on Worker's Compensation
May 24, 2001
Mr. Bagin, Ms. Connor, Mr. Beiriger, Mr. Buchen, Ms. Coakley, Mr. Fronk, Mr.
Glaser, Mr. Gordon, Mr. Gleichert, Mr. Newby, Ms. Norman-Nunnery, Mr. Olson,
Ms. Vetter, Mr. Welnak.
Staff present: Mr. OMalley
and Mr. Smith.
1. Minutes. Ms.
Norman-Nunnery convened the meeting in accordance with Wisconsins open
meetings law. Mr. Welnak moved adoption of minutes of the April 19, 2001
meeting. Mr. Bagin seconded the motion. The motion passed unanimously.
2. Introduction of new
Council member. Ms. Norman-Nunnery introduced Mr. Don Gordon, Claim
Program Manager, General Casualty, Sun Prairie, who was selected as one of
the three insurance industry members on the Council. He replaces Mr.
Fronk, who recently resigned. Mr. Gordon said he had enjoyed working on
Iowa's Council in a similar capacity and was looking forward to now
serving on the Wisconsin Council.
3. Discussion of LIRC
issues. Ms. Norman-Nunnery introduced Mr. David Falstad, Chairman,
Labor and Industry Review Commission (LIRC), and Mr. James Pflasterer,
LIRC's General Counsel. Mr. Falstad said that LIRC has a renewed interest
in the activities of the Council.
Mr. Falstad briefly
summarized the experience of the current members. He said the three
Commissioners serve staggered six-year terms. Mr. Falstad said that he
came to LIRC after more than 20 years in the private sector; Mr. Rutkowski
had 27 years of experience in the Legislature; and Ms. McCallum, who will
join the Commission when the Senate confirms her nomination, has many
years of experience at the Personnel Commission.
Mr. Falstad said that, as
a quasi-judicial body, LIRC Commissioners adhere to the Judicial Code of
Conduct, although it may not technically apply. He explained that this
often means LIRC remains silent in the face of media criticism of its
decisions. In his first 4 years, LIRC had low visibility. Currently, there
has been more interest as a result of the Supreme Court's decisions in
several cases--Honthaner's, Theuer, and particularly, the Larsen decision.
He said that, given an opportunity to explain, he thought LIRC does pretty
well. He emphasized that, while the Commissioners may agonize when common
sense seems to conflict with the dictates of the law, they do not pursue a
political agenda. They follow the law. He concluded by saying that
Wisconsin has an excellent system, in large part, thanks to the Council.
LIRC wants to play its role in helping to preserve and improve the system.
Mr. Pflasterer said LIRC
has five full-time attorneys. Typically, one or both parties will petition
for review of the ALJs' orders in 35- to 40-percent of the cases.
Currently, he estimated it was 38%. He estimated the appeals rate from
LIRC to the circuit court is about 15%. The parties have 21 days after the
ALJ's order to petition LIRC for review. He said that the ALJs dictate a
synopsis of the hearing (a para-phrased transcript that LIRC prefers to
use in lieu of an actual transcript) and prepare the exhibits and hearing
file for LIRC's review within 30-40 days. He complimented the ALJs for
doing a good job in preparing the synopses. He estimated that in 85% of
the employees appeals and in 100% of the insurers appeals, those
parties are represented by attorneys
Mr. Pflasterer said that
when LIRC receives the synopsis it sets up a 50-day briefing schedule: 20
days for the petitioners brief; 20 days for a response brief and.10
days for the petitioners reply brief. In 25-35% of the cases the
Commissioners are inclined to follow the staff recommendation. In the
rest, the staff prepare a 2- to 20-page staff recommendation for
discussion with the Commissioners. He said the process may be extended a
little longer if its necessary to have a credibility conference with
Mr. Bagin asked if it is
customary to consult with ALJ on a reversal. Mr. Falstad said that, when
in doubt, they will call the ALJ just in case credibility is an issue. Mr.
Bagin asked if they did so in Larsen and Honthaners. Mr. Falstad said
he did not recall specifically in those cases.
Ms. Norman-Nunnery asked
if the Commissioners called the ALJs if the synopses were not adequate.
Mr. Falstad said that if there were problems with the synopses, LIRC
expects the parties to point it out in their briefs.
Mr. Buchen said that
certain medical experts have little credibility in the system. He asked if
that was a factor in the Honthaners decision. Mr. Falstad replied that
certain doctors have a bad reputation, but sometimes an ALJ will treat
those doctors as credible in certain cases. LIRC does the same thing. Mr.
Pflasterer said that if the only issue is the written opinion, the ALJ is
in no better position to assess that opinion than LIRC. He said it is on
"demeanor" issues that consultation with an ALJ is required.
Mr. Glaser said that in
one sense the Larsen case was routine. The problem is that the employee
and the employer were the same person. If the injured employer were not
also the owner, perhaps the owner would have challenged the paymentor
would have fired him for intoxication. Or, perhaps the co-owner would have
fought the payment, except she was the wife of the injured employee. Thats
what unusual about this case. The restraints that operate on an employee
in an ordinary caseespecially getting fireddid not apply here.
Mr. Buchen said Larsen is
not significant. Honthaners does change the law. And, the ALJ saw
credibility very differently than LIRC. Mr. Pflasterer said the LIRC staff
attorneys have recently discussed the viability of Spencer. Mr. Bagin said
the ALJ did not accept the 60 weeks of disability based on the lack of
credibility. Mr. Pflasterer said that LIRC did not think the ALJ applied
Mr. Newby said he did not
want to re-try the two cases. He said the Council should focus on the
process, not the individual cases.
Mr. Falstad said LIRC
staff would try to attend future Council meetings to improve the
communication between the Council and the Commission.
4. Safety Investigations
Buchen said he and Mr. Newby had run into some scheduling difficulties
in trying to arrange a meeting with Commerce Secretary Blanchard.
5. Budget UpdateALJ
Ms. Norman-Nunnery said DOA had approved the Departments request
under s. 16.515, Stats. Unless the Joint Finance Committee objects, the
positions and funding will be approved June 13th. Mr. Glaser
asked Ms. Norman-Nunnery to thank the Secretary for her efforts to
secure the positions.
6. 2001 Assembly Bill
Representative Walker appeared to discuss his proposal to allow the
circuit courts broader authority to review LIRC decisions. He said AB
397 would apply the same standard of review to LIRC decisions that the
Court of Appeals has in reviewing circuit court decisions. He said he
became interested in the subject after reading articles by Judge Eich
and Judge Deininger, a former legislative colleague. He said his bill is
more the result of Judge Deiningers article than the Larsen decision.
Mr. Glaser said the
system needs a body like the Council that sees the "big
picture." He said that too many people forget that worker's
compensation is a no-fault system, with the exclusive remedy principle
protecting the employer from any further legal action. He said that
while the Supreme Court has often ignored the needs of labor, and what
seem to be the clear words of the statute, they have done so in
deference to those, like LIRC and the Department, that have administered
this highly technical law over a long period of time. He said that while
he may not like the outcome in a particular case, he respects the
Supreme Court for applying that deference rationale. Under AB 397, he
said, its possible that the courts would have decided the outcome in
Larsen differently; but it could also fundamentally hurt the system.
While that is not the intent, it could easily be the result.
Mr. Bagin said the
weakness in the system is between the ALJ level and LIRC, and it is not
necessary to give courts broader discretion.
Mr. Smith said that
under the current system the final decision comes earlier in the process
than it would if AB 397 were enacted. He said the system does not favor
litigationor extended litigation. A fundamental principle is that
insurers should pay benefits due promptly and accurately, rather than
litigate. In fact, only about 10-percent of Wisconsin reported injuries
are litigatedwhich is considered the lowest litigation rate of any
industrial state. Mr. Smith said that, in his opinion, LIRC
commissioners are also far more consistent and knowledgeable regarding
the legal issues than are circuit court judges. He predicted the 38%
appeal rate that Mr. Pflasterer cited from the ALJ level to LIRC would
now occur between LIRC and the courts. Currently that rate is about 15%.
Mr. Smith noted that there were other experienced worker's compensation
attorneys in the audience, and asked whether they would agree or
Representative Hundertmarks aide, said he was interested in the
attorneys opinions about how much litigation into the courts would
increase. He said Rep. Walker had asked Rep. Hundertmark to hold a
hearing on the bill. Attorney Dennis Wicht said that he had 32 years of
experience doing worker's compensation for both applicants and insurers;
he guaranteed litigation would significantly increase.
Mr. Newby said he was
very troubled by the idea that the legislature would take an independent
course and hold a hearing on a bill opposed by the Council. Mr. Glaser
said either there is an "agreed bill" process or there is not.
Mr. Newby said that Council members are very sensitive to the process
and that this kind of action has the potential to break the system
apart. Mr. Roston said that Rep. Hundertmark had not decided anything;
he was merely reporting Rep. Walkers request to the Council.
7. Review Department
Mr. Smith briefly explained the Departments legislative proposals, as
introduced at the February 28, 2001 meeting.
The Council unanimously
employer subject to the Act
Amend 102.04(2) as
Except with respect
to a partner or member electing under s. 102.075 members of
partnerships or limited liability companies shall not be counted as
employees. Except as provided in s. 102.07(5)(a) a person under
contract of hire for the performance of any service for any employer
subject to this section
(1961) shall not constitute
an employer of any other person with respect to such service and
such other person shall, with respect to such service, be deemed to
be an employee only of such employer for whom the service is being
Comment. This deletes an obsolete reference.
employer subject to the Act
Amend 102.07(4m) as
For the purpose of
determining the number of employees to be counted under s.
102.04(1)(b) or (c), but for no other purpose, a member of a
religious sect is not considered to be an employee if the conditions
specified in s, 102.28(3)(b) have been satisfied with respect to
102.04(1)(b) excludes certain religious sect members when counting
non-farm employees to determine if an employer is subject to the
Act. 102.04(1)(c) relates to farm employees, to whom the same
counting provision should also apply. This corrects an inadvertent
cross-reference in Chapter 102 to s. 166.03(8)(d).
102.07 Employee defined. "Employee" as used in this chapter means:
(19) An emergency
management employee or volunteer as defined in s. 166.03(8)(d).
attorney representing an injured volunteer suggested the
166.03(8)(d) reads as follows:
municipal and county emergency management units are employees of the
municipality or county to which the unit is attached for purposes of
worker's compensation benefits. Employees of the area and state
emergency management units are employees of the state for purposes
of worker's compensation benefits. Volunteer emergency management
workers are employees of the emergency management unit with whom
duly registered in writing for purposes of worker's compensation
benefits. An emergency management employee or volunteer who engages
in emergency management activities upon order of any echelon in the
emergency management organization other than that which carries his
or her worker's compensation coverage shall be eligible for the same
benefits as though employed by the governmental unit employing him
or her. Any employment which is part of an emergency management
program including but not restricted because of enumeration, test
runs and other activities which have a training objective as well as
emergency management activities during an emergency proclaimed in
accordance with this chapter and which grows out of, and is
incidental to, such emergency management activity is covered
employment. Members of an emergency management unit who are not
acting as employees of a private employer during emergency
management activities are employees of the emergency management unit
for which acting. If no pay agreement exists or if the contract pay
is less, pay for worker's compensation purposes shall be computed in
accordance with s. 102.11
Delete the sunset
provisions related to work-experience students.
law authorizes schools to voluntarily insure work-experience
students, but only if they get no wages from the work-site employer.
The option is rarely used. The exclusive remedy provision immunizes
the work-site employer from tort suits. The sunset provisions were
enacted in 1996 and extended in 1998 and 2000. No problems have been
reported to the Department.
normal full-time work week
shall mean the daily earnings of the employee at the time of the
injury in the employment in which the employee was then engaged. In
determining daily earnings under this paragraph, overtime shall not
be considered. Overtime
means hours worked beyond the employer's normal full-time workweek.
Premium pay such as time-and-a-half or double time may be earned
during the normal workweek or during overtime
premium pay are not synonymous. Overtime is not used to calculate
earnings under par (a), but is used under par. (d). For most employees, earnings are the larger of paragraphs (a) or (d).
requirement for an annual fraud report to the Governor and
Legislature (or, alternatively, have the Department report to the
Department refers only about 15 cases of alleged fraud annually to
district attorneys. They prosecute about 3. This low level of fraud
reported and prosecuted does not justify such high-level annual
reporting. The Department has issued reports covering the first 5
years of the program. There is nothing new to report.
of treatment disputes
(c) as follows:
Except as provided in ss. 102.16(1) or 102.18(1), before determining
the necessity of treatment provided for an injured employee who
claims benefits under this chapter, the department shall obtain a
written opinion on the necessity of the treatment in dispute from an
expert selected by the department. To qualify as an expert, a person
must be licensed to practice the same health care profession as the
individual health service provider whose treatment is under review
and must either be performing services for an impartial health care
services review organization or be a member of an independent panel
of experts established by the department under par. (f). The
department shall adopt the written opinion of the expert as the
department's determination on the issues covered in the written
opinion, unless the health service provider or the insurer or
self-insured employer present clear and convincing written evidence
that the expert's opinion is in error.
Comment. Peer review in 102.16(2m)(c) is an option for compromise
orders under 102.16(1) or for an ALJ issuing orders after hearing
under 102.18(1), but it was never intended to be a requirement.
"any" for "either" in four statutes:
Any party shall have the right to be present at any hearing,
in person or by attorney, or any other agent, and to present such
testimony as may be pertinent to the controversy before the
102.17(1) (e) The
department may, with or without notice to
party, cause testimony to be taken
102.20 Judgment on
either any party presents a
certified copy of the award to the circuit court for any county, the
court shall, without notice, render judgment in accordance therewith
action may thereupon be brought on for hearing before the court upon
the record by
either any party on 10 days'
notice to the other
"Any" is more appropriate if there are more than 2
deposit of benefits
Create a new
subparagraph in 102.26(3)(b).
as provided in par. (b), compensation exceeding $100 in favor of any
claimant shall be made payable to and delivered directly to the
claimant in person.
(b) 1. The
department may upon application of any interested party and subject
to sub. (2) fix the fee of the claimant's attorney or representative
and provide in the award for that fee to be paid directly to the
attorney or representative.
2. At the request of the claimant medical expense, witness fees and
other charges associated with the claim may be ordered paid out of
the amount awarded.
3. If the
claimant and the insurer mutually agree, the claimant may request an
insurance carrier or employer to deposit payments or awards under
this chapter directly in a financial institution by electronic
transfer or as otherwise approved by the department. The claimant
may revoke consent by providing appropriate written notice.
102.26(3)(a) requires compensation over $100 to be "delivered
directly to the claimant." This prevents payment to a third
party, e.g., the claimant's attorney. Arguably, it prevents direct
deposit in a claimant's bank account. Some states specifically
authorize direct deposit because it's faster and safer than mail
delivered to the home. At least one state, Texas, mandates that
insurers give employees a direct deposit option. The financial
services consultant for one TPA that is setting up a system to offer
the option in other states has requested permission to offer this
option in Wisconsin. Their process to approve and generate payments
is not changed. The employee must fill out a direct deposit
authorization form and may revoke authorization at any time. At its
May 24, 2001meeting the Council amended the Departments proposal
to specificy that the insurer could not be compelled to participate;
there had to be mutual agreement.
Section 1. 102.31
(8) of the statutes is amended to read:
compensation rating bureau shall provide the department with any
information it relating to worker's compensation insurance
coverage, including but not limited to the names of employers
insured and any insured employers business, business status, type
and date of coverage, manual premium code, and policy information
endorsements and reinstatement dates. The department may enter into
contracts with the Wisconsin compensation rating bureau to share the
costs of data processing and other services. The
Wisconsin compensation rating bureau may authorize the department to
publish or release information obtained by the bureau under s.
626.32(1) (a). The department shall not make that information public
except as authorized by the rating bureau.
Section 2. 626.32
(1) (a) of the statutes is amended to read:
Acquisition of information. (a) General. Every insurer writing any
insurance specified under s. 626.03 shall report its insurance in
this state to the bureau at least annually, on forms and under rules
prescribed by the bureau. The bureau must file, pursuant to rules
adopted by the department of workforce development, a record of such
reports with the department. No such information may be made public
by the bureau or any of its employees except as authorized or required
by law and in accordance with its rules.
Council agreed to this change in principle in the last session. In
1982, the AG determined that records of organizations like WCRB are
not subject to Wisconsin's Open Records law. See May 7, 1982 letter
to Insurance Commissioner Susan Mitchell. In April 1999, the AG
supported the Department's refusal to release that WCRB insurer
information from a database shared by WCRB and the WC Division. The
Division assumes that Datalister, Inc., a Florida firm, intended to
use the insurance policy information to solicit employers. The AG
encouraged the Department to clarify the statutory intent. This
proposal codifies the long-standing working relationship between the
Department and the Rating Bureau and is supported by both agencies.
In August 1999, Datalister successfully sued to obtain similar data
under Arizona and Minnesota laws.
Amend 102.32(5) as
employer may, within the discretion of the department, compel the
insurer to discharge, or to guarantee payment of its liabilities in
any such case under this section and thereby release himself or
herself from compensation liability therein, but if for any reason a
bond furnished or deposit made under sub. (4) does not fully
protect, the compensation insurer or
employer, as the case may be, shall still be liable to the
Comment. In the
context of a subsection dealing with the relationship of an insured
employer to its insurer, the reference to an "uninsured"
employer is absurd.
Prompt PPD payments
Amend 102.32(6) as
If compensation is
due for permanent disability following an injury or if death
benefits are payable, payments shall be made to the employee or
dependent on a monthly basis. Compensation for permanent
disability shall begin within 30 days after the end of the
employee's healing period or after the insurer receives a medical
report with a permanent disability rating, whichever is later. If
the insurer notifies the claimant within 30 days after the end of
temporary disability or after receiving the rating, whichever is
later, that the insurer is scheduling an examination under s.
102.13(1), compensation shall begin within 30 days after the insurer
receives the examining report, or within 90 days after the notice to
the claimant of the intent to schedule the exam, whichever is
earlier. Payments for permanent disability shall continue on a
monthly basis, and shall accrue and be payable between intermittent
periods of temporary disability, including payments based on the
minimum permanent disability ratings set by rule if the insurer has
clear information regarding the nature of the injury or the surgery.
The department may direct an advance on a payment of unaccrued
compensation or death benefits if it determines that the advance
payment is in the best interest of the injured employee or his or
her dependents. In directing the advance, the department shall give
the employer or the employer's insurer an interest credit against
its liability. The credit shall be computed at 7%.
1. In October 2000,
the Department proposed codifying the 30-day payment standard and
clarifying how to handle intermittent periods of PPD and temporary
disability to a group of about 40 experienced insurance claims
handlers and supervisors. In November 2000, an insurance attorney
requested the extension for IMEs, with 30 days to give notice of
intent to schedule the IME and a 90-day limit on starting payments
(even if the IME is not done by then).
2. This also
clarifies that if PPD is due because of the minimum ratings in DWD
80.32, it is due during weeks in which no temporary disability is
paidregardless of whether there is an end of healing, permanency
rating, or return to work.
3. The Council
amended the Departments proposal to commence payments with 30
days rather than 14 days.
Amend 102.37 as
Every employer of 3 or more persons and every employer who is
subject to this chapter shall keep a record of all accidents causing
death or disability of any employee while performing services
growing out of and incidental to the employment. This record shall
give the name, address, age and wages of the deceased or injured
employee, the time and causes of the accident, the nature and extent
of the injury, and any other information the department may require
by rule or general order. Reports based upon this record
shall be furnished to the department at such times and in such
manner as it may require by rule or general order,
forms in a format approved by the department.
1. The term
"rule" has replaced the phrase "general order"
in almost all other statutory usage. However, since both terms are
occasionally used elsewhere (e.g., s. 103.005, which is
cross-referenced in s. 102.39) the reference to general orders is
retained rather than deleted). The same change is proposed in
102.37, 102.38, 102.39, 102.57 and 102.58
2. The requirement
to use a "form" is unnecessarily restrictive. The statute
is more restrictive than the electronic reporting rule, DWD
80.02(3). The Department allows and encourages insurers to provide
required information in other formats--fax, EDI and over the
Amend 102.38 as
payments; reports thereon. Every insurance company which transacts
the business of compensation insurance, and every employer who is
subject to this chapter but whose liability is not insured, shall
keep a record of all payments made under this chapter and of the
time and manner of making the payments, and shall furnish reports
based upon these records or any other information to the
department as it may require by rule or general order,
forms in a format approved by the department.
1. Just as
employers must provide any information required by rule in 102.37,
insurers should provide any information required by rule, not just
payment information. For example, insurers (not employers) now
provide the first report of injury (WKC-12). See DWD 80.02(2).
2. General order is
an obsolete term. The same change is proposed in ss. 102.37, 102.38,
102.39, 102.57 and 102.58
Amend 102.39 as
application of statutes. The provisions of s. 103.005 relating to
the adoption, publication, modification and court review of rules
or general orders of the department shall apply to all rules
or general orders adopted pursuant to this chapter.
Comment. The same
change is proposed in ss. 102.37, 102.38, 102.39, 102.57 and 102.58
Amend 102.57 as
safety provisions, penalty. If injury is caused by the failure of
the employer to comply with any statute, rule or any lawful
order of the department
Comment. The same
change is proposed in ss. 102.37, 102.38, 102.39, 102.57 and 102.58
Amend 102.58 as
compensation. If injury is caused by the failure of the employee to
use safety devices which are provided in accordance with any statute,
rule or lawful order of the department
Comment. The same
change is proposed in ss. 102.37, 102.38, 102.39, 102.57 and 102.58
reference to Department of Health and Family Services
Comment. DVR is now
a sub-unit of DWD, not DHFS.
The Council rejected the
engaged in maritime employment or interstate commerce who are
covered by the Federal Employers Liability Act, the Longshore and
Harbor Worker's Compensation Act, or any of its extensions, or the
Jones Act, may not elect to waive coverage under the Wisconsin
Worker's Compensation Act.
Wisconsin Compensation Rating Bureau requested this change. Their
attorney indicates it would affect a small number of Great Lakes
fishermen. While there is some precedent for waiver or release of
Jones Act benefits, a person may not waive LHWCA benefits. This
means insurers have liability for the corporate officers based on
federal law. Therefore, when corporate officers eligible for LHWCA
benefits elect out of Wisconsin's law, insurers continue to collect
premium on their wages to cover their exposure under federal
law--negating the benefit from opting out. Eligibility for Wisconsin
benefits does not preempt any federal claims the corporate officers
may wish to make. In short, since there is no financial advantage
for them to opt out, and since by doing so, they give up Wisconsin
benefits for which they are being charged a premium, the WCRB
proposed this change. WCRB educational efforts with these commercial
fishermen have not been successful.
The Council tabled the
- Employer's normal
full-time work week
Amend 102.11(1)(a) as
Daily earnings shall mean
the daily earnings of the employee at the time of the injury in the
employment in which the employee was then engaged. In determining
daily earnings under this paragraph, overtime shall not be
considered. If at the time of the injury the employee is working on
part time for the day, the employee's daily earnings shall be
arrived at by dividing the amount received, or to be received by the
employee for such part-time service for the day, by the number of
hours and fractional hours of such part-time service, and
multiplying the result by the number of hours of the employer's normal
full-time working day for the employment involved. The words
"part time for the day" shall apply to Saturday half days
and all other days upon which the employee works less than normal
full-time working hours. The average weekly earnings shall be
arrived at by multiplying the employee's hourly earnings by the
hours in the employer's normal full-time workweek or by multiplying
the employee's daily earnings by the number of days and
fractional days in the employer's normal full-time workweek
worked per week at the time of the injury in the business
operation of the employer for the particular employment in which the
employee was engaged at the time of the employee's injury, whichever
is greater. Except
as provided in par. (b), it is presumed that the employer's normal
full-time workweek is 24 hours for flight attendants, 56 hours for
firefighters, and at least 40 hours for other employees unless there
is reasonably clear and complete documentation to rebut it. If the
employer has a multi-week schedule with regular alternating hours,
the employer's normal full-time workweek is the average number of
weekly hours in the multi-week schedule. A workweek is from Sunday
1. The council approved the
"overtime" language: not shown here, but tabled the
language changes shown above.
2. Whether one uses the employee's
daily earnings (or hourly earnings) those earnings have
always been multiplied by the days (or hours) in the employer's
normal full-time workweek, not the days (or hours) worked by the
claimant. True, the department uses the claimant's actual work days
(or hours) as a starting point to audit the employer's workweek.
But, that does not conclusively determine the workweek.
3. The confusion is getting
worse. In 2000, LIRC and the circuit court refused to consider
arguments from the employer regarding its regular schedule. Instead,
LIRC and the court determined the workweek under 102.11(1)(a) is
based on the "local labor market" not the injury
employer's schedule. The department has never used the local labor
market under par. (a). The labor market concept used in UI is not
used in WC. In WC, the closest one comes to the local labor market
is looking at "same or similar" employment under par.
(c)--a rarely used section. See Diane Aronson v. Caregivers Home
Health, No. 00-CV000615, Waukesha County, November 1, 2000.
4. Adding the hourly formula
to the daily formula in the current statute will not change the
average weekly earnings. However, for most insurers and employers
the hourly formula will make more sense.
Amend 102.11(1)(f) as
1. Except as provided in
sub. 2, average weekly earnings may not be less than 24 times the
normal hourly earnings at the time of injury.
2. The weekly temporary
disability benefits for a part-time employee who restricts his or
her availability in the labor market to part-time work and is not
employed elsewhere may not exceed the average weekly wages of the
members of a regularly scheduled class of part-time employees must do
the same type of work and maintain the same regular work schedule.
The members of a class do not need to work the same days or shifts,
but a schedule is not regular if the minimum and maximum weekly
hours scheduled by the employer or actually worked by any member of
the class vary by more than 5 hours during the 13 weeks prior to the
injury. Employees are not part of a class unless at least 10 percent
of the employer's workforce doing the same type of work are members
of the class. A class must have more than one employee. An employer
may not use multiple locations to establish a class. For State of
Wisconsin employees it is presumed that membership in a class is
determined separately for each agency or department, although a
smaller subunit may used if appropriate.
Comment. These changes
codify the department's current procedures.
1. In a NRA case, the court
distinguished a "class" of four part-time watchmen working
staggered-days and staggered-shifts from a full-time watchman. See Allis
Chalmers v Industrial Comm., 215 Wis. 616 (1934). See also, Carr's
Inc. v. Industrial Comm., 234 Wis. 466 (1940).
2. The 5-hour variance is
less than the 8-hour variance approved by the Wisconsin Supreme
Court in Carr's Inc., the leading part-time, part-of-class
3. 13 Weeks is borrowed from
the 90-day period specified for full-time employment in DWD
4. The department wage
analysts have used the 10-percent concept and required more than one
employee in a class at least since the 1980's when Harry Benkert
wrote: "The class must be regularly scheduled. We have also
administratively determined 'class' to mean more than one employee.
There must be a significant number of employees relative to the
employment to constitute a class."
5. Until very recently, the
department did not consider multiple locations in determining a
class. Recently it has been allowed in some cases. Wage analysts are
unanimous that the law would be simpler to administer if the
long-standing policy excluding multiple locations were codified.
Delete the sunset
provision on the fee dispute program.
provision was enacted in 1992. The sunset has been extended every
two years since then. The program is well established.
2. If DOC, then
after "department" add "of Commerce."
Comment. DOC has
1. Eliminate the
12-year statute of limitations for claims involving the loss or
total impairment of:
- the hand or rest
of the arm,
- the foot or rest
of the leg,
- any loss of
- any brain injury
and total or
partial knee or hip replacements.
2. Fund existing
claims that are otherwise meritorious from the Work Injury
Supplemental Benefit Fund (WISBF) for "treatment" after
1/1/2002 regardless of the date of injury.
1. Insurers used to
pay these claims voluntarily if the claim was meritorious, except
for the statute of limitations. Now, insurers routinely defend
against these claims citing the statute of limitations. Since these
are pre-existing conditions group health carriers refuse coverage.
There has been a significant increase in problems with serious eye
injuries and the need for prosthetic devices, both of which
essentially require life-long treatment. The need for future knee or
hip replacements is a trap for the unwary. Doctors advise holding
off surgery as long as possible. Unwary claimants may not know to
preserve their right to surgery by filing an application for
injuries beyond the 12-year period are currently funded from WISBF.
reimbursement to governmental units that pay living expenses or
If a governmental
unit provides public assistance under ch. 49 to pay medical costs or
living expenses related to a claim under this chapter, the employer
or insurance carrier owing compensation shall reimburse that
governmental unit any compensation awarded or paid if the
governmental unit has given the parties to the claim written notice
stating that it provided the assistance and the cost of the
assistance provided. Reimbursement for living expenses shall
equal the lesser of either the amount of assistance the governmental
unit provided or two-thirds of the amount of the award or payment
remaining after deduction of attorney fees and any other fees or
costs chargeable under ch. 102. The employer or insurance carrier
shall reimburse the governmental unit for all medical costs related
to a claim under this chapter. The medical reimbursement shall not
be deducted from the employee's award or payment. The department
shall comply with this paragraph when making payments under s.
bifurcates the formula for reimbursement. The insurer would continue
to reduce the employee's award to reimburse living expenses. There
would be no reduction for reimbursing medical expenses. While
current law does not specify that reimbursement shall come from the
claimant's award (it merely sets the formula for determining
reimbursement), the department has always applied it that way.
Insurers--not governmental units providing public assistance or
employees--should be responsible for the entire cost of medical
Wages received from
other employment held by the employee when the injury occurred shall
be considered in computing actual wage loss from the employer in
whose employ the employee sustained the injury, if the employee's
weekly temporary disability benefits are calculated under s.
the employee's wage is expanded under s. 102.11(1)(a) the employee's
earnings from other employment held at the time of injury shall be
offset against that expanded wage not the actual wage at the time of
Comment. This would
clarify that the offset against the expanded wage is only for
workers who had more than one job at the time of injury. [For people
who get a second job after the injury the offset has always been
taken against the actual pre-injury wage, not the wage expanded
under s. 102.11(1)(a).] 2-Job wage earners were clearly relying on
the 2-job wages prior to the injury. For this reason, in 1985, the
offset was eliminated. In 1988, the offset was restored to prevent
what some saw as unjust enrichment. However, the offset was intended
to be against the expanded wage to prevent undue hardship.
Unfortunately, the statutory language has never been clear. In
recent years, there have been more and more arguments on this point.
And, recent LIRC decisions have added to the confusion, by adding
wages from both jobs to determine both the TTD rate and the
offset--something the department has never done. Typically, the
problem addressed by this change occurs when the worker who is hurt
on a part-time job is able to partially return to work at the
full-time job. (Once they have returned full-time to the full-time
job, the offset will almost always reduce TTD to zero regardless of
whether it is taken against the actual or expanded wage from the
part-time job). The problem is that the higher wage from a partial
return to the full-time job almost immediately offsets the actual
wage from a (typically) lower paying part-time job. Even when the
offset is made against the expanded wage, the worker is still making
far less than prior to the injury from both jobs (that is, there is
no unjust enrichment.) In short, the department believes the 1988
offset against the expanded wage was a compromise between no offset
and offsets against actual wage.
The Department withdrew
the following proposal:
Uninsured Employers Fund
102.81(2) and Chapter 20
Amend 102.81(2) as follows:
(2) The department may
retain an insurance carrier or insurance service organization to
process, investigate and pay claims under this section and may
obtain excess or stop-loss reinsurance with an insurance carrier
authorized to do business in this state in an amount that the
secretary determines is necessary for the sound operation of the
uninsured employers fund. In cases involving disputed claims, the
department may retain an attorney to represent the interests of
the uninsured employers fund and to make appearances on behalf of
the uninsured employers fund in proceedings under ss. 102.16to
102.29. Section 20.918and subch. IV of ch. 16 do not apply to an
attorney hired under this subsection. The charges for the services
retained under this subsection shall be paid from the
appropriation under s. 20.445(1)(hp). The cost of any reinsurance
obtained under this subsection shall be paid from the
appropriation under s.
1. The proposal would
shift the cost of the UEF excess insurance coverage
($180,000-220,000 annually) from the Fund itself to the annual
assessment on insurance carriers and self-insurers.
2. This will help protect
the long-term solvency of the Fund. In the first 4.5 years, the
UEF paid more than $2.1 million in benefits and $837,000 in excess
insurance premiums. Excess insurance costs were 30% of the total
$2.9 million paid from the fund since 1996. As of January 31,
2001, the Fund balance is $8.8 million, with outstanding loss
reserves and IBNR claims of $2.4 million. The percentage of UEF
assets encumbered by outstanding loss reserves and IBNR claims is
3. The cost of the excess
policy is about 30% of the annual payments out of the Fund, so it
has a large impact on solvency. Yet, the excess policy cost is
small in comparison to the Division's $10 million annual operating
budget, the estimated $40 million in annual premiums generated for
private insurance companies by UEF enforcement, and $1.1 billion a
year in direct WC insurance premiums earned in Wisconsin (7th
in the nation in 1999).
8. Next meeting.
The Council adjourned until its next meeting scheduled for 9 a.m., June
25, 2001, at Local 494, International Brotherhood of Electrical Workers
(IBEW), 3303 S. 103rd ST. Milwaukee.