By Christopher D. Vanderbeek
The Work Loss Data Institute (WLDI) recently released state-by-state workers’ compensation report cards. The report cards incorporate data compiled during the 10-year period from 2000 through 2009. Forty-three states, as well as Puerto Rico, Guam and the Virgin Islands, were included in the survey.
The data used in determining states’ grades comes primarily from OSHA recordable injuries and illnesses. Once the data was collected, it was interpreted in terms of the two most significant factors driving the cost of workers’ compensation throughout the US. The first factor is injury/illness outcomes, specifically the success within a state in preventing injuries, and, when they occur, the success in returning the injured worker to health and productive endeavor, thus avoiding prolonged absence and medical treatment costs. The second factor is administrative burden stemming from the accumulation of rules, procedures, disputes, delays, discretionary charges and patterns of practice, including lawsuits, affecting the resolution of claims.
The 2012 WLDI report cards primarily consider the “primary outcome measure” of how quickly workers recover from their injuries/illnesses and return to work. Five different outcome measures are compared among the states for each year:
- Rates of the occurrence of workplace incidents;
- Number of cases in which employees missed work;
- Median duration of disability;
- Instances of “delayed recovery”; and
- Instances of the “key condition,” which for this reporting period was low back strain.
For 2012, Missouri was one of only five states to receive an “A” grade overall. The other four states were Alabama, Arkansas, Georgia, Minnesota, and Utah. In addition, the WLDI reports indicated “impressive advancement” for Missouri from 2000 through the present.
Posted by Attorney Christopher D. Vanderbeek. Vanderbeek is involved in the evaluation and defense of workers’ compensation and other insurance claims, protecting the interests of employers and insurers.
02/1/12 8:40 AM
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Missouri Receives “A” Grade on State Workers’ Compensation Report Card
By Christopher D. Vanderbeek
Missouri businesses have kicked off 2012 with a legislative measure that is intended to effect comprehensive reform with regard to Missouri workers’ compensation law. The business-backed measure is the coordinated response of Missouri businesses to many recent issues that have surfaced on the state’s legal landscape.
One major issue, the depletion of Missouri’s Second Injury Fund (SIF), arose gradually.
Other issues arose much more suddenly. Specifically, two recent Missouri cases flipped Missouri’s workers’ compensation system on its side by respectively providing:
(a) that an employee can sue a co-employee in civil court for the co-employee’s negligence in causing a workplace injury, and
(b) that an employee can sue his or her employer in civil court for a work-related occupational disease (e.g. carpal tunnel syndrome).
Prior to these court cases, it was believed – and, Missouri businesses argue, the Missouri legislature intended – that the sole venue for a claim based on a work-related injury was the workers’ compensation system.
Missouri businesses have responded by throwing their weight behind SB 572. The bill proposes a plethora of amendments to Chapter 287 of the Missouri’s statutory code, which is informally known as the Missouri Workers’ Compensation Act. Included are several amendments to Section 287.120, otherwise known as the “Exclusivity Clause.” This section was recently cited in the case of State ex rel. KCP & L Greater Missouri Operations Co. v. Cook in support of the argument that employees have the right to sue their employers in civil court for work-related occupational diseases.
Some highlights of the proposed bill:
- Prohibition of occupational disease claims outside the workers’ compensation forum
- Prohibition of negligence-based injury claims against co-employees
- Elimination of a $40-per-week benefit paid to injured workers out of the SIF
- Elimination of benefits paid by the SIF to uninsured employers
- Prohibition of all claims for permanent partial disability (PPD) against the SIF
- Prohibition of all claims by employees not legally entitled to work in the US
- Elimination of benefits for employees who become incarcerated
SB 572 was introduced by Senator Tom Dempsey of the 23rd District of Missouri (St. Charles County). The bill is currently being considered by the Small Business, Insurance, and Industry Committee and was initially presented to the committee on January 10, 2012.
Posted by Attorney Christopher D. Vanderbeek. Vanderbeek is involved in the evaluation and defense of workers’ compensation and other insurance claims, protecting the interests of employers and insurers.
01/16/12 4:33 PM
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New Proposed Bill Would Impact Workers’ Compensation Reform in Missouri
By Christopher D. Vanderbeek
In September 2011, Missouri’s Western District Court of Appeals rendered its opinion in State ex rel. KCP & L Greater Missouri Operations Co. v. Cook. The Court ruled that Missouri employees may sue their employers in civil court where they have allegedly suffered an “occupational disease” as a result of their employment. It is important to note that the Court did not bar employees from filing workers’ compensation claims based on occupational diseases. Rather, the Court essentially gave employees with occupational diseases the option of either filing a workers’ compensation claim or filing a civil lawsuit.
Prior to KCP & L, the general understanding among employers, employees, the State of Missouri, and workers’ compensation legal practitioners was that the Missouri workers’ compensation system was the exclusive remedial forum for any claim involving a work-related injury, whether it be a broken arm or lung cancer. This general understanding was derived from Section 287.120 of the Missouri statutory code. Section 287.120 (the “exclusivity provision”) states as follows:
- Every employer subject to the provisions of this chapter shall be liable, irrespective of negligence, to furnish compensation under the provisions of this chapter for personal injury or death of the employee by accident arising out of and in the course of the employee’s employment, and shall be released from all other liability therefor whatsoever, whether to the employee or any other person.
- The rights and remedies herein granted to an employee shall exclude all other rights and remedies of the employee, his wife, her husband, parents, personal representatives, dependents, heirs or next kin, at common law or otherwise, on account of such accidental injury or death, except such rights and remedies as are not provided for by this chapter.
The intent behind the exclusivity provisions was that Chapter 287 of the Missouri statutory code would provide the exclusive remedy for all claims based on work injuries. However, the Court in KCP & L exploited an oversight in legislative wording – the legislature only made the workers’ compensation system the exclusive forum for claims based on injuries (or deaths) caused by accidents.
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12/20/11 12:30 PM
Business Law, Employment Law, Workers' Compensation | Comment (0) |
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Employees Can Now Sue for Occupational Diseases: Understanding Breeds a Solution to the Problem
By Christopher D. Vanderbeek
Missouri Appeals Court Says Employees Can Sue Employers in Civil Court for Occupational Disease Claims
Missouri’s Western District Court of Appeals recently decided that an employee can sue his employer in civil court for an “occupational disease” claim. In KCP & L Greater Missouri Operations Co. v. Cook, the employee claimed that he contracted mesothelioma as a result of his employment. The court ruled that Gunter was allowed to file suit in civil court because, under Missouri law, the workers’ compensation forum is not the exclusive forum for a claim premised on an “occupational disease” injury, such as mesothelioma, even if the injury is allegedly work-related. (Note the distinction between an “occupational disease,” which develops over a period of time, versus an injury that happens instantaneously or acutely as a result of a single accident.)
This is a major change from prior law. Historically, the exclusive remedy for every employment-related injury was a workers’ compensation claim. And workers’ compensation is a system that clearly benefits employers (as well as third-party workers’ compensation insurance carriers). Relative to the civil realm, the workers’ compensation system places a dramatically lower ceiling employer and insurer liability vis a vis employee benefits.
There are generally two types of “occupational disease” injuries. The first type is an actual disease, such as mesothelioma, that results from an employment condition. The second type is a “repetitive use” injury, which results from the employee overusing the injured body part. Although it is yet to be seen whether or not Missouri courts will allow pursuit of repetitive use claims in the civil forum as well, a plain-language reading of the court’s opinion in KCP & L suggests that they will.
What This Means for Missouri Employers
This does not necessarily mean that a large number of employees will pursue injury claims in civil court. Repetitive use injuries like carpal tunnel syndrome are caused by repetitive use of the injured body part, plain and simple. It would be difficult for an employee to prove that his employer’s negligence cause this sort of injury. To prove negligence, an employee must prove that the employer knew or should have known that a harmful condition existed and that its employees were at risk as a result. If the employee cannot prove negligence, it would be foolish for his attorney to file a civil lawsuit rather than a workers’ compensation claim.
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11/23/11 10:59 AM
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Occupational Disease Claims: Civil Court an Option for Employees
By Christopher D. Vanderbeek
According to a recent study published in the Journal of Occupational and Environmental Medicine, modifiable employee health risks dramatically increase employer operating costs. “Modifiable” health risks are those which can be remedied with appropriate action, such as exercise, diet, or medication.
The study focused on the employees of a large Midwestern corporation. It looked at the most common modifiable health risks: obesity, high blood pressure, high blood sugar, high cholesterol, inadequate exercise, poor nutrition, poor emotional health, tobacco use, and high alcohol consumption.
Researchers focused on two types of costs: health care-related costs, and productivity-related costs. The study suggests that health care costs were driven upward most significantly by high blood pressure, high blood sugar, and inadequate exercise. Productivity costs were driven upward most significantly by poor emotional health, which was also a driver of increased health care costs, though to a smaller extent.
The study also implemented findings from a Mayo Clinic assessment. A few of the pertinent Mayo Clinic findings:
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11/8/11 5:00 AM
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Easiest Way to Increase Productivity and Decrease Health Care Costs
By Christopher D. Vanderbeek
The United States Department of Labor has initiated a crackdown on enforcement of federal wage laws. The Labor Department has signed agreements with twelve states, as well as the I.R.S., to share information about wage violations. Missouri is one of the states that has signed on to assist in the effort. Illinois reportedly plans to become involved in the near future.
The hope is that the shared information will help the Labor Department target businesses that improperly classify employees in order to pay employees less.
The most prevalent violations across the country involve employers classifying employees as “independent contractors.” This allows employers to avoid paying employees overtime pay and avoid complying with minimum wage requirements. Employers also do not pay for workers’ compensation and unemployment insurance for these misclassified workers. Employers also skip out on federal payroll taxes for the workers, which is why the I.R.S. is involved in the effort.
The practice of misclassifying workers is illegal, but U.S. businesses have been employing it as a cost-cutting measure for years. Misclassification for the purpose of depriving workers of overtime pay and minimum wage – known as “wage-theft” – is most prevalent and wide-spread in the hotel, restaurant, janitorial, health care, and daycare industries. The Labor Department has recently intensified efforts to curb the practice of misclassification, including getting states like Missouri involved, due in large part to the practice growing across corporate industries in recent years.
Thus far, the Labor Department’s crackdown has been an overwhelming success. From 2008 to 2010, collection of back wages for misclassified workers increased by 400 percent. The Labor Department expects even better results now that states like Missouri are involved in the effort.
Missouri businesses looking to ensure compliance with employer classification legal requirements, as well as other employment-related legal requirements, can find more information here.
Posted by Attorney Christopher D. Vanderbeek. Vanderbeek is involved in the evaluation and defense of workers’ compensation and other insurance claims, protecting the interests of employers and insurers.
10/10/11 8:56 AM
Business Law, Emerging Business, Employment Law | Comments Off |
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Federal Crackdown on Misclassifying Employees Includes Missouri and the I.R.S.
By Christopher D. Vanderbeek
When a Missouri business is faced with a workers’ compensation case, what can its supervisory employees do to assist in the defense of the business?
There are six essential tips to follow that apply in all workers’ compensation cases. These apply regardless of whether (a) an employee suffered a work injury that is indisputable and the injury is of the severity that the employee alleges; or (b) there is a dispute regarding an injury, such as conflicting accounts of how, when, and/or where an injury occurred.
Following these tips will result in a stronger defense for the employer and insurer. Conversely, ignoring them could irrevocably weaken the defense.
1. Be Proactive and Diligent.
- As soon as you find out that an injury has allegedly occurred, first write down all the facts you know.
- Next, speak to the injured employee and any witnesses. Witnesses would be any employees/vendors/visitors that were in the injured employee’s vicinity at the time of injury, even if they didn’t necessarily see the alleged incident.
- Note the conditions where the injury allegedly occurred and how it allegedly occurred.
In some cases, this is easier said than done. In cases where the injured employee does not immediately notify the employer of the alleged injury, it will not be possible to go to the scene of the alleged injury and speak to those present.
- In these cases, as soon as you become apprised of the alleged injury, write down the details as quickly as possible.
- Compile your witness list. Be sure to include any vendors and visitors who were in the vicinity at the time of the alleged injury.
- Figure out what employees were supposed to be working with the injured employee when the injury allegedly occurred. Find out if these employees were working with the injured employee at the time. Speak with the ones who were, with regard to the circumstances surrounding the alleged incident.
And part of being diligent is making sure to…
2. Pay Attention. Don’t just let the issue rest after the initial investigation.
- Take note of conversations in the days following the incident, as other employees might discuss the incident and pertinent information could arise out of their conversations.
- When the injured employee returns to work, note his or her interactions with other employees and take stock of the body part alleged to be injured.
- If you notice that there is or are one or two specific employees with whom the injured employee seems to talk to a lot and spend a lot of time around, seek out those employees, as they may have pertinent information.
- If possible, evaluate the injured employee’s behavior when he or she believes no one is watching.
And when being diligent and paying attention…
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09/11/11 6:00 AM
Business Law, Employment Law, Litigation | Comments Off |
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Six Must-Follow Tips for Employers with Workers’ Comp Cases
By Christopher D. Vanderbeek
Did you know that when a Missouri worker injures (or claims to have injured) himself during the course and scope of his employment, the worker’s employer automatically has a statutory duty to get the ball rolling to ensure that the worker receives workers’ compensation benefits? In Missouri, it starts with the employer filing a “First Report of Injury” with the state.
From this moment forward, the company will play a substantial and vital role in the defense of its interests, as well as the interests of its workers’ compensation insurance carrier. Other employees of the company, such as human resources personnel and the injured employee’s supervisors, are also in an invaluable position to assist in this defense.
For example, consider an employee who claims that a work-related injury has rendered him unable to use his dominant shoulder. If that same employee were to come into work one morning and brag to his co-workers that he caught a giant fish during the previous weekend, it would cast doubt on the severity, or even existence, of the shoulder injury. But without vigilance in reporting from other employees, it is likely that defense counsel would never come to know this information.
Missouri businesses must remember that when a worker allegedly suffers a work-related injury, defense counsel acts on behalf of the company’s workers’ compensation insurer as well as the company itself. This is because in every workers’ compensation claim filed in Missouri, both the insurer and the employer are named as defendants.
Furthermore, the more a company aids in the defense of a workers’ compensation claim, the lower the liability exposure likely will be. This in turn keeps the company’s insurance premiums lower than they would be otherwise.
Naturally, then, it is in the employer’s interest to assist in the defense of the claim.
Next up: Six must-follow tips when dealing with workers’ compensation cases.
Posted by Attorney Christopher D. Vanderbeek. Vanderbeek is involved in the evaluation and defense of workers’ compensation and other insurance claims, protecting the interests of employers and insurers.
09/6/11 10:00 AM
Business Law, Employment Law, Litigation | Comments Off |
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Workers’ Compensation Claims: What Comes First for the Best Defense
By Christopher D. Vanderbeek
The National Counsel on Compensation Insurance (NCCI) and the Missouri Department of Insurance, Financial Institutions and Professional Registration recently approved a change regarding the filing of work-related medical claims in Missouri. The change reportedly reduces the impact of medical-only claims on Missouri businesses’ experience ratings by 70%.
The change is effective in Missouri as of July 1, 2011.
To understand the change’s effect on Missouri businesses, one first must understand the “experience rating” (i.e. “experience modifier,” “experience modification rating”). The experience rating is a mathematical formula used by insurance companies to assess premiums. In part, the formula takes into account insurance-paid losses over the past three years.
Small losses (i.e. less than $5,000) have a greater impact on a company’s experience rating than large losses, because small losses are more frequent and more predictable than large losses. Medical-only claims (i.e. claims involving no lost work time) typically constitute small losses. Therefore, medical-only claims have a substantial impact on the experience rating computation.
It is for this reason that Missouri businesses have commonly paid medical-only claims in-house, without reporting the claims to their insurance carriers. Not reporting the claims has allowed businesses to insulate themselves from the impact that reporting the claims would have on the businesses’ experience rating and, as a result, on insurance premiums. However, this practice inevitably leads to employers failing to report proper loss data to the state Department of Labor. Accordingly, the change is intended to deter businesses from handling medical-only claims without the involvement of their insurance carriers.
The change comes just as data for the first quarter of 2011 has indicated that workers’ compensation insurance premiums increased nationally for the first time since 2005. The data was produced by a survey involving 39 insurance carriers (approximately 20% of the market). It indicated a modest 2% increase. Factors such as decreased investment income, increased medical treatment costs, and an increase in total claims filed (for the first time in 16 years) are said to account for the price hikes.
It is imperative that Missouri businesses understand the effect of this change. It is now financially beneficial for businesses to report all claims, even medical-only claims, to their workers’ compensation insurance carriers. Missouri businesses must act accordingly, ensuring optimal financial success in today’s economy.
Posted by Attorney Christopher D. Vanderbeek. Vanderbeek is involved in the evaluation and defense of workers’ compensation and other insurance claims, protecting the interests of employers and insurers.
08/14/11 11:00 AM
Business Law, Employment Law, Litigation | Comments Off |
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New Change in Workers’ Compensation Premium Calculation: Missouri Businesses Now Have Financial Incentive to Report Medical-Only Claims
By Christopher D. Vanderbeek
Good news for Missouri: A survey conducted recently by the United States Chamber of Commerce has determined Missouri to be the seventh most business-friendly state in the country, according to its ranking in the survey’s “taxes and regulation” category.
The category took into account five criteria affecting businesses and economic functioning: overall state and local tax burden, corporate tax burden, impact of “government-imposed and related costs” on small businesses and entrepreneurs, anticipated state budget gap in fiscal year 2012, and cost of living. Missouri was ranked in the top twenty in all five criteria. It ranked eighth in terms of cost of living.
The study specifically recognized Missouri for “comprehensive reforms” in its workers’ compensation system in recent years. This language undoubtedly refers, at least in part, to the sweeping amendments enacted in 2005. Prior to 2005, the system generally favored injured employees. However, the 2005 amendments dramatically shifted the landscape in favor of employers. A microcosm of the shift can be found in Missouri’s statutory directive regarding judicial interpretation of workers’ compensation statutes: prior to 2005, judges were directed to generally interpret the statutes liberally and in favor of employees, but the 2005 amendments called for “strict interpretation” of all statutes and struck the language regarding favoring employees.
The survey further noted the recent passage of legislation in Missouri to eliminate the state franchise tax. It is suggested that the measure will save Missouri businesses $80 million over the six-year period during which the tax is phased out.
Finally, the survey credited Missouri’s tax credit programs and state tax structure with providing corporations with “one of the most favorable situations in the nation.” For example, the state only considers income earned within the state taxable. Furthermore, manufacturer inventories (such as raw materials), as well as goods held by retailers, distributors and wholesalers, are exempt from property taxes.
What this means for Missouri businesses is, essentially, that Missouri is a great place to start, run, or relocate a business. The state tax structure allows businesses to keep a higher percentage of earned income than they would be able to keep in most other states. In addition, the employer-friendly workers’ compensation system keeps workers’ compensation insurance carriers’ liability exposures down relative to other states, which in turn bolsters relative the earning capacities of Missouri businesses even further.
The full U.S. Chamber survey report is available here.
07/18/11 7:36 AM
Business Law, Emerging Business, Tax | Comments Off |
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Missouri Ranks High for Businesses in U.S. Chamber Survey
