Saturday, January 25, 2020
I have begun work on a project in which I seek to compare the monopolistic workers' compensation systems in the United States and Canada. The Workers' Compensation system in Canada has separate legislation and policies for each province or territory, but the majority of Canadian workers are covered in some form by workers' compensation when they are at work. To help get me started with the project, researcher Terry Bogyo kindly directed my attention to the 1913 report of Sir William Ralph Meredith, a storied figure in the history of Canadian workers' compensation, to the Lieutenant-Governor of the Province of Ontario. The report makes for extraordinarily rich reading, I dare say to any student of workers' compensation. It is interesting to note that Meredith deemed the German system superior to the English, which is contrary to the American view of the time, which fastened on to the English system. In this regard, the report reveals interesting differences of opinion between Meredith and P. Tecumseh Sherman, a principal draftsman of the prototypical American statute adopted, more-or-less, by most American states. (I discuss some of this early history here). I am especially struck by the extent to which the dialogue of the era was explicitly moral. If you will indulge me, I offer the following passage of the report as evidence of this epochal morality. The statement was in response to a counter-proposal to Meredith's proposed bill that had been offered by the Canadian Association of Manufacturers:
A just compensation law based upon a division between the employer and the workman of the loss occasioned by industrial accidents ought to provide that the compensation should continue to be paid as long as the disability caused by the accident lasts, and the amount of compensation should have relation to the earning power of the injured workman. To limit the period during which the compensation is to be paid regardless of the duration of the disability, as is done by the laws of some countries, is, in my opinion, not only inconsistent with the principle upon which a true compensation law is based, but unjust to the injured workman for the reason that if the disability continues beyond the prescribed period he will be left with his impaired earning power or, if he is totally disabled without any earning power at a time when his need of receiving compensation will presumably be greater than at the time he was injured, to become a burden upon his relatives or friends or upon the community.
And again, commenting on the inadvisability of a proposal for a one-time, lump-sum, fixed permanent partial award, Meredith wrote:
The limitation to $1,500 of the amount of compensation in case of permanent partial disability is, I think, unreasonable . . . The payment of lump sums is contrary to the principle upon which compensation acts are based and is calculated to defeat one of the main purposes of such laws – the prevention of the injured workman becoming a burden on his relatives or friends or on the community – and has been generally deprecated by judges in working out the provisions of the British act . . .
I wonder if Meredith would be considered a wild-eyed dreamer (or worse) in today's mean, mean times.
Michael C. Duff
Wednesday, January 22, 2020
I am not implacably opposed to all that is new. Indeed, I think we need a new, New Deal, and I am not so confident to claim that I know exactly what that should look like. But I’m also a product of my experience. And as someone who has battled companies like Walmart in the trenches, while employed as a trial attorney with the National Labor Relations Board fighting for employees’ union organizing rights, I’m also not about to give certain actors the benefit of the doubt. So when I see a story like the one I saw in WorkCompCentral recently (behind paywall here), about how Walmart has devised an efficient “mass settlement” program—a bunch of employees, judges (!!), and lawyers gathered in the same Walmart facility at the same time to settle cases—and how the company is “all in” on settling cases, I’m not going to lie, my first reaction was “uh oh.”
Nevertheless, the way I try to react to all new things I hear about is to apply simple cost-benefit analyses having an emphasis on the bottom-line benefit for working people. That is how I would have approached the original New Deal. Want to sell me on the virtues of arbitration, workers’ compensation opt-out, Walmart mass settlements, the Gig economy, or any other innovation? It’s simple – just show me how working people are better off under the arrangement. Notice I didn’t say “just show me the change is pareto efficient.” Imagine I have two marbles, and you have a mountain of marbles. Then we make a trade. Now I have three marbles and you have an even bigger mountain of marbles. That trade was pareto efficient – someone (in this case both transacting parties) was made better off, and no one was made worse off. But did I mention that at the time we made the trade I was in dire poverty, and that the trade did nothing meaningful to alleviate my poverty? When pareto efficient, wheeling and dealing (a.k.a. innovation coupled with economic rent seeking) is made in a preexisting context of social contract erosion, it is hard to see how something good has happened.
These days, I have become aware that it is increasingly rare for the economically powerful to even attempt to demonstrate why their schemes are better for ordinary people. I’m constantly telling people that my late dad was the type of Republican who would try to demonstrate how his viewpoint would actually be better for ordinary people. I always respected him for that quality. And even though we frequently disagreed, I thought that if he and I were in a room for long enough we might actually be able to come up with something workable (temporarily, at least). So, my bottom line on Walmart mass settlements is this: show me how much injured workers are receiving in these settlements, and describe for me the process under which the deliberations are carried out. Transparency is everything. If you won’t show me, I don’t believe you. Or to put it in lawyer-speak, I will draw an adverse inference, and assume the arrangement will be worse for working people, not better.
Michael C. Duff
Saturday, January 18, 2020
The California Trucking Association has temporarily carved out an exception to applying the ABC test to truck drivers in California, who will continue to be stripped of important rights regardless the economic realities of their “contractor” arrangement. The route to this right-stripping is predictably circuitous. Because, according to a federal district court judge, a worker could never be found an independent contractor under the ABC test, use of that test violates the Federal Aviation and Administration Authorization Act of 1994 (“FAAAA”). Under that federal law, states “may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier . . . with respect to the transportation of property.” 49 U.S.C. § 14501(c)(1). This is the theory on which the federal district court in San Diego, in the case California Trucking Association (CTA) v. Becerra, Download California_Trucking_Associati, 2020 WL 248993 granted a permanent injunction in favor of the CTA.
You may recognize the “relate to” phraseology. As the court acknowledges in its opinion, it is the same phrase that, under the Airline Deregulation Act, prevents states from enacting a law “relating to” air ambulance rates. Morales v. Trans World Airlines, Inc., 504 U.S. 374, 386 (1992) (“a State . . . may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier that may provide air transportation.”). Both statutes, in turn, admittedly pattern their language after the Employee Retirement Income Security Act of 1974. ( “the provisions of this subchapter and subchapter III of this chapter shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan . . .”) In the case of ERISA, early Supreme Court cases held, “Congress used the words ‘relate to’ in § 514(a) in their broad sense. To interpret § 514(a) to preempt only state laws specifically designed to affect employee benefit plans would be to ignore the remainder of § 514. It would have been unnecessary to exempt generally applicable state criminal statutes from preemption in § 514(b), for example, if § 514(a) applied only to state laws dealing specifically with ERISA plans.” The Court began to walk ERISA preemption back in the Travelers case. Justice Souter’s opinion reemphasized that,
[D]espite the variety of these opportunities for federal preeminence, we have never assumed lightly that Congress has derogated state regulation, but instead have addressed claims of pre-emption with the starting presumption that Congress does not intend to supplant state law . . . Indeed . . . where federal law is said to bar state action in fields of traditional state regulation . . . we have worked on the "assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress."
The question in the context of the preemption provision of the FAAAA, and the Airline Deregulation Act for that matter, is, what traditional state law would not be preempted? As Justice Souter also presciently wrote,
If “relate to” were taken to extend to the furthest stretch of its indeterminacy, then for all practical purposes pre-emption would never run its course, for “[r]eally, universally, relations stop nowhere,” H. James, Roderick Hudson xli (New York ed., World's Classics 1980). But that, of course, would be to read Congress's words of limitation as mere sham, and to read the presumption against pre-emption out of the law whenever Congress speaks to the matter with generality. (Emphasis supplied).
A layperson might be inclined to dismiss the importance of the preemption of state law by federal law. After all, who really cares if state or federal law addresses a problem, as long as the problem is addressed. All-too-frequently however, in the case of these sweeping preemption provisions given virtually unchecked sway, substantive state law is supplanted by non-substantive federal law – a phenomenon I have referred to as “empty preemption.” It is not as if federal law with similar substantive provisions substitutes for state law. Rather, state law, even within traditional state spheres, is defeated utterly. Here, the state cannot regulate trucking substantively (as extremely broadly defined) but federal law provides no solution. Similarly, state workers’ compensation systems are prevented from taking measures to curtail unacceptably high air ambulance costs, but federal law contains no applicable alternative. And now, states are prevented from acting against “unreal” employment classification practices. Surely, one might think, there must be some federal resolution to the employment classification problem. After all, time and time again, the U.S. Supreme Court has instructed that common law definitions of employment be utilized where a federal statute is silent on the question. And the FAAAA is substantively silent on employee classification. The question then becomes, “whose” common law, and common law from which century?
Read closely, CTA v. Becerra, Download California_Trucking_Associati ,and some of the cases cited therein, seem on the one hand to say that Congress meant to preempt the traditional sphere of state definition of employee status (as an aside, a determination with important tort ramifications), and on the other to say that the problem is not with traditional state control (to which lip service is paid), but with the change in a state rule—not traditional enough?—which has upset settled business expectations because it makes establishment of employee status much more likely (See Becerra, slip op. at 6 citing California Trucking Association v. Su, 903 F.3d 953, 964 (9th Cir. 2018) (Borello test as applied to truckers not preempted by FAAAA), which I interpret as a back-door, due process challenge. There is much more to say, but I will close here by arguing that this is a major federalism case. The heretofore obscure progeny of ERISA preemption are about to be sorely tested. Though the U.S. Supreme Court has recently avoided review of 9th Circuit rebuff of aggressive California Trucking Association tactics, another such rebuff here (which I anticipate) may render these issues unavoidable.
Michael C. Duff
Thursday, January 16, 2020
All the World’s a Platform?: Some Remarks on “Marketplace Platform” Employment Laws -- an Anti ABC/Dynamex/AB 5 Ethic
I've written a short paper in advance of the 2020 Workers' Compensation Midwinter Conference panel in which I'll be participating on March 28 in New Orleans. The panel is titled, "WORKERS’ COMPENSATION AND THE "GIG” ECONOMY: CHALLENGES FLOWING FROM TEMPORARY WORK." As usual, I will play the role of "unreasonable angry guy" raving only barely controllably at "mean stuff." Blogmate Judge David Torrey will provide needed stability, as will Pittsburgh attorney, Justin Beck.
On the panel I'll be discussing my short paper, as titled above, addressing the enactment of "marketplace platform" laws, which have arisen as a remarkable feature of the "gig" economy in recent years. A marketplace platform law decides the question of whether an individual worker is an independent contractor or an employee—an ongoing controversy in all employment law, including workers’ compensation law—by emphasizing factors other than those normally considered in traditional legal analyses. As of this writing, seven states appear to have enacted marketplace platform laws.
In short, marketplace platform laws--developed substantially and lobbied aggressively by the company Handy, Inc.--make it much easier to classify a worker as an "independent contractor" rather than an "employee." Essentially, as the paper shows by analyzing one such law, if a company uses "online enhancements" in the operation of its business it may qualify as a "marketplace contractor" rather than an "employer," whatever the degree of control of working conditions it may exercise de facto in the workplace. The paper shows how, in the case of workers' compensation law, this de-emphasis of the control factor in assignment of responsibility for workplace injury flies in the face of original workers' compensation theory. The development is also at complete odds with the "ABC" employee test, which not only emphasizes the control factor but places the burden of proof on employers to show absence of control. However one may come down on the "employee status" issue, there seems no denying that, in light of California's substantial adoption of the ABC test in broad swaths of its employment law, what rights a worker has to legal protection is increasingly dependent on the worker's state of residence or employment. You can obtain the full paper here.
Michael C. Duff
Saturday, January 11, 2020
I have always thought that the Federal Arbitration Act would make its first systemic appearance in workers’ compensation cases in highly proceduralized (and non-medical) contexts. Cases turning exclusively on notice or statute of limitations issues seem likely candidates. And from the perspective of an employer, I would think that cases alleging an employee was fired for claiming workers’ compensation benefits or exercising workers’ compensation rights are also well-suited for arbitration. After all, 53.9% of nonunion, private-sector employers already have mandatory arbitration procedures (governed de jure by the Federal Arbitration Act) pursuant to which all other employment law discrimination cases are decided. What’s so different about a workers’ compensation retaliation suit?
My blog mate David Torrey alerted me a while back to a decision of the West Virginia Supreme Court in Rent-A-Center v. Ellis. A simplified summary of the case is that Rent-A-Center moved to compel arbitration of a lawsuit by an employee alleging that she was unlawfully fired from her job for pursuing workers’ compensation benefits. The employee had signed a standard, pre-hire arbitration agreement which contained a delegation clause instructing that the arbitrator possessed exclusive authority to resolve any challenge to the enforceability or formation of the arbitration agreement. The employee unsuccessfully attempted to avoid the agreement by arguing that the clause was ambiguous as to whether arbitrability issues were for the arbitrator, was unconscionable under state common law, and was invalid for violating West Virginia statutory law. Reversing a lower-court determination that the delegation clause was procedurally and substantively unconscionable, and that there was no mutual agreement to arbitrate, the West Virginia Supreme Court unsurprisingly compelled arbitration of the claim. (It is not likely the Court would risk running afoul of the FAA following its dressing down at the hands of the U.S. Supreme Court in Marmet Health Care Center, Inc. v. Brown). In a nutshell, the Court concluded that the delegation clause clearly expressed an intent to arbitrate and was not substantively or procedurally unconscionable (unequal bargaining power, “take it or leave it” adhesion, and etc.).
More recently, in Hobby Lobby Stores v. Cole (opinion issued on 1/3/20), a Florida appellate court reversed a decision of a trial court refusing to enforce an arbitration agreement in a workers’ compensation retaliation claim. The trial court found the arbitration agreement unconscionable, but the appellate court concluded “that the Agreement was binding, enforceable, and not unconscionable . . .” The appellate court discussed the agreement as follows,
The Agreement is a two-page, single-spaced document Hobby Lobby and Mr. Cole signed on July 27, 2015. The Agreement conditioned Mr. Cole’s employment on his acceptance of its terms. The parties agreed that any employment-related dispute Mr. Cole had with Hobby Lobby, including “[d]isputes involving interference and/or retaliation relating to workers’ compensation,” would be submitted to and settled by final and binding arbitration. Mr. Cole could select from two sets of arbitration rules, and Hobby Lobby agreed to pay all arbitration fees and costs. The parties acknowledged they had each read the agreement, gave up any right to sue one another, waived any right to a jury trial, and “knowingly and voluntarily consent[ed] to all terms and conditions set forth in this Agreement.”
The readership of this blog, being an especially astute and sophisticated group, will know that, whatever the eventual arbitral decisions in these cases, they will not as a practical matter be subject to judicial review. If the arbitrator, for example, “screws up” the state legal standard applicable to workers’ compensation retaliatory discharges—perhaps it derives from the McDonnell Douglas v. Green burden shifting standard in Title VII cases—neither party could have the award set aside on that basis. Awards may only be set aside where procured by corruption, fraud, or undue means; arbitrator misconduct in refusing to postpone a hearing, refusing to hear material evidence; or of any other “misbehavior;” or where “the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.” Spend a few days reading cases and you may understand why this former trial and appellate lawyer claims there is no real judicial review of an arbitration award.
The cases demonstrate that there is nothing that would prevent an employer from compelling arbitration in any workers’ compensation case, and one should take special note when an impact litigation employer rolls out new lines of legal argument (though the Hobby Lobby agreement was executed in 2015 it seems interesting that the probable boiler plate language is being enforced now). For now, the risk and unpredictability of having non-specialist arbitrators involved in medico-legal controversies may exceed the benefit of the liability savings that would almost certainly result from widespread use of arbitration in workers’ compensation cases. But I doubt that would remain the case if the economy were to go into a serious tailspin. Yet I also think that the attempted extension of the FAA into such a traditional police power, state-law enclave as workers’ compensation may ultimately trigger the reaction that I know is coming – the FAA has already gone too far, as the #MeToo controversy has revealed. There is a reason, after all, that workers’ compensation was generally carved out even from ERISA, the mother of all employment-preemptive statutes.
Michael C. Duff
Sunday, January 5, 2020
Ipse Dixit: The Deep Legal Stirrings in the “Gig” Employers’ Challenge of California Employment Law AB 5
From the beginning, the Achilles heel of the “gig economy” is that its justifications have proceeded as ipse dixit (defined as assertions made but not proved, and as an aside a great name for a Southern rock band). Something about what the new employers were/are doing was/is so new and mysterious it simply cannot be comprehended within the old world order of “employers” and “employees” (let alone ferreted out by notions of control and the Restatement Second Section 220 of Agency). After all, these companies were (and are) not cab companies, not delivery companies, not handyman companies (all which sounds rather “zen”). They. Just. Are. Not. They are technology companies because they use, well, technology. Ipse dixit. At its core, California’s new employment law AB 5—and the ABC employment test that will make it harder for employers to claim their workers are independent contractors—takes the bloom off the rose. As of this month, says California, “prove it, employer – prove that this is not an employment relationship.” The titans of the Gig economy are not pleased. They seek to challenge the law with old, Lochner-era arguments—the Government is interfering with our liberty, and our liberty, akin to the divine right of kings, trumps all. I think these arguments cannot possibly succeed, but there may be constitutional implications for challengers of workers’ compensation laws if they do.
Before thinking of the constitutional implications of the gig employers’ challenge, there is perhaps something more fundamental to point out about the nature of employment law. To me, employment law is deeply instrumental. Employment law obviously regulates employment but it is also profoundly important in communicating social contract policies. We have, for example, an employment law—actually several—that says you can’t discriminate in employment on the basis of race or sex. While employment law is the medium by which social-contract, anti-racist and anti-sexist policy is transmitted, the heart of what is going on is anti-racism and anti-sexism, not employment (which is a necessary, but not sufficient, condition for the policies). We also have a social-contract policy that says, “people who are injured should be adequately taken care of.” Some of that policy is transmitted through the medium of workers’ compensation law; some through tort law; some through social security disability law; some through private disability contract law (ERISA). The underlying policy embedded in the National Labor Relations Act (NLRA) is the facilitation and/or decriminalization of workers taking collective action to level the bargaining playing field against their much more powerful employers, improve their economic circumstances, reduce inequality, and reduce the likelihood of industrial strife. The NLRA is simply a medium for achieving broader social-contract policies. Do the titans of the gig economy imagine that once employment status is eviscerated the social contract policies animating employment law will also be eviscerated? Perhaps. But it’s the old adage, be careful what you wish for. Society may react to such dissolution not by accepting the milquetoast, half-expedient of watered-down “portable benefits,” but rather by requiring users of “independent contractors” also to comply with the social contract policies previously transmitted exclusively through “employment” law. Keep poking California in the eye and let’s see what happens. On the federal side, want to decree that “gig” economy workers can’t unionize under the NLRA? You may have provoked a future Congress to expand such rights. (And let’s not even talk about the Federal Arbitration Act . . .)
But back to contemporary times and the current AB 5 challenge. One count of the titans’ complaint Download Gig complaint alleges in part: “AB 5 violates the Equal Protection Clause of the Fourteenth Amendment of the United States Constitution because it draws classifications between network companies and non-network companies without a rational basis for distinguishing between the two groups.” Tellingly, another part of the same count alleges, “Strict scrutiny review applies because AB 5 is designed to burden, and if enforced against independent service providers like Individual Plaintiffs and network companies such as Company Plaintiffs in a manner consistent with the sponsors’ stated intent would burden, the fundamental rights of network companies and workers to pursue their chosen profession and determine when and how they earn a living.” Why is this telling? Because equal protection challenges are analyzed under the “rational basis” standard. And under that standard the challenger almost always loses. So yes, titans, you’d better conjure a strict scrutiny argument, even if from thin air, and continually use the word “fundamental” to describe the rights supposedly infringed. A federal due process challenge also makes a predictable appearance in another count of the complaint: “In addition, California businesses have a constitutionally protected interest in operating free from unreasonable governmental interference. Businesses are therefore protected from baseless or invidiously discriminatory standards and have a right to be free from excessive and unreasonable government conduct intentionally directed toward them to force them out of business.” Yes, just like government was “invidiously” trying to force employers out of business when enacting workers’ compensation statutes back in the 1910s. The fact is that the state can exercise its police powers to protect the health and welfare of its citizens. That has been the answer to this argument for roughly eleven decades.
These are, in short, Lochner challenges, and I doubt it will take a federal court long to dispose of them. (I omit here the titans’ challenges under analogous California constitutional provisions, which will share a similar fate—this post is already too long). In short, a California loss in the AB 5 challenge would have me scurrying to call my former Constitutional law professor, Laurence Tribe, for re-immersion into the mystical rites of Constitutional law, because I will clearly have lost “the thread.” But if the Gig titans did prevail, if modern equal protection and due process analysis were stood on its head, straight on up through the federal courts, I can’t help thinking about the potential vulnerability of workers’ compensation laws to various claimant challenges. Some of the objections to draconian scaling-back of claimants’ rights over the past decades have been met with by little more than the argument, “You can’t prove the legislature was insane when it passed this law.” Oh for the abandonment of the “not insane” standard! Perhaps this is the ultimate, cosmic purpose of the emergence of the peddlers of the Gig economy, whose claims proceed apace as ipse dixit.
Michael C. Duff
Friday, December 27, 2019
Here are my humble recommendations of the best books for the workers’ compensation professional – at least those that I read – for 2019.
Let’s start, however, with two brief, largely negative, mentions. In the category of the entirely unsatisfactory experience falls the novel My Chemical Mountain (2013), by Corina Vacco. The teen protagonist spends the book working out a vendetta against his late father’s employer, a Buffalo, NY-area chemical factory, and its employment lawyer. The latter is an evildoer who has tricked the widow into signing what appears to be a very illegal workers’ compensation release and who tools around in a glitzy silver Lexus. In the end, our hero dynamites the factory and its attorney is sent to jail for his many misdeeds. “Kiss your stupid Lexus good-bye!” is our protagonist’s final ungenerous sentiment.
Not much better was Stephanie Land’s Maid: Hard Work, Low Pay, and a Mother's Will to Survive (2019). Land – whose sudden status as single-mother, thrown out by her abusive boyfriend – finds herself in an epic struggle to get by. She does recount what it is like to work as a maid. We learn, for example, that it is hard on one’s back, and she tells of many an Ibuprofen 800 popped to help her get through the day. Yet, much of the book is comprised of her bitter complaints about governmental poverty programs, the indifference of her family, and the innumerable woes of her toddler.
Enough complaining of my own!
The most educational book I read this year was The Technology Trap: Capital, Labor, and Power in the Age of Automation (2019), by Carl Benedikt Frey. Frey addresses that ubiquitous concern we talk about at workers’ compensation conferences: the growing threat of artificial intelligence (AI) to eliminate the jobs of millions of workers. The concern is voiced by lawyers and others in our community in a more narrow, existential way. If the number of jobs is significantly truncated, particularly those in the industrial sector, will workers’ compensation become superannuated, and along with it those who labor in the dispute resolution process? Of course, a healthy commentary already exists in this realm. But in this new book, Frey takes a novel retrospective/historical look at the situation and tries to predict the future from experiences of the past.
Journalist Steven Greenhouse’s tour de force history of the labor movement, particularly as it has unfolded since the New Deal, is invaluable. That book, Beaten Down, Worked Up: The Past, Present, and Future of American Labor (2019), is, indeed, a history of labor and not simply of unions. The author treats the remarkable phenomena of fast-food workers campaigning for equitable pay in the “Fight for $15” movement and immigrant tomato harvesters fighting for humane working conditions in Florida. These are workers who were not, and are not likely to be, laboring under the auspices of a collective bargaining agreement. While this new book discusses all aspects of labor, front and center is the unavoidable account of the decline of union power and influence. For those sympathetic to labor, the Greenhouse book is a grim read.
Next on my recommended list is Jeffrey Pfeffer’s Dying for a Paycheck: How Modern Management Harms Employee Health and Company Performance – and What We can Do About It (2018). The author asserts that modern business practices create harmful work conditions for employees. He argues that businesses as a whole do little to tend to the emotional well-being of their workers. As a result, workers become disaffected, sick and, in some cases, even die because of work conditions. To Pfeffer, this is at once an injustice, as business, and hence society, are shown to have little regard for workers’ overall health; and a waste, because establishing good work conditions, and keeping workers happy, should both enhance employee performance and the success of business.
Journalist David Owen’s new book, Volume Control: Hearing in a Deafening World (2019), is a personal-journey account his investigation into hearing loss, remedies for the same, and seemingly all of its cultural manifestations. Owen explores the mechanics and physiology of hearing loss, causation, audiograms, how such losses have been interpreted over the centuries, the experience of the deaf, the business and progress of hearing aids and cochlear implants, and regulation of noise in industry, the military, and in our personal lives.
Workers’ compensation professionals can benefit by a grounding in the industrial and organized labor histories which were so formative to our field and the larger system of which we’re a part. Behemoth: A History of the Factory and the Making of the Modern World (2018), by Joshua Freeman, assists in providing such education. The book is an account of the rise and partial fall of the great factories which were, for so many years, the centers of international industrial growth. The manufacturing facilities treated by the author range from the early cotton mills of Britain and New England to those of the Ford Motor Company, its Soviet imitators, and the modern mega-factories of mainland China.
Recently, I wrote on this blog about the most recent National Academy of Social Insurance data showing continued declines in employer costs and employee benefits per $100 of employer payroll. As I have written, there are various explanations for this phenomenon. Perhaps it reflects significantly safer workplaces overall. Perhaps there is significant underclaiming of benefits and ongoing legal obstacles to obtaining and retaining benefits. (See here Emily Spieler and John Burton’s article, The Lack of Correspondence Between Work-Related Disability and Receipt of Workers’ Compensation Benefits). The NASI data set does not attempt the expensive and complicated task of capturing information required to answer these granular questions. (In my opinion, the federal government should be gathering the information).
This past November, the NCCI released an issue brief showing that “since 2000, indemnity benefits on a wage-adjusted basis have . . . kept pace with wage growth across all indemnity injury types in most of the NCCI states.” Assuming this fact to be accurate, is it a counterweight to the NASI graph in my last post that shows a decidedly downward-sloping line for benefits since roughly 1991 (from $1.65 per $100 in payroll in that year to 80 cents per $100 in payroll in 2017)?
One immediate reaction with respect to comparing anything with wage growth since 2000 is – what wage growth? Keeping pace with wage growth may mean keeping pace with real wage declines. As the Pew Research Center reported in 2018, “today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago.” Moreover, “what wage gains there have been have mostly flowed to the highest-paid tier of workers.” And with respect to recent years, the Economic Policy Institute claims “nominal wage growth since the recovery officially began in mid-2009 has been low and flat. This isn’t surprising—the weak labor market of the last seven years has put enormous downward pressure on wages.”
This highlights at least a couple of problems. First, wage growth since 2000 is an especially difficult metric from which to draw many conclusions about the adequacy of workers’ compensation benefits since the Great Recession lay embedded within the period. But, intuitively, I accept the idea that benefits in the aggregate have “kept pace with” wages in the aggregate during that period. The larger question is whether wage growth keeps pace with inflation. (Keeping pace with breadcrumbs may be all that the workers' compensation system demands). Still, what might be more useful for analytical purposes is to compare the relationship between wage growth and benefits during the 1980s, 1990s, and 2000s. I suspect benefits came crashing down relative to wages in earlier decades, and that we are now working from that already depressed baseline. (John Burton has written about the diminished urgency of fixing workers' compensation subsequent to the disbanding of the 1972 Commission. In a nutshell, benefits initially went up for a short period, and then seemed to deteriorate following the election of Ronald Reagan, which ended any realistic threat of federal intervention into state workers' compensation systems). In other words, more rapid erosion may have occurred in earlier decades and some seem to demand accolades for not slipping further.
The second problem with comparing benefits to wage growth is that most wage growth in recent decades has gone to the top of the socioeconomic ladder. In order to assess the relationship more carefully I would want to know how benefits have kept pace with wages at several different junctures of the wage scale. It may be that workers’ compensation benefits have kept pace with the wages of low-earners but not with those of high-earners. Or it may be that low wage earners have experienced significant real wage declines, and there is a policy question as to how to adjust workers’ compensation benefits in the context of those declines.
In any event, it is hard for me to conclude that the NCCI issue brief is contrary to NASI figures. Each data set measures different trends, and each shows why multiple metrics are required to gain a clear picture of what is transpiring nationally. It is also evident that workers’ compensation is subordinate to larger economic trends. For example, I have little doubt that the current relative silence in workers’ compensation policy circles has everything to do with waiting to see who is going to prevail in the Medicare for All battle. Hard to have a deeper policy debate on workers’ compensation when the entire paradigm could be set on its head.
Michael C. Duff
Saturday, December 14, 2019
I had the privilege and honor of presenting on this subject on December 12 on a panel at the National Council of Insurance Legislators' Annual Meeting. My co-panelists were Robert Stokes of the law firm Flahive, Ogden & Latson; and Glenn Deshields, Legislative Director of the Texas State Association of Fire Fighters. The main points I attempted to make were first that PTSD could not reasonably have been part of the original workers' compensation quid pro quo because negligent infliction of emotional distress was in its infancy as a tort cause of action. It makes sense to me that PTSD would expand under workers' compensation as negligent infliction of emotional distress expanded under tort. And when you have claimants like first responders held in universally high regard, a "bridge" is formed that permits policy expansion. I also emphasized a point that David Torrey has made in some of his writings -- there is nothing new about occupational disease presumptions. They existed in the British Act of 1906 and were picked up in New York beginning about 1920. I have some cites in my working paper that may be of interest to researchers.
Whenever policy makers consider expanding workers’ compensation coverage there is concern expressed that expansion risks converting workers’ compensation into general accident or health insurance. It is easy to understand why policy uneasiness may emerge when assessing expanded coverage of arguably work-related disabilities like post-traumatic stress disorder (PTSD), or when debating the option of adopting relaxed workers’ compensation causation standards—"Firefighter Presumptions”—in connection with diseases sustained by law enforcement officials, safety personnel, and first responders. After all, expanded coverage means expanded costs (and, of course, the need to insure against those costs). But workers’ compensation has had a long history of fundamental expansion since its inception over a century ago, often to the point where one can no longer imagine the expansion as not being originally part of the system. Often under the surface, workers’ compensation expansion is tracking similar expansion in tort liability, and the workers’ compensation expansion reflects a perceived need for enhanced tort immunity—though many involved in the debate may not be aware of this dynamic. In other words, increases in workers’ compensation costs are constantly being weighed against the potential for increased tort liability.
To take one broad historical example, many observers of workers’ compensation may be unaware that, in the earliest versions of the American workers’ compensation statutes, circa 1911, no provision at all was made for payment of ongoing medical care in connection with work-related injuries. At that time, workers’ compensation medical benefits were limited to post-injury first aid at the workplace, and perhaps initial medical treatment for, at most, 90 days. The first United Kingdom workers’ compensation statute (of 1897, as amended in 1906—the progenitor of most American statutes did not cover ongoing medical benefits: something akin to national health care for workers was about to arrive on the scene in the U.K. in 1911. The other early workers’ compensation model, German workers’ compensation, established in about 1884, was similarly part of a much broader universal health care insurance system in which work-related medical costs and indemnity payments merged into a broad social insurance structure). The point is that American statutes had to expand to cover ongoing medical treatment for work-related injuries. Few in 2019, however, think of medical coverage for work-related injuries as an “expansion” of the original idea of workers’ compensation. Workers’ compensation “had” to expand because, if American workers’ compensation statutes had not covered the expense of ongoing medical treatment for work-related injuries, that expense would have to have been pursued by workers in tort litigation, with all the expense that process has always entailed. American stakeholders preferred expanded workers’ compensation and tort immunity to expanded tort liability.
Along similar lines, many readers may know that workers’ compensation was originally limited to coverage of extra hazardous employment. One reason for the limitation was that it was not known by state legislatures until 1917 whether the United States Supreme Court would uphold on constitutional grounds a version of the Grand Bargain that included non-hazardous employment. Another reason for states deciding initially to cover only extra hazardous employment was that it was there that the need for workers’ compensation coverage was most acutely felt. (Necessity is often the mother of invention). Eventually, the U.S. Supreme Court very broadly authorized the Grand Bargain—the historic “quid pro quo” of workers’ compensation benefits for tort damages (and defenses). The High-Court authorization solved major problems, but created new ones. Now that states possessed a more-or-less legal blank slate on which to write workers’ compensation law (albeit with some very broad boundaries), they were placed in a position of having to flesh out exactly what the quid pro quo should entail. But states had no hesitation expanding workers’ compensation coverage from solely extra hazardous employment to most employment. And, again, from the perspective of employers, with the costs of workers’ compensation expansion came (and comes) the benefits of expanded tort immunity. There were, of course, other statutory beneficiaries: workers relieved of the time and expense of pursuing tort litigation (to say nothing of workers who would have had no viable tort claims at all); and society-at-large, which benefited from having the costs of workplace injury shifted to producing sectors of the economy (and away from broad taxpayer subsidization), and which also benefited from safer workplaces generally.
The rest of the paper can be found here.
Michael C. Duff
This year, I had the honor and privilege of serving on the National Academy of Social Insurance Workers' Compensation Data Panel. Twenty-three panel members from various backgrounds and policy perspectives (including my blog mate Judge David Torrey) scrutinized data collection over a period of several months and then met in early November to debate, discuss, and refine findings and thought about findings. It was scintillating to this evolving policy wonk. The panel makes every attempt to be a neutral body. Of course, everyone operates through a series of cognitive biases and honest brokers reveal those biases in advance. I think everyone who reads these pages from time to time understands that I am biased in favor of injured workers. When I smell a rat, I say so. I'm not embarrassed about choosing a side or about choosing the particular side I've chosen -- I conjecture there are plenty of advocates out there who can make the case that what is good for their respective clients is good for America. I made my choice a long time ago.
Still for all of that -- the chart above seemed to rankle certain workers' compensation observers. What does it show? It's very simple. The benefits for injured workers per $100 of payroll continues to go down. The costs for employers per $100 of payroll continues to go down. Now you and I can have a debate about why that might be so. But that is what the numbers show. You might argue that the metric itself is flawed. Maybe you think that benefits and costs per $100 of payroll is a meaningless statistic. Of course, if you have that view you would be in opposition with NASI panels going back several years and, by the way, the use of the metric by other governmental agencies. But, of course, you have the right to disagree with everyone -- I do it all the time. The full NASI report is here, and in my humble opinion is essential reading.
Some critics of the current report seemed to be complaining that benefits can't be decreasing all that much because since the 2012-16 Oklahoma drama there have been no major incursions on the workers' compensation citadel. In a way, I agree with them. Creeping erosion has been the norm. We won't see more opt-out drama until the next severe economic downturn. When that comes--and it always will--the same questions we were considering in 2016 will once again be front and center. I am always amazed at how very intelligent people can talk themselves into the proposition that the 2016 tumult was a tempest in a teapot. I hope you will remember (when the time comes) that this observer thought that, when times get especially bad, the first question an employer might pose to a legislator is, "why do we have to have this expense at all?" If you think there is a clear answer to that question, I respectfully respond that you are wrong. Legal and social consensus is always much more fragile than contemporaries imagine.
The outgoing Obama Department of Labor produced a 41 page report titled, "Does the Workers' Compensation System Fulfill its Obligations to Injured Workers?" My answer to the question is, of course it doesn't. But if I'm going to be intellectually honest I have to concede that the answer depends on the premises that 1) there is a broader social obligation to injured workers and 2) we have some kind of consensus about what is meant by fulfillment. It is on point number 2 that I think we have tremendous disagreement. Some believe that workers' compensation is a bare, anti-destitution safety net program. Others believe that because injured workers have forfeited valuable tort rights something more than starvation wages is required.
Forgotten in the clamor is the point that the National Commission in 1972--chaired by the esteemed John Burton and peopled with members who could hardly be considered anti-business--concluded, at the risk of oversimplification, that workers' compensation was inadequate and thought that federal intervention could be in order in the absence of significant improvements. To me, that is the correct context in which to view the chart above -- but that is one man's opinion. The DOL report discussed the National Commission's 19 Essential recommendations and discussed the six focus areas of those recommendations only two of which I'll mention here:
adequate weekly benefits for temporary total, permanent total and death benefits including both statutory rates and a desired earnings replacement rate. This area included recommendations that the maximum weekly benefit rise to a maximum of at least 100 percent of the state’s average weekly wage initially, and then to 200 percent, and that, subject to this maximum, benefits be at least 66 2/3 of the worker’s gross weekly wage. Notably, many of the 84 National Commission recommendations not included in the 19 essential recommendations went further with regard to income maintenance, including that beneficiaries in death cases have their benefits escalate with increases in the state average weekly wage and that maximum weekly benefits should ultimately reach 200 percent of the state’s average weekly wage.
no arbitrary limits on the duration of benefits for permanent total disability or death,including that total disability benefits be paid for the duration of the worker’s disability or for life
In my day, I was a fair to middling trial attorney and was schooled by excellent mentors to sit down when I'd made my point. You'll be the judge of whether I have. I'll merely point out that the graph above begins only eight years after the Commission's report was issued -- and the graph does not seem to reflect a system that could possibly be improving from the perspective of injured workers.
Michael C. Duff
Wednesday, December 11, 2019
One reason it is hard to bamboozle me on the true state of working America is that before I became a lawyer, and then a law professor, I did 15 years of hard labor in working America. I've worked as a janitor, in warehouses, restaurants, and on airport tarmacs -- often as putative part-timer doing full time work without full benefits. I've been hurt on the job. And none of it as part of a social science experiment. It was my livelihood, and I didn't know if I'd ever make it out. So let's just say I'm a different kind of law professor when I evaluate labor and employment issues. Here's a little sunlight revealing what is going on in a workplace governed by America's second largest employer. If you thought nobody could make Walmart look like a safe employer consider this joint Atlantic/Reveal expose:
Amazon’s famous speed and technological innovation have driven the company’s massive global expansion and a valuation well over $800 billion. It’s also helped make Amazon the nation’s second-largest private employer behind Walmart, and its CEO, Jeff Bezos, one of the richest humans on Earth. Now an investigation by Reveal from the Center for Investigative Reporting has found that the company’s obsession with speed has turned its warehouses into injury mills.
Reveal amassed internal injury records from 23 of the company’s 110 fulfillment centers nationwide. Taken together, the rate of serious injuries for those facilities was more than double the national average for the warehousing industry: 9.6 serious injuries per 100 full-time workers in 2018, compared with an industry average that year of 4. While a handful of centers were at or below the industry average, Reveal found that some centers, such as the Eastvale warehouse, were especially dangerous. Dixon’s was one of 422 injuries recorded there last year. Its rate of serious injuries—those requiring job restrictions or days off work—was more than four times the industry average.
The full story from November's Atlantic is here.
Statistics and data are important, but sometimes (for whatever reason) they just don't line up with what any fool can see is truly unfolding on the ground. How much more do you have to see about what is going on at Walmart and Amazon, the number 1 and 2 private sector employers in the U.S. to understand that it is not safe out there?
Michael C. Duff
Wednesday, December 4, 2019
I'm very pleased to announce the publication of my Wyoming Workers' Compensation treatise. I'm especially tickled that I was able to do it "open source":
A Treatise of Wyoming Workers’ Compensation Law seeks both to introduce Wyoming workers’ compensation students to the law of their own jurisdiction, and to provide a continuing resource to those same students as they embark on workers’ compensation legal practice after graduation. In this way, the text fills a gap in the literature by serving as a concrete exemplar of what it means to assist students in becoming “practice-ready” as soon as possible after graduating from law school. In short, practice ready lawyers must have some exposure to the law of their own jurisdictions. Furthermore, Wyoming Workers’ Compensation Law is meant to be a resource to all practicing lawyers in the state of Wyoming. This objective is intimately connected with the mission of the University of Wyoming as a Land Grant Institution broadly striving to serve the needs (including legal needs) of Wyoming citizens.
Substantively, the treatise canvasses the traditional areas of workers’ compensation law: employee/employer definitions, causal connection to work, evaluation of the extent of disability, types of benefits, and a brief discussion of the Wyoming administrative structure. In several places the treatise first introduces a substantive area of law generally, for example “causal connection,” and then focuses on how Wyoming analyzes the area of law. In discussing some substantive areas of workers’ compensation law, the treatise underscores especially unique Wyoming idiosyncrasies. Not content to merely “restate” the law, the treatise in certain areas subjects the law to academic criticism and suggests legal reform in order to stimulate broader discussion of the legal doctrine.
The text is free to download. You just need your name, email address, and law school affiliation (which I don't think is aggressively policed so you can probably simply enter the name law school closest to where you reside).
Michael C. Duff
Monday, November 25, 2019
Gig Economy Article by Keith Cunningham-Parmeter (Williamette Law School) is One-stop Shopping to Understand the Misclassification Debate Surrounding Platform-based Gig Workers
In a new article, the author argues that the traditional common law right of control test is inappropriate, and unworkable, for analyses of whether workers in the platform-based gig economy are employees or independent contractors. See Keith Cunningham-Parmeter, Gig-Dependence: Finding the Real Independent Contractors of Platform Work, 39 Northern Illinois University Law Review 379 (2019).
The author, Keith Cunningham-Parmeter, identifies the long-appreciated reality that the control test was developed centuries ago as the criterion of establishing whether the negligence of an agent of an enterprise, towards a third party, could be ascribed to the enterprise via respondeat superior. If control, or the right of control, existed, then the enterprise would be considered the master, the agent the employee, and vicarious liability would attach.
This test has, over the last century, been cut-and-pasted over to areas like wage and hour protections and, of course, workers’ compensation. Certainly this describes the Pennsylvania experience and the current law, 104 years after enactment.
But all of this, the author correctly argues, really does not make any sense. Respondeat superior is based on the idea that an entity which has the power to control a disempowered, subordinate actor presumably also has the economic wherewithal to answer for such an agent’s torts. When such control does not exist, and the agent can be viewed as economically autonomous, it makes sense for that party, a truly independent actor, to be responsible for its torts – and the enterprise protected.
Programs like the Fair Labor Standards Act and workers’ compensation, on the other hand, were intended to expand the responsibilities of such enterprises to workers. The control criterion does not vindicate this purpose. In the author’s view, economic autonomy, and not control, should be the controlling test when considering whether a worker is really an independent contractor.
The author commences his article with an account of the efforts of platform-based gig enterprises – via “clever branding” – to establish their workers as independent contractors. He refers to this practice as reflecting “platform exceptionalism.” The idea here is that the gig economy presents a whole new type of business innovation that does not have employees in the first place. After all, for example, Uber is not a transportation enterprise but, instead, a technology company. The author is, rightly, suspicious of this rhetoric.
In any event, to remedy the situation, the author argues that courts and legislatures should follow the example of the California Supreme Court in the recent Dynamex case. See Dynamex Operations, W. v. Superior Court, 416 P.3d 1 (Cal. 2018). That case, he explains, “embraced a simplified standard – the so-called ‘ABC Test’ – to determine whether contemporary workers are genuine independent contractors. Rather than engage in the … [control-dominated] multifactorial balancing – a process guaranteed to yield muddled results – the ABC test begins with the presumption that most workers who provide labor to firms are employees. If firms want to overcome this presumption, they must prove three separate elements to establish that their workers possess the marketplace strengths of legitimate independent contractors.”
Those three elements, notably, are inquiries into whether the worker is engaged in the firm’s usual course of business; whether he or she is operating a separate business; and whether the worker is free from control of the purported principal.
The author notes that use of this test does not necessarily mean that all platforms will be deemed employers. For example, delivery services workers (as in Dynamex) for enterprises like GrubHub may well be deemed employers, but handymen working for a “chore” platform like TaskRabbit may well be deemed independent contractors.
The author’s footnotes feature a seemingly unabridged recounting of all the latest cases and scholarship in this area. This straightforward and well-written article is one-stop shopping for the lawyer or judge seeking out the latest arguments, pro and con, on the misclassification debate surrounding platform gig workers.
Sunday, November 24, 2019
The late 1980s and much of the 1990s were the period of the "Hearing Loss Wars" in Pennsylvania workers’ compensation. Most lawyers and judges came to learn the basic aspects of the law and medicine of hearing loss. We knew by heart that 90 decibels was the OSHA limit for an eight-hour workday, that a worker who experienced a “temporary threshold shift” had no doubt sustained some level of permanent sensorineural loss, and we routinely heard of the 6000 to 8000 hertz “notch” of the typical audiogram.
So intense and litigated were hearing loss cases that my treatise on workers’ compensation features nearly 30 single-spaced pages devoted to the law and practice of such claims.
Those wars are over now, likely because of the decline of manufacturing in our state. If they return, however, both the novice and the hoary veteran will want to read journalist David Owen’s new book, Volume Control: Hearing in a Deafening World (Riverhead Books 2019).
The author, in a chatty, personal-journey type account, reports here on his investigation into hearing loss, remedies for the same, and seemingly all of its cultural manifestations. Owen, specifically, explores the mechanics and physiology of hearing loss, causation, audiograms, how such losses have been interpreted over the centuries, the experience of the deaf, the business and progress of hearing aids and cochlear implants, and regulation of noise in industry, the military, and in our personal lives.
Owen frequently turns philosophical about hearing loss. For example, would it be better to be blind or deaf? Owen suggests that most people who have thought about the issue at length believe that deafness is much worse, as it interferes with communication and estranges the victim from society. On another issue, why is it that most of us know that exposure to loud noise can be harmless, but we ignore the hazards nonetheless? One reason is inconvenience or sloppiness, to which we probably can all attest, but it turns out that, as well, the brain actually likes certain things, like music, loud. Rock concerts (and the finales of Brahms symphonies, I would add), are not overwhelmingly loud for nothing.
The irony, however, is that even soft noises, like the drip of a leaking faucet, can be irritating. Hearing, the author’s interviewees point out, is closely related to our emotions. The author, in this regard, might well have identified loud, unmuffled motorcycle exhaust; giant exhaust pipes on pick-up trucks; and car stereos with exaggerated subwoofers supporting vulgar lyrics. None of these noise sources probably damage hearing, but they disrupt the peace of whole neighborhoods.
Owen’s most interesting chapters address the recent improvements in hearing aids. For many years, a few companies controlled the market, and for an aid to be adjusted required a trip to the audiologist. Now, however, regulation is loosening, and many enterprises market other devices that aid in hearing, short of being hearing aids. Owens’ chapter, “Beyond Conventional Hearing Aids,” was the most enlightening for this reader.
In the realm of occupational noise, Owen discusses one item that was often discussed at hearing loss medical depositions, to wit, the role of loud noise in the workplace that was not shown to be in excess of the OSHA thresholds. Experts suggested to Owen that such noise may well, indeed, cause hearing loss – the OSHA standard is hardly definitive in establishing which workers have sustained occupational hearing loss and which have not. As Owen states, correctly, the OSHA standards “say that if you work in a covered industry you can legally be exposed to eight continuous hours of 90-decibel noise (motorcycle eight meters away, lawn mower), or to two hours of 100-decibel noise (New York City subway car, jackhammer, kitchen blender, snowmobile), or to thirty minutes of 110-decibel noise (car horn one meter away, chain saw) – every day of your career .…” Owen concludes, “Probably the best that can be said about the rules is that they’re better than nothing.”
In his final chapter, Owen nods his head briefly to the issue of law and regulation. The residents of some urban areas have revolted, in this “deafening world,” and insisted on noise regulation. But, as Owen correctly states, enforcement is a major problem. Already-overworked law enforcement personnel may be reluctant to spend lots of time doing noise control, and some urban areas are unavoidably going to be noisy. He uses the all-night garbage collection trucks of Manhattan as a familiar and persuasive example.
Owen’s book is not heavily footnoted, but his bibliography features what seem to be excellent references, usually supported by websites, for further reading. The book would have benefited by illustrations and diagrams, but overall this new book is an enriching one for the workers’ compensation professional.
Especially for those who missed the Wars.
Saturday, November 23, 2019
Principled Article by Chapman University Law Professor Lan Cao Argues for FLSA Protections for Inmates Working in the Prison Labor Industry
In a new law review article, the author, a law professor, argues that prisoners, when undertaking most aspects of labor, should be considered employees, covered by the Fair Labor Standards Act, and receive at least minimum wage. Limited authority surrounding this issue exists from the federal courts, but the overwhelming rule is that prisoners generally enjoy no such protections. See Lan Cao, Made in the USA: Race, Trade, and Prison Labor, 43 N.Y.U. Review of Law & Social Change 1 (2019).
The author’s advocacy follows her long investigation into what she says is a trend of private companies contracting with federal, state, and private prisons to employ prisoners as labor in the provision of services and the manufacture of goods. She shows that use of prisoners by for-profit enterprises has long been a matter of tension, particularly where such work, which is often at nominal or no wages, creates an advantage over enterprises that employ free labor at prevailing (or even minimum) wages. In the last few decades, however, with the rising prison population, such employment has also risen, with private companies contracting with federal and state agencies for inmates to undertake such things as manufacturing apparel and answering calls at call-in centers. Cao cites several muckraking stories on this issue, referencing articles in Mother Jones, The Christian Science Monitor, and an investigation by Pro Publica.
Cao argues that the idea that work by prisoners is solely “penological” and rehabilitative is a fiction. She asserts, on this point, that no research supports the proposition that inmates who work actually experience a lower recidivism rate. A better policy in this area, she says, would be for inmates to receive wages and develop savings, which in turn would facilitate an easier return to society after release from confinement.
Cao notes that some laws provide that prison work is not to be undertaken in a manner that would create unfair competition. However, she states that such rules are often flouted, and that the federal government has outsourced policing of such laws to an industry group. She in effect asserts that the chickens are guarding the hen-house. The author throughout depicts the prison labor industry in such negative terms. Her most acid commentary addresses the industry’s cynical attempt to depict American prisoner labor as part of the “reshoring” of manufacturing and as a part of the “Made in the USA” movement.
Cao does not discuss at length the role of workers’ compensation, but if inmates are considered neither employees of the prison or of the contracting for-profit company for which they labor, they are not going to have FLSA, unemployment, or workers’ compensation protections. She does quotes one entrepreneur as indicating that he prefers prison work for his company because he avoids the burdens of such benefit costs. (Ironically, some employers also like inmates as workers because their absenteeism is lower.) She also identifies California as a state where an inmate can receive workers’ compensation, but only upon release from confinement. Notably, though not mentioned by Cao, the federal government, at 18 U.S.C. § 4126, maintains the Inmate Accident Compensation System, characterized as “the equivalent of a prison inmate’s workers’ compensation program,” which is “the exclusive means of recovery against the Government for a federal prisoner’s work-related injuries, and bars suits for damages for such injuries” under the Federal Tort Claims Act.
In Pennsylvania (my state), WCJ and Board decisions exist where prisoner attempts at securing workers’ compensation have been rejected. The leading case is by Judge Bruce Doman (Allentown), who rejected the proposition that a prisoner could be conceived of as providing services to another for a valuable consideration. See Paar v. State Correctional Institute (May 28, 1993), filed May 28, 1993 (Doman, WCJ) (“‘Work’ in the claimant’s prison environment is a rehabilitation tool for the claimant’s benefit, rather than a service for the employer. Volunteering for work in a prison cannot be equated with voluntary acceptance of employment for a free citizen, because the inmate’s alternatives are limited…. The Act was first passed in 1915. In the 78 years since, no case has reported an award of Workmen’s Compensation to an inmate and for good reason. A duly sentenced inmate cannot be considered to be an employee of the institution that confines him. Employment and imprisonment may share some characteristics, but they are plainly not the same.”).
Professor Cao, of course, knows all about this type of reasoning but asserts that such analysis should not be valid when taking into account the for-profit motives of the prison labor industry.
In any event, if limited, or absent, state workers’ compensation remedies exist, what of tort law? One scholar has argued that the Eighth Amendment, which proscribes “cruel and unusual punishments,” should be applied to prisoners injured while laboring at their jobs in prison industries. She argues, specifically, that such prisoners should be deemed to have claims based on this proviso when they suffer their injuries on machinery that prison officials know is defective, malfunctioning, and dangerous. In addition to her constitutional analysis, she summarizes briefly the various state workers’ compensation laws as they address the compensability of prisoner injuries. The variety of approaches is indeed quite remarkable. She finds them too scattered and ineffective to cause prison officials to be leveraged to safe workplace practices. In her view, only by way of threat of a viable constitutional claim can this purpose be fulfilled. Dougherty, The Cruel and Unusual Irony of Prisoner Work Related Injuries in the United States, 10 University of Pennsylvania Journal of Business & Employment Law 483 (Winter 2008).
In crafting her legal argument about the FLSA, Cao sets forth one admonition at the outset: any right under the law must be based on that law and not under constitutional precepts. In this regard, it is sometimes forgotten that the Thirteenth Amendment does not proscribe slavery as to convicted prisoners. It states, “[n]either slavery nor involuntary servitude, except as punishment for crime whereof the party has been duly convicted, shall exist in the United States, or any place subject to their jurisdiction.”
Wednesday, November 20, 2019
Pennsylvania Judge Cohn Jubelirer Writes on Appellate Judging, Pennsylvania's Commonwealth Court, and Workers' Compensation Appeals
Commonwealth Court (Pennsylvania) Judge Renee Cohn Jubelirer, in a new law review article, posits that her court’s codified Internal Operating Procedures, norms, and traditions, all contribute to an effectively-operating court where communication makes for better decision-making and lack of personal tensions among the judges. The judge’s article is a rare offering: a longstanding sitting judge’s sometimes behind-the-scenes account of how a court operates. See Renee Cohn Jubelirer, Communicating Disagreement Behind the Bench: The Importance of Rules and Norms of an Appellate Court, 82 Journal of Law & Contemporary Problems 103 (2019).
Commonwealth Court is the unique Pennsylvania appeals court that takes appeals from agencies, like the Workers' Compensation Office of Adjudication, and trial courts, outside of criminal cases, when the Commonwealth or some other governmental agency has been a party.
As a prelude to her must-read discussion about the Commonwealth Court, the judge discusses several aspects of the nature of appellate decision-making. She sets forth, for example, what perhaps we all know intuitively: the idea of having a multiple-member court, on appeal, is basically that two (or more) heads are better than one: “The appellate design assumes that judges working together will communicate and consider different points of view, which increases the probability of reaching a better decision than would a single judge.” The design is “‘specifically structured to promote a collaborative form of decision making," which presumably improves the quality of accurate decisions, free of bias, and consistent with precedent.
And, indeed, as the judge shows us, a significant literature, mainly centered on the federal courts, has addressed the behavior of appellate judges, seeking to ascertain whether this assumption works in the trenches. Judge Richard Posner, for example, has remarked on such issues in his book How Judges Think (2008). Apparently not everyone accepts the common wisdom that multi-member appellate courts will necessarily engage in constructive, collaborative decision-making.
Judge Cohn Jubelirer is at odds with such naysayers, and believes that Commonwealth Court, for its part, achieves the related goals of collegiality and collaboration.
The judge’s review of her own court commences with a brief history of that body, a note on its unique original jurisdiction, and a review of the Internal Operating Procedures and other rules that guide how the panels receive their assignments, vote, and, if necessary, conference on disputed issues. The judge insists that the court’s (1) tradition of placing a premium on collegiality and, famously, (2) policy of having all members vote on every case, leads to a minimum of unnecessary friction, avoids gratuitous (my word) dissents, and helps to ensure consistency of the law. On this latter point, Commonwealth Court has a goal of “polic[ing] itself to maintain consistency of precedent and development of the law….”
The judge’s discussion of “Judicial Conference,” convened on cases where significant disagreement exists, will perhaps be the most revealing for most readers. When this writer was a clerk at the court, first for Judge Craig and then for Judge Barry, we were not allowed into such sessions:
A central feature of the deliberative process is our judicial conference. If four judges disagree with the majority opinion, the opinion cannot be filed, and the matter is sent to judicial conference, where all the judges gather and discuss those cases. Judicial conferences are held in person nine times a year during argument sessions…. At conference, the judge who wrote the majority opinion speaks first and explains why the majority opinion is correct on the facts and the law. The other judges can, and do, ask questions about the factual record, the parties' arguments, legal precedent, and reasoning. Then, if there is a dissent, the dissenting author explains why that opinion is correct, and, again, the judges can, and do, ask questions. If there was no dissenting opinion, the objecting judges explain their objections. There is a discussion during which any judge can speak without regard to seniority as many times as needed. At the end of the discussion, the president judge holds a vote, with the newest judge voting first…
Many perhaps knew of this process. The judge further shares with us, however, that Judicial Conference can become fairly animated:
All the judges prepare for judicial conference, many as if for oral argument. Some judges strategize in their preparation. Prior to conference, a majority writer may think long and hard about whether to withdraw the opinion and rewrite when five or more judges voted in opposition to the majority opinion. The judges [who I interviewed] all felt that the effort costs are worth the benefits of conference…. There is an expectation that disagreements will be honestly aired at a conference that is “always heated and wonderful,” where the judges “really care and battle it out.” ….
And the Conference has objectively proven successful: “Minds are changed when knowledgeable judges participate in discussion, even though they were not on the panel. Because everyone participates, and has at different times been a majority writer as well as an objector or dissenter, it is not personal…. . Judges listen to their colleagues and may change their minds.”
In a special insight, Judge Cohn Jubelirer notes, “Conference gives all the judges a voice in the decision, so everyone can be heard and then accept the decision. There is a sense that if some judges did not have input into the precedent, they might try to diminish it by distinguishing it in subsequent opinions.”
Cohn Jubelirer completes her analysis with a nod towards empiricism. She seeks to determine, for the 304 workers’ compensation appeals adjudicated in the year 2007, whether the make-up of the various panels (on the criteria of political affiliation) yielded any meaningful difference in whether employer or injured worker prevailed. Though acknowledging that the data set she is using is small, she discerns, in the end, no bias. The welcome results of her study, she states, “support that there are no real panel composition effects based on political party.”
With some luck, that is the result, in material part, of the judges effectively collaborating and seeking, wherever possible, a reasonable and accurate consensus.
Monday, November 18, 2019
New Novel by Andrew Miller, "Now We Shall be Entirely Free," Animated by Brutal Child Labor of Early 19th Century England
The first phase of the industrial revolution unfolded in England during the late eighteenth and early nineteenth centuries. The early cotton mills of that period were known for being sweatshops and dangerous to life and limb. They were typically manned by women and children, the latter often working in brutal, virtually slave-like conditions. These were the types of environments, of course, that inspired Dickens as he wrote Oliver Twist and David Copperfield.
Notably, before workers and reformers ever lobbied for safety, for changes to tort law, and then for workers’ compensation, they argued for restrictions on such labor.
This environment comes alive, if only briefly, in a new historical novel by British author Andrew Miller. In Now We Shall be Entirely Free (Europa Editions 2019), the protagonist is a young army officer (Lacroix) who has fought against Napoleon in the British effort to ally with Spain in trying to repel (unsuccessfully) the French invasion. Unfortunately, the British are routed at the Battle of Corunna (1809) and, during the retreat, LaCroix is put in charge of a group of stragglers, wounded, and ne’er-do-wells. Mentally and physically overwhelmed, in the end he is unable to prevent his soldiers from committing atrocities against Spanish villagers.
Back in England, Lacroix seeks to find himself, journeying to rural Scotland, but he is pursued by a pair of assassins charged by both the British and Spanish to exact revenge for the massacre.
As it turns out, the lead assassin, a British corporal, is a sociopath who developed his violent instincts while working in an early cotton mill, brought in from London as an orphan boy to undertake forced labor. Calley (yes, that’s his name) relates that unforgiving work – fourteen-hour days – to his colleague as they traverse the English countryside in pursuit of Lacroix.
For a boy, Calley relates, to fall asleep in the final hours of the day, brought beatings “without pause” from the overseers, but this punishment was not as hazardous as the unshielded moving machinery: “There was a girl called Lizzie …. She had ginger hair for a start. Anyway, the dozy cow slipped when she was under the machine and the belt caught her hand and took off her arm at the shoulder. She was nine…. She lived. They gave her a job running messages, one arm being enough to carry a piece of paper with.”
The brutality of the cotton mill, particularly in the punishment of young girls, is to have a direct effect in the Spanish atrocity.
Andrews has the special skills of creating atmosphere and making the reader care about his characters. The fan of historical fiction will be engrossed by this dark, unusual account of human suffering in the early days of the industrial revolution.
Saturday, November 16, 2019
Journalist Steven Greenhouse’s new book is a tour de force history of the labor movement, particularly as it has unfolded since the New Deal. See Beaten Down, Worked Up: The Past, Present, and Future of American Labor (Penguin/Random House 2019).
And the book is, indeed, a history of labor and not simply of unions. The author, in this regard, treats the remarkable phenomena of fast-food workers campaigning for equitable pay in the “Fight for $15” movement and immigrant tomato harvesters fighting for humane working conditions in Florida. These are workers who were not, and are not likely to be, laboring under the auspices of a collective bargaining agreement. The same can be said of the Amazon and Wal-Mart workers he discusses, who have connected via Facebook and other Internet vehicles to work towards better pay and working conditions.
While this new book discusses all aspects of labor, front and center is the unavoidable account of the decline of union power and influence. Greenhouse, in this regard, sets forth the familiar, shocking statistics: only 6.4% of workers in the private sector enjoy union protection, with only 10.5% of the workforce, overall, unionized. He explains the many reasons for this phenomenon, which in fact seems to have been a long time coming, ever since the Taft-Hartley Act made it harder for workers to unionize. More recent developments are the changing nature of employment and industry, labor’s own bad image, the remorseless efforts of corporations to fight unionization, and the Citizens’ United effect of allowing millions of business-interest dollars into political campaigns.
For those sympathetic to labor, the Greenhouse book is a grim read. On hopeful notes, he identifies recent successes, such as the remarkable influence of Culinary Workers’ #226 in Las Vegas, which brought collective bargaining to most of the resort casinos; and the rebellion of underpaid public-school teachers in West Virginia and Oklahoma, where even Trump-supporting educators joined with their union colleagues and successfully demanded fairer treatment. Still, Greenhouse asserts that major changes in the National Labor Relations Act, and in how unions imagine and run themselves, will be required before most workers gain true voice and are treated and paid fairly.
The issues of workplace safety, and compensation for the same, are part of the story, if only on the periphery. In the present day, he observes, employment sites where worker representation is absent often feature significant hazards to health (he sets forth, among others, an utterly plausible account of a dangerous recycling plant). Meanwhile, gig labor platforms like Uber establish their workers as independent contractors, often disavowing responsibility for safety and compensation. And, in a return to the roots of the modern labor movement, the author sets forth a portrait of the redoubtable Frances Perkins, who was animated by the Triangle Shirtwaist Factory fire to devote her career to workplace safety, workers’ compensation, and other forms of social insurance.
An account new to this writer: Martin Luther King, Jr. was famously (and fatefully), in Memphis in 1968 in support of the momentous sanitation workers’ strike. An unhappy situation had long been simmering, but the workers became truly disaffected, prompting, in part, the strike, when two of their colleagues died in a mishap caused by chronically malfunctioning vehicles. According to Greenhouse, “neither Cole nor Walker had workers’ compensation coverage because of a loophole in the law. That meant no death benefits for their families. Nor were Cole and Walker able to afford the life insurance the city offered. The families were left in penury, receiving just one month’s salary and a special $500 special payment – not even enough to cover burial expenses….”
Greenhouse, with his top-notch new book, is treating issues that have been in the headlines the last few decades. The attentive reader will find his topics familiar. However, the author skillfully brings the whole story together, fills in gaps in one’s knowledge, and offers recommendations for what he asserts is much-needed change. This writer wasted not a moment in reading this epic treatment of labor in the present day and recent past.
Monday, August 26, 2019
Carl Benedikt Frey's "The Technology Trap" (2019): A Holistic, Historical Examination of Artificial Intelligence and the Future of Work
A frequently-voiced social concern, universally, is the perceived growing threat of artificial intelligence (AI) to eliminate the jobs of millions of workers. The concern is voiced by workers’ compensation lawyers and others in the community in a more narrow, existential way. If the number of jobs is significantly truncated, particularly those in the industrial sector, will workers’ compensation become superannuated, and along with it those who labor in the dispute resolution process?
A healthy commentary exists in this realm. In a new book, Oxford University economic historian Carl Benedict Frey takes a retrospective/historical look at the situation and tries to predict the future from experiences of the past. See The Technology Trap: Capital, Labor, and Power in the Age of Automation (Princeton Univ. Press 2019).
Frey, a specialist in studying technology and employment, has, along with his colleague Mark Osborne, published several widely-read articles on this topic the last three years. The book is thick but, in the end, highly readable and a balanced, up-to-date treatment of this burning socio-legal issue. The book does not focus on industrial injuries. Still, the advance of AI, and the replacement of human labor with robots and/or other labor-saving innovations, holds the portent that many of the injuries and deaths encountered in the present day will be eliminated in the future.
An attractive feature of the book is the author’s attention to the workers whose jobs are threatened by AI. Will they simply accede, as they did with computerization, to the elimination of jobs, or will they seek government action to suppress AI innovation? Meanwhile, will workers be attracted more and more to populist movements, fired by resentment of elites who seem most advantaged by job-threatening technological processes?
A key focus of the book is explaining that the advance of technology has, since the eighteenth century – first in England and then in the United States – affected labor in two ways. The first affect is from technology that simply replaces jobs that were theretofore undertaken by human labor. Frey’s example, throughout, is that of gas lamplighters. With the invention of the light bulb, such jobs were simply eliminated. The second affect is from technology that, in contrast, enables workers to undertake the same or similar jobs with greater ease, and hence with greater productivity; and/or which generates new, theretofore uncontemplated, jobs. Frey again uses electrification as an example, here with the technological marvel of the lighting and powering of factories. Between lighting which allowed longer hours of work and the powering of motors to drive manufacturing processes, workers could be more productive, avoid dangerous conditions and, ultimately, achieve greater wages.
Of course, workers are better off when technology generates jobs that are of the enabling sort, as opposed to that which totally eliminates jobs. However, even with enabling technology, history has shown that a period of adjustment, which he calls “Engels’ Pause,” may exist. During such a period, workers may be displaced from their customary employments and experience depressed wages and other social and economic disruption. This phenomenon is most vividly illustrated by the Luddites, with their rebellion against mechanization and their destruction of labor-replacing machinery. Their revolt against innovation was not based on some abstract devotion to custom and tradition but, instead on the real threat of unemployment and other socio-economic upheaval.
On this point, Frey, throughout, makes an observation that may be counterintuitive. In this regard, over the centuries, rulers, particularly monarchs, often joined in the suppression of technological development because of social disruption. They feared that the population, particularly enterprises like craft guilds, would turn against them. In the late eighteenth and early nineteenth centuries, however, commercial interests in England gained formidable political clout and began to displace landed aristocratic interests. With this change in power structure, the government began supporting technological innovation. Indeed, the army was called out to crush the Luddites. Meanwhile, the new governing elites did nothing (at first) to prevent factory owners from replacing able-bodied men with women and children – who could easily, and cheaply, labor at the new machinery. In any event, the pattern over the last two centuries has been for government to support technological innovation in the workplace. The anxiety over displaced (and displeased) workers has persisted, but the typical response, with a few exceptions, has been retraining programs and unemployment compensation.
Frey thoroughly covers the past in trying to predict the AI future. Most familiar to the current reader will be how workers and society reacted to such things as the automation of automobile and other factories, the invention of the typewriter, and computerization of innumerable processes. By and large, these technologies have been ones of enablement, however hard for some the transition. In contrast, Frey believes that AI is full of replacement-of-jobs potentialities. He identifies, in particular, truck driving. The coming loss of jobs to autonomous vehicles in this area is especially critical, as truck driving is a leading form of employment in virtually all states. He ponders, as noted at the outset, whether those currently employed in the field, and in other entry-level and low-skilled jobs, will simply roll over in the face of the phenomenon. The author seems certain that at least some workers will suffer through another “Engel’s Pause” period of adjustment, such as was encountered so painfully during the initial phase of the industrial revolution.
The author’s final chapter is devoted to recommendations to make the period of adjustment easier. First and foremost is the promotion of education; it is the non-educated who, in the wake of IA innovations, will suffer the most. The second is retraining and a more flexible approach to educating the displaced. Frey also discusses wage insurance, tax credits (he is unsympathetic to universal basic income), decreased regulation, i.e., licensure, of skilled jobs (which he favors), relocation, and modifying transportation systems to connect displaced workers in one area to others where work is plentiful.
In the end, Frey has no hard answers to the labor issue in the age of automation, but a considered reading of his book is thought-provoking and, gratifyingly, places the issue in detailed historical context.
Wednesday, August 21, 2019
Researcher Frank Neuhauser Writes on Firefighter Cancer Presumptions: Observations from the Pennsylvania Trenches
In an important new article, distinguished California researcher Frank Neuhauser identifies the current trend of states enacting and expanding cancer presumptions in favor of firefighters. He cites and evaluates the studies which have sought to ascertain whether firefighters are at increased risk of developing cancer and – along with others, including IARC – finds that they are inadequate in evidencing such a phenomenon. At best prostate, testicular, and brain cancer may be implicated, but in Neuhauser’s view the science is weak even as to these types of cancer in establishing a pattern of causation. See Frank Neuhauser, Cancer Presumption for Firefighters: Good Policy or Give Away?, IAIABC Perspectives, p.7 et seq. (July 2019) (behind a pay-wall: https://www.iaiabc.org/iaiabc/Perspectives.asp).
Neuhauser unequivocally recommends that legislatures not enact such statutes. He declares, “What does all this mean for policymakers? The evidence for elevated risk of cancer among firefighters should be considered insufficient for adopting presumptions…. Presumption[s] lead to [unjustifiable] extra costs being imposed on local jurisdictions ….”
True, some studies have suggested increased risk, but Neuhauser finds three major weaknesses attendant to such studies. First, most firefighters have group health insurance, so cancers are more readily identifiable in that occupation than in the general population. Second, firefighters, overall, live longer than members of the general public and are hence more likely than others to develop cancer. Third, studies that show greater incidence are retrospective in nature and, for the most part, observed Caucasian men, a group that has a substantially greater rate of cancer than the general population.
Neuhauser also rejects the proposition that the cancer presumption in the instance of firefighters should be expanded to other maladies, such as heart disease, hypertension, Tuberculosis and other respiratory diseases, PTSD, and MRSA. “Again,” he admonishes, “the evidence for elevated risk among firefighters for any of these conditions is nonexistent, inconsistent or even contradictory.”
Neuhauser’s critique is familiar to the Pennsylvania reader. In the wake of Act 46, the scientific integrity, or lack of the same, of the firefighter cancer presumption has been well-aired in the court precedents. A minor library of cases is, indeed, available where Dr. Tee Guidotti, testifying for the City of Philadelphia, questions the presumption and ridicules the firefighters’ expert, a Dr. Singer, for suggesting that occupational cancer in a firefighter can be deemed exposure-related based not on epidemiological evidence but, instead, via the differential diagnosis method.
Of course, we know that physicians (and judges) cannot “attack” or “reject” a statutory presumption. That is a lesson from both the workers’ compensation and Black Lung litigation of many years back. Neuhauser knows this, and his remedy is that legislatures should never feel pressured into enacting such scientifically-bereft legal devices in the first place.
Readers of Neuhauser’s essay may assume that any firefighter who develops cancer and receives a presumption of causation automatically receives an award. But the notion that the cancer-victim firefighter is always on the receiving-end of the purported “Give Away” is incorrect. Presumption laws create rebuttable presumptions. In practice, municipalities often, if not always, oppose such claims and are often successful. In Pennsylvania, meanwhile, the presumption of causation is a mere procedural device, and when the municipality produces any level of contrary causation evidence, the burden of proof is once again on the firefighter to prove causation – just like in any other case. (In contrast, in some states, like Virginia, the firefighter’s cancer presumption is substantive in nature, that is, an element of proof, and aids the cancer victim throughout any dispute.)
In any event, given the procedural character of the presumption in Pennsylvania, some observers have questioned whether the presumption device really assists the disease-victim worker. Notably, during the dust disease wars of the 1970s and 1980s, injured workers (coal miners alleging pneumoconiosis and steelworkers alleging silicosis) never relied solely on the presumption. To the contrary, they always presented expert testimony in support of causation.
In arguing against presumptions, Neuhauser may have launched the proverbial “assault on a citadel.” He realizes that, in the present day, firefighters have a strong lobby and are politically powerful. However, presumptions, though currently trending, are not menacing 21st Century phenomena like legalized marijuana and comfort dogs on airplanes. To the contrary, presumptions have been found in workers’ compensation laws for over a century. Notably, a disease-of-the-heart-and-lungs presumption for firefighters has been a feature of Pennsylvania law since 1939.
Meanwhile, the British Workmen’s Compensation law of 1906 contained a list of diseases, to which attached presumptions of causation relative to workers who had exposure to the related disease hazards: “If the workman at or immediately before the date of the disablement … was employed in any process mentioned in the [list of occupations] … and the disease contracted is the disease … [paired with such occupations] … the disease, except where the certifying surgeon certifies that in his opinion the disease was not due to the nature of the employment, shall be deemed to have been due to the nature of that employment, unless the employer proves the contrary.” True, cancer in firefighters was not on the list – the law concerned itself more with anthrax in wool sorters and hookworm disease in coal miners. The point to remember, however, is that presumptions in workers’ compensation laws are not some modern device, custom-manufactured to coddle to the lobby of a special constituency.