Review of Work Comp in the Land of Lincoln

Thursday, April 30, 2009 | 0

By Michael E. Rusin
 
AROUND SPRINGFIELD
 
All Illinoisans have been embarrassed by the actions of our former governor, Rod Blagojevich. At the time I published my last newsletter a few months ago, Blagojevich had just been indicted by the U.S. Attorney for soliciting bribes and campaign contributions in return for state business.  The Illinois state Legislature moved quickly to impeach him and to schedule a trial to convict him and remove him from office. 
 
Despite staunchly protesting his innocence, Blagojevich chose not to defend himself in the impeachment trial.  Instead, he went on the national talk show circuit to explain that he was not a crook.  Our local embarrassment went national as he was blasted on every national talk show.  From The View to David Letterman, he found no support and gave no rational explanation of his alleged innocence.
 
The Illinois Senate scheduled and held a trial to convict Blagojevich and remove him from office.  It was over in less than a week and the vote to convict was unanimous.  Blagojevich did not present a defense, but did show up for a rambling speech to protest that he was not a crook.  Wisely, he jumped on a state plane and flew to Chicago before the final vote, or else he would have been stranded in Springfield.
 
A significant issue arose as to appointment of an individual to fill President Obama's open Senate seat.  No one wanted the tainted Blagojevich to fill the seat, since audiotapes show conclusively that he was trying to sell it to the highest bidder.  Nevertheless, in a stunning news conference, Blagojevich appointed Roland Burris, a former state office holder and failed candidate for governor.  The Senate refused to seat Burris because of the tainted appointment, but shortly thereafter reversed its decision and accepted the appointment.  Within weeks, however, it was learned that Burris' bizarre appointment wasn't as clean as claimed.  I still cant believe nobody saw this coming.  Both the state and the feds continue to investigate Burris and I wouldn't be surprised to see some charges filed.  For now, he will remain our junior Senator, but he will be a pariah in the Senate.  His term will end in 2010 and he has already announced his candidacy for the 2010 elections.  In the first four months of 2009, he has raised $845.00 for his next campaign.  At this rate, he wont raise enough campaign money to run a campaign.  His political career is clearly over.
 
Our new governor is Pat Quinn, the former Lieutenant Governor, who was not friend or ally to Blagojevich.  Under Illinois law, the Governor and Lt. Governor run in separate primaries.  In this case, Blagojevich's ally in 2002 did not win the primary and Quinn, an independent Democrat, became his running mate.  No one ever expected impeachment and now the political gadfly is the leader of our state.  He has a chance to prove himself and seek election in 2010.  However, the competition will be stiff.  Quinn is no fan of business interests having long fought for consumer rights and against utility companies.  Business interests should not expect any WC law relief unless they can convince Quinn such changes would improve the state's economy.

Such an effort is worthwhile.  Quinn will likely be intellectually honest, a trait not shared by Mr. Blagojevich.  Quinn has fought for taxpayers most of his career and now is pushing for a huge increase in the state sales tax. 
 
When (not whether) Blagojevich goes to jail is the next big question, although few likely care if he is jailed.  Most are thrilled just to get him out of the government.  His arrogance and pettiness won't be missed.  His trial is a long way off, but if I were betting on the result, I would bet on the Feds to convict. 
 

AROUND THE COMMISSION
 
Oops!  The Commission erred when it published the new PPD maximum rate in effect from 7/1/08 to 6/30/09.   The PPD max is now set at $664.72, rather than the figure previously announced.  This change will not affect any cases involving accident dates during this time period, which have already been settled. 
 
No changes in personnel have occurred at the Commission yet.  Since commission personnel are appointed by the governor, each must be wondering about reappointment.  It is unlikely that any of the current commissioners have any close ties to the new governor. 
 

BEFORE THE SUPREME COURT OF ILLINOIS
 
Exclusive Remedy Protections Apply to Employer, Employers Co-Venturer, and to the Joint Venture Itself
 
Daniel Ioerger v. Halverson Construction Co. and Midwest Foundation Corp., Docket Nos. 105912, 105917, filed Dec. 18, 2008.
 
The two defendants, Halverson and Midwest Foundation, formed a joint venture in the summer of 1999 to bid on a project to repair a bridge in Peoria.  Pursuant to the written agreement between the two companies, Midwest agreed to provide all the labor and pay workers' compensation benefits.  The parties successfully submitted the bid and began working on bridge repair.  On April 24, 2000, a serious accident occurred and several employees were injured, including plaintiff.  Plaintiff filed for and received workers' compensation benefits from Midwest, the company who paid his wages and workers' compensation benefits. 
 
Plaintiff then filed a civil lawsuit against multiple defendants, including Halverson and the joint venture.  Halverson and the joint venture moved for summary judgment, claiming that they were protected by the exclusive remedy of the Workers' Compensation Act.  The trial court agreed and granted summary judgment.  However, the appellate court reversed and reinstated the complaint against them. 
 
They appealed to the Supreme Court, and the Supreme Court reversed.  The Supreme Court held that the exclusive remedy protections apply to the loaning employer and also the borrowing employer and any joint venture between the lending and borrowing employer.  The court noted that the borrowing employer and the joint venture have a legal obligation to pay workers' compensation benefits to the plaintiff whether or not such benefits are actually paid.  The court
noted that the creation of a joint venture creates a partnership.  Since Halverson and the joint venture were partners with Midwest, they became agents for Midwest. The court noted that under the terms of the Workers' Compensation Act, the exclusive remedy provisions extend not only to the employer but to various other specific entities including agents of the employer. 
 
Therefore, both Halverson and the joint venture were protected by the exclusive remedy of the Workers' Compensation Act. This was true whether or not either had paid or contributed to pay workers' compensation benefits to the plaintiff.  Since legally they could be obligated to pay the benefits, they were entitled to the protection of the Workers' Compensation Act.
 
Comment:  This is a good decision from the Supreme Court, especially since it reversed an erroneous appellate court ruling.  The exclusive remedy protection of the Act is an important one for all employers.  It forms the primary basis for the automatic application of the Act and the immediate granting of no fault benefits to claimants.  There must be protection for employers, partnerships and joint venturers, or else the Act loses its meaning.  The exclusive remedy
protection of the Act is intentionally broad and covers employers and many employer agents, including insurance companies, third party administrators, and attorneys.  The borrowing-lending provision of the Act creates the obligation to pay workers' compensation benefits from both the borrowing and the lending employer on a joint and several basis.  That legal liability is overly broad and therefore must grant exclusive remedy protection to both borrowing and lending employers. This decision reinforces that legal principle. 
 
BEFORE THE UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT
 
United States Court of Appeals Reverses District Court and Reinstates Complaint against Employer, Its Third Party Administrator, and a Doctor Pursuant to the Federal RICO Statute Prohibiting Racketeering Activity
 
Paul Brown et al. v. Cassens Transport Co., Crawford & Company, and Dr. Saul Margules, No. 05-2089, filed October 23, 2008.
 
Plaintiffs were five employees of Cassens Transport Co.  They all had workers' compensation claims against Cassens in the state of Michigan.  On June 22, 2004, they filed a complaint against Cassens, a self-insured employer, Crawford & Co., its claims administrator, and Dr. Saul Margules, a doctor who apparently served as an independent examiner with respect to the workers' compensation claims.  The complaint alleged that Cassens, Crawford, and Margules, as well as other cut off doctors, engaged in a pattern of racketeering activity that denied plaintiffs workers' compensation claims.  The plaintiffs alleged that the defendants deliberately selected and paid unqualified doctors, including Margules, to give fraudulent medical opinions that would support a denial of workers' compensation benefits and that defendants ignored other medical evidence in denying benefits. 

The district court dismissed the complaint, because the plaintiffs failed to plead that they relied on the misrepresentations by the defendants to their detriment.  The plaintiffs appealed to the appellate court and the appellate court affirmed.  The plaintiffs further appealed to the Supreme Court, and the Supreme Court vacated the appellate courts decision.  The Supreme Court ordered the appellate court to reconsider based on the recent United States Supreme Court case, Bridge v. Phoenix Bond & Indemnity Co., 128 S.Ct. 2131 (2008).  In the Bridge case, the Supreme Court unanimously determined that reliance on misrepresentations is not an element for a civil RICO claim. 
 
Based on the Bridge decision, the appellate court then ruled that the plaintiffs' complaint should not have been dismissed.  The appellate court ruled that the plaintiffs successfully pleaded a RICO claim for racketeering.  The court held, the plaintiffs have pleaded with sufficient particularity at least 13 predicate acts, which are comprised of allegedly fraudulent
communications by mail and wire, including communications among the defendants and communications from the defendants to the plaintiffs relating to each of the plaintiffs injuries and claim for benefits for workers' compensation.
 
The court held that no aspect of federal law or state law precluded a RICO action from proceeding further. 
 
Comment:  This decision appears well-reasoned and correct.  However, the nature of the complaint and the end result should certainly make all employers wary.  This type of complaint could be simply a new vehicle for disgruntled employees to seek new and different benefits from an employer.  The employer already must pay workers' compensation benefits to its employees on a no-fault basis.  The right to benefits is protected by the Michigan Workers' Disability Compensation Commission.  Michigan law further provides penalties for wrongful denial of claims.  If all of these benefits are guaranteed by Michigan law, why then should plaintiffs be entitled to a federal cause of action when all their rights are protected by state law?
 
Its understandable that federal law would protect individuals from racketeering.  I never thought I would see it applied to an employer and its insurance carrier. I am somewhat surprised that attorneys are not named also in the lawsuit as part of the alleged conspiracy and racketeering. 
 
Once this case goes back to the district court for trial, I hope the evidentiary standards applied by the circuit judge are stringent. Since the allegations are so excessive, plaintiffs should be held to a high standard of proof.  I certainly don't want to see more complaints like this filed. 
 

BEFORE THE APPELLATE COURT OF ILLINOIS, NON-WORKERS' COMPENSATION DIVISION
 
Retaliatory Discharge Action Allowed Against a Borrowing Employer Based on Allegations that Claimant was Terminated for Testifying in a Co-Worker's WC Claim
 
Carrie Hester v. Gilster-Mary Lee Corporation, No. 5-07-0283, 5th Dist., filed Dec. 18, 2008.

Petitioner was employed by Manpower, a company that provides temporary employees to its customers.  Manpower assigned her to work at Gilster-Mary Lee Corporation.  Petitioner was never an employee of Gilster-Mary Lee.  The employment situation made Manpower a loaning employer and Gilster a borrowing employer. 
 
Petitioner filed a retaliatory discharge claim against Gilster.  Petitioner alleged that on Sept. 13, 2006, under threat of subpoena, she testified in a co-worker's workers' compensation claim.  She alleged that on the following day, Sept. 14, 2006, she was told by her Gilster supervisors that they wouldn't be utilizing her services anymore and she should return to Manpower for reassignment.  She apparently went back to Manpower for reassignment and couldn't get a job for eight weeks.  She claimed that she was entitled to both compensatory and punitive damages for this discharge. 
 
Gilster filed a motion to dismiss claiming that they could never be subject to a retaliatory discharge claim by petitioner because she was never their employee.  She was employed simply by Manpower.  The trial court granted Gilster's motion to dismiss.
 
Petitioner appealed and the 5th District Appellate Court reversed.  They found that a borrowing employer is subject to a retaliatory discharge claim even though it never directly hired petitioner.  The court stated, we hold to the extent that an employee could maintain an action against an employer for retaliatory discharge as a result of activities engaged in by the employee which are protected by the Workers' Compensation Act, such an action is also available to a borrowed employee against a borrowing employer.  The court held that Gilster was petitioner's de facto employer, because Gilster set her daily hours, her work schedule, her hourly wage, her job assignments, and her workplace.  Further, no one from Manpower supervised her work in any way and she worked side by side with regular Gilster employees with no distinction between them and herself.  Based on those allegations, the court found it justified to allow petitioner to seek a retaliatory discharge claim against the borrowing employer. 
 
Further, even though the discharge had nothing to do with a claim for compensation by petitioner herself, she could seek damages for alleged retaliation as a result of her testifying in a co-employee's workers' compensation claim.  The court found this was protected activity and merited protection supported by Illinois public policy.
 
Comment:  This is an unwarranted expansion of the retaliatory discharge doctrine.  Despite petitioner's allegations that Gilster was her de facto employer, in fact, Gilster was never her employer.  She may have worked at the Gilster plant, but Manpower was her employer.  Manpower may have allowed Gilster to supervise petitioner, but Gilster was never her true
employer.  Her true employer was Manpower.  Therefore, if Gilster decided they didn't want her services anymore, she had the absolute right to go back to Manpower and seek another assignment.  This is the nature of being a temporary employee rather than a permanent employee.  It is one of the reasons for companies to use temporary employees, to avoid the hassles and liabilities of hiring and firing employees who may not be needed long term.  This is truly an unjustified expansion of the retaliatory discharge doctrine.
 
It's not surprising that such an expansion would come from the 5th District.  The 5th District Appellate Court generally expands employee rights frequently beyond what is allowed by other districts and the Supreme Court.  I would not be surprised to see another district have a different view of this fact pattern.  I hope the employer is able to appeal this case to the Supreme Court.
 
BEFORE THE APPELLATE COURT, WORKERS' COMPENSATION DIVISION
 
Court Rules that Each Section 19(b) Hearing Is a Separate and Distinct Proceeding  Even Though Commission Found a Shoulder Injury was Work-Related in One 19(b) Proceeding, the Commission Could Deny Causal Connection with Respect to a Proposed Shoulder Surgery in Second 19(b) Hearing
 
Patrick Weyer v. IWCC and Wagner Heating & Ventilation, No. 1-08-0784WC, filed Dec. 16, 2008.
 

Here is an excellent decision from the appellate court obtained by Dan Egan in our office.
 
Petitioner was employed by respondent as a union sheet metal worker.  He had worked in this profession since 1975.  He started working for the employer in 1997.  Prior to his alleged accident of June 3, 2002, he had a long history of low back and left shoulder problems.  Some of these problems were the result of work accidents and some were the result of personal injuries.  He had a prior left shoulder rotator cuff repair surgery on Jan. 19. 2001.
 
On June 3, 2002, he claimed he was lifting a cabinet and injured his low back and left shoulder.  He sought treatment for his shoulder with the orthopedic surgeon who had previously performed surgery.  For his back he saw a different doctor, who did another MRI and recommended surgery. 
 
We arranged for an IME and the IME doctor concluded that petitioner's back problem was not causally related to this work accident.   Petitioner didn't actively treat for his back but was receiving conservative care for his shoulder.
 
Petitioner sought a 19(b) hearing and demanded TTD and medical to date on July 24, 2003.  After a hearing the arbitrator found that petitioner's low back problem was not causally related to the accident of June 3, 2002.  However, the arbitrator did find that the left shoulder problem was causally related and awarded TTD June 4, 2002 to July 15, 2002 and Oct. 8, 2002 to Feb. 26, 2003.  Both parties appealed to the Commission.  After briefs and oral arguments, the Commission confirmed the first 19(b) award..
 
Petitioner remained under the care of his shoulder surgeon and he released petitioner for light work only.  He didn't prescribe any surgery.  We arranged for an IME with Dr. Mark Levin.  He felt that as of Jan. 5, 2004 petitioner was at MMI with respect to his left shoulder condition.  He did not feel petitioner needed any further medical treatment and could perform regular work duties.

In January 2005, a year later, petitioner's shoulder surgeon again examined him and he diagnosed a SLAP lesion and recommended surgery.  We arranged a reexamination with Dr. Levin in February 2005 and had him review all of petitioner's films.  He concluded that petitioner's labral tear was not causally related to the accident of June 3, 2002.
 
Petitioner filed another 19(b) petition and a second 19(b) hearing was held July 25, 2005.  The arbitrator ruled in our favor.  The arbitrator denied the causal relationship between the June 3, 2002 accident and the proposed shoulder surgery.
 
Petitioner appealed to the Commission and on June 25, 2007, the Commission affirmed the arbitrator's decision.  Petitioner appealed to the circuit court and on Feb. 28, 2008, the circuit court confirmed.
 
Petitioner appealed to the appellate court.  Petitioner argued that the Commission could not reconsider its decision as to causal connection.  Petitioner argued that since causal connection with respect to the shoulder was found in favor of petitioner in the first 19(b) hearing, the Commission was bound to rule in favor of petitioner in the second hearing on the issue of causal connection.  The law-of-the-case doctrine barred the Commission from denying causal connection.
 
We argued that each section 19(b) hearing is different and that the issues raised in each hearing can be distinct and different.  The appellate court agreed with us and ruled in our favor.  The appellate court ruled that the factual issues raised in each 19(b) hearing were different and the evidence presented was different.  Even though the arbitrator found the left shoulder was injured in the accident, the issue of surgery was not ruled on in the first hearing.  It was only in the second hearing that petitioner demanded surgery on the shoulder.  The evidence presented in the second case merited a different decision.  The law-of-the-case doctrine did not demand that the Commission simply rule in petitioners favor again.
 
Comment:  Dan Egan excelled in handling this case on behalf of American Family Insurance.  He obviously did a superb job in a very difficult case.  Complicated factual issues, medical issues, and legal issues existed here.  This claimant had a litany of prior problems, many of which were personal in nature.  It is clear the claimant was trying to retire with this claim.  Dan did a great job of preparing the case factually and medically to show that petitioner's conditions were personal and not caused by the July 3, 2002 accident.  Legally, petitioner had good precedent on his side, but the courts properly ruled that even though causal connection was found by the Commission, it didn't mean we were responsible for all conditions to an injured body part forever.
 

Court Rules the Commission Erroneously Excluded IME Report  Award for Total and Permanent Disability Set Aside and Case Remanded
 
City of Chicago v. IWCC and Ezra Townsend, No. 1-07-2850WC, filed Dec. 23, 2008.
 
Petitioner suffered an injury to his lower back on April 17, 1998.  He received medical treatment and never returned to work for the employer.  He claimed he was permanently and totally disabled. 
 
On May 7, 2004, petitioner's attorney took the evidence deposition of his treating physician, Dr. Chmell, who testified that petitioner was permanently and totally disabled. 
 
Subsequent to this, the employer arranged for an IME with Dr. Charles Slack on Aug. 26, 2004.  He issued a report Sept.  6, 2004, and concluded that petitioner was not permanently and totally disabled.  The employer tendered this report to petitioner's attorney Sept. 20, 2004.
 
The case went to trial before the arbitrator on Feb. 8, 2005, and May 11, 2005.  At the hearing, the transcript of the evidence deposition of Dr. Chmell was introduced.  Petitioner objected to the IME report of Dr. Slack on the basis that the hearing in this case actually started on May 7, 2004 when the deposition of the treating physician was taken.  Therefore, any evidence created after that date was barred.  The arbitrator denied admission of the IME report and the Commission affirmed the denial, awarding permanent total disability. 
 
The employer appealed to the circuit court, who affirmed, and then to the appellate court, who reversed.  The appellate court ruled that the Commission's decision as to the admissibility of the IME report was erroneous.  The court noted that petitioner did not object to the IME being done several months after the deposition and in fact never raised an objection to the IME report until the date of trial. The court ruled that the decision to exclude the IME report was error as a matter of law.  However, the court noted that their decision as to the admissibility of the IME report might be different if the IME had been done prior to the deposition of the treating physician and had not been tendered to petitioner's attorney until the date of the deposition. 
 
Comment:  This is an excellent decision from the court protecting employers' interests.  Trials before the Commission are significantly different from the trials in circuit court.  The hearings tend to be works in progress.  It is common to have a series of evidence depositions taken over a period of months or even years before a case is actually tried before the arbitrator.  It's frequent that there are long gaps between arbitration hearings before they are eventually completed.  In
this case there was an evidence deposition May 7, 2004 and then there were two arbitration hearings, Feb. 8, 2005 and May 11, 2005.  Therefore, it's not surprising that activity will take place before and between arbitration hearings.  It's clear in this case that the employer was surprised by petitioner's objection to his IME report. 
 
However, it is clear from this decision that if an employer gets an IME report that it plans to use at trial, it should disclose the IME report prior to taking the evidence deposition of petitioner's treating doctors or IME doctors.  Of course, if an IME report doesn't exist prior to taking an evidence deposition, it is impossible to tender the report and therefore it shouldn't be excluded.
 

Arbitrator Erred in Reopening Proofs in Issuing a Second Decision Despite Allegations of Fraud Where Neither Party Sought Review with the Commission
 
Smalley Steel Ring Co. v. IWCC and Harry Diaz, No. 2-07-1050WC, filed Dec. 12, 2008.
 
Petitioner, alleging a name of Harry Diaz, filed an application with the Commission alleging an accident date July 9, 2004.  Petitioner claims that he injured his left arm pulling a rack at work. The employer disputed liability.  An arbitration hearing was conducted Jan. 31, 2005.  At the hearing, the employer requested a continuance claiming they were disputing petitioner's identity. Petitioner had presented a social security number which was false, because it belonged to a person who died in New York Sept. 1, 2003.  Petitioner objected to the continuance and the arbitrator denied the continuance.
 
On April 7, 2005, the arbitrator issued his decision awarding 14 weeks of TTD and $21,000.00 in medical bills.
 
The employer did not file a petition for review with the Commission.  However, on May 10, 2005, the employer filed a motion to reopen proofs.  The employer presented evidence that, in fact, petitioner's true identity was Alejandro Atilano who had previously filed a workers' compensation claim for a left shoulder injury and had received a settlement for 25% loss of use of the arm. 
 
The arbitrator conducted a second hearing on the employer's motion.  The arbitrator granted the employer's motion, recalled his April 7, 2005 decision, and denied benefits in a new decision dated Nov. 15, 2005. 
 
Petitioner filed an appeal with the Commission and the Commission reversed the arbitrator's second decision.  The Commission found that the arbitrator had no jurisdiction to recall his first decision and that the first decision was final.  The Commission ruled the second decision was null and void. 
 
The employer appealed to the circuit court and the appellate court and the courts affirmed.  The court found that the arbitrator had no jurisdiction to recall his first decision even if petitioner committed fraud.  The court ruled that there is no ability for an arbitrator to recall a decision once it is entered and once it becomes final.  The arbitrator has a very limited right under 19(f) to correct clerical and computational errors.  The arbitrator does not have jurisdiction to withdraw a decision even if there is evidence of fraud.
 
The court found that the employer's right of action, if any, was to file a claim for fraud in the circuit court.  The court stated, The employer may seek recourse for claimant's fraudulent conduct.  The appropriate forum for its allegations is in the circuit court . We note that the facts of this case present an unfortunate scenario. Although employer possessed strong evidence of fraud, the arbitrator lacked the statutory authority to act.  Suchdeficiencies in the Act should be addressed by the Legislature.
 
Comment:  The arbitrator was clearly correct in his second decision in this matter.  The claimant certainly engaged in fraudulent conduct. However, the Illinois Workers' Compensation Act does not provide a statutory scheme to address the issue raised by the employer.  It's clear that the arbitrator should have granted the employer additional time at the arbitration hearing to further  investigate petitioner's true identity. However, the arbitrator failed to grant this request and tried to make up for it by withdrawing the first award and issuing a second decision. The employer was certainly in a difficult position here. This is an unfortunate result where the employer has to pay a fraudulent decision and then seek recourse in circuit court to reverse the fraud.  This is an onerous process which should be corrected by legislative action.  With concerns of fraud here, the employer's best course of action should have been to appeal the decision of the arbitrator and at least keep the decision of the arbitrator from becoming final until their investigation was complete.  This decision is consistent with prior court decisions significantly limiting the Commission's authority to modify its decisions once entered. The Commission has limited statutory authority to correct its own mistakes.  Employers must be wary of this fact and use the circuit court as needed.
 

Commission Not Allowed to Vacate Ruling from Initial 19(b) Hearing in a Subsequent Permanency Hearing  Doctrine of Law of the Case Applies
 
Ming Auto Body v. IWCC and Darrell Marmor, No. 1-07-1125WC, filed Nov. 18, 2008.
 
Petitioner suffered a back injury while working on Oct. 5, 1990. There was subsequently a 19(b) hearing in November 1995.  There was a permanency hearing in December 2002.  At the 19(b) hearing, petitioner proved that he sustained a back injury on Oct. 5, 1990 while lifting. Thereafter, he underwent a back fusion, which included the insertion of rods.  He claimed that he couldn't return to work.  After a hearing, the Commission awarded petitioner TTD through Feb. 2, 1993. The Commission issued its decision Nov. 7, 1996.  Neither party appealed and the decision became final.
 
Several years later, in December 2002, a permanency hearing was held. Petitioner testified along with his ex-wife.  Significant evidence was presented, much of which questioned petitioner's veracity.  The evidence showed petitioner had falsified various applications.  They showed petitioner was involved a motor vehicle accident Oct. 30, 1996, and filed a lawsuit claiming that all of his problems related back to the motor vehicle accident, denying any work-related problems.
 
The arbitrator found that petitioner was a liar and had been fraudulent. She denied further benefits. Petitioner appealed to the Commission.  However, the Commission found that the law-of-the-case doctrine required that the employer was required to pay for petitioner's second back surgery to remove his rods.  They awarded some additional TTD, medical expenses, and PPD in the amount of 25% loss of use of the man as a whole.  The employer appealed to the circuit court
who affirmed. 
 
The employer appealed to the appellate court and they also affirmed. The appellate court found that the law-of-the-case doctrine decides and resolves all issues for subsequent stages of the litigation.  In this case, petitioner proved that he sustained an accident and suffered a back injury.

The employer therefore became responsible for that accident, related medical expenses, and permanent disability.  Even after the employer subsequently proved that petitioner was a liar and had been fraudulent with respect to subsequent claims, this fact couldn't vacate the prior award.

The court stated:
Ming Auto argues that the phrase in the absence of fraud contained in section 19(f) creates a statutory exception that permits an arbitrator and the Commission to reconsider and vacate a prior final award that was entered as a result of fraud.
Based on this language, Ming Auto contends that Arbitrator Neal and the Commission had authority and discretion to reconsider and vacate the section 19(b) award based on the fraudulent conduct of the claimant. This contention is
without merit.
 
We also reject Ming Auto's assertion that the Commission has inherent authority to reconsider its prior rulings where it is alleged that a previous award was based on fraud.  The Commission is an administrative agency that has no general or common law powers.  Rather, its powers are strictly limited to those particularly granted by the legislature and any action taken by the Commission must be specifically authorized by statute.
 

Therefore, the court ruled that the initial 19(b) award, which became final, could not be reexamined by the Commission despite evidence being offered that petitioner was fraudulent.  The Commission had to award additional medical bills proven to be associated with petitioner's initial injury along with TTD and permanent partial disability.
 
Comment:  This is a frustrating decision for the employer.  It again presents another example of where the employer finds fraud on the part of the claimant, but finds it too late.  The employer disputed this accident initially but couldn't produce enough evidence to convince the Commission that the case wasn't compensable.  The employer has a very limited right to produce evidence and prove fraud.  The employer must develop all of its evidence and present it at the arbitration hearing. There is no provision under Illinois law for evidence to be offered after that. Parties used to be able to present evidence on review, but that right was taken away from employers back in 1989. 
 
Once an employer finds fraud, it is very limited in its opportunity to present that evidence to the Commission and get the Commission to change a prior ruling.  This decision, as well as Smalley, the prior one summarized in this newsletter, shows that in order for an employer to get justice, the employer has to seek a remedy in the circuit court, a court with general powers not powers limited solely by what is granted in the statute. Despite the wording of the statute, which states the Commission's decision becomes final in the absence of fraud, the Commission really doesn't have any ability to change prior awards if they discover the petitioner has been engaged in fraudulent activities.  The fraud language of the statute has only very limited applicability.
 


Court Rules Illegal Aliens Are Entitled to Workers' Compensation Benefits and Can Prove Entitlement to Permanent and Total Disability So Long as Unemployability Is Not Based on Immigration Status
 
Economy Packing Company v. IWWC and Ramona Navarro, No. 1-07-2947WC, filed Dec. 9, 2008. 
 
In 1992, petitioner was hired by Economy to work on an assembly line manually deboning chickens. Petitioner was born in Mexico and was an illegal alien. She admitted that when she applied for employment she presented false documents. 
 
Petitioner worked for the employer for 10 years.  On May 7, 2002, she slipped and fell and hurt her chest and shoulder.  She eventually had shoulder surgery and in April 2003 she was released to return to work at MMI with a permanent lifting restriction of 10 pounds or less and no work above shoulder level. Petitioner was not able to return to her prior employment.  Her treating doctor issued a report stating she was permanently and totally disabled. He subsequently issued a report stating petitioner could still be gainfully employed, but required significant lifting restrictions.  Petitioner claimed that she was entitled to permanent and total disability.  She testified that she had limited education and could not speak, read, or write English. 
 
Petitioner presented testimony from a vocational consultant who concluded that petitioner was unemployable because of her age, limited education, limited communication skills, and work restrictions.  She stated that petitioner wouldn't be employable even if she were a citizen of the United States. The employer retained a vocational consultant. He concluded that petitioner was employable, but for her illegal status. He felt she could perform a variety of unskilled sedentary work occupations. 
 
After a hearing, an arbitrator awarded petitioner 60 weeks of TTD and permanent and total disability benefits for life.  The arbitrator found petitioner was permanently and totally disabled under the odd lot doctrine.  The employer appealed, but the Commission affirmed. The employer appealed to the circuit court which also affirmed the award of permanent and total disability. 
 
The employer appealed to the appellate court and argued that the Commission applied an incorrect standard in awarding permanent and total disability benefits to petitioner. The employer argued that a different standard should apply when dealing with illegal immigrants who claim they are unemployable.  The employer argued that before an illegal immigrant can receive PTD benefits under the odd lot category, the claimant must establish she is not employable due to her age, training, education, and experience in a country where she is legally entitled to work.
 
The court analyzed the issue of whether an illegal alien is entitled to workers' compensation benefits. The court ruled that under the Illinois Workers' Compensation Act, illegal aliens are definitely covered as employees and entitled to Illinois WC benefits. 
 
However, the court noted that it was unlawful for an employer to knowingly hire an undocumented alien pursuant to federal law. Further, if an employer later discovers that it hired an illegal alien, the employer must discharge the worker.  Federal law makes it illegal for an alien to use false documents. The court considered whether petitioner's use of false documents in violation of federal law precluded the employee from receiving workers' compensation benefits. The court held that federal law does not expressly preempt state laws, which allow illegal aliens to get workers' compensation benefits. Therefore, even though petitioner violated federal law in order to get her job, she was still entitled to Illinois workers' compensation benefits.
 
Further, the court ruled that federal law does not preempt a claimant from receiving permanent and total disability benefits. 
 
The court distinguished this case from the United States Supreme Court case of Hoffman Plastic Compounds Inc. v. National Labor Relations Board, 535 U.S.137 (2002).  In Hoffman, the Supreme Court denied back pay for an illegal alien who was wrongfully terminated for supporting efforts to unionize. The court ruled that it would be improper to force an employer to pay back pay to an illegal alien who should not have ever been lawfully employed and only obtained employment through criminal fraud. 
 
The court found this case to be significantly different from Hoffman.  The court ruled in this case the claimant couldn't return to work elsewhere because of her injury. The court ruled that the award of benefits here would not create any incentive for employers to hire more undocumented workers. The court examined cases from other jurisdictions and found many other jurisdictions had already ruled that federal law did not preempt undocumented aliens from receiving workers' compensation benefits. 
 
The court then concluded that the Commission's award of odd lot permanent total disability benefits was not contrary to the manifest weight of the evidence. The court found that petitioner did prove that she was permanently and totally disabled under the odd lot doctrine. The court refused to create a special standard for illegal aliens. However, the court did state, "Applying this reasoning to the 'odd-lot' doctrine, we conclude that an undocumented alien has the initial burden of proving that she cannot sustain regular employment in a well-known branch of the labor market without regard to her undocumented status.  The burden then shifts to the employer to produce sufficient evidence that suitable jobs would be regularly and continuously available to the undocumented alien but for her legal inability to obtain employment." The court found that the Commission's reliance on petitioner's vocational expert, instead of respondent's vocational expert, was not manifestly wrong. The award for permanent and total disability benefits was, therefore, confirmed.
 
Comment: This is an expected but disappointing decision from the appellate court.  Many other jurisdictions grant workers' compensation benefits to illegal aliens.  Because of the way the Illinois workers' compensation statute is worded, there is no way the court could deny benefits to illegal aliens unless it concluded federal law preempted the field entirely.  That was an argument destined to fail.
 
This decision does not mean it is any easier for an illegal alien to get an odd lot permanent total disability award than before.  In order to justify such an award, the illegal alien still has to show there is no reasonably stable job market available for him. 
 
The problem for employers is that most of these illegal alien cases involve claimants who, because they are illegal aliens,  generally have more than physical problems which make it difficult for them to find work.  More often than not, the illegal alien cases involve claimants who are (1) unable to speak, read, or write English, and (2) poorly educated.  Those traits generally have more to do with the individuals being unemployable than their physical restrictions.  It is easy to argue that an individual with significant physical restrictions can perform sedentary work.  The argument becomes more difficult if the individual has virtually no education and cant read, write, or speak English. Employers who hire such workers should recognize the potential difficulty they may have in placing such employees in alternate employment or fighting a case of alleged permanent and total disability. 
 
In claims like this, employers must do more if possible to present evidence as to a worker's employability despite language problems and limited education. Permanent total disability awards are obviously very costly and a greater investment should be made in vocational rehabilitation evidence.  Despite this decision employers should continue to vigorously defend illegal alien claims of PTD.  The argument should continue to be advanced that the test of employability should be based on the ability of the employee to return to work in an area where limited language skills are irrelevant. An alien claimant should not be entitled to benefit by illegally getting a job here and then claiming total disability because of an inability to communicate. 
 

Death Benefits to Miner's Widow Confirmed  Case Remanded Back to Commission to Also Award Benefits to Miner Prior to Death
 
Freeman United Coal Mining Co. v. Artis Van Houten, Widow of Kenneth Van Houten, Deceased, Nos. 4-07-0905WC, 4-07-0907WC consolidated, filed Sept. 28, 2008.
 
Petitioner worked as a coal miner for respondent for 38 years and was exposed to coal dust.  He had difficulty breathing and stopped working Feb. 2, 1998. 
 
Two years later, on May 10, 2000, he filed an application with the Workers' Compensation Commission for benefits for his alleged lung disease.  Two months later, on May 19, 2000, he died from an acute myocardial infarction secondary to atherosclerosis and emphysema. 
 
Significant and conflicting medical evidence was presented as to whether or not petitioner suffered from coal workers' pneumoconiosis.  He was also a smoker and suffered from chronic obstructive pulmonary disease. Conflicting evidence was presented as to whether petitioner's fatal heart attack was in any way related to his lung disease. 
 
The Commission ruled in the widow's favor and granted death benefits. The Commission dismissed the coal workers' claim.  The employer appealed up to the appellate court, and the appellate court affirmed, finding that the Commission could have well relied on petitioner's multiple experts who all testified that his coal dust exposure caused his lung problems and also was a causative factor in his fatal heart attack. 
 
However, the appellate court also reversed the Commission's denial of any benefits for the coal worker himself.  The court remanded the case back to the Commission to determine if any award should be made on behalf of the coal miner.  The court held, precedent supports our conclusion that if a claimant in a workers' compensation case dies during the pendency of the claims process, the claim shall proceed as if death had not occurred.  If the claim ultimately prevails, all compensation that would have been awarded to the claimant shall be paid to the dependents of the deceased claimant.  Any other claims any dependent might have as a result of the claimant's death shall proceed unaffected. 
 
Comment:  This is a dangerous decision from the appellate court.  It encourages the Commission to award a claimant PPD for his injury and then award the claimant's widow death benefits for his death.  In my view, that is a foolish and unwarranted result.  A claimant should not be awarded permanent partial disability benefits if he has already died, especially if the death is ruled to be work-related.  The benefits that the claimant would be awarded simply go to his dependents. There is no justification for such an award.  Permanent partial disability benefits are to compensate an individual for his disability.  If the claimant dies, there is no reason to award the benefits to be paid to dependents.  It's especially true in this case where the widow is getting the full death benefit for 20 years. It doesn't make sense to me to have the Commission consider the miner's case and award him 20% or 30% loss of use of the man as a whole only to have that money paid to a widow who is already receiving death benefits.  Such a result would add insult to injury.  However, the potential for this unreasonable result is encouraged by this decision.



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Michael E. Rusin is a senior partner of the Chicago firm Rusin, Maciorowski, Friedman. He can be reached at merusin@rusinlaw.com or by phone at (312) 454-5119.
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