March 10, 2012
Attorneys blast idea of moving Workers' Comp Commission into Labor Department
"This came out of the blue, approximately a month ago, when the governor introduced the bill. We did not see it coming," said Bailey, after testifying against the bill last week before the legislature's Appropriations Committee.
Bailey, who chairs the workers' comp section of the Connecticut Trial Lawyers Association, said his group, which represents injured workers, and the Connecticut Bar Association, which also includes lawyers representing employers, are united in their opposition.
"Overall what's happening, it's a power grab, in my opinion, of the executive branch over an independent adjudicatory commission," said workers' comp lawyer Nathan Shafner, of Groton's Embry & Neusner, which concentrates on workers' comp law.
The head of the Workers' Compensation Section for the Connecticut Bar Association, representing both claimants and respondents lawyers, is David Weil, of Cheshire's Nuzzo & Roberts. He said section members voted unanimously Feb. 15 to oppose the governor's bill. The reasons they're against it are numerous. "It would add a level of bureaucracy to something that's now working rather well," Weil said. "It seems counter-productive to me."
Andrew McDonald, a former state senator and now Gov. Dannel P. Malloy's top legal counsel, said the impetus behind the consolidation is economic efficiency. The Malloy administration has already championed a number of agency mergers. On a grand scale, energy and environmental programs were consolidated in a new Department of Energy and Environmental Protection. On a more modest scale, a host of smaller oversight agencies, including those that monitor ethics and elections, were put under one umbrella.
"The goal is to achieve the greatest amount of efficiencies for back-office operations," McDonald said. "There are economies of scale that can be achieved in areas such as human resources, accounting, office support and those types of areas without interfering with the mission of the workers' comp commission."
Bailey, of Bridgeport's Tremont Sheldon Robinson Mahoney, said he has no problem with economic efficiency and back-office administrative work being done more economically. "We're looking at the policy-making function," he said.
Workers' compensation commissioners, by definition, are lawyers steeped in the law of workers' comp, and have been able to respond quickly and efficiently when disastrous circumstances strike. The question is, would a big agency with many other functions be able to respond as quickly?
"Every now and again, an extraordinary event happens," said Bailey. "A tragic event. There were the shootings at the lottery offices years ago, or the Kleen Energy plant explosion." In the 1998 lottery shooting, distraught employee Matthew Beck shot four supervisors, then himself; the Kleen Energy disaster in Middletown in 2010 killed six and injured dozens more.
"In those situations, the chairman of the Workers' Compensation Commission got involved to try to streamline the processing of claims," Bailey said. "As opposed to having multiple parties [and] multiple insurers haggling and fighting, he cut through the red tape to establish policy to get things moving. It was very beneficial that way, to the employers, as well as to the injured workers. We'd be losing that."
Weil, who also testified in a Feb. 16 hearing on the bill, scoffed at the notion that sliding the commission into the Labor Department would save any money. "Workers' compensation is off-budget," he said. "It's not funded by Connecticut tax dollars; it's funded by the insurance companies and the employers, so there's no money actually being saved by the state of Connecticut in this move."
Weil represents workers' comp "respondents," or company clients that are hit with claims from injured workers. He agrees with Bailey, the claimants lawyer, when he says "the bill removes a lot of powers from the Workers' Compensation commissioner, and places them in the hands of the Labor commissioner. This may not have an effect in the short term, but in the long term it makes it harder to get things done in an efficient manner."
Agency That Works
In 1991, recalled Groton attorney Shafner, the system got a major overhaul. "Everyone was screaming how workers' comp wasn't working in Connecticut, and the General Assembly did a huge study," he said. The study concluded the agency needed centralized decision-making authority.
"At that time, commissioners [who decide cases] had their own little fiefdoms, if you will," Shafner said. "They created the stronger role of the chairman. Now we've had our issues with workers' comp, but one thing that's happened over the last 20 years is that you have an agency that can respond very quickly to the needs and concerns of those participants who use its agency."
The reforms created a nine-member advisory board made up of industry and workforce representatives, one of whom is an injured worker. Another member represents hospitals. "This has given it both transparency and fairness," Shafner contends.
This coming year, Connecticut's workers' compensation commission turns 100, and it would be a grim centennial event to suddenly rob it of the independence and policy-making autonomy it has enjoyed over the decades, Shafner said.
He also has a theory that a government reorganization is contrary to the dictates of the Connecticut Constitution, which says that in even-numbered "short session" years, the legislature must stick to budgetary matters.
The measure, House Bill 5016, is couched in language that stresses its budgetary and economic aspects. But lawyers who testified about the bill last week — uniformly in opposition — contended that any actual dollar savings would be minimal or non-existent.
Melanie I. Kolek, legal counsel for the Connecticut Education Association in Hartford, spends much of her time representing injured teachers before workers' comp boards. She urged Appropriations Commission members to look closely at the bill's illusory economic impact.
As drafted, she said, it does not "provide any cost savings for the foreseeable future," given that no employees can be terminated or laid off until 2014 under the cost-saving deal the governor reached with state employees last year. Kolek also said leases of office space now used by the Workers' Compensation Commission run thorough at least 2014.
Speaking to the Law Tribune after her testimony, Kolek predicted that under the wing of the Labor Department, workers' comp lawyers would experience delays in getting a prompt hearing, adding weeks to the time needed to respond to clients' emergencies. She opposed consolidation for consolidation's sake, "especially if the change fails to improve government services, fails to reduce spending, and fails to adequately and promptly serve the needs of those it is intended to serve."
McDonald, the governor's lawyer, said he has been meeting with groups of key stakeholders, and that the criticisms of the bill were being heard. "We are taking their positions into consideration and may be altering the proposal to address some of their concerns," he said. "We will continue to vet the proposal as the course of the legislative proposal progresses."
Connecticut Law Tribune, By THOMAS B. SCHEFFEY