Dye then sought out a dermatologist who noted a two by one-centimeter depressed area on the right frontal temporal region in front of the temporal hairline.  There was a raised lower edge resembling a scar.  The doctor recommended grafting to correct the deformity. At arbitration on petitioner’s 8(a) petition, the Arbitrator took notice of the area in question but denied the request for prospective cosmetic medical treatment; he also denied a petition for penalties on the basis that the treatment that was outside the allowable chain of referrals.  The Commission modified this finding but otherwise affirmed the Arbitrator’s decision to deny prospective medical and penalties, stating that “the evidence is at best unclear as to whether [claimant] has an observable disfigurement.”

On appeal, the Appellate Court cited the definition of disfigurement as “that which impairs or injures the beauty, symmetry or appearance of a person or thing; that which renders unsightly, misshapen, or imperfect, or deforms in some manner.”  Petitioner had an indentation on the right side of the forehead which her dermatologist proposed to repair which clearly demonstrated that the disfigurement was observable to the naked eye.  The court overruled the Commission’s finding that it was “unclear” whether there was observable disfigurement.  Although the Commission’s relied on the neurologist who opined that nothing needed be done and that the dent would not cause Dye trouble in the future, the court felt that he was speaking strictly from a neurological standpoint.  Therefore, the court granted the 8(a) petition seeking the cosmetic surgery.

The employer argued that any disfigurement Dye sustained was not serious and therefore she was not entitled to prospective cosmetic medical care.  The court dismissed this argument, stating that there was no language limiting medical care under Section 8(a) for serious and permanent disfigurement.  The Court did affirm the Commission finding denying penalties, however.

Justice Turner dissented, accusing the Court of reweighing the evidence and ignoring the reasonable inferences drawn by the Commission.  The dissent cited the fact that there were no photographs of the disfiguring area in evidence, something the dissent considered a “red flag.”  The Arbitrator’s decision provided no information and was vague and subject to different interpretations.  Further, a reasonable inference could have been made that the Arbitrator questioned the need to fix something trifling from his statement, made after he asked petitioner if she were seeking cosmetic repair, “You have got to be kidding.”  The dissent would have affirmed the Commission’s conclusion that the evidence was at best unclear as to whether there was observable disfigurement. 

Comments:

Inasmuch as the right to medical treatment remains open under Section 8(a), any claimant can at any time seek cosmetic surgery for so-called disfiguring injuries.  This means that any cut or burn observable on the face, neck, arms or hands and legs below the knees can be subject to future medical care.  The question is not whether the claimant here could profit from cosmetic surgery but rather the open-ended nature of ‘serious and permanent’ disfiguring injuries.  An orthopedic specialist can easily conclude that an individual no longer needs medical treatment for an operated shoulder or elbow.  A cut on the face is a different matter, however.  It appears the court usurped the Commission’s function in this case. 

Dye then sought out a dermatologist who noted a two by one-centimeter depressed area on the right frontal temporal region in front of the temporal hairline.  There was a raised lower edge resembling a scar.  The doctor recommended grafting to correct the deformity. At arbitration on petitioner’s 8(a) petition, the Arbitrator took notice of the area in question but denied the request for prospective cosmetic medical treatment; he also denied a petition for penalties on the basis that the treatment that was outside the allowable chain of referrals.  The Commission modified this finding but otherwise affirmed the Arbitrator’s decision to deny prospective medical and penalties, stating that “the evidence is at best unclear as to whether [claimant] has an observable disfigurement.”

On appeal, the Appellate Court cited the definition of disfigurement as “that which impairs or injures the beauty, symmetry or appearance of a person or thing; that which renders unsightly, misshapen, or imperfect, or deforms in some manner.”  Petitioner had an indentation on the right side of the forehead which her dermatologist proposed to repair which clearly demonstrated that the disfigurement was observable to the naked eye.  The court overruled the Commission’s finding that it was “unclear” whether there was observable disfigurement.  Although the Commission’s relied on the neurologist who opined that nothing needed be done and that the dent would not cause Dye trouble in the future, the court felt that he was speaking strictly from a neurological standpoint.  Therefore, the court granted the 8(a) petition seeking the cosmetic surgery.

The employer argued that any disfigurement Dye sustained was not serious and therefore she was not entitled to prospective cosmetic medical care.  The court dismissed this argument, stating that there was no language limiting medical care under Section 8(a) for serious and permanent disfigurement.  The Court did affirm the Commission finding denying penalties, however.

Justice Turner dissented, accusing the Court of reweighing the evidence and ignoring the reasonable inferences drawn by the Commission.  The dissent cited the fact that there were no photographs of the disfiguring area in evidence, something the dissent considered a “red flag.”  The Arbitrator’s decision provided no information and was vague and subject to different interpretations.  Further, a reasonable inference could have been made that the Arbitrator questioned the need to fix something trifling from his statement, made after he asked petitioner if she were seeking cosmetic repair, “You have got to be kidding.”  The dissent would have affirmed the Commission’s conclusion that the evidence was at best unclear as to whether there was observable disfigurement. 

Comments:

Inasmuch as the right to medical treatment remains open under Section 8(a), any claimant can at any time seek cosmetic surgery for so-called disfiguring injuries.  This means that any cut or burn observable on the face, neck, arms or hands and legs below the knees can be subject to future medical care.  The question is not whether the claimant here could profit from cosmetic surgery but rather the open-ended nature of ‘serious and permanent’ disfiguring injuries.  An orthopedic specialist can easily conclude that an individual no longer needs medical treatment for an operated shoulder or elbow.  A cut on the face is a different matter, however.  It appears the court usurped the Commission’s function in this case. 

Relying on the foregoing facts, the Arbitrator found that Timms had sustained psychological injuries arising out of and in the course of her employment.  Although she did not obtain treatment for approximately two months, thinking she would be able to manage the tragedy ‘through her own strength,’ this did not defeat her claim.  The Arbitrator found that her flashbacks of the victim laying curled up in the street fell within the holding of Pathfinder Co. vs. Industrial Comm’n, 62 Ill.2d 556 (1976), in that she suffered a sudden, severe emotional shock traceable to a definite time and place and cause which caused psychological injury. 

The Commission affirmed with a dissent which concluded that Timms failed to prove the immediate onset of an emotional injury as a result of the accident.  Upon appeal, the Appellate Court interpreted Pathfinder which authorizes recovery when a claimant suffers a “sudden, severe emotional shock traceable to a definite time, place, and cause which causes psychological harm.”  The CTA argued that Timms could recover only if she proved that a sudden, severe emotional shock caused a psychological injury that was “immediately apparent,” citing General Motors vs. Industrial Comm’n, 168 Ill.App 3d 678 (1988).  The court distinguished General Motors because the injuries in that case did not stem from a single traumatic work-related incident but rather a variety of factors, including non-traumatic and non-work-related events. 

But the court went further, rejecting the argument that recovery can be had only when the resulting psychological injury is “immediately apparent.”  Under Pathfinder, the emotional shock needs to be “sudden” not the ensuing injury.  Thus, Timms could recover if she showed she suffered a sudden, severe emotional shock which caused a psychological injury even if this psychological injury did not manifest itself until some time after the shock. 

The court also rejected the argument that its holding would “open the flood gates” to fraudulent or frivolous claims, expressing confidence that the Commission will continue to be vigilant in assessing psychological claims.  The court stressed that a claimant must present objective evidence supporting inferences of psychological injury, causation, and disability; although not dispositive as a matter of law, evidence that a claimant delays treatment for alleged psychological injuries may still be relevant in a given case.  In the present case, the court found it reasonable to infer that Timms suffered a sudden shock during the bus accident which caused a psychological injury even though she did not seek treatment for her problems for two months; it was also reasonable to infer she did not. 

The court concluded that watching a pedestrian dying was the type of “exceptionally distressing” and “uncommon” work-related experience that can support an award under Pathfinder and from which one can infer that Timms suffered a “sudden, severe emotional shock” causing psychological injury.  She testified that she felt shaken and depressed after the accident and that her supervisor referred her to a “comp psych.”   Although she thought she could manage the tragedy, her symptoms worsened and she sought professional help.  Her doctor diagnosed an adjustment disorder which was unrebutted by the employer.  It was not apparent that the CTA produced witnesses to rebut petitioner’s testimony regarding her reactions to the accident.  Therefore, the Court concluded that the Commission decision was not against the manifest weight of the evidence. 

Comments

Notwithstanding the Court’s protestations, the holding in Pathfinder has been expanded.  Pathfinder involved an immediate manifestation of psychological injury, whereas Timms did not.  A delay in the manifestation of symptoms, is common in post-traumatic stress cases, but here it is difficult to reconcile the delay in seeking treatment when it occurred only after Timms was terminated, a fact both the Commission and the court seemingly ignored.  One must concede that the bus-riding public may not be best served by drivers who are unaffected when their vehicle strikes and kills a pedestrian.  However, recovery should be limited to those cases where there is an obvious “sudden” emotional reaction, not one where the claimant walks away from work on the day of the accident and seeks treatment only after she is terminated.

At the hearing on the petitions, the village disputed liability for additional TTD, asserting that any request for such benefits must be brought under Section 19(h) of the Act, which would bar TTD payments in this case as the petition was filed beyond the 30-month statutory time limit imposed by Section 19(h).  The village further maintained that Section 8(a) does not entitle a claimant to additional TTD following the expiration of the Section 19(h) period.

The Commission denied the claim for additional TTD benefits, stating that no Section 19(h) petition was filed, presumably because the 30-month period required by 19(h) had expired.  The Commission considered Curtis’ claim to be for ‘maintenance’ under Section 8(a), but found that maintenance under a vocational rehabilitation situation, while provided under Section 8(a), “is not the same as TTD albeit the benefit rate for TTD and maintenance may be the same.”  The Commission concluded there was no provision in Section 8(a) providing for the relief Curtis was seeking.

The Appellate Court took up Curtis’ argument that additional TTD benefits can be awarded under Section 8(a).  Curtis argued that Section 8 authorized the payment of additional TTD benefits for the “destabilization” of a work-related injury beyond the 30-month statutory time limit set forth in Section 19(h).  The court first quoted Section 19(h) of the Act, which states in pertinent part:

“[A]s to accidents occurring subsequent to July 1, 1955 which are covered by any…award under this Act providing for compensation in installments…, such…award may at any time within 30 months…after such…award be reviewed by the Commission at the request of either the employer or employee on the ground that the disability of the employee has subsequently recurred, increased, diminished, or ended.”

The court noted that the purpose of Section 19(h) is to set a time period within which the Commission can consider whether an injury has recurred, increased, decreased, or ended.  This time limit is jurisdictional and begins to run from the date of the Commission decision or, when no review of an Arbitrator’s decision is sought, the date of the arbitration decision. 

Considering this, the court held that the petition for additional TTD benefits was untimely under Section 19(h).  The court dismissed Curtis’ claim that Section 19(h) is silent with regard to temporary total disability benefits and that the term “disability” in Section 19(h) was intended to refer exclusively to permanency.  Curtis argued that the use of the modifiers “increased” and “diminished” in Section 19(h) made it clear that the word “disability” was intended to refer only to permanency and, therefore, did not exclude a claim for further temporary total disability which cannot “increase” or “diminish,” but can only begin and end.  The court disagreed, stating that this definition ignored the plain language of Section 19(h), which also contains the modifier “recurred” when referring to the term “disability.”  Thus, while permanent injuries can increase or decrease, only temporary disability can “recur” which permits the Commission to re-establish compensation payments.  Since only temporary disability can recur, it necessarily follows that only TTD payments may be “re-established.”  When Section 19(h) is read as a whole, it is clear that the legislature did not intend to limit its scope to permanency, but rather to cover TTD benefits as well.

Curtis also argued that Section 8 of the Act did not place a time limit on the availability of TTD benefits, citing the silence of that section on whether benefits were limited either prior to or after a finding of disability.  When Section 8 was amended in 1975, it abolished a 64-week time limit on TTD; therefore, Curtis argued that the legislature intended that TTD benefits under Section 8 were intended to be unlimited.  The court was not persuaded by this argument either.  Section 8(a) makes no provision for the relief Curtis requested, and even if the petition were to be considered one under Section 8(b), the section governing TTD payments, the court would have rejected Curtis’ argument.  The court stated that to adopt an interpretation of a statute permitting unlimited Section 8(b) benefits would be to render meaningless the 30-month limitations period in Section 19(h) as it relates to TTD benefits.  Therefore, Curtis’ claim for additional TTD benefits was denied.

COMMENT

Curtis was, in essence, asking the court to interpret the Act as broadly as possible, this based on its being a remedial statute intended to provide financial protection for injured workers and, while one can appreciate the equitable aspect of his argument, the court chose to strictly interpret Section 19(h) and to ignore the lack of a limit on TTD benefits as provided in Section 8(b).  One could state that it does no violence to Section 19(h) to grant unlimited TTD benefits under Section 8(b).  However, the court looked to the meaning of Section 19(h) and the wording of that section as it applies to ‘recurring’ disability.  The court seemingly made a narrow interpretation of the statute, something unusual in your editor’s experience.  Noting that the result of this decision was a harsh one, the court felt it “a concern better addressed to the legislature” than to the court’s interpretation.

Wood Dale claimed a credit for Bilson’s pension benefits.  The Arbitrator awarded a weekly wage differential benefit based on lost earnings and denied Wood Dale’s claim for credit.  The Commission affirmed the Arbitrator with two exceptions.  First, Bilson’s wage loss benefits were modified to reflect the maximum rate that could be awarded.  Second, the Commission found that Wood Dale was entitled to a credit for any pension benefits that accrued during Bilson’s time working for Wood Dale.  Upon remand, the Arbitrator issued a Decision calculating Wood Dale’s pension credit at $432.00 per week.  The Commission affirmed this finding.

When the matter was heard in the Circuit Court, the court set aside that portion of the award granting Wood Dale credit and remanded the case to the Commission to determine as a factual matter the extent to which Bilson would be entitled to pension benefits.  Wood Dale appealed.

When the Appellate Court took up the case, it first ruled that the Circuit Court had no jurisdiction over Bilson’s pension benefits and vacated that portion of the Circuit Court’s order.  It then addressed the question of what credits Wood Dale was entitled tounder the Act, stating that “The right to credits, which operates as an exception to liability created under the Act, is narrowly construed.”  Wood Dale argued that Section 8(j)2 of the Act set forth a clear exception. 

The Court noted that Section 8(j) contains three subparts, two of which did not apply to the case.  The portion of the Section which did apply provides as follows: 

Nothing contained in this Act shall be construed to give the employer or the insurance carrier the right to credit for any benefits or payments received by the employee other than compensation payments provided by this Act, and where the employee receives payments other than compensation payments, whether it’s full or partial salary, group insurance benefits, bonuses, annuities, or any other payments, the employer or insurance carrier shall receive credit for such payments only to the extent of the compensation that would have been payable during the period covered by such payment. 

Bilson argued that the above language excluded pension payments, emphasizing the words “[n]othing contained in the Act shall be construed to give” a credit.  Wood Dale argued that this interpretation of the Section limited credits which an employer “shall receive” for payments made.  

The Court resolved the issue by referring to prior case law which had disallowed credit in instances where employees receiving full salary while off work due to accident or illness were entitled to such benefits irrespective of whether a workers’ compensation accident had occurred. 
Where an employer intends that its employees can collect both salary and workers’ compensation payments, no credit will be allowed for payment of salary.  Here, there was no dispute that the pension payments due Bilson were the result of his pension retirement benefits which were unrelated to the work injury.  Thus Bilson could collect his pension and wage loss benefits.

In addition to the credit issue, Wood Dale argued that Bilson should not be entitled to a wage differential under Section 8(d)1 because he voluntarily removed himself from the workforce by electing to retire.  The Court disagreed with this proposition, stating that in order to qualify for a wage differential, a claimant must prove (1) a partial incapacity that prevents him from pursuing his usual and customary line of employment, and (2) an impairment of earnings.  There was no dispute Bilson had suffered a diminution in earnings following the accident due to his inability to return to work as an electrician.  The evidence produced before the Commission was sufficient to show his efforts to find suitable post-accident employment.  Therefore, he was entitled to a wage differential award.  His voluntary decision to remove himself from the workforce did not preclude a wage differential award. 

Comment:

All claims for credit under the Act are narrowly construed.  This includes claims for credit for wages paid when an employee is off due to a work-related injury.  Although a retirement pension is clearly a benefit that would have been paid “irrespective” of the occurrence of a workers’ compensation accident, in the case of other benefits the result is not so clear.  Most observers would read the plain language of Section 8(j)2 and conclude that an employer should receive credit for payment of wages or other benefits, but this is not the case.  For this reason, all salary continuation programs should state explicitly that in cases of work-related accidents such benefits are being paid in lieu of temporary total disability benefits under the Act.  And employers should stand ready to provide assistance in proving the credit.

We also note the court's summary holding that an injured worker can retire and still qualify for wage loss.  Again, pension benefits are paid irrespective of a work-related injury:  A worker who retires from his principle employment and finds other work has not effectively removed himself from the work force.

The court characterized TTC as a temporary employment agency or “employee leasing company” which loaned Szaradzinski and other workers to MGM.  It was undisputed that TTC was contractually responsible for paying Szaradzinski’s salary and maintaining workers' compensation coverage for him.  During the proceedings, an employee of Virginia Surety testified that its underwriting file indicated that TTC intended to procure its own workers' compensation coverage and that MGM needed coverage only for its own employees.  Also, an audit of MGM’s payroll records used to determine its premium found that MGM employed clerical and sales personnel only; Virginia Surety disregarded the 350 workers MGM leased from TTC in its premium calculations. 

Virginia Surety’s coverage was limited to people MGM “employed,” and Virginia Surety subsequently rejected Szaradzinski’s claim because he was a leased employee of TTC and not an “employee” of MGM.  The underwriting file also contained a letter from MGM’s broker, which stated that TTC was to cover the leased “unit employees” and that MGM needed coverage only for the clerical staff, sales people, and other specified MGM personnel.  The Virginia Surety policy reflected payroll for these personnel. 

MGM’s premium was initially estimated and then finalized after the policy period ended by using actual business records.  The policy indicated that the premium would be based on payroll and all other enumeration paid for the services of officers and employees engaged in work covered by the policy and “all other persons engaged in work that could make us liable” under the workers' compensation policy.  An auditor’s report at the end of the coverage period stated that the above-mentioned personnel were the only employees on MGM payroll; the majority of the employees were paid through TTC, which covered all employees for payroll and workers' compensation insurance. 

 In the trial court, the Fund argued that Section 4(a)(3) of the Act required an employer to insure all its employees.  This section of the Act states that an employer must: 

 Insure his entire liability to pay such compensation in some insurance carrier authorized, licensed or permitted to such insurance business in the State.  Every policy…insuring the payment of compensation under this Act shall cover all the employees in the entire compensation liability of the insured… 

The Fund also relied on Section 546(a) of the Insurance Code, which requires that “other insurance” must be exhausted before the Fund is required to provide compensation. 

Last, the Fund relied on Section 1(a)(4) of the Act, which provides that where an employer 

loans an employee to another such employer and such loaned employee sustains a compensable accidental injury in the employment of such borrowing employer and where borrowing employer does not provide or pay the benefits or payments due such injured employee, such loaning employer is liable to provide or pay all benefits or payments due such employee under this Act and as to such employee the liability of such loaning or borrowing employers is joint and several, provided such loaning employer is in the absence of an agreement to the contrary entitled to receive from such borrowing employer full reimbursement for all sums paid incurred pursuant to this paragraph…

Virginia Surety argued that it did not agree to cover and did not collect the premium for MGM’s employees.  Further, MGM was free to agree with TTC that TTC would maintain coverage for its employees and that MGM was not required by law or by contract to duplicate TTC’s coverage.  Last, Virginia Surety maintained that its coverage was limited to MGM employees only.

The Circuit Court found for the Fund, under the general principle that potential claims against the Fund should be reduced by a solvent insurer.  The Appellate Court disagreed and reversed, stating that none of the cited statutes required Virginia Surety to compensate TTC’s employees and that the underlying goals of the legislation were not furthered by the ruling for the Fund. 

First, the Court summarily dismissed the argument that the Insurance Code protected the Fund, stating that the plain terms of Section 546(a) of the Code do not create “other insurance” coverage.  The Court held that Szaradzinski’s claim was never within Virginia Surety’s coverage.  The Virginia Surety policy language, substantiated by the underwriting file and testimony of its employee, indicated that the policy coverage was limited to MGM’s employees.  Virginia Surety did not collect or retain a premium for non-MGM employees.  Szaradzinski was never on MGM’s payroll and was never covered by the Virginia Surety policy.  Therefore, the Virginia Surety policy was not “other insurance” within the meaning of Section 546(a) of the Code.

With regard to Section 1(a)(4) of the Act, the Court held that the legislature did not require both the loaning employer and the borrowing employer to procure identical coverage for the same employees.  There being no requirement to duplicate coverage, the Court refused to construe Section 1(a)(4) of the Act to require MGM to duplicate the coverage that TTC was contractually obligated to obtain for the employees it lent to MGM. 

Last, the Court dismissed the Section 4(a)(3) argument that the Act requires a policy to “cover all of the employees in the entire compensation liability of the insured.”  The Court held that the purpose of this section was to prohibit the selective omission of an employee or employees from coverage of a policy, but did not require duplicate coverage.  The Court further distinguished case law wherein a loaned employee has been considered an employee of both the loaning employer and borrowing employer, stating that this definition was solely for purposes of determining whether an injured employee could maintain a negligence action against the borrowing employer. 

COMMENTS

Most workers' compensation attorneys would supply a more simple answer to the issue presented in this case:  The loaning employer had an agreement to provide workers' compensation coverage and this, in and of itself, should give protection to the borrowing employer and its carrier.  Although the “agreement to the contrary” was not part of the record, it is evident that TTC, as an “employee leasing company” was responsible for maintaining workers' compensation coverage.  Thus, the Fund was responsible for the obligation of TTC’s defunct carrier.  Had there been no such agreement, the outcome could have been different, certainly as to MGM Company itself. 

Under Section 1(a)(4), the loaning employer can seek reimbursement from the borrowing employer where the borrowing employer refuses to provide compensation.  But where there is an agreement to the contrary, the Fund has no rights greater than the loaning employer. 

The case has implications for all workers' compensation insurers of employers who borrow employees from certified “leasing company” businesses.  Those companies will not be responsible for maintaining coverage for borrowing employees.  MGM’s carrier’s judicious audit of the company’s personnel and the policy language covering the issue won the day for Virginia Surety, as it surely will for any other similarly situated insurance carrier.  This case makes it clear that the borrowing employer does not need to duplicate the coverage of the employee leasing company with whom it contracts for employees.  As long as the borrowing employer secures the necessary agreement that the leasing company provide compensation insurance, it needs only to insure those personnel on its payroll.

• Permits parties to determine Medicare’s claim for conditional payment reimbursement prior to settlement.  This eliminates the practice of only issuing the “final demand letter” after settlement was completed.  Thus, parties will now be able to determine their conditional payment exposure before finalizing settlement. 
   
• Provides that rules shall be promulgated for a formal appeals process from Medicare’s determinations regarding its entitlement to conditional payment reimbursement.
   
• Establishes an exemption from reimbursement claims for low dollar liability settlements.
   
• Enacts a three-year statute of limitations for Medicare’s claims for conditional payment reimbursement, thereby providing more certainty to the parties to litigation.  The SMART Act provides that CMS must bring suit to secure reimbursement of conditional payments within three years of the date that CMS receives notice of a settlement, judgment, award, or other payment.
   
• Makes the $1,000 per day penalty for failure to properly report under Section 111 discretionary as opposed to mandatory.  This provision is aimed at avoiding penalties in instances of good faith compliance.

We are pleased that Congress has finally taken steps to address the inefficiencies within the Medicare Secondary Payer Act.  We will continue to monitor the SMART Act and keep you advised regarding its practical implications.  The SMART Act does a great deal to streamline resolution of Medicare’s pre-settlement interest, i.e., conditional payments.  We are hopeful that Congress will eventually take a similar approach to addressing Medicare’s future interests, i.e., Medicare Set-Asides. 

Please always feel free to contact Wiedner & McAuliffe’s Medicare Set-Aside attorneys if you would like additional information regarding the SMART Act or other Medicare compliance issues. 

In conjunction with these amendments, the Commission has generated rules governing the collecting and testing of alcohol and drug samples found in sections 9140.50 through 9140.70 of the Rules Governing Practice before the IWCC, Title 50, Chapter VI, Part 9140.  They take effect as of November 5, 2012. These sections may be reviewed and accessed via the IWCC website of www.iwcc.illinois.gov. 

In general, an employer must 1) designate a representative to make decisions regarding testing and test results, 2) retain a facility or vendor competent to collect the sample who meets the training requirements, and 3) retain a medical review officer who receives and communicates test results to the employer and the employee within certain time requirements.  The following overview should prove useful in guiding employer’s seeking implementation of testing protocol to ensure compliance with the stationary scheme.

RULE OVERVIEW

1. Employer shall Appoint a Designated Employer Representative (DER)–

Identify an employee authorized to make decisions in the testing and evaluation process. The DER should direct the injured worker to a designated facility for testing. DER also receives test results and other communications on behalf of the employer. 

2.  Employer shall select a designated facility/vendor/individual(s) to conduct the testing. Requirements that need be satisfied:

• Blood Collector – licensed physician, advanced practice nurse, registered nurse, licensed practical nurse, phlebotomist, or certified paramedic.
• Urine Collector – a collector meeting the training requirements in the Code of Federal Regulations (49 CFR 40.33, 2012), licensed physician, advanced practice nurse, registered nurse or licensed practical nurse; but not an immediate supervisor of employee (unless no other collector available) or a person employed by a lab who could link the employee with a urine specimen, testing result or lab report.
• Breath Alcohol Technician (BAT) and Screening Test Technician (STT) – person who instructs and assists employees in the alcohol testing process.  BAT operates an Evidential Breath Testing Device, while STT operates an Alcohol Screening Device. This may not be an immediate supervisor of an employee unless no other Technician is available. Must meet training requirements set forth in Code of Federal Regulations (49 CFR 40.213, 2012), essentially requiring qualification training.
• Medical Review Officer (MRO) – responsible for performing the functions and qualifications set forth in 49 CFR 40.121 (2012). Shall not be employed by the lab performing the testing. An employer or DER shall not serve as MRO for his or her own employees.

3.  Testing Protocol

• MRO receives results of testing first and before the DER.
• MRO reviews and verifies results before transmitting to DER.
• If positive, adulterated or substituted result, MRO must contact employee within 72 hours after receipt of the test results from the lab and allow employee to provide any information relevant to results and advise of employee’s right to request testing of the split specimen.
• If MRO is unable to reach employee within 72 hours, then MRO must contact DER and request that DER direct employee to contact MRO.
• MRO must notify DER in writing of the verified positive, substituted or adulterated test within7 days after receipt of the test result from the lab.
• MRO must notify DER of a negative result within 5 days after receipt of the test result from the lab.
   

4.  The designated individuals/facilities are governed by specific testing rules found in Sections 9140.50 through 9140.70 of the Rules Governing Practice of the IWCC and must be accustomed to these      rules. 

5.  The following documentation related to testing need be generated:

• Chain of Custody Formcompleted by the collector, the testing lab, and MRO; that ensures the integrity of urine and blood specimens and records testing results for the specimens. The DER receives a copy, and six other copies are kept by the lab(s), MRO, collector(s) and employee.
• Collection Formis required for breath and saliva testing and includes the name, address and phone number of the employee, DER, BAT, STT; name of testing device/serial or lot number and expiration date; activation time; reading time; results of the alcohol testing and remarks of BAT or STT.

6.  Split Testing is available in the event of a positive or invalid result.  An employee may verbally or in writing request split specimen testing within 72 hours from time of notification of the initial testing results from MRO. The MRO has discretion to allow an extension if employee presents documentation of “serious injury, illness, lack of actual notice of the verified test result, inability to contact the MRO, or other circumstances unavoidably prevented the employee from making a timely request.”

• The split specimen testing is to be performed by a lab different from the lab testing the primary specimen. 
• Employer must ensure the split specimen testing is conducted as required by Section 9140.50.  Employer may seek payment or reimbursement of all or part of the cost of the split specimen testing from the employee, but shall not condition compliance with this Section of employee’s payment for this testing.

7.  Employer must retain Collection Forms (breath and saliva testing) for a minimum of 3 years. Employee may request in writing that the records be retained for a maximum of 1 additional year.

8.  The lab must retain the specimens for a minimum of 3 years.  DER, MRO or employee may request in writing that it be retained for a maximum of 1 additional year.

9.  The lab must retain all records pertaining to the testing of each employee, to include the Chain of Custody Form, for a minimum of 2 years. DER, MRO or employee may request in writing that these be retained for a maximum of 1 additional year. Of note, the Chain of Custody Form must also be retained for the same amount of time by the collector, MRO and DER.

10.  Chain of Custody Form must be retained for a minimum of 2 years.

11.  Employee refusal to undergo testing need be documented.  Document information of a witness who is able to testify to an employee’s refusal to undergo testing.  Also, identify any employment policies, rules and regulations governing refused or positive testsand documentation evidencing their dissemination to all employees. 

Do not hesitate to contact our office if any questions arise regarding our summary of the Commission rules on conducting drug testing.

“for the purposes of determining the nature, extent and probable duration of the injury received by the employee, and for the purpose of ascertaining the amount of compensation which may be due the employee from time to time for disability…”  In addition, the Commission may on its own motion order an impartial examination when "such an examination will materially aid in the just determination of the case.”

This type of examination, under Section 19(c), shall be made by a member of a panel of physicians chosen by the Illinois State Medical Society; the Commission shall establish procedures by which a physician is selected from this list.

In the case at hand, Clement Kolin was referred to Dr. Tonino for a Section 12 evaluation  by his employer, W. B. Olson, following knee replacement surgery.  Dr. Tonino concluded that Kolin was at maximum medical improvement and acknowledged certain restrictions previously imposed by the treating surgeon.  In addition, he recommended a FCE based on the belief that this test was ‘probably a more reliable objective indication’ of Kolin’s work capabilities.  Kolin’s physician did not order an FCE and Kolin refused to attend a FCE ordered by W. B. Olson’s Section 12 examiner.  W. B. Olson continued paying benefits and filed a 19(b) petition to adjudicate the issue and the merits of competing vocational rehabilitation plans.

The Arbitrator found that Kolin had been involved in a reasonable vocational rehabilitation effort via his expert yet was silent as to the Dr. Tonino FCE recommendation.  On review, the Commission affirmed the Arbitrator’s decision as regards vocational rehabilitation and was also silent on the FCE.  However, in her dissent, Commissioner Lindsay noted that Dr. Tonino’s opinions were not challenged and suggested that certain restrictions initially imposed were no longer necessary.  Therefore, Commissioner Lindsay opined that for effective vocational rehabilitation to proceed, Kolin’s current physical abilities needed to be known; she would have required a FCE be undertaken as part of an updated vocational plan.

On appeal, the court stated that the Commission “determined…that it was unnecessary and inappropriate to order either a repeat FCE or formal vocational rehabilitation,” notwithstanding the silence in both the Arbitration and Commission majority opinions on the propriety of the FCE.  The court held that neither Section 12 nor Section 19(c) of the Act provides statutory authority for a functional capacity evaluation.  A FCE is performed by a physical therapist, whereas neither Section 12 nor Section 19(c) permits an evaluation with anyone but a “medical practitioner or surgeon” or “an impartial physical or mental examination” by “a member or members of a panel of physicians.” 

The Court rejected a due process argument made by W. B. Olson, stating that a Section 12 examination performed by a doctor chosen by an employer is sufficient due process to provide the employer with “a meaningful hearing and a ‘level playing field’ in workers’ compensation litigation.”  The Court refused to expand the meaning of Section 12 to permit the evaluator to order a claimantto submit to a FCE.

Comments:

A prescription for a FCE has long been considered “treatment” by the petitioner’s bar.  Notwithstanding the relative silence of the Commission on this subject, the Appellate Court decided to relieve injured petitioners from the onerous requirement of having potential restrictions cast in an objective light.  In discussions with select members of the petitioner’s bar, your editor is given to understand that it is unlikely attorneys will argue a blanket ‘ban’ on all FCE requests – where appropriate, the attorneys will agree to a FCE – but it is unlikely that an agreement will come in cases where a treating physician is keeping a claimant off work with no prospective end in sight to conservative care and disability. 

As our clients know, there are select physicians who consider it their role to advocate for total disability for their patients irrespective of their ability to work.  We believe that in a case involving one of these physicians, it will be difficult to obtain an agreement to undertake a FCE now that the Appellate Court has given its imprimatur to ignore such requests.  Meanwhile, we ask: Can a Section 12 evaluator demand an X-ray or request an MRI or CT scan in order to properly diagnose a condition?

The position in Cordova was expected to last only a few weeks.  The required work was anywhere from six to seven 10- to 12-hour days; pipefitters could also be called in on an emergency basis. Venture-Newberg did not request or require prospective employees to reside near the jobsite, but admitted it would be difficult to work a 12-hour shift and be available for emergencies if the pipefitter were driving more than 200 miles to and from the jobsite on a daily basis. 

Daughtery did not claim he was directed to travel any particular route to the Cordova plant.  He was neither directed to reside at any particular location near the plant, nor did Venture-Newberg make lodging arrangements for him.  Venture-Newberg did not compensate him for travel expenses or time spent traveling to and from the motel where he stayed and the jobsite.  The union agreement did not provide for reimbursement of travel or lodging expenses, unless “the contractor has sent [the member] away.”

The day after Daughtery commenced work at the Cordova plant, he was injured in a vehicular occurrence while traveling from the motel where he and a co-worker were staying and the plant.  He claimed that it was his “understanding” that Venture-Newberg required workers to be within an hour of the jobsite and that they “had to be available” by phone, which required him to stay “within a certain parameter” of the plant.

Based on these facts, the Arbitrator denied the claim; in a divided decision, the Commission reversed.  The Commission conceded that accidents while traveling to and from work are not considered to arise out of or in the course of employment; however, the Commission found an exception, namely that petitioner was a “traveling employee” at the time of the accident.  On appeal, the Appellate Court defined a “traveling employee” as:  “one who is required to travel away from his employer’s premises in order to perform his job.”  The court cited the facts that Daughtery was employed by Venture-Newberg, that he was assigned to work at the Cordova plant some 200 miles from his home, and that the premises where he was assigned to work “were not the premises of his employer” and summarily found him to be a traveling employee. 

In the face of a strong dissent, the majority maintained its determination that Daughtery was a traveling employee by citing one of the lead cases on the traveling employee doctrine, Wright v. Ind. Comm’n., stating:

“It would be inconsistent to deprive an employee benefits of workmen’s compensation simply because he must travel to a specific location for a period of time to fulfill his employment, and yet grant the benefits to another employee because he continuously travels.”

The dissent found the majority’s reasoning facile.  First, it cited exceptions to the “going to and coming from” rule, the main one coming from the Chicago Bridge & Iron case which the dissent found the majority misapplied.  Chicago Bridge & Iron involved a 19-year employee who worked exclusively for that employer, and was compelled to establish a temporary residence out of state while on assignment when injured driving from this residence to the job site.  Also, the court in Chicago Bridge & Iron agreed that if the claimant had never worked for CB&I, he would not be a traveling employee.  Whereas Daughtery had worked only four short stints for Venture-Newberg in the two years before the accident and could not be considered a longstanding employee.  Second, Daughtery was assigned to the Cordova jobsite and not required to travel away from that location.  In contrast, the claimant in Chicago Bridge & Iron was an itinerant boilmaker, always required to travel away from his employer’s headquarters. 

The dissent also found that the proposition that Daughtery was a traveling employee was “misplaced.”  Unlike the claimant in Wright, who was required to travel away from his employer’s premises, Daughtery was not required to travel away from the Cordova site.  The dissent held that:

“When an employee is hired on a temporary basis only and assigned by the employer to work at one specific jobsite for the duration of the employment, that assigned location becomes the employer’s ‘premises’ for purposes of the application of the “traveling-employee rule.”

This interpretation is grounded in the true considerations of the rule, which is based on the requirements or of the employer, not a voluntary decision by the employee.

The dissent also took exception to the finding that Daughtery was entitled to benefits because the course or method of travel to the Cordova plant “was determined by the demands or exigencies” of the job, as opposed to Daughtery’s own personal preference.  The “exigency exception” has been applied in situations where the employer dictates the terms of the travel and/or reimburses an employee for travel, which was not the case here.  Although the Commission held that as a practical matter Daughtery had to stay within a reasonable commuting distance from the plant, neither the Commission nor the court explained how this established Venture-Newberg’s “control over the course or method of” Daughtery’s travel to the Cordova plant. 

Comments:

The holding in this case is disturbing in that it expands the “traveling employee” doctrine to any case where an employee must travel from the place where he lives to work elsewhere.  Traditionally, case law required that an employer direct an employee to travel to a “remote” location before he could be considered a traveling employee. 

Your editor is not aware of any prior case where an individual has been asked to work beyond commuting distance from his home where an injury to that individual going to and from work at a jobsite was held compensable.  The Cordova plant was the site of Daughtery’s work.  Thus, this decision stretches the concept of what it means to “travel” to and from one’s employer’s place of business.  It is a far cry from the 1970’s cases of Wexler v. Ind. Comm’n. and Wright, prior to which traveling employee cases underwent traditional “arising out of and in the course of” analysis, which included the requirement that an injury must be causally connected to the employment and not the random injuries one can sustain while walking down a street or encounter in places of public accommodation while traveling. 

An individual driving into his employer’s central premises has been found to be a ‘traveling employee’ merely because he drove a radio-dispatch truck, albeit he was not being dispatched to any job at the time of the accident.  If one reads the Venture-Newberg case closely, this court would have found that case not compensable.  But, it did, and now finds this one compensable as well.  It appears that this court crafts doctrines for all seasons when it comes to injuries sustained by individuals who argue they are traveling employees.  Now all workers hired out of union halls can qualify for traveling employee status.

Noting that two justices dissented, including Judge Hudson from the 5th District, we assume that the employer will request a re-hearing and certification to the Supreme Court.  We will look to the action of the Appellate Court on a petition for re-hearing and, if this is successful, to the decision of the Supreme Court on this subject