As indicated, Wisconsin’s current Budget proposal (now being considered by the state’s Joint Finance Committee in the legislature) proposes a sweeping change to the stability of the state’s workers’ compensation system.
The proposal axes the independent appeals commission, known as the Labor and Industry Review Commission. The Commission, or LIRC, handles appeals from workers’ compensation, equal rights, and unemployment insurance cases.
An insightful article about this proposal–from the perspective of unemployment– can be found here. This article (LIRC’s Elimination) is from one of the state’s foremost experts on unemployment, and it offers a deep dive into some of the potential reasoning behind this proposal. I’d encourage all interested stakeholders to take a look at this article in detail.
Interesting take on a provision in the newly proposed Worker’s Compensation Advisory Council (WCAC) bill: https://wisconsinui.wordpress.com/2016/01/15/substantial-fault-and-misconduct-principles-from-unemployment-law-to-come-to-workers-compensation/
One of the provisions in the new WCAC bill would allow denial of temporary disability/lost time benefits if a worker is terminated for “misconduct” or “substantial fault.” These terms will be defined based on unemployment law standards. Misconduct and substantial fault recently were brought into play with changes to the unemployment insurance laws in Wisconsin. These legislative changes certainly were employer-friendly, allowing employers a greater ability and opportunity to deny unemployment benefits.
With worker’s compensation poised to adopt this standard for lost time benefit denials, workers definitely could face a rough spot when recovering from a job injury. If the employer terminates a worker for alleged misconduct or substantial fault, they would be denied unemployment benefits and worker’s compensation benefits–until an administrative hearing is held to determine the legitimacy of the employer’s actions. The possibility for many worker’s compensation hearings turning into “he said/she said” determinations like in unemployment cases is a strong possibility.
In the bigger picture, all sides must remember that this was a compromised agreed-upon bill by labor and management. Both sides gained and gave up provisions–this produces the stability in the worker’s compensation system.
Eligibility for Unemployment Compensation in Wisconsin will change substantially in 2014. For more than 70 years, an employee would only be found ineligible for Unemployment Compensation if he quit a job or was found guilty of “misconduct”. Misconduct was defined under a 1941 case as “willful or wanton disregard of an employer’s interest.” Mere inefficiency or unsatisfactory conduct or failure in good performance as a result of an inability to meet job expectations was not misconduct.
As a result of the aggressive efforts of Republican lawmakers (who ignored “agreed-upon” bill proposed by the non-partisan Unemployment Compensation Advisory Council) many workers will be deemed ineligible for Unemployment Compensation benefits.
A new basis for disqualifying workers from receiving Unemployment Compensation benefits will be called “Substantial Fault” which may include a series of inadvertent errors made by the employee and violations of work requirements after the employer warns the employee about the infraction.
In addition, a series of situations in which a voluntary resignation would not disqualify a worker from benefits have been severely restricted.
In the worker’s compensation arena, if an employer terminates an employee because of a work injury, or unreasonably refuses to rehire the employee after a compensable work injury, a penalty of up to one year of wages applies. The purpose of the statute is to prevent discrimination against employees who have previously sustained injuries, and if there are positions available within the injured employee’s restrictions, to assure that the injured person goes back to work with his former employer. This statutory protection is an exception to the general rule of “at will” employment in Wisconsin – where an employer can hire, fire, and make employment decisions for any reason or no reason at all except for a discriminatory reason defined by law (like race, gender, religion). Under the Wisconsin Worker’s Compensation Law, a work injury is essentially an additional protected category. The worker’s compensation Labor Industry and Review Commission has held that refusal to rehire benefits are not “back pay for Unemployment reimbursement purposes.”
Under Unemployment Compensation law, no finding of fact or law made with respect to liability under the UC provisions is binding in an administrative proceeding under the Worker’s Comp law. As such, the Unemployment decision generally is inadmissible in a worker’s compensation hearing. However, some litigants attempt to use an Unemployment Insurance file for other purposes – beyond the findings of fact and conclusions of law – in a worker’s compensation hearing. A finding in the Unemployment Compensation arena by an initial Unemployment Compensation deputy, for example, may prove admissible in the worker’s compensation arena on the issue of misconduct, thus providing the employer in a worker’s compensation claim a defense to a refusal to rehire claim.