93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB6645

 

Introduced 02/09/04, by Jay C. Hoffman

 

SYNOPSIS AS INTRODUCED:
 
820 ILCS 305/4   from Ch. 48, par. 138.4
820 ILCS 310/4   from Ch. 48, par. 172.39

    Amends the Workers' Compensation Act and the Workers' Occupational Diseases Act. In provisions setting forth civil penalties for failing or refusing to comply with specified requirements relating to insurance or self-insurance, deletes language requiring that the failure or refusal be knowing and willful. Effective immediately.


LRB093 19311 WGH 45047 b

 

 

A BILL FOR

 

HB6645 LRB093 19311 WGH 45047 b

1     AN ACT concerning employment.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Workers' Compensation Act is amended by
5 changing Section 4 as follows:
 
6     (820 ILCS 305/4)  (from Ch. 48, par. 138.4)
7     Sec. 4. (a) Any employer, including but not limited to
8 general contractors and their subcontractors, who shall come
9 within the provisions of Section 3 of this Act, and any other
10 employer who shall elect to provide and pay the compensation
11 provided for in this Act shall:
12         (1) File with the Commission annually an application
13     for approval as a self-insurer which shall include a
14     current financial statement, and annually, thereafter, an
15     application for renewal of self-insurance, which shall
16     include a current financial statement. Said application
17     and financial statement shall be signed and sworn to by the
18     president or vice president and secretary or assistant
19     secretary of the employer if it be a corporation, or by all
20     of the partners, if it be a copartnership, or by the owner
21     if it be neither a copartnership nor a corporation. All
22     initial applications and all applications for renewal of
23     self-insurance must be submitted at least 60 days prior to
24     the requested effective date of self-insurance. An
25     employer may elect to provide and pay compensation as
26     provided for in this Act as a member of a group workers'
27     compensation pool under Article V 3/4 of the Illinois
28     Insurance Code. If an employer becomes a member of a group
29     workers' compensation pool, the employer shall not be
30     relieved of any obligations imposed by this Act.
31         If the sworn application and financial statement of any
32     such employer does not satisfy the Commission of the

 

 

HB6645 - 2 - LRB093 19311 WGH 45047 b

1     financial ability of the employer who has filed it, the
2     Commission shall require such employer to,
3         (2) Furnish security, indemnity or a bond guaranteeing
4     the payment by the employer of the compensation provided
5     for in this Act, provided that any such employer whose
6     application and financial statement shall not have
7     satisfied the commission of his or her financial ability
8     and who shall have secured his liability in part by excess
9     liability insurance shall be required to furnish to the
10     Commission security, indemnity or bond guaranteeing his or
11     her payment up to the effective limits of the excess
12     coverage, or
13         (3) Insure his entire liability to pay such
14     compensation in some insurance carrier authorized,
15     licensed, or permitted to do such insurance business in
16     this State. Every policy of an insurance carrier, insuring
17     the payment of compensation under this Act shall cover all
18     the employees and the entire compensation liability of the
19     insured: Provided, however, that any employer may insure
20     his or her compensation liability with 2 or more insurance
21     carriers or may insure a part and qualify under subsection
22     1, 2, or 4 for the remainder of his or her liability to pay
23     such compensation, subject to the following two
24     provisions:
25             Firstly, the entire compensation liability of the
26         employer to employees working at or from one location
27         shall be insured in one such insurance carrier or shall
28         be self-insured, and
29             Secondly, the employer shall submit evidence
30         satisfactorily to the Commission that his or her entire
31         liability for the compensation provided for in this Act
32         will be secured. Any provisions in any policy, or in
33         any endorsement attached thereto, attempting to limit
34         or modify in any way, the liability of the insurance
35         carriers issuing the same except as otherwise provided
36         herein shall be wholly void.

 

 

HB6645 - 3 - LRB093 19311 WGH 45047 b

1         Nothing herein contained shall apply to policies of
2     excess liability carriage secured by employers who have
3     been approved by the Commission as self-insurers, or
4         (4) Make some other provision, satisfactory to the
5     Commission, for the securing of the payment of compensation
6     provided for in this Act, and
7         (5) Upon becoming subject to this Act and thereafter as
8     often as the Commission may in writing demand, file with
9     the Commission in form prescribed by it evidence of his or
10     her compliance with the provision of this Section.
11     (a-1) Regardless of its state of domicile or its principal
12 place of business, an employer shall make payments to its
13 insurance carrier or group self-insurance fund, where
14 applicable, based upon the premium rates of the situs where the
15 work or project is located in Illinois if:
16         (A) the employer is engaged primarily in the building
17     and construction industry; and
18         (B) subdivision (a)(3) of this Section applies to the
19     employer or the employer is a member of a group
20     self-insurance plan as defined in subsection (1) of Section
21     4a.
22     The Industrial Commission shall impose a penalty upon an
23 employer for violation of this subsection (a-1) if:
24         (i) the employer is given an opportunity at a hearing
25     to present evidence of its compliance with this subsection
26     (a-1); and
27         (ii) after the hearing, the Commission finds that the
28     employer failed to make payments upon the premium rates of
29     the situs where the work or project is located in Illinois.
30     The penalty shall not exceed $1,000 for each day of work
31 for which the employer failed to make payments upon the premium
32 rates of the situs where the work or project is located in
33 Illinois, but the total penalty shall not exceed $50,000 for
34 each project or each contract under which the work was
35 performed.
36     Any penalty under this subsection (a-1) must be imposed not

 

 

HB6645 - 4 - LRB093 19311 WGH 45047 b

1 later than one year after the expiration of the applicable
2 limitation period specified in subsection (d) of Section 6 of
3 this Act. Penalties imposed under this subsection (a-1) shall
4 be deposited into the Industrial Commission Operations Fund, a
5 special fund that is created in the State treasury. Subject to
6 appropriation, moneys in the Fund shall be used solely for the
7 operations of the Industrial Commission.
8     (b) The sworn application and financial statement, or
9 security, indemnity or bond, or amount of insurance, or other
10 provisions, filed, furnished, carried, or made by the employer,
11 as the case may be, shall be subject to the approval of the
12 Commission.
13     Deposits under escrow agreements shall be cash, negotiable
14 United States government bonds or negotiable general
15 obligation bonds of the State of Illinois. Such cash or bonds
16 shall be deposited in escrow with any State or National Bank or
17 Trust Company having trust authority in the State of Illinois.
18     Upon the approval of the sworn application and financial
19 statement, security, indemnity or bond or amount of insurance,
20 filed, furnished or carried, as the case may be, the Commission
21 shall send to the employer written notice of its approval
22 thereof. The certificate of compliance by the employer with the
23 provisions of subparagraphs (2) and (3) of paragraph (a) of
24 this Section shall be delivered by the insurance carrier to the
25 Industrial Commission within five days after the effective date
26 of the policy so certified. The insurance so certified shall
27 cover all compensation liability occurring during the time that
28 the insurance is in effect and no further certificate need be
29 filed in case such insurance is renewed, extended or otherwise
30 continued by such carrier. The insurance so certified shall not
31 be cancelled or in the event that such insurance is not
32 renewed, extended or otherwise continued, such insurance shall
33 not be terminated until at least 10 days after receipt by the
34 Industrial Commission of notice of the cancellation or
35 termination of said insurance; provided, however, that if the
36 employer has secured insurance from another insurance carrier,

 

 

HB6645 - 5 - LRB093 19311 WGH 45047 b

1 or has otherwise secured the payment of compensation in
2 accordance with this Section, and such insurance or other
3 security becomes effective prior to the expiration of the 10
4 days, cancellation or termination may, at the option of the
5 insurance carrier indicated in such notice, be effective as of
6 the effective date of such other insurance or security.
7     (c) Whenever the Commission shall find that any
8 corporation, company, association, aggregation of individuals,
9 reciprocal or interinsurers exchange, or other insurer
10 effecting workers' compensation insurance in this State shall
11 be insolvent, financially unsound, or unable to fully meet all
12 payments and liabilities assumed or to be assumed for
13 compensation insurance in this State, or shall practice a
14 policy of delay or unfairness toward employees in the
15 adjustment, settlement, or payment of benefits due such
16 employees, the Commission may after reasonable notice and
17 hearing order and direct that such corporation, company,
18 association, aggregation of individuals, reciprocal or
19 interinsurers exchange, or insurer, shall from and after a date
20 fixed in such order discontinue the writing of any such
21 workers' compensation insurance in this State. Subject to such
22 modification of the order as the Commission may later make on
23 review of the order, as herein provided, it shall thereupon be
24 unlawful for any such corporation, company, association,
25 aggregation of individuals, reciprocal or interinsurers
26 exchange, or insurer to effect any workers' compensation
27 insurance in this State. A copy of the order shall be served
28 upon the Director of Insurance by registered mail. Whenever the
29 Commission finds that any service or adjustment company used or
30 employed by a self-insured employer or by an insurance carrier
31 to process, adjust, investigate, compromise or otherwise
32 handle claims under this Act, has practiced or is practicing a
33 policy of delay or unfairness toward employees in the
34 adjustment, settlement or payment of benefits due such
35 employees, the Commission may after reasonable notice and
36 hearing order and direct that such service or adjustment

 

 

HB6645 - 6 - LRB093 19311 WGH 45047 b

1 company shall from and after a date fixed in such order be
2 prohibited from processing, adjusting, investigating,
3 compromising or otherwise handling claims under this Act.
4     Whenever the Commission finds that any self-insured
5 employer has practiced or is practicing delay or unfairness
6 toward employees in the adjustment, settlement or payment of
7 benefits due such employees, the Commission may, after
8 reasonable notice and hearing, order and direct that after a
9 date fixed in the order such self-insured employer shall be
10 disqualified to operate as a self-insurer and shall be required
11 to insure his entire liability to pay compensation in some
12 insurance carrier authorized, licensed and permitted to do such
13 insurance business in this State, as provided in subparagraph 3
14 of paragraph (a) of this Section.
15     All orders made by the Commission under this Section shall
16 be subject to review by the courts, said review to be taken in
17 the same manner and within the same time as provided by Section
18 19 of this Act for review of awards and decisions of the
19 Commission, upon the party seeking the review filing with the
20 clerk of the court to which said review is taken a bond in an
21 amount to be fixed and approved by the court to which the
22 review is taken, conditioned upon the payment of all
23 compensation awarded against the person taking said review
24 pending a decision thereof and further conditioned upon such
25 other obligations as the court may impose. Upon the review the
26 Circuit Court shall have power to review all questions of fact
27 as well as of law. The penalty hereinafter provided for in this
28 paragraph shall not attach and shall not begin to run until the
29 final determination of the order of the Commission.
30     (d) Upon a finding by the Commission, after reasonable
31 notice and hearing, of the knowing and wilful failure or
32 refusal of an employer to comply with any of the provisions of
33 paragraph (a) of this Section or the failure or refusal of an
34 employer, service or adjustment company, or an insurance
35 carrier to comply with any order of the Industrial Commission
36 pursuant to paragraph (c) of this Section disqualifying him or

 

 

HB6645 - 7 - LRB093 19311 WGH 45047 b

1 her to operate as a self insurer and requiring him or her to
2 insure his or her liability, the Commission may assess a civil
3 penalty of up to $500 per day for each day of such failure or
4 refusal after the effective date of this amendatory Act of
5 1989. The minimum penalty under this Section shall be the sum
6 of $10,000. Each day of such failure or refusal shall
7 constitute a separate offense. The Commission may assess the
8 civil penalty personally and individually against the
9 corporate officers and directors of a corporate employer, the
10 partners of an employer partnership, and the members of an
11 employer limited liability company, after a finding of a
12 knowing and willful refusal or failure of each such named
13 corporate officer, director, partner, or member to comply with
14 this Section. The liability for the assessed penalty shall be
15 against the named employer first, and if the named employer
16 fails or refuses to pay the penalty to the Commission within 30
17 days after the final order of the Commission, then the named
18 corporate officers, directors, partners, or members who have
19 been found to have knowingly and willfully refused or failed to
20 comply with this Section shall be liable for the unpaid penalty
21 or any unpaid portion of the penalty. All penalties collected
22 under this Section shall be deposited in the Industrial
23 Commission Operations Fund.
24     Upon the failure or refusal of any employer, service or
25 adjustment company or insurance carrier to comply with the
26 provisions of this Section and with the orders of the
27 Commission under this Section, or the order of the court on
28 review after final adjudication, the Commission may bring a
29 civil action to recover the amount of the penalty in Cook
30 County or in Sangamon County in which litigation the Commission
31 shall be represented by the Attorney General. The Commission
32 shall send notice of its finding of non-compliance and
33 assessment of the civil penalty to the Attorney General. It
34 shall be the duty of the Attorney General within 30 days after
35 receipt of the notice, to institute prosecutions and promptly
36 prosecute all reported violations of this Section.

 

 

HB6645 - 8 - LRB093 19311 WGH 45047 b

1     (e) This Act shall not affect or disturb the continuance of
2 any existing insurance, mutual aid, benefit, or relief
3 association or department, whether maintained in whole or in
4 part by the employer or whether maintained by the employees,
5 the payment of benefits of such association or department being
6 guaranteed by the employer or by some person, firm or
7 corporation for him or her: Provided, the employer contributes
8 to such association or department an amount not less than the
9 full compensation herein provided, exclusive of the cost of the
10 maintenance of such association or department and without any
11 expense to the employee. This Act shall not prevent the
12 organization and maintaining under the insurance laws of this
13 State of any benefit or insurance company for the purpose of
14 insuring against the compensation provided for in this Act, the
15 expense of which is maintained by the employer. This Act shall
16 not prevent the organization or maintaining under the insurance
17 laws of this State of any voluntary mutual aid, benefit or
18 relief association among employees for the payment of
19 additional accident or sick benefits.
20     (f) No existing insurance, mutual aid, benefit or relief
21 association or department shall, by reason of anything herein
22 contained, be authorized to discontinue its operation without
23 first discharging its obligations to any and all persons
24 carrying insurance in the same or entitled to relief or
25 benefits therein.
26     (g) Any contract, oral, written or implied, of employment
27 providing for relief benefit, or insurance or any other device
28 whereby the employee is required to pay any premium or premiums
29 for insurance against the compensation provided for in this Act
30 shall be null and void. Any employer withholding from the wages
31 of any employee any amount for the purpose of paying any such
32 premium shall be guilty of a Class B misdemeanor.
33     In the event the employer does not pay the compensation for
34 which he or she is liable, then an insurance company,
35 association or insurer which may have insured such employer
36 against such liability shall become primarily liable to pay to

 

 

HB6645 - 9 - LRB093 19311 WGH 45047 b

1 the employee, his or her personal representative or beneficiary
2 the compensation required by the provisions of this Act to be
3 paid by such employer. The insurance carrier may be made a
4 party to the proceedings in which the employer is a party and
5 an award may be entered jointly against the employer and the
6 insurance carrier.
7     (h) It shall be unlawful for any employer, insurance
8 company or service or adjustment company to interfere with,
9 restrain or coerce an employee in any manner whatsoever in the
10 exercise of the rights or remedies granted to him or her by
11 this Act or to discriminate, attempt to discriminate, or
12 threaten to discriminate against an employee in any way because
13 of his or her exercise of the rights or remedies granted to him
14 or her by this Act.
15     It shall be unlawful for any employer, individually or
16 through any insurance company or service or adjustment company,
17 to discharge or to threaten to discharge, or to refuse to
18 rehire or recall to active service in a suitable capacity an
19 employee because of the exercise of his or her rights or
20 remedies granted to him or her by this Act.
21     (i) If an employer elects to obtain a life insurance policy
22 on his employees, he may also elect to apply such benefits in
23 satisfaction of all or a portion of the death benefits payable
24 under this Act, in which case, the employer's compensation
25 premium shall be reduced accordingly.
26     (j) Within 45 days of receipt of an initial application or
27 application to renew self-insurance privileges the
28 Self-Insurers Advisory Board shall review and submit for
29 approval by the Chairman of the Commission recommendations of
30 disposition of all initial applications to self-insure and all
31 applications to renew self-insurance privileges filed by
32 private self-insurers pursuant to the provisions of this
33 Section and Section 4a-9 of this Act. Each private self-insurer
34 shall submit with its initial and renewal applications the
35 application fee required by Section 4a-4 of this Act.
36     The Chairman of the Commission shall promptly act upon all

 

 

HB6645 - 10 - LRB093 19311 WGH 45047 b

1 initial applications and applications for renewal in full
2 accordance with the recommendations of the Board or, should the
3 Chairman disagree with any recommendation of disposition of the
4 Self-Insurer's Advisory Board, he shall within 30 days of
5 receipt of such recommendation provide to the Board in writing
6 the reasons supporting his decision. The Chairman shall also
7 promptly notify the employer of his decision within 15 days of
8 receipt of the recommendation of the Board.
9     If an employer is denied a renewal of self-insurance
10 privileges pursuant to application it shall retain said
11 privilege for 120 days after receipt of a notice of
12 cancellation of the privilege from the Chairman of the
13 Commission.
14     All orders made by the Chairman under this Section shall be
15 subject to review by the courts, such review to be taken in the
16 same manner and within the same time as provided by subsection
17 (f) of Section 19 of this Act for review of awards and
18 decisions of the Commission, upon the party seeking the review
19 filing with the clerk of the court to which such review is
20 taken a bond in an amount to be fixed and approved by the court
21 to which the review is taken, conditioned upon the payment of
22 all compensation awarded against the person taking such review
23 pending a decision thereof and further conditioned upon such
24 other obligations as the court may impose. Upon the review the
25 Circuit Court shall have power to review all questions of fact
26 as well as of law.
27 (Source: P.A. 91-375, eff. 1-1-00; 91-757, eff. 1-1-01; 92-324,
28 eff. 8-9-01.)
 
29     Section 10. The Workers' Occupational Diseases Act is
30 amended by changing Section 4 as follows:
 
31     (820 ILCS 310/4)  (from Ch. 48, par. 172.39)
32     Sec. 4. (a) Any employer, including but not limited to
33 general contractors and their subcontractors, required by the
34 terms of this Act or by election to pay the compensation

 

 

HB6645 - 11 - LRB093 19311 WGH 45047 b

1 provided for in this Act shall:
2         (1) File with the Commission an application for
3     approval as a self-insurer which shall include a current
4     financial statement. The application and financial
5     statement shall be signed and sworn to by the president or
6     vice-president and secretary or assistant secretary of the
7     employer if it be a corporation, or by all of the partners
8     if it be a copartnership, or by the owner if it be neither
9     a copartnership nor a corporation. An employer may elect to
10     provide and pay compensation as provided for in this Act as
11     a member of a group workers' compensation pool under
12     Article V 3/4 of the Illinois Insurance Code. If an
13     employer becomes a member of a group workers' compensation
14     pool, the employer shall not be relieved of any obligations
15     imposed by this Act.
16         If the sworn application and financial statement of any
17     such employer does not satisfy the Commission of the
18     financial ability of the employer who has filed it, the
19     Commission shall require such employer to:
20         (2) Furnish security, indemnity or a bond guaranteeing
21     the payment by the employer of the compensation provided
22     for in this Act, provided that any such employer who shall
23     have secured his or her liability in part by excess
24     liability coverage shall be required to furnish to the
25     Commission security, indemnity or bond guaranteeing his or
26     her payment up to the amount of the effective limits of the
27     excess coverage in accordance with the provisions of this
28     paragraph, or
29         (3) Insure his or her entire liability to pay such
30     compensation in some insurance carrier authorized,
31     licensed or permitted to do such insurance business in this
32     State. All policies of such insurance carriers insuring the
33     payment of compensation under this Act shall cover all the
34     employees and all such employer's compensation liability
35     in all cases in which the last day of the last exposure to
36     the occupational disease involved is within the effective

 

 

HB6645 - 12 - LRB093 19311 WGH 45047 b

1     period of the policy, anything to the contrary in the
2     policy notwithstanding. Provided, however, that any
3     employer may insure his or her compensation liability under
4     this Act with 2 or more insurance carriers or may insure a
5     part and qualify under Subsection 1, 2, or 4 for the
6     remainder of his liability to pay such compensation,
7     subject to the following two provisions:
8             Firstly, the entire liability of the employer to
9         employees working at or from one location shall be
10         insured in one such insurance carrier or shall be
11         self-insured.
12             Secondly, the employer shall submit evidence
13         satisfactory to the Commission that his or her entire
14         liability for the compensation provided for in this Act
15         will be secured.
16         Any provision in a policy or in any endorsement
17     attached thereto attempting to limit or modify in any way
18     the liability of the insurance carrier issuing the same,
19     except as otherwise provided herein, shall be wholly void.
20         The insurance or security in force to cover
21     compensation liability under this Act shall be separate and
22     distinct from the insurance or security under the "Workers'
23     Compensation Act" and any insurance contract covering
24     liability under either Act need not cover any liability
25     under the other. Nothing herein contained shall apply to
26     policies of excess liability carriage secured by employers
27     who have been approved by the Commission as self-insurers,
28     or
29         (4) Make some other provision, satisfactory to the
30     Commission, for the securing of the payment of compensation
31     provided for in this Act, and
32         (5) Upon becoming subject to this Act and thereafter as
33     often as the Commission may in writing demand, file with
34     the Commission in form prescribed by it evidence of his or
35     her compliance with the provision of this Section.
36     (a-1) Regardless of its state of domicile or its principal

 

 

HB6645 - 13 - LRB093 19311 WGH 45047 b

1 place of business, an employer shall make payments to its
2 insurance carrier or group self-insurance fund, where
3 applicable, based upon the premium rates of the situs where the
4 work or project is located in Illinois if:
5         (A) the employer is engaged primarily in the building
6     and construction industry; and
7         (B) subdivision (a)(3) of this Section applies to the
8     employer or the employer is a member of a group
9     self-insurance plan as defined in subsection (1) of Section
10     4a.
11     The Industrial Commission shall impose a penalty upon an
12 employer for violation of this subsection (a-1) if:
13         (i) the employer is given an opportunity at a hearing
14     to present evidence of its compliance with this subsection
15     (a-1); and
16         (ii) after the hearing, the Commission finds that the
17     employer failed to make payments upon the premium rates of
18     the situs where the work or project is located in Illinois.
19     The penalty shall not exceed $1,000 for each day of work
20 for which the employer failed to make payments upon the premium
21 rates of the situs where the work or project is located in
22 Illinois, but the total penalty shall not exceed $50,000 for
23 each project or each contract under which the work was
24 performed.
25     Any penalty under this subsection (a-1) must be imposed not
26 later than one year after the expiration of the applicable
27 limitation period specified in subsection (c) of Section 6 of
28 this Act. Penalties imposed under this subsection (a-1) shall
29 be deposited into the Industrial Commission Operations Fund
30 created under Section 4 of the Workers' Compensation Act.
31     (b) The sworn application and financial statement, or
32 security, indemnity or bond, or amount of insurance, or other
33 provisions, filed, furnished, carried, or made by the employer,
34 as the case may be, shall be subject to the approval of the
35 Commission.
36     Deposits under escrow agreements shall be cash, negotiable

 

 

HB6645 - 14 - LRB093 19311 WGH 45047 b

1 United States government bonds or negotiable general
2 obligation bonds of the State of Illinois. Such cash or bonds
3 shall be deposited in escrow with any State or National Bank or
4 Trust Company having trust authority in the State of Illinois.
5     Upon the approval of the sworn application and financial
6 statement, security, indemnity or bond or amount of insurance,
7 filed, furnished, or carried, as the case may be, the
8 Commission shall send to the employer written notice of its
9 approval thereof. Said certificate of compliance by the
10 employer with the provisions of subparagraphs (2) and (3) of
11 paragraph (a) of this Section shall be delivered by the
12 insurance carrier to the Industrial Commission within 5 days
13 after the effective date of the policy so certified. The
14 insurance so certified shall cover all compensation liability
15 occurring during the time that the insurance is in effect and
16 no further certificate need be filed in case such insurance is
17 renewed, extended or otherwise continued by such carrier. The
18 insurance so certified shall not be cancelled or in the event
19 that such insurance is not renewed, extended or otherwise
20 continued, such insurance shall not be terminated until at
21 least 10 days after receipt by the Industrial Commission of
22 notice of the cancellation or termination of said insurance;
23 provided, however, that if the employer has secured insurance
24 from another insurance carrier, or has otherwise secured the
25 payment of compensation in accordance with this Section, and
26 such insurance or other security becomes effective prior to the
27 expiration of said 10 days, cancellation or termination may, at
28 the option of the insurance carrier indicated in such notice,
29 be effective as of the effective date of such other insurance
30 or security.
31     (c) Whenever the Commission shall find that any
32 corporation, company, association, aggregation of individuals,
33 reciprocal or interinsurers exchange, or other insurer
34 effecting workers' occupational disease compensation insurance
35 in this State shall be insolvent, financially unsound, or
36 unable to fully meet all payments and liabilities assumed or to

 

 

HB6645 - 15 - LRB093 19311 WGH 45047 b

1 be assumed for compensation insurance in this State, or shall
2 practice a policy of delay or unfairness toward employees in
3 the adjustment, settlement, or payment of benefits due such
4 employees, the Commission may after reasonable notice and
5 hearing order and direct that such corporation, company,
6 association, aggregation of individuals, reciprocal or
7 interinsurers exchange, or insurer, shall from and after a date
8 fixed in such order discontinue the writing of any such
9 workers' occupational disease compensation insurance in this
10 State. It shall thereupon be unlawful for any such corporation,
11 company, association, aggregation of individuals, reciprocal
12 or interinsurers exchange, or insurer to effect any workers'
13 occupational disease compensation insurance in this State. A
14 copy of the order shall be served upon the Director of
15 Insurance by registered mail. Whenever the Commission finds
16 that any service or adjustment company used or employed by a
17 self-insured employer or by an insurance carrier to process,
18 adjust, investigate, compromise or otherwise handle claims
19 under this Act, has practiced or is practicing a policy of
20 delay or unfairness toward employees in the adjustment,
21 settlement or payment of benefits due such employees, the
22 Commission may after reasonable notice and hearing order and
23 direct that such service or adjustment company shall from and
24 after a date fixed in such order be prohibited from processing,
25 adjusting, investigating, compromising or otherwise handling
26 claims under this Act.
27     Whenever the Commission finds that any self-insured
28 employer has practiced or is practicing delay or unfairness
29 toward employees in the adjustment, settlement or payment of
30 benefits due such employees, the Commission may after
31 reasonable notice and hearing order and direct that after a
32 date fixed in the order such self-insured employer shall be
33 disqualified to operate as a self-insurer and shall be required
34 to insure his entire liability to pay compensation in some
35 insurance carrier authorized, licensed and permitted to do such
36 insurance business in this State as provided in subparagraph

 

 

HB6645 - 16 - LRB093 19311 WGH 45047 b

1 (3) of paragraph (a) of this Section.
2     All orders made by the Commission under this Section shall
3 be subject to review by the courts, the review to be taken in
4 the same manner and within the same time as provided by Section
5 19 of this Act for review of awards and decisions of the
6 Commission, upon the party seeking the review filing with the
7 clerk of the court to which said review is taken a bond in an
8 amount to be fixed and approved by the court to which said
9 review is taken, conditioned upon the payment of all
10 compensation awarded against the person taking the review
11 pending a decision thereof and further conditioned upon such
12 other obligations as the court may impose. Upon the review the
13 Circuit Court shall have power to review all questions of fact
14 as well as of law. The penalty hereinafter provided for in this
15 paragraph shall not attach and shall not begin to run until the
16 final determination of the order of the Commission.
17     (d) Upon a finding by the Commission, after reasonable
18 notice and hearing, of the knowing and wilful failure of an
19 employer to comply with any of the provisions of paragraph (a)
20 of this Section or the failure or refusal of an employer,
21 service or adjustment company, or insurance carrier to comply
22 with any order of the Industrial Commission pursuant to
23 paragraph (c) of this Section the Commission may assess a civil
24 penalty of up to $500 per day for each day of such failure or
25 refusal after the effective date of this amendatory Act of
26 1989. Each day of such failure or refusal shall constitute a
27 separate offense.
28     Upon the failure or refusal of any employer, service or
29 adjustment company or insurance carrier to comply with the
30 provisions of this Section and orders of the Commission under
31 this Section, or the order of the court on review after final
32 adjudication, the Commission may bring a civil action to
33 recover the amount of the penalty in Cook County or in Sangamon
34 County in which litigation the Commission shall be represented
35 by the Attorney General. The Commission shall send notice of
36 its finding of non-compliance and assessment of the civil

 

 

HB6645 - 17 - LRB093 19311 WGH 45047 b

1 penalty to the Attorney General. It shall be the duty of the
2 Attorney General within 30 days after receipt of the notice, to
3 institute prosecutions and promptly prosecute all reported
4 violations of this Section.
5     (e) This Act shall not affect or disturb the continuance of
6 any existing insurance, mutual aid, benefit, or relief
7 association or department, whether maintained in whole or in
8 part by the employer or whether maintained by the employees,
9 the payment of benefits of such association or department being
10 guaranteed by the employer or by some person, firm or
11 corporation for him or her: Provided, the employer contributes
12 to such association or department an amount not less than the
13 full compensation herein provided, exclusive of the cost of the
14 maintenance of such association or department and without any
15 expense to the employee. This Act shall not prevent the
16 organization and maintaining under the insurance laws of this
17 State of any benefit or insurance company for the purpose of
18 insuring against the compensation provided for in this Act, the
19 expense of which is maintained by the employer. This Act shall
20 not prevent the organization or maintaining under the insurance
21 laws of this State of any voluntary mutual aid, benefit or
22 relief association among employees for the payment of
23 additional accident or sick benefits.
24     (f) No existing insurance, mutual aid, benefit or relief
25 association or department shall, by reason of anything herein
26 contained, be authorized to discontinue its operation without
27 first discharging its obligations to any and all persons
28 carrying insurance in the same or entitled to relief or
29 benefits therein.
30     (g) Any contract, oral, written or implied, of employment
31 providing for relief benefit, or insurance or any other device
32 whereby the employee is required to pay any premium or premiums
33 for insurance against the compensation provided for in this Act
34 shall be null and void. Any employer withholding from the wages
35 of any employee any amount for the purpose of paying any such
36 premium shall be guilty of a Class B misdemeanor.

 

 

HB6645 - 18 - LRB093 19311 WGH 45047 b

1     In the event the employer does not pay the compensation for
2 which he or she is liable, then an insurance company,
3 association or insurer which may have insured such employer
4 against such liability shall become primarily liable to pay to
5 the employee, his personal representative or beneficiary the
6 compensation required by the provisions of this Act to be paid
7 by such employer. The insurance carrier may be made a party to
8 the proceedings in which the employer is a party and an award
9 may be entered jointly against the employer and the insurance
10 carrier.
11     (h) It shall be unlawful for any employer, insurance
12 company or service or adjustment company to interfere with,
13 restrain or coerce an employee in any manner whatsoever in the
14 exercise of the rights or remedies granted to him or her by
15 this Act or to discriminate, attempt to discriminate, or
16 threaten to discriminate against an employee in any way because
17 of his exercise of the rights or remedies granted to him by
18 this Act.
19     It shall be unlawful for any employer, individually or
20 through any insurance company or service or adjustment company,
21 to discharge or to threaten to discharge, or to refuse to
22 rehire or recall to active service in a suitable capacity an
23 employee because of the exercise of his or her rights or
24 remedies granted to him or her by this Act.
25     (i) If an employer elects to obtain a life insurance policy
26 on his employees, he may also elect to apply such benefits in
27 satisfaction of all or a portion of the death benefits payable
28 under this Act, in which case, the employer's premium for
29 coverage for benefits under this Act shall be reduced
30 accordingly.
31 (Source: P.A. 90-109, eff. 1-1-98; 91-375, eff. 1-1-00; 91-757,
32 eff. 1-1-01.)
 
33     Section 99. Effective date. This Act takes effect upon
34 becoming law.