Tag Archives: Labor and Industry Review Commission

Work Comp Budget UPDATE: Committee Votes to Preserve Court Reporters & LIRC

Last week, the all-important Wisconsin Joint Finance Committee voted on two major issues impacting worker’s compensation in our state.   On both votes, Joint Finance removed the two Budget proposals, opting, instead, to keep the current well-run and efficient system!

As we reported in a previous post (MORE changes to Work Comp: Elimination of Court Reporters & Appeals Commission?), the Budget Bill proposed dramatic changes to Wisconsin’s top notch worker’s compensation system: (1) eliminating the use of live court reporters in litigated hearings; and (2) eliminating the independent appeals commission (Labor and Industry Review Commission, or LIRC) that reviews judge decisions.  

After public hearings on these proposals and lobbying efforts from various industry stakeholders, the Joint Finance Committee voted to preserve the current structure of the work comp system.  

LIRC: 

Indeed, the Committee rejected the Budget proposal to eliminate the LIRC–retaining the second-level appeals commission that has helped shape Wisconsin work comp law virtually since its inception in 1911.  While some vacant staff positions go away, LIRC remains in place for future appeals of work comp, unemployment, and equal rights cases.   As the LIRC website states:

LIRC is an independent Wisconsin administrative agency established to provide a fair and impartial review …  The commission’s decisions provide consistency, stability, and integrity to the programs for the employers, employees, insurers, and citizens of the State of Wisconsin.

As part of keeping LIRC, the Committee also voted for the Wisconsin Supreme Court to conduct a further study about LIRC’s interpretation of the statutes.   The upshot of the vote is for LIRC to remain for the next biennium.

Court Reporters:

The Committee also voted to keep the status quo and retained the use and funding for court reporters in litigated worker’s compensation hearings.   These stenographic court reporters are necessary to the efficient functioning of the system by ensuring decorum in the court room, properly managing exhibits, making sure parties do not talk over each other, and creating an accurate and legitimate transcript.  The initial Budget propsal involved eliminating court reporters in exchange for ill-defined audio recording equipment. Many system stakeholders (employees, employers, and carriers) raised signficant concerns about having six to seven figure case exposures decided based on unknown or questionable audio technology.  The costs of such “equipment” were also not described or budgeted.

As part of the Joint Finance Committee deliberations, the state’s Legislative Fiscal Bureau provided options for the use of court reporters: eliminate them, keep them, or keep them but submit the issue for further study. The Committee selected the later option, which involved keeping the current use and funding for the all-important court reporters.  

Furthermore, the Commitee requested a study to be conducted (and submitted to the Advisory Council) about the viability and use of potential audio recording equipment.  This makes good sense.  We are a first-in-the-nation work comp system.  If there is technology that exists, we need to research it and make sure it works efficiently and cost-effectively for our work comp system.  Let’s get it right!  Ultimately, we may discover (like many other states have) that live in-person court reporters still beat out any potential audio recording equipment.   

Next steps:

First, I’d like to thank the state legislature’s Joint Finance Committee for their thoughtful consideration of the concerns from the work comp stakeholders. 

As to procedural issues, following the Joint Finance Committee votes last week (and further completion of the votes on other major issues), the Budget ultimately proceeds to the full legislature and then to the Governor’s desk for approval or veto.

As of right now, the Joint Finance Committee recognized what many stakeholders preach: the Wisconsin work comp system works well now, so avoid dramatic changes that could upset the historic stability. 

 

Elimination of Appeals Commission: More Updates

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.

MORE changes to Work Comp: Elimination of Court Reporters & Appeals Commission?

Budget Bill Proposes Eliminating Court Reporters

Wisconsin’s Governor recently proposed significant changes to Wisconsin’s best-in-nation worker’s compensation system.  For the second budget cycle in a row, the Governor’s Budget Bill wants to drastically change the structure of worker’s compensation cases.

The Budget Bill, revealed on February 8, 2017, proposes two main changes : (1) the elimination of court reporters in litigated worker’s compensation trials; and (2) the elimination of the independent body that reviews judge decisions.

A base level concern exists, again, because these proposals were made outside the stabilizing force of the Wisconsin Worker’s Compensation Advisory Council.   As mentioned at length in this forum, the Advisory Council, with its balanced membership of labor and management representatives, has produced reasoned, incremental changes historically–creating a beneficial system for all stakeholders.  Hopefully the Advisory Council will weigh in on the other potential effects of the unveiled Budget Bill proposals.

Each of the proposals significantly impact the state’s work comp system:

Elimination of Court Reporters:

The Budget proposes eliminating the use of statutorily-required stenographic court reporters in worker’s compensation trials.  The specific proposal is to eliminate necessary court reporters (who ensure decorum in the court room, properly manage exhibits, make sure parties do not talk over each other, and create an accurate and legitimate transcript) in exchange for some type of ill-defined audio recording equipment.

Employers and carriers in our state—facing six to seven figure exposures—will have concerns about facing such liability based on questionable audio technology.  Imagine if at a critical point in trial, a witness talks to softly or inaudibly, resulting in a blank area in the transcript.  No stakeholder wants this, and our live court reporters ensure that it does not.

Also, the circuit court (and further appellate courts) want an accurate, undisputed transcript of the lower trial proceedings.   If the audio is poor, unclear or inaccurate, we may be forced to re-litigate the trial.  A redo will increase system costs.  Further, if court reporters are eliminated, the private parties will bear the costs by hiring their own court reporters.  We then may face disputes about the “real” transcript between the state’s audio recording (which will need to be transcribed for appeals) and the privately-hired court reporter transcript.

Wisconsin is not alone in its use of court reporters in worker’s compensation trials, as an informal poll revealed the use of court reporters in IN, PA, CT, IA, NC, MT, NE, WY, SC, CA, MA, GA, KS, IL, LA, NY, WA…and the list goes on.

Near universal opposition exists to this unnecessary proposal to eliminate live court reporters.  The State Bar litigation section board voted unanimously to oppose this proposal.  Moreover, all of the three main groups of attorneys that represent clients in worker’s compensation proceedings oppose this proposal.   The Wisconsin Defense Counsel (defense attorneys), the Wisconsin Association of Justice (injured worker attorneys), and the Wisconsin Association of Workers’ Compensation Attorneys (bi-partisan group) jointly drafted a letter to the Governor voicing their opposition (PDF link).

All parties to litigation want a fair and accurate depiction of the trial proceedings, and court reporters help secure that justice.  This proposal faces stiff opposition.

Elimination of the Appeals Commission

Traditionally, the Labor and Industry Review Commission (LIRC) is an independent body of three political appointees that rule on worker’s compensation, unemployment, and equal rights appeals.  The cases are litigated in front of administrative law judges and then the appeal is to LIRC, who have a virtual de novo review.  The appeal from LIRC is direct to circuit court, which has a very deferential standard and will uphold the LIRC decision if there is any “credible and substantial evidence.”  Barring a legal issue, the circuit court upholds the factual and credibility findings of LIRC.

LIRC has been in existence in some form since the inception of the worker’s compensation act in 1911.  LIRC actually serves to define much of the worker’s compensation case law—for over one hundred years.  When I look at our treatise, I’d guess 80% of the cited cases are LIRC cases.  Judges use the LIRC decisions in making determinations.

The current Budget proposal is the complete elimination of LIRC.  However, as opposed to a direct appeal from a judge determination to circuit court, the proposal is to substitute the Division Administrator for LIRC.  Thus, litigants would trial cases to the administrative law judge, with an appeal to the state Division of Hearings and Appeals Administrator (currently Brian Hayes) as the intermediate level of appeal.  Appeal from the Administrator’s decision would be to circuit court–with no apparent change in the standard of review by circuit court.

The upshot is to give much authority and discretion back to the actual administrative law judges–the ones who actually observed the witness and heard the evidence.  One of the statutory proposals indicates that the “findings of fact” by the judge “shall, in the absence of fraud, be conclusive.” That appears to give even less discretion to the Administrator’s ability to review judge decisions.

There is much ambiguity about the reasoning behind these proposals, as well as the potential impact.  I’ve already heard from a number of individuals that the proposal comes from issues within the unemployment insurance arena (and unemployment appeals fill up the majority of LIRC’s docket).  If true, worker’s compensation appeals are being swept up with the issues within unemployment.

However, if implemented, the practical effects are drastic.  Presumably, the Division Administrator would likely be more deferential to the sitting administrative law judges (i.e., approve more ALJ decisions) and probably produce a faster appeal turnaround time than the current LIRC process.   The catch is that it remains unknown how the Adminstrator would handle the influx of worker’s compensation appeals. Would there need to be additional staff?  (if so, budgetary costs need to be considered).  If no new staff, the simple time constraints lead to the likelihood of rubberstamping judge determinations.

In the future though, the Administrator position changes.  Future appointees could have their own political proclivities that could impact the system.  Also, the proposal may have just eliminated 100 years of case law as guidance for future judicial determinations.  The budget is devoid of what happens to the precedential value of past LIRC decisions.

Accordingly, further details really need to be revealed about the proposed plan before the stakeholders can weigh in.

One further item is known, based on the intersection of the two proposals.  If the system eliminates LIRC and provides more deference to the underlying judge determination, the value of court reporters increases exponentially.  If the judge factual determination is conclusive, a reviewing circuit court certainly wants an accurate, credible, and decipherable transript of those all-important findings.

We will explore the further Budget process and these proposals as they progress…

For further information:

The full statutory text of the Budget Bill (2017 Assembly Bill 64/ 2017 Senate Bill 30) can be found here, with a summary found here.