Anyone considering moving to Texas to find work may want to reconsider.

A recent hearing conducted jointly by two committees of the Texas House raises serious questions about worker safety in the Lone Star State. Related questions may make one question the official regard of workers in general, given news about advice given to employers regarding unemployment benefits.

Texas employers not required to carry workers comp insurance

According to a July 29 article in The Texas Tribune, the nation’s second-largest state is dead last in requiring employers to carry workers’ compensation insurance. That is to say, it’s the only state that allows all employers except “public entities” to choose whether to provide workers comp coverage:

“Texas is the only state that does not require employers to purchase workers’ compensation insurance. As such, 33 percent of Texas employers [in 2008] elect[ed] not to purchase such insurance; the committee sought information about whether that number had changed in the wake of the Entergy decision. Cathy DeWitt, vice-president for government affairs at the Texas Association of Business, testified that her group would not support making workers’ comp mandatory.”

To be fair, a slide show linked to from the article, from the state department of insurance indicates that 70 per cent of employers who elect not to subscribe to workers comp do cover employers through private insurance. Further, the presentation shows that the one-third of employers without workers comp is a declining number; in 1993, the number was 44 per cent.

Still, that’s a bunch of uncovered workers. Of course, without buying workers comp coverage, the employer leaves itself open to lawsuits–and some indicate employers indicate that’s the main reason they do buy coverage.

On the other hand, as the hearing shows, there’s plenty of room in the entire system for improvement.

House hearing focuses on serious workplace injuries

The pair of committees–Business and Industry, and Judiciary & Civil Jurisprudence–convened to examine “concerns over whether benefits in Texas were adequate in the case of serious workplace injuries,” concerns apparently fueled by reports coming from the BP tragedy in the Gulf.

“José Herrera, a worker badly burned by hot oil in an accident in a Citgo refinery in 2008, testified that his benefits (which will not last a lifetime) amounted to less than one-quarter of his former take-home pay and that his insurance has often delayed needed surgeries. ‘I’m in pain the day this happened to me, til now, for the rest of my life,’  Herrera told the committees.

“Some lawmakers voiced support for reviewing benefits allotted to badly injured workers. ‘I would hope somewhere along the line some subcommittee would look at the adequacy of benefits,” said state Rep. Jim Jackson, R-Carrollton.

Entergy ruling limits abilities to sue

“Herrera’s ability to sue for damages is severely constrained by a 2007 Texas Supreme Court decision. In Entergy Gulf States v. John Summers, the court ruled that plant owners can shield themselves from lawsuits by injured contract workers by purchasing workers’ compensation insurance, which pays workers a portion of their wages as well as medical bills in the event of injury. Contractors — the companies that actually employ the workers — are already able to shield themselves in this way; what was new was the extension of this right to companies that own the workplace.”

Another Tribune piece, also dated June 29, says, “The Entergy ruling startled many Texas officials and stirred anger among some lawmakers, who argued the legislative intent was ignored. But so far, efforts to change the law to get around the ruling have fallen short — the Texas Supreme Court reaffirmed its ruling last year — though another try is expected in the coming session.”

Audit finds more workers comp issues

Yet another July 29 piece, this in Texas Watchdog, reports more troubling details. After acknowledging long-standing features that traditionally have drawn workers to Texas (no state income tax, relatively available work, and a decent cost of living), the Watchdog notes that, “But if you hit some hard times, the place isn’t so hospitable, a recently released audit shows. In fact, one could say the state is in no hurry to police employers who might abuse the rights of employees injured or otherwise compromised.”

Citing a report from the state auditor’s office, the Watchdog says “pending workers’ comp enforcement cases have been open for an average of 467 days. That’s about a year and three months.

“Fifty-eight of those cases have been open since 2007, and one lingers from 2006, when oversight for worker’s comp moved from the dismantled Texas Worker’s Compensation Commission to the insurance department. The division of workers’ comp issues disciplinary orders when providers and carriers have not complied with the law.”

Among other findings:

• “The case log that Division management used to monitor workers’ compensation enforcement cases was not complete. Auditors identified 81 . . . cases that were not on . . . the log and 61 pending  . . . cases that the Division had assigned to [Division employees] whose employment had been terminated the prior calendar year.”
• “The Division did not consistently conduct supervisory reviews of staff’s work . . . . According to the Division, from March 2009 to March 2010, the Division conducted only two supervisory reviews of cases that were progressing to disposition.”
• The audit also found a reporting problem caused by physical layout: “This reporting structure makes it difficult for the Associate Commissioner . . . to monitor . . . enforcement cases.”
• Perhaps most disturbing, this finding regarding reduced penalties: “In addition, for two cases with the largest penalties assessed, the team leader . . . approved settlement amounts significantly less the amount recommended by the staff  attorneys assigned to the cases. However, there was no documentation justifying the reduced penalty amounts. According to Division procedures, settlement amounts and their correspondence should be documented.”

Skirting unemployment benefits

Now, what about those unemployment benefits? The Watchdog also cites the case of a high-ranking Texas Workforce Commission employee who has been giving some dubious advice during employer workshops. It comes from a July 7 story in the Houston Chronicle:

“Say you’re the boss and you’re going to fire one of your employees. Instead of booting the employee out the door, the Texas Workforce Commission recommends giving your employee the option to resign.

“Employees given that choice are more likely to conclude they aren’t eligible for benefits, said Jonathan Babiak, who spoke before 800 Houston area employers recently at a seminar sponsored by the Texas Workforce Commission.

“It’s not the employer’s obligation to correct that misunderstanding, said Babiak, [then-]deputy director of appellate services for the Texas Workforce Commission in Austin. If employees resign, he said, ‘chances are they won’t file a claim.’ “

The Chronicle also quotes an attorneys, speaking from appropriate disgust:

” ‘This is outrageous,’ Houston employment lawyer Margaret Harris said. ‘If you resign in lieu of termination, of course you’re entitled” to benefits.

” ‘This is an agent of the state of Texas telling employers how to defraud citizens of the state of Texas of a benefit to which they are lawfully entitled and that they very much need,’  said Harris, of Butler & Harris.”

The Watchdog was unable to get a statement from Babiak, but did manage to reach an attorney across the hall from him.

“Across the hall from Babiak at the Texas Workforce Commission sits the office of Ronald Congleton, the commissioner representing labor in Texas.

” ‘We certainly were not happy with those comments,’ said Bob Stewart, an attorney in Congleton’s office. ‘Counseling employers how to avoid paying unemployment? We aren’t in favor of that.’ “

The Watchdog also learned that Babiak is no longer a deputy director of appellate services.

Nope, he’s been transferred, apparently…

…to the human resources department.

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Have you, a friend or a loved one been injured on the job? Whether you’re merely seeking answers about your rights or believe a lawsuit may be necessary, be sure to seek counsel with attorneys trained and experienced in workers’ compensation. Here’s some resources:

Workers compensation basics

Injury on the job

Filing a claim

A snarl in workers comp coverages for volunteer fire fighters in West Virginia could result not only in  loss of coverage but also in at least one court case as well as hefty raises for insurance premiums on homes that would no longer be served by volunteer departments.

According to a mid-June Charleston Gazette article re-posted at a fire-and-rescue trade site, West Virginia legislators were mulling options “as hundreds of volunteer fire departments around the state [were facing] sharp increases in Workers’ Compensation premiums, effective July 1.

Homeowners insurance premiums could triple

“If volunteer fire departments ultimately shut down because of the high workers’ comp costs, residents in those areas would see their homeowners’ premiums nearly triple, Insurance Commission Rates and Forms director Tonya Gillespie told the Joint Committee on Government and Finance.”

The problem is doubly vexing for West Virginia because most of the state relies on volunteer forces; accordingly, many departments are affected–and, potentially, so are a lot of homeowners.

A June 16 piece in The State Journal says that State Fire Marshal Sterling Lewis Jr. explained that “447 fire departments operate in West Virginia. Only 12 are full-time fire departments. Another 16 are a combination full-time and volunteer, and the rest are volunteer.”

Some VFD departments’ rates could more than double

Various sources have reported that volunteer departments in the state have historically paid  “suppressed rates”  (artificially low) and that the current provider, Brickstreet  Mutual, has been losing money since 2006 under laws requiring it to provide coverage. The first of July was to have been  the end of that arrangement, and Brickstreet was set to raise the rates, in some cases more than double.

The Journal reported that “[o]ne department in Wayne County would see its premiums increase from $23,000 to $48,000 a year, State Fire Marshal Sterling Lewis Jr. said. Any departments that can’t afford workers’ compensation must shut down and leave residents in those areas without ready access to emergency services.

” ‘We’re hoping that between the executive branch and the legislative branch there could be some quick resolution to the problem because on July 1, that could be doomsday,’ he said.”

Governor pulls off a temporary fix

The doomsday deadline was averted, however, by an agreement reported on June 18 in the Mineral Daily News-Tribune:

“Volunteer fire departments throughout the state will get a reprieve — at least for a year — in the expected skyrocketing costs of Worker’s Compensation premiums.

“Gov.  Joe Manchin on Thursday joined Department of Revenue Cabinet Secretary Virgil Helton, Brickstreet Insurance CEO Greg Burton, West Virginia Insurance Commissioner Jane Cline, members of the West Virginia State Firemen’s Association and others to announce Brickstreet Insurance’s decision to delay increasing state’s volunteer fire departments’ (VFDs) workers’ compensation premium rates for one year to allow time for the state to develop a long-term solution.”

Lost wages and severe injuries

One remarkable aspect of the situation involves the method calculating payments to injured volunteers. Premiums are based on awards to fire fighters working for minimum wage, but payouts addressing lost wages are calculated on actual lost wages–not from the unpaid volunteer position but for the person’s regular job income. Thus, an accountant or other highly paid worker can take on the voluntary duty without worrying about the financial repercussions to family in event of an injury.

Another interesting angle is that costs are significant not because of the number of claims but because when injuries do occur, they typically are severe.

According to the Journal, “BrickStreet currently is providing coverage to volunteer firefighters at a 600 to 700 percent loss, meaning it pays out roughly $7 in claims for every $1 it receives in premiums, [CEO Greg] Burton wrote [in an e-mail]. The company still will lose money at a rate of $3.5 million to $4 million a year even after the increase in premiums goes into effect.

“Not all volunteer fire departments will see a large jump in premiums. The increase may range from 3 to 10 percent in some cases, Lewis said. But in others, the increase could be more than 100 percent.”

Dramatic questions over ‘broad form’ liability

More intrigue enters the story due to requirements for supervisors to be covered in case of litigation filed by an inured fire fighter against one of the departments. ” . . . BrickStreet has announced it will stop providing such coverage after Sept. 1,” according to a July 24 article in The Intelligencer. “Other companies also are unwilling to provide the policies, according to the State Fireman’s Association.

” ‘Broad form’ liability policies cover officers and board members of volunteer fire companies. They protect officials against lawsuits by firefighters who are injured in the line of duty. Clearly, a volunteer fire company chief without such protection would have to be a fool to command members of his unit to enter a burning building.”

The intrigue ramps up, according to another Gazette article, from July 26, which reports that “a memo from the state Insurance Commission advises that the VFDs don’t need the coverage.”

Says the Gazette:

“Last week, representatives of VFDs protested at the Capitol, warning that some fire departments may “shut the doors” rather than risk personal liability for injury claims.

“A day later, Commissioner Jane Cline told lawmakers that directors and officers of VFDs don’t need the coverage, since state law gives them immunity under the Government Tort Claims Act.

“Under that law, she said, officials in state government as well as all government subdivisions have immunity from lawsuits stemming from employees’ work-related injuries — unless there is proof the employer had a deliberate intent to put the employee into unsafe working conditions.

But, says one VFD lobbyist, that raises an even larger question.

“There’s some glaring questions that jump out, including why was BrickStreet selling us broadform coverage if we didn’t need it?” said [Sam Love, lobbyist for the West Virginia Fireman's Association]. “There’s a lot of questions out there, that I don’t think this memo leaves firemen with a warm and fuzzy feeling.

“I’m afraid where it’s going to be headed is to a court case,” he said of issues regarding potential liability of VFD directors and officers.

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Have you, a friend or a loved one been injured on the job? Whether you’re merely seeking answers about your rights or believe a lawsuit may be necessary, be sure to seek counsel with attorneys trained and experienced in workers’ compensation. Here’s some resources:

Workers compensation basics

Injury on the job

Filing a claim

Following months of wrangling, Oklahoma recently passed a workers comp reform package, which we discussed here. Now the Sooner State has a legal dust-up involving the presiding judge of the state’s Workers’ Compensation Court.

Judge Kent Eldridge has apparently decided he’d rather be an elected Oklahoma County District judge than a state-level appointed judge–even though the positions pay the same, according to a June 5 article in The Oklahoman.

Of course, there’s nothing wrong with a job change or furthering one’s career.

The problem is, the law might restrict Eldridge from running for the elected post while sitting as the workers comp judge.

Should he resign before running?

“Some attorneys say Judge Kent Eldridge appears to be violating the law by not resigning before running for office.

Eldridge and his legal adviser say he’s not required to resign.”

But whether he must resign the workers comp position is only part of the story–campaign contributions are also raising questions.

Fundraising and an ‘unseemly atmosphere’

According to a July 5 piece at Newson6.com, “Eldridge says no one has complained to him and he is not aware of it if anyone has complained to the workers’ comp court’s administration. He says he has never suggested that he might be influenced by a contribution to his campaign.”

The Oklahoman reports says, “Critics also say Eldridge’s campaign has created an unseemly atmosphere at the workers’ compensation court. They claim attorneys who represent both employers and injured workers are being pressured by other lawyers to give to his campaign to prevent opposing attorneys from gaining the upper hand in cases.”

In that account, the judge is described having assigned responsibility for all campaign activities to campaign chairman Bill Liebel and, further, has directed campaign officials to not reveal to him the names of any contributors “because he can’t be influenced by contributors when he doesn’t know their identities.”

Invitation present at court

Apparently, at least one fundraiser invitation was present at  workers comp court, and it ” listed nearly two dozen workers’ compensation and district court attorneys as sponsors for the June 8 fundraiser. Sixteen of those individuals were listed on an invitation as sponsors of another reception for Eldridge scheduled for 3 p.m. to 5 p.m. May 13 at the Faculty House.”

The article also says, “Eldridge acknowledged he attended a fundraiser for him in the home of workers’ compensation attorney [Sid Musser] and made a point of trying to visit with everyone there. A number of workers’ compensation attorneys and other lawyers reportedly were in attendance.”

Three attorney reached by the paper say they believe the judge ran afoul of Oklahoma statute Title 20, Chapter 19, Section 1404, which reads “20‑1404.  Additional grounds for removal of judicial officer:

“5.  A judicial officer becoming a candidate for any nonjudicial office or for another judicial office whose term is to commence before the expiration of his present term of office; provided that no judge holding a nonelective judgeship shall become a candidate in a race in which the incumbent seeks to retain an elective judicial office unless he first resign his appointive judgeship.”

Eldridge’s position is that he sought qualified legal opinion before declaring for election. Maybe the part about “the incumbent” gets him off the hook, as the incumbent has declined to seek re-election.

Attorney contributions commonplace

One thing seems apparent: The campaign contributions issue is not likely to result in charges. For one thing, Eldridge’s opponents who are assistant DA’s are probably getting attorney contributions, too.

“Terry West, general counsel for the Council on Judicial Complaints, said contributions from attorneys to judges have been an issue for a long time since district judges are allowed to accept campaign contributions from attorneys who practice before them.

” ‘It’s very uncomfortable for judges and very uncomfortable for lawyers,’ West said. ‘No one else is particularly interested in a judge’s race so they pretty much have to solicit from lawyers.’ ”

Gad–what a system.

***********************************************************************************************************************
Have you, a friend or a loved one been injured on the job? Whether you’re merely seeking answers about your rights or believe a lawsuit may be necessary, be sure to seek counsel with attorneys trained and experienced in workers’ compensation. Here’s some resources:

Workers compensation basics

Injury on the job

Choosing an attorney