Wins, losses for business: workers' compensation eludes reform

When lawmakers return to Springfield for their fall "veto" session they will try to consummate elusive reform of the state workers' compensation system. Left unresolved were revisions to the way that Illinois goes about deciding how a worker is compensated for on-the-job injuries. An agreement was hammered out this spring between business and labor but it fell through at the 11th hour under criticism from trial lawyers.

All in all it was not a great spring for business interests in the legislature. "I wish I could call it a silent spring, but I can't," quipped Arthur R. Gottschalk, president of the Illinois Manufacturers' Association (IMA), one of the major business groups. Several elements of the business community had opposed tax increases. The IMA was not among them, but had conditioned its support for an income tax hike upon an education accountability measure. The IMA saw taxes raised by more than $1 billion without passage of its school plan. "We got the castor oil without the sugar," Gottschalk said. There were other losses. The IMA and other business organizations failed in the closing hours to stop party line approval of a bill requiring unpaid family leave.

Much of lobbying is fending off hostile bills, and business succeeded on a number of those fronts. They blocked measures that would have required that members of the Illinois Commerce Commission be elected — a change that business fears would mean higher business utility rates to hold down residential rates. They beat back bills that would have rolled back insurance rates. And they quashed a proposal that would have mandated that employers provide health insurance to their workers.

As for workers' compensation, labor and business had reached agreement (prior to the trial lawyers' objection) with the aid of a $150,000 report that Gov. James R. Thompson contracted for with John H. Lewis, a Florida lawyer and workers' compensation expert. Talks in 1987 had stalemated over business allegations that the system was too expensive and labor claims that benefits were too low. Lewis addressed the differences by pointing out that benefits were at the national average, lower than industrial states but higher than those around us.

Lewis's report also detailed structural and financial problems with the system, administered by the Illinois Industrial commission. Lewis discovered records piled in cardboard boxes and an unreliable computer system. He found that in a third of the cases, it took more than two weeks for the injured worker to get the first workers' compensation check. And he found that when arbitrators' rulings are appealed to the full commission, something that happens in 70 percent of cases, delays as long as two years ensue.

The revisions agreed to by business and labor were structural and administrative. Included in the failed agreement were:

• Adding a third panel of commissioners to clear the 2,000-case backlog of appeals of arbitrators' rulings.
• Streamlining the process by allowing no new evidence to be introduced on appeal, using pretrial conferences to expedite resolution, and allowing voluntary binding arbitration.
• Extending coverage for farm workers.
• Allowing small employers with good claims records to get out of the expensive assigned risk pool.
• Improving training and annually reviewing arbitrators' performance, assigning to each commissioner two staff attorneys and making the position of chairman of the industrial commission an administrative instead of a judicial post.
• Adding $2.8 million to the budget of the Illinois Industrial Commission to provide additional staff and clear backlogs of case.

The entire agreement was derailed when trial lawyers challenged the provision for voluntary binding arbitration, a provision sought by business and agreed to by labor negotiators. The objection to arbitration resulted in keeping the bill from going to a vote.

The new money for the Illinois Industrial Commission is in the budget, but now there is no plan for spending it. Jeffrey C. Miller, Gov. Thompson's chief of staff and the man who headed up the negotiations, says that the new money was included contingent upon reforms. Breaking that dead lock will be difficult. Business will resist giving up the arbitration provision without getting something in return. And Miller says as far as he is concerned, both business and labor still support their original agreement.

The education accountability measure that business favored would have created a Department of Public Accountability within the Illinois State Board of Education. The state education board would be required to establish learning goals and identify academically troubled school districts. Ultimately, financial sanctions could be taken against schools that did meet timetables for improvement. And the measure would create a business-education partnership commission to seek private support for public education.

The other major damage control for business was over the Family Responsibility and Medical Leave Act, a measure that guarantees workers time off for family medical problems. The bill cleared the General Assembly in its closing hours. "This is without doubt one of the strongest pieces of pro-family legislation approved this session," Sen. Dawn Clark Netsch (D-4, Chicago), the bill's sponsor, declared upon passage.

To win House approval Netsch had to trim from 12 to eight the number of weeks of leave allowed over a two-year period. The bill requires unpaid leave for medical or serious medical problems of a child, spouse or parent. To qualify, workers must have 12 consecutive months of employment, must work 20 or more hours per week and must schedule leave, if possible, to avoid disrpution.

In mid-August the business community lobbying, aimed at convincing Thompson to veto the family leave measure, continued. Gottschalk also voiced hope that the education accountability measure may yey become law and workers' compensain resolved: "A number of things are hanging which may yet be resolved in a positive way."

August & September 1989 | Illinois Issues | 54