to make it much more challenging for IL employers, large and small to hire safety consultants and inspectors because those service providers will have dramatically higher exposure for any injury. Please note the third party exposure for the Mockbee claim listed above could easily be $30-60 million. Trust us, the members of the IL Trial Lawyers Assn. are pushing your legislators to guarantee those monster paydays. For that reason, SB 3287 will have an immediate and dramatically negative effect on retention of safety engineers, resulting in decreased workplace safety, exposing more workers to injury. If Illinois workplaces are getting safer, why jeopardize that continued improvement?  

Small employers especially will be adversely impacted. This is because smaller IL employers typically cannot afford a full-time safety professional on staff to address safety issues. Employers with 5-300 employees use outside consulting firms which provide expertise to help keep their business in compliance with OSHA standards and limit workers’ compensation exposure to employee injury. As we indicate above, this approach is working very well. If you make outside safety consulting exponentially higher in cost, employers aren’t going to want to use them and may not be able to afford them, even if they want to use them.

Please further note erosion of the exclusive remedy provision will only create more expensive litigation and higher costs for Illinois employers—this means increased costs for both private employers and governments across our state.  The liability exposure will immediately increase liability insurance costs for safety consultants and inspectors. Those increased expenses will be passed onto employers and taxpayers. In turn, these dramatically increased costs will be passed along to consumers, making IL even less competitive.

The attorneys and staff at KCB&A join with the IL State Chamber and many other groups in opposing this unnecessary legislation. We thank the reader who provided information leading to this article. We urge our readers to join the IL Chamber and get more information on their website at www.ilchamber.org.

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

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Synopsis: Why Illinois is Soooo Bankrupt—“Lifetime Pay” for Government Workers Plus WC Benefits Plus Lifetime Family Healthcare Coverage.

Editor’s comment: We bet the average IL citizen doesn’t understand what a mess our State of IL and City of Chicago governments are in. The combined pension debts of these government bodies are over $140 billion, yes billion dollars. Despite that giant debt, we already have the second highest property taxes in the country and an income tax that is already at 5% with our legislators trying to find lots of ways to justify even higher taxation. We are starting to become concerned some of our older leaders are becoming senile when you read the contradictions and craziness coming from Springfield.

In a recent ruling in Pedersen v. Village of Hoffman Estates, we saw another example of how challenging it is for taxpayers to understand where their money is going. Former Firefighter Pedersen had hearing issues and used hearing aids. He went to a fire on the expressway and put the fire out in the company of other firefighters. The fire was over and the crew was cleaning up and preparing to leave. Another firefighter mistakenly turned on the siren on the truck. It appears Pedersen wasn’t able to cover his ears in time and suffered more hearing loss. Despite the fact he can currently work and make money in lots of jobs, to the extent his hearing issues preclude him from being a firefighter, the taxpayers of Hoffman Estates now have to pay him for the rest of his life as if he is completely disabled from all work. Our legislature could change this “lifetime pay” concept today but we assure you there is no chance they will do so.

On top of the “lifetime pay” he is currently receiving, our research indicates former Firefighter Pedersen also received workers’ comp benefits of 11% BAW and about 42% loss of use of the left ear and about 30% loss of use of the right ear. This was a “going-away-present” of about $70,000.

Sounds like a pretty good deal, huh? Lifetime pay with the ability to also work at any job(s) you can find plus $70K? Well, why stop there? In Illinois, if a firefighter can demonstrate their injuries were the result of a "response to what is reasonably believed to be an emergency," they are also entitled to full lifetime family health care group health coverage. If you aren’t sure the additional cost to the taxpayers of Hoffman Estates is probably in the range of $25K per year and that amount is going to continue to rise.

Please note the Village determined the firefighter wasn’t in the act of responding to an emergency. We strongly agree with that determination—the fire was out! They were cleaning up after the fire and putting things away. There was no reason for the siren that arguably caused injury—all parties agree it was set off by mistake. The Circuit Court affirmed denial of family group health benefits.

In a somewhat shocking turn of events, the unanimous IL Appellate Court found the determination by the Village and the Circuit Court was “clearly erroneous” and there was no question the injury occurred in response to an emergency. You may note the dictionary defines “emergency” as an “unexpected and usually dangerous situation that calls for immediate action.” At the time of this unfortunate event, Claimant Pedersen was returning reflective triangles to their storage place. We don’t consider that a clear and immediate emergency but in Illinois, it would appear that it is. It seems a lot more justified for taxpayers to pay the extra money for group family lifetime coverage for a firefighter injured while actively tangling with a fire, explosion or pulling children out of a burning building. How do you equate that heroic work with putting shiny triangles back into a truck?

So along with:

·         The thousands of IL and Chicago government workers receiving total and permanent disability awards with hefty COLA increases that could be ended today by using voc rehab and job placement to return the workers to other government or private jobs;

·         The firefighters and police officers now being paid for life when they are also working and making lots of money in other jobs;

·         Along with the hundreds of thousands of former government workers currently receiving what some call pensions or what we call “lifetime pay” being paid out of our current tax dollars

you start to see why this state is in the dire financial mess that it is.

If you would like the website of the ruling above, send an email. We appreciate your thoughts and comments. Please post them on our award-winning blog.

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Synopsis: Dealing with ADA—The Burden May Be on the Worker to Show Existence of Another Position.

Editor’s comment: After the Americans with Disabilities Act Amendments Act of 2008 and the recent legislative changes that hit U.S. employers where prior defenses to ADA were arguably stripped by the Feds, lots of employers in the public and private sector have struggled with the best approach to dealing with this challenging law. Most HR and other managers want to get people to work with reasonable accommodation but they also want to make money in their businesses or be effective government managers. It appears the new battlefield may be over whether the worker can demonstrate you have a position that will “reasonably accommodate” their disability but also it appears they have to be able to safely perform the “essential job functions” of a job you have available.

In Perez v. Transformer Manufacturers, Inc., the Federal District Court dealt with a “wire-winder” from Norridge, IL who developed hand issues with resulting work restrictions. There was no question the worker could not perform the prior position.

The Court further noted the employee failed to show there was another position to which his employer reasonably could have assigned him following his alleged on-the-job accident or disability. Thus, because the employee was admittedly unable to perform at least some essential functions of his previous job after his on-the-job accident, his ADA discrimination claim for failure to accommodate was not viable. The Federal Court rule the employer was not required to “manufacture a job that will enable the disabled worker to work despite his disability.” The Court also noted “an employer need not create a new job or strip a current job of its principal duties to accommodate a disabled employee.” The employer “need only transfer the employee to a position for which the employee is otherwise qualified.”

The record indicates the employee never asked to be reassigned to another position within the company. Also, Plaintiff Perez merely referred to injured workers who were placed in vacant light-duty positions at some time in the past, without presenting anything to show comparable vacant positions were available at the time he was injured. Further, even if there had been such vacancies, he offered nothing to show he was capable of performing the essential functions of those positions.

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