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Council on Worker's Compensation
Meeting Minutes
Madison, Wisconsin
June 25, 2001

Members present: Mr. Bagin, , Mr. Beiriger, Mr. Buchen, Ms. Coakley Ms. Connor, Mr. Glaser, Mr. Gordon, Mr. Newby, Ms. Norman-Nunnery, Mr. Olson, Ms. Vetter, Mr. Welnak.

Staff present: Mr. O’Malley and Mr. Smith.

  1. Minutes. Ms. Norman-Nunnery convened the meeting in accordance with Wisconsin’s open meetings law. Mr. Newby requested that the minutes of the May 24, 2001 meeting be amended at the bottom of page 2 where Mr. Glaser refers to the Larsen case. He said the third sentence of that paragraph should refer to an injured employee, not an injured employer. As amended, Mr. Bagin moved adoption; Mr. Welnak seconded the motion. The motion to adopt the minutes of the May 24, 2001 meeting was unanimously approved.
  2. Review Department Proposals. The Council reviewed the Department’s proposals that had been tabled at the May 24, 2001 meeting. The Council agreed to include the following proposals.

Weekly wage

  • Overtime
  • Employer's normal full-time work week

102.11(1)(a)

Amend 102.11(1)(a) as follows:

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 normally 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 to Saturday.

Comment.

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.

(continued)

Weekly wage

  • Part-time part-of-class

102.11(1)(f)

Amend 102.11(1)(f) as follows:

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 part-time employment.

3. 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 wage case.

3. 13 Weeks is borrowed from the 90-day period specified for full-time employment in DWD 80.51(1).

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.

Medical fee disputes

102.16(2)(d)

Delete the sunset provision on the fee dispute program.

Comment. The provision was enacted in 1992. The sunset has been extended every two years since then. The program is well established.

Safety inspections

102.17(1)(h)

102.57

102.58

Re-instate safety inspections by requiring the Department to secure the services of safety specialists by contract, MOU or direct employment.

Comment. DOC will continue with inspections under the MOU with the Worker's Compensation Division until the end of the year 2001. It is not yet clear how the Department will secure these services. Still, the Council wants the Department to have clear responsibility and authority to act.

Statute of Limitations

102.17(4)

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 vision
  • any brain injury

and total or partial knee or hip replacements.

2. Pay for otherwise meritorious claims from the Work Injury Supplemental Benefit Fund (WISBF) 1/1/2002 regardless of the date of injury.

Comment.

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 hearing.

2. Occupational injuries beyond the 12-year period are currently funded from WISBF.

Wage offset

102.43(6)(b)

Amend 102.43(6)(b) as follows:

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. 102.11(1)(a). If 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 injury.

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.

  1. 102.27 Reimbursements to Counties. After reviewing the Department’s proposal to amend s. 102.27(2)(b), Stats., the Council requested that Mr. O’Malley prepare some examples of the problems created by the statute. He said he would circulate them to the members prior to the next meeting.
  2. Caucuses. The members adjourned to separate caucuses to discuss additional proposals.
  3. Honthaner’s Restaurant’s decision. The members reconvened. Mr. Bagin said it appeared both sides had made significant progress in developing proposals that would probably be acceptable to all members. Still, he said the members would like Mr. Smith and Mr. O’Malley to meet with attorneys selected by labor and management members of the Council to discuss possible statutory options to limit the scope of the recent Honthaner’s Restaurants case. Mr. Smith and Mr. O’Malley said they would be glad to participate. The meeting will take place prior to the next Council meeting.
  4. Combined Reporting under UI. Mr. Smith handed out a memo he had received from Mr. Mike Tomsyck in the Division’s Bureau of Insurance Programs. Based on newspaper reports, Mr. Tomsyck was concerned that if the Unemployment Insurance Division allowed combined reporting of payroll for self-insured companies and insured companies that have common ownership or subsidiary relationships, the Worker's Compensation Division Self-Insurance Program would have no way to separate out payroll to assess self-insured employers for insolvent self-insured employers under s. 102.28(7), Stats. Mr. Tomsyck said assessments that were necessary in the Hardy case might not be accurate if combined payroll reporting is enacted.
    Mr. Buchen said he was familiar with the combined reporting issue, but was not sure what the impact would be. He suggested that the Department work with the Department of Revenue to more fully understand the impact of the proposal.
  5. Next meeting. The Council adjourned until 9 a.m., July 24, 2001, at a Madison location to be determined.
Updated February 06, 2012
Division of Worker's Compensation
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