3-26-2018; Chicago Bears WC Program Hits the Headlines in Forbes Magazine with Quotes from Gene Keefe; Kevin Boyle on an Important Indiana WC Claims Caveat and more

Synopsis: Chicago Bears WC Defense Program Hits the Headlines in Forbes Magazine—I Am Not Sure What the Buzz Might Be.

Editor’s comment: Forbes Magazine published an interesting article that highlighted the fact the Chicago Bears spent about $13M in work comp costs over 18 years. With respect to the authors, I don’t consider that a lot of money for a professional team that participates in one of the most brutal and dangerous events on the planet. To my understanding, most professional football teams have lots more “disabling” injuries than players because the players get hurt, hustle hard to recover and then return to work to be injured/disabled again.

To my understanding, almost all professional football players retire, at least in part, due to disabling injuries. The only reason they probably aren’t wildly interested in workers’ comp benefits is the limits on such claims for permanency isn’t close to the salaries many of the players garner. Several Chicago Bears players make close to or more than $13M a year, every year.

The Forbes Magazine article noted, in Illinois, workers injured on the job including professional athletes, can file wage-loss differential claims, entitling them to two-thirds of their wage loss (with a cap) receivable to age 67, or five years after the claim is made, whichever is later. The money is paid by the professional team’s workers' compensation insurance carrier or self-insured program.

The annual statutory cap on such wage-loss awards limits professional athletes and other employees to no more than the average weekly wage in Illinois, but anyone earning $1 million or more per year, such as an NFL player, would be eligible for the current maximum annual wage loss benefit of $55,971. The wage loss payouts are not taxable. And for most professional athletes in their 20’s and 30’s, wage loss benefits to age 67 could be well into the millions.

A professional football team is particularly susceptible to such compensation claims because, apart from the violent nature of the game, teams carry 53-man rosters, with many players coming and going with great regularity throughout the season due to the strain of competition and injuries.

As one of the leading national authorities on workers’ comp from my position with Keefe, Campbell, Biery and Associates, I was quoted by Forbes as saying workers’ compensation to wealthy athletes is “warping” the system. I was further quoted to say “It doesn't match reality. And the Bears just don't fight the cases anymore. They settle instead of going to court and making the player a hero.”

I commented on the claim of Roger Stillwell, who had a limited NFL career with the Bears in the 1970s that was ended by injury. I pointed out Stillwell later became a travel agent making $400,000 per year but still applied for and received lifetime workers' compensation for his football injury. I confirmed Stillwell's case was one of the first to call into question lifetime wage loss compensation for professional athletes. One has to wonder if someone making $400K a year needs further lifetime compensation due to prior football injuries.

On the other side, Forbes reported George Atallah of the NFL Players Association told The Associated Press last year that workers’ compensation benefits “provide a lifeline to players whose athletic careers end suddenly.”

According to Forbes, the “bench is deep” when it comes to former Bears players looking for compensation, with hundreds having put in for payments, according to state records.

·        Lamarr Houston, a linebacker, said his right knee was injured in a 2014 game and his left knee in 2016.

·        Another linebacker, Jon Bostic, said his back was injured in 2014 and his right ankle in 2015.

·        Defensive end Henry Melton suffered a lower-back injury in 2012 and a concussion in 2013, according to records.

Many other former players have settled their cases, including Brian Urlacher, Devin Hester, Tommie Harris and Charles Tillman. In Urlacher's case, he settled with his former team in 2017 for $550,000, for claims filed between 2009 and 2014, covering his neck, back, hands, wrist, legs, knees and shoulders. Urlacher’s settlement might have been heightened by the fact he was a close personal friend with a workers’ comp Plaintiff/Petitioner lawyer.

Cade McNown was a disappointment as a Bears quarterback in the 1999 and 2000 seasons, but his shoulder injuries netted him a $220,000 settlement in 2006.

The largest amount for a single injury in recent years was $400,000, given in 2014 to wide receiver Johnny Knox for a 2011 spinal injury that ended his career.

Forbes reported there have been 458 compensation cases filed against the Bears since 2000, most of which involve players, with the rest involving off-field employees. In that period, the team and its insurer have paid at least $12.8 million in settlements. I consider that a low amount for 18 years of claims brought by professional football players.

Last year, the Illinois Legislature considered a bill that would have prohibited wage loss compensation payouts to athletes beyond age 35. The Chicago Bears, Bulls, Blackhawks, White Sox and Cubs all supported the change. The bill was bundled with a compromise of other proposed WC and other laws, set up so all the bills passed or none did; the measure failed to make it through the goal posts.

Forbes quoted Jay Dee Shattuck, a longtime WC guru with the IL State Chamber and a lobbyist with Shattuck and Associates Consulting who described the bill as an attempt to “bring back some sanity to IL Workers' Comp law.”

Collective bargaining arrangements can also provide compensation for injuries. Please note the math above is a strong reason to avoid making college football players into paid athletes—the initial and increased costs to colleges/universities could be dramatic.

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

Synopsis: Important Claims Caveat from Kevin Boyle, KCB&A’s Indiana Defense Team Leader—Always Remember to Check for Employee Bonuses When Calculating TTD in Indiana.

Editor’s comment: The Indiana Court of Appeals recently issued an important ruling to remind us to include bonuses when calculating TTD benefits for Indiana worker’s compensation claims. 

In Midwest Equipment & Supply Co., v. Garwood, 87 N.E.3d 33 (Ind. Ct. App. 2017), the employee received a $20,000 profit sharing bonus and also a $1,750 shipping bonus that was tied to the employee’s performance in the warehouse.  Employer calculated his AWW using the regular wages earned in the 52 weeks immediately preceding his injury, but did not include two large bonuses in the calculation.

The Court of Appeals rejected the employer’s contention that those bonuses should not be included in the AWW because they were not governed by a written agreement, were not automatically paid, were awarded through discretionary management decisions, and the $20,000 profit sharing bonus was not based on his output or performance.

The Court held that “true as those statements may be, the statute defining average weekly wages specifies only one condition for its calculation – that the calculation include the earnings of the injured employee during the period of fifty-two weeks immediately preceding the date of injury. I.C. 22-3-6-1(d).” For Indiana AWW calculations, unlike Illinois where the Illinois worker’s compensation statute specifically excludes bonuses from its definition of AWW, Indiana’s statute does not exclude bonuses from the calculation of average weekly wages.

Finally, the employee also argued that his award should be increased by 10% for the employer’s frivolous appeal. The Court rejected that argument stating the issue presented upon appeal was not frivolous, but rather a genuine legal issue that required clarification. However, the award was increased the standard 5% since the Court affirmed the Full Board on the employer’s appeal.

3-12-2018; Can An IL Employer/WC Claims Handler Bring Claimant Back to Light Work At a Charity?; Matt Wrigley JD Reports on an Important Federal EPLI Ruling and more

Synopsis: Can An IL Employer/WC Claims Handler Bring a Claimant Back to Transitional Light Work At a Charity? Can You Cut-off TTD If They Refuse?

Editor’s comment: I am asked this question all the time. We had a reader send us a brilliant article by an excellent IL defense attorney, Jessica Bell that was published in the Illinois Association of Defense Trial Counsel Quarterly. I salute her hard work and acumen in this growing area of U.S. workers’ compensation law.

This situation arises when an employee is injured at work and cannot immediately return to their former job due to medical restrictions resulting from the work injury. The employer or claims manager assumes the work restrictions are temporary and should be lifted as the worker’s medical condition improves, enabling the employee to return to his former job at the same employer or possibly another available position. In the interim, some employers, particularly in union settings, have many hurdles to accommodate restricted work.

Getting the injured worker back to any work is better than letting them sit home and watch the television. In my experience, many injured workers try to “disappear” and stay out of view. This “charity-volunteer-job” situation offers benefits to the employer and the employee, ranging from reduced workers’ compensation for the employer, to getting an injured work to take a shower, travel to work with others and remain somewhat off the dole. To me, the concept is a win-win for everyone.

The article mentioned above reviewed whether an Illinois employer may effectively offer transitional light duty work through another entity, say, such as a charity while also paying TTD. Many IL Claimant attorneys support the concept and want their clients to cooperate. Sadly, some Claimant attorneys are willing to fight over it to see what the Arbitrator and IWCC might do.

Other states have examined this scenario and several have adopted what is commonly referred to as temporary transitional employment (TTE) provisions, whereby the employer is permitted to return the employee to light-duty work with another business while the employee’s condition heals. Ms. Bell’s research documented at least eight states have already adopted specific TTE or similar programs via statute, while other states permit TTE programs based on their workers’ compensation statute’s current wording. We hope the secret-powers-that-control-the-IWCC consider enacting legislation to incorporate or delineate a rule about it and avoid confusion and unnecessary litigation.

One important aspect of this TTE concept is to consider obtaining the opinions of a certified vocational rehab counselor or CRC who is familiar with the idea and can provide an expert report backing up the concept. The CRC report doesn’t need to be 500 pages—short and to the point works best. Please remember the IL WC Act/Rules contemplate a “120-day” voc rehab rule, requiring both sides to agree on a voc plan to get a moderate to severely injured worker back to any work. The plan is supposed to be considered by both sides and approved via the Arbitrator. Anyone off 120 days on a continuous basis after an accident is, in my view, a moderate to seriously injured worker. If you have an expert report from a CRC or certified rehab consultant confirming the worker can and should be doing something, even in a charity setting, and get them off their couch, you have a much better shot at Arbitrator approval.

The article mentioned above carefully chronicles widely differing IL WC outcomes and this concept is going to remain a transitional idea in our nutty State for the time being. Under the current administration, I do feel a well-documented TTE offer could “work” and many Arbitrators might informally confirm their concerns or formally deny disputed TTD benefits if the worker remains adamant about staying home with their TV remote and won’t volunteer at a charity while getting TTD. I am somewhat sad to report if a Democrat moves into the Governor’s mansion in the fall, TTE may disappear for four years.

If you want defense legal guidance on implementing a TTE program including referral assistance or experts, reply or call me. I appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Document, Document, Document Employee Absences—It Takes 1 Minute. Employee Fails to Establish her Termination Violated the FMLA, ADA, and Rehabilitation Act. Research and analysis by Matthew Wrigley, J.D., licensed in IL and MI.

Editor’s Comments: In Guzman v. Brown County, No. 16-3599 (March 7, 2018) E.D. Wisc. Affirmed, a telecommunications operator previously diagnosed with sleep apnea was terminated by her employer after repeatedly failing to report for work when scheduled. The employer maintained a progressive disciplinary system which escalated from verbal warning to written warning, suspension, and termination. Under this policy between 2004 and 2013 the employee received nine verbal or written warnings regarding use of vacation or casual time, failing to complete proficiency tests, and failing to report for work. Due to two additional infractions which included tardiness and failure to report for work the employee was suspended and eventually terminated.

The employee sued the employer under the Family and Medical Leave Act (FMLA), the Americans with Disabilities Act (ADA), and the Rehabilitation Act alleging interference, retaliation, and discrimination. The trial court granted the employer’s request for summary judgment finding no genuine dispute as to any material fact. This resulted in judgement for the employer, and a dismissal of the suit. The employee appealed this decision to the Seventh Circuit Court of Appeals, which affirmed summary judgment in its entirety. 

The Seventh Circuit initially addressed the employee’s charge of FMLA interference and found she failed to introduce any evidence to show she suffered from a “serious health condition” at the time of her infractions. In addition, the Seventh Circuit found no evidence to establish the employee provided either actual or constructive notice of her asserted need for FMLA leave. Finally, the Seventh Circuit found it undisputed the decision to terminate the employment relationship was made before the employer had knowledge of any serious health condition or request for FMLA leave.  With regard to the charge of retaliation under the FMLA, the Seventh Circuit held the employee failed to present evidence her termination constituted an “adverse employment action” which occurred because she requested or took leave. In other words, the Seventh Circuit found that the employer had no prior knowledge of the employee’s health issue to link up the employee’s claim of retaliation for requesting FMLA leave. 

Addressing the discrimination charges under the ADA an Rehabilitation Act the Seventh Circuit held the employee failed to present evidence to show her termination was a result of an alleged disability rather than her violations of the progressive disciplinary system. With regard to the employee’s charge of failure to accommodate, the Seventh Circuit held no evidence was presented to show the employer was aware of an alleged disability prior to the termination. The Court specifically held “after the fact requests for accommodation do not excuse past misconduct.” Finally, with regard to the charge of disability retaliation under the ADA the Seventh Circuit held the employee presented no evidence to establish a causal connection between her engagement in a statutorily protected activity and an adverse employment action. 

The research and writing of this article was performed by Matthew Wrigley, JD. He can be reached regarding employment law or workers’ compensation issues that you face at mwrigley@keefe-law.com

EVENT

Dealing with Employees from Application to "Z" you Later | March 19 | 12-2pm | Johnson & Bekk, Ltd., Chicago

Who Should Attend?

HR professionals, employment lawyers, and anyone who manages personnel are invited to Dealing with Employees from Application to "Z" You Later on March 19 where our speakers will discuss how and where to advertise for positions, the do’s and don’ts for selecting and interviewing candidates, proper considerations for hiring decisions, how to properly document performance and other disciplinary issues, and when and how to terminate employment.

Schedule

11:30 a.m. - 12:00 p.m. Registration and Light Lunch

12:00 - 2:00 p.m. Dealing with Employees from Application to "Z" You Later

Presented by: Kimberly Ross, FordHarrison LLP and Bradley Smith, Keefe, Campbell, Biery & Associates, LLC

The program will review through the “life” of an employee from a management perspective. Many employers hire managers and supervisors of employees who know the business end of the job, but who have no training or experience in managing people. Many employers also think about the life of an employee in terms of hiring and firing only. This program will explore the infancy of the employment relationship, beginning with proper advertisement for the position, soliciting, collecting and reviewing applications, interviewing, hiring, performance reviews, disciplining, and termination. We will discuss state and federal laws that must be considered, as well as general best practices. We will also explore some of the pitfalls that may be encountered with social media and the Internet, including a discussion of the type of information employers can and cannot consider when making employment decisions. 

CLE Credit

The IDC has also been approved for 2.0 hours of CLE credit for this program in the state of Illinois. We will apply for the following CLE credit in other states:

• Indiana 2.0 CLE; 0.0 Professionalism
• Iowa 2.0 CLE; 0.0 Professionalism
• Missouri 2.4. CLE; 0.0 Professionalism
• Wisconsin 2.4 CLE; 0.0 Professionalism

Registration

This event will be held at the offices of ISBA Mutual Insurance Company, 20 N. Clark Street, Ste 800, Chicago and via TELECONFERENCE. Please indicate your attendance method (in-person or via teleconference) on your registration form. Registration for this event is $25 for IDC members (Non-member $50).

3-5-2018; Birth Defect Claims by Children Not Blocked by WC "Exclusive Remedy" Proviso; Wisconsin Legislature Moves Rapidly to Block Appellate Court Ruling about Coverage for Temp Workers and more

Synopsis: Birth Defect Claims by Kids Based on Exposure to Parents at Work Not Blocked by WC “Exclusive Remedy” Proviso.

Editor’s comment: We consider this article required reading for the insurance/claims industry. In a ruling with potentially far-reaching implications, two Illinois teenagers who claimed to have suffered life-long birth defects because of their fathers' workplace exposure to toxins are not blocked by the concept of their parent’s WC “exclusive remedy” under Section 5 of the IL WC Act. In short, the children can and will pursue a civil suit against their parent’s employer, Motorola for millions in damages.

I assume these sorts of claims will potentially bring billions in new liability exposure to U.S. employers, as birth defects are lifetime medical/physical problems, causing decades of misery. Juries are generally very amenable to finding causation and awarding box-car verdicts.

In these claims, the Appellate Court of Illinois ruled workers' compensation was not the exclusive remedy for 18-year-old Claimant Finzer and 17-year-old Claimant Hardison, because they were seeking damages for their own injuries, not their parents. The decision reversed the Circuit Court of Cook County, which granted Motorola's motion to dismiss, following that legal concept.

Motorola successfully argued because “the children’s injuries were … derivative of a work-related injury to their fathers’ reproductive systems,” they should be required to adjudicate their claims through the IL workers’ compensation system, like their fathers would have had to. But this argument ignored the fact the children weren’t employees of or otherwise paid by Motorola, and they were suing over their own injuries, not their fathers.

“Because minor plaintiffs seek to recover not based on workplace injuries sustained by their employee-fathers, but for their own personal injuries, the exclusive remedy provisions of the Arizona and Texas workers’ compensation laws do not apply,” Justice Mary Anne Mason wrote for the unanimous three-judge Appellate Court panel.

In contrast, the circuit court reasoned because the validity of these claims depended on the validity of their fathers’ claims, the workers’ compensation exclusivity provision applied to the teenagers’ claims as much as it would have to their fathers.

The appellate court found no basis for this legal argument. The ruling compared these claims to a personal injury lawsuit brought by a Claimant named Woerth in 1984. Woerth was a Kentucky man who contracted hepatitis from his wife, a nurse who allegedly got it from work. “The court specifically noted that ‘[w]hile Woerth’s hepatitis may derive from his wife as a matter of proximate cause, his cause of action does not,’” Mason wrote in Ledeaux v. Motorola. “Because Woerth was not seeking relief relating to his wife’s injuries, his claim for his own injuries was not barred by the exclusive remedy provision.”

Claimant Finzer’s father worked at Motorola’s manufacturing plant in Mesa, Arizona, from 1997 to 1998. Finzer was born in April 1999 with a club foot.

Claimant Hardison’s father worked at Motorola’s manufacturing plant in Austin, Texas, from 1991 to 2001. Hardison was born in April 2000 with an underdeveloped jaw.

In 2010, alongside almost two dozen other plaintiffs, Finzer and Hardison filed a combined complaint against Motorola, claiming negligence, willful and wanton misconduct, abnormally dangerous activity and loss of child consortium. They alleged their fathers sustained injuries to their reproductive systems as a result of exposure to toxic chemicals on the job. They also alleged that Motorola knew that its “limited environmental and biological sampling” did not comply with federal occupational safety guidelines.

The lawsuit further alleges “high-level corporate employees” knew reactions between the chemicals used during Motorola’s manufacturing process and machinery at the plants “dramatically increased and/or compounded the likelihood of resultant injury to workers and their unborn children.”

When the lawsuit arrived at the 1st District Appellate Court, the court had to decide how Finzer's and Hardison’s claims compared to the concept of a “derivative claim,” or a claim that “would not exist in the absence of the injury to the employee.” Common derivative claims include loss-of-consortium and wrongful death claims, which are generally resolved through the workers’ compensation system.

The Appellate Court ruling decided the teenagers’ claims were not derivative claims, because they were claims for “injuries personal to them that exist apart from and regardless of a work-related injury sustained by their parent.”

You can review the opinion here. We appreciate your thoughts and comments. Please post them on our award-winning blog.

Synopsis: Wisconsin Legislature Acts Fast to Overturn Recent Appellate Court Case Addressing Remedies for Injured Temp Workers. Research and analysis by Matthew Ignoffo, J.D., M.S.C.C

Editor’s Comment: A month ago we reported on the January 2018 ruling in In Re the Estate of Carolos Esterley Cerrato Rivera v. West Bend Mutual Insurance Company and Alpine Insulation, No. 2017AP142. The Appellate Court held because a deceased temporary employee’s Estate had not made any claim for workers’ compensation medical or death benefits, it was not barred from pursuing tort claims against the borrowing employer and its insurer.

In less than a month after the court’s ruling, Senate Bill 781 was introduced and three weeks later it was enacted into law. It was published March 1, 2018. This bill changes the language of Section 102.29 of the Wisconsin Worker’s Compensation Act from an employee who “makes” a claim for compensation to an employee who “has the right to make” a claim for compensation.

The pertinent discussion in Rivera focused on the fact the decedent’s estate had never made a claim for WC benefits. Under the amended Act the fact the estate had the right to make a claim means it cannot pursue a tort action against the employer who accepted the loaned employee’s services.

We suspected the legislature would not let the ruling stand for long and applaud it for quickly addressing the matter as the amendment is a welcome relief to staffing agencies, their clients, and their insurers.

This article was researched and written by Matthew Ignoffo, J.D., M.S.C.C., who is licensed and practices in Illinois and Wisconsin. Matt is one of KCB&A’s top Medicare Set-Aside experts.

Please feel free to contact Matt on a 24/7 basis at mignoffo@keefe-law.com.