Better Days Ahead for Wisconsin Employers?

December 14, 2012

While the Democrats won Wisconsin on the federal level, the Republicans won Wis­consin on the state level. Given that we have a Republican governor and Republican ma­jorities in the Assembly and the Senate, Wis­consin employers soon may reap the benefits of having a probusiness agenda. Finally, the time has come to simplify Wisconsin’s cum­bersome maze of employment laws.

Background

Wisconsin has a long tradition of legislative activism. We invented work­er’s compensation and beat the feds to the punch on the Americans with Dis­abilities Act (ADA) and the Family and Medical Leave Act (FMLA). The down­side to being the first on the block is that our statutes aren’t identical to fed­eral laws. Many of those state statutes are still on the books, and they’re not always in sync with their federal coun­terparts. For example, the Wisconsin FMLA (WFMLA) is calculated on a calendar basis, while the FMLA can be calculated using four different meth­ods. That means employers may have to use two FMLA calendars for the same employee, especially in the case of multistate employers. Similarly, the Wisconsin version of the ADA is some­times more employee-friendly than its federal counterpart.

I’d Like to Teach the World to Sing

Since Governor Scott Walker took office, there have been attempts to har­monize state and federal laws. Given the governor’s focus on making Wis­consin more business-friendly, employ­ers are very hopeful that he and the legislature will take the opportunity to finally simplify the tangled web of laws so that Wisconsin employers—particu­larly those doing business in multiple states—don’t need a PhD to practice HR.

The good news for employees is that Wisconsin can tweak its state laws to put them in harmony with federal laws while keeping the favorable parts that aren’t found in federal law—e.g., the prohibition against arrest and con­viction record discrimination.

Here are the keys changes that are on the table for employment laws:

  • Harmonize the WFMLA to mirror the federal FMLA;
  • Harmonize the Wisconsin Fair Em­ployment Act (WFEA) to mirror the federal ADA with respect to reason­able accommodation obligations;
  • Harmonize Wisconsin wage and hour law to coincide with the federal Fair Labor Standards Act (FLSA) regarding the exemptions from overtime; and
  • Add a “loser pays” provision in appeals of no prob­able cause pending before the Wisconsin Equal Rights Division (ERD). A majority of employees who request such hearings do so to spite an employer that has successfully defended a discrimination com­plaint through the investigation stage. Any oppor­tunistic individual can force his former employer to attend a probable cause hearing, which can cost tens of thousands of dollars to defend. Currently, there is no risk or downside to an employee who chooses to do so.

Worker’s Comp

With respect to worker’s comp, it’s time to level the playing field:

  • We need to allow the defense to engage in discov­ery (the pretrial exchange of evidence). Currently, an employer and its insurer have no right to engage in discovery. Prior to a hearing, they don’t have a right to obtain responses from the employee concerning the most basic relevant factual issues, including, for example, the employee’s past employment his­tory, past treatment history, or even the details of the alleged injury, including but not limited to the alleged mechanism of injury and witnesses. Em­ployees’ attorneys leverage that massive advantage to their benefit and enjoy describing worker’s comp proceedings as “the last bastion of trial by surprise.” How can you properly defend a case when the law allows employees to “hide the ball” and imposes no adverse consequences on them or their attorneys for doing so?
  • We need to eliminate the rule that employees get temporary total disability (TTD) benefits after being terminated for misconduct. The current rule allows employees to engage in terminable miscon­duct and then receive TTD benefits during the healing period. There are cases in which employ­ees have been arrested, unable to come to work because they were in jail, and terminated for not coming to work but still got TTD benefits (in the form of lost wages) while in jail merely because they were in a healing period. That’s the case even when work would have been available to them but for their misconduct.
  • We need to eliminate the rule that an employer is liable for an unreasonable refusal to rehire (in the form of a worker’s comp penalty equal to one year’s wages) if it fails to contact an injured worker who is no longer employed with an offer to work in a newly opened or created job. The burden should be on the former employee to apply for the job, not on the em­ployer to seek out the employee.
  • We need to eliminate the line of “odd lot” perma­nent total disability (PTD) cases because the Wis­consin Labor and Industry Review Commission (LIRC) repeatedly has decided that an employee is considered permanently and totally disabled unless the employer and its insurer can (1) point to actual jobs in the employee’s labor market for which he is qualified and (2) effectively obtain a job offer for the employee from those employers even though the employee has not applied. No prospective employer is going to offer a job to an employee who hasn’t ap­plied; that’s ridiculous.
  • A provision needs to be added stating that injured workers have a duty to engage in reasonable good-faith measures to mitigate their damages.
  • We need to allow reasonable defenses to vocational rehabilitation claims. Currently, there are virtually no defenses to the claim. As a result, many individuals file vocational rehabilitation claims to increase the settlement value of their case.

Call to Arms

Wisconsin employers have a duty to contact their elected officials and let them know that the times need to be a-changin’. If Wisconsin wants to get serious about competing for good-paying jobs with other business-friendly states, then it needs to start practicing what it preaches. Simplifying the state laws can be a win-win for employers and employees. Doing so will create more jobs while leaving in place the key protections that the state established long ago.

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For more information about "Better Days Ahead for Wisconsin Employers?," contact Saul C. Glazer at sglazer@axley.com or 608.260.2473 or Troy D. Thompson at tthompson@axley.com or 608.283.6746.