With Burke Charged by Feds, Chicago WC Program to Finally Be Audited

Tuesday, January 8, 2019 | 0

With Chicago’s longest-serving alderman and head of the city’s scandal-plagued workers’ compensation program charged with a federal crime, Chicago Mayor Rahm Emanuel on Sunday announced plans for a long-hoped-for audit of the program.

Alderman Ed Burke

The mayor, who has refrained from demanding reforms and investigations into the comp program until now, also said he wants it moved out from under control of the City Council’s Finance Committee, where longtime Alderman Ed Burke managed to block previous audits for years, according to news reports.

“We have a unique opportunity to hit the reset button on workers’ compensation,” Emanuel said in a statement to Chicago news outlets. “To achieve a fresh start, we need to know what we’re dealing with, so we get it right, which is why I’ve directed my administration to engage an outside firm to conduct a forensic audit.”

The windy city was rocked last week when federal prosecutors charged Burke, who as chairman of the Finance Committee managed the $100 million comp program for decades, with attempted extortion. Burke could face as much as 20 years in prison for allegedly shaking down the Burger King corporation, demanding that it give his law firm its business in exchange for a permit for a restaurant in his ward.

On Friday, Burke stepped down from the Finance Committee, something reformers have increasingly called for. The federal charges reportedly do not mention Burke’s oversight of the workers’ compensation program, but his resignation from its helm opens the door for audits and perhaps other investigations, according to news reports.

In recent weeks, a caucus of progressive aldermen introduced an ordinance to take the comp program out of the hands of the City Council committee and put it under the corporation counsel, part of the mayor’s office. The mayor now appears to have taken steps to move the program to the city Finance Department, run by a mayoral appointee.

Chicago is considered the only major U.S. city that allows the legislative branch to manage its workers’ compensation program, which is usually part of the executive branch. As an alderman, Burke was able to influence ordinances that blocked the city’s inspector general from examining the comp program books, news reports have said.

That has led to a program that costs five times what most other major cities’ comp systems cost and has resulted in political patronage rife with corruption, critics have charged.

In 2006, the Chicago Sun-Times newspaper reported that favored patronage workers filed injury claims at a higher rate than any occupation tracked by the Labor Department — including the most dangerous ones — and paying workers’ comp benefits to people who held outside jobs. The highest rates of injury coincided with the names of people who had the most political standing in the city, the newspaper reported.

The newspaper also reported that the comp program paid $136,036 in benefits to a Streets and Sanitation Department worker who beat up his daughter’s boyfriend while out on disability for an injured hand.