093_HB3110

 
                                     LRB093 07561 WGH 07736 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
13        application for approval as a  self-insurer  which  shall
14        include  a  current  financial  statement,  and annually,
15        thereafter, an application for renewal of self-insurance,
16        which shall include a current financial statement.   Said
17        application  and  financial statement shall be signed and
18        sworn to by the president or vice president and secretary
19        or assistant  secretary  of  the  employer  if  it  be  a
20        corporation,  or  by  all  of  the  partners,  if it be a
21        copartnership, or  by  the  owner  if  it  be  neither  a
22        copartnership nor a corporation. All initial applications
23        and  all  applications for renewal of self-insurance must
24        be submitted at least 60  days  prior  to  the  requested
25        effective  date of self-insurance.  An employer may elect
26        to provide and pay compensation as provided for  in  this
27        Act  as  a  member  of a group workers' compensation pool
28        under Article V 3/4 of the Illinois Insurance  Code.   If
29        an   employer  becomes  a  member  of  a  group  workers'
30        compensation pool, the employer shall not be relieved  of
31        any obligations imposed by this Act.
 
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 1             If  the sworn application and financial statement of
 2        any such employer does not satisfy the Commission of  the
 3        financial  ability  of the employer who has filed it, the
 4        Commission shall require such employer to,
 5             (2)  Furnish   security,   indemnity   or   a   bond
 6        guaranteeing  the  payment  by  the   employer   of   the
 7        compensation  provided for in this Act, provided that any
 8        such employer whose application and  financial  statement
 9        shall  not  have  satisfied  the commission of his or her
10        financial  ability  and  who  shall  have   secured   his
11        liability  in part by excess liability insurance shall be
12        required to furnish to the Commission security, indemnity
13        or bond  guaranteeing  his  or  her  payment  up  to  the
14        effective limits of the excess coverage, or
15             (3)  Insure   his   entire  liability  to  pay  such
16        compensation  in  some  insurance   carrier   authorized,
17        licensed,  or  permitted to do such insurance business in
18        this  State.   Every  policy  of  an  insurance  carrier,
19        insuring the payment of compensation under this Act shall
20        cover all  the  employees  and  the  entire  compensation
21        liability  of  the  insured:  Provided, however, that any
22        employer may insure his  or  her  compensation  liability
23        with  2  or  more insurance carriers or may insure a part
24        and qualify under subsection 1, 2, or 4 for the remainder
25        of his or her liability to pay such compensation, subject
26        to the following two provisions:
27                  Firstly, the entire compensation  liability  of
28             the  employer  to  employees  working at or from one
29             location shall be  insured  in  one  such  insurance
30             carrier or shall be self-insured, and
31                  Secondly,  the  employer  shall submit evidence
32             satisfactorily to the Commission  that  his  or  her
33             entire  liability  for the compensation provided for
34             in this Act will be secured.  Any provisions in  any
 
                            -3-      LRB093 07561 WGH 07736 b
 1             policy,  or  in  any  endorsement  attached thereto,
 2             attempting to  limit  or  modify  in  any  way,  the
 3             liability of the insurance carriers issuing the same
 4             except  as otherwise provided herein shall be wholly
 5             void.
 6             Nothing herein contained shall apply to policies  of
 7        excess  liability  carriage secured by employers who have
 8        been approved by the Commission as self-insurers, or
 9             (4)  Make some other provision, satisfactory to  the
10        Commission,   for   the   securing   of  the  payment  of
11        compensation provided for in this Act, and
12             (5)  Upon  becoming  subject   to   this   Act   and
13        thereafter  as  often  as  the  Commission may in writing
14        demand, file with the Commission in form prescribed by it
15        evidence of his or her compliance with the  provision  of
16        this Section.
17        (a-1)  Regardless   of  its  state  of  domicile  or  its
18    principal place of business, an employer shall make  payments
19    to  its insurance carrier or group self-insurance fund, where
20    applicable, based upon the premium rates of the  situs  where
21    the work or project is located in Illinois if:
22             (A)  the   employer  is  engaged  primarily  in  the
23        building and construction industry; and
24             (B)  subdivision (a)(3) of this Section  applies  to
25        the  employer  or  the  employer  is  a member of a group
26        self-insurance plan  as  defined  in  subsection  (1)  of
27        Section 4a.
28        The  Industrial Commission shall impose a penalty upon an
29    employer for violation of this subsection (a-1) if:
30             (i)  the employer  is  given  an  opportunity  at  a
31        hearing  to  present evidence of its compliance with this
32        subsection (a-1); and
33             (ii)  after the hearing, the Commission  finds  that
34        the  employer  failed  to  make payments upon the premium
 
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 1        rates of the situs where the work or project  is  located
 2        in Illinois.
 3        The  penalty shall not exceed $1,000 for each day of work
 4    for which the employer  failed  to  make  payments  upon  the
 5    premium  rates  of  the  situs  where  the work or project is
 6    located in Illinois, but the total penalty shall  not  exceed
 7    $50,000  for  each  project  or each contract under which the
 8    work was performed.
 9        Any penalty under this subsection (a-1) must  be  imposed
10    not   later  than  one  year  after  the  expiration  of  the
11    applicable limitation period specified in subsection  (d)  of
12    Section   6  of  this  Act.   Penalties  imposed  under  this
13    subsection (a-1)  shall  be  deposited  into  the  Industrial
14    Commission Operations Fund, a special fund that is created in
15    the  State treasury.  Subject to appropriation, moneys in the
16    Fund  shall  be  used  solely  for  the  operations  of   the
17    Industrial Commission.
18        (b)  The  sworn  application  and financial statement, or
19    security, indemnity or bond, or amount of insurance, or other
20    provisions,  filed,  furnished,  carried,  or  made  by   the
21    employer,  as  the  case  may  be,  shall  be  subject to the
22    approval of the Commission.
23        Deposits  under  escrow   agreements   shall   be   cash,
24    negotiable  United  States  government  bonds  or  negotiable
25    general obligation bonds of the State of Illinois.  Such cash
26    or  bonds  shall  be  deposited  in  escrow with any State or
27    National Bank or Trust Company having trust authority in  the
28    State of Illinois.
29        Upon  the approval of the sworn application and financial
30    statement,  security,  indemnity  or  bond   or   amount   of
31    insurance,  filed,  furnished or carried, as the case may be,
32    the Commission shall send to the employer written  notice  of
33    its  approval  thereof.  The certificate of compliance by the
34    employer with the provisions of subparagraphs (2) and (3)  of
 
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 1    paragraph  (a)  of  this  Section  shall  be delivered by the
 2    insurance carrier to the Industrial  Commission  within  five
 3    days  after  the  effective  date of the policy so certified.
 4    The insurance  so  certified  shall  cover  all  compensation
 5    liability  occurring during the time that the insurance is in
 6    effect and no further certificate need be filed in case  such
 7    insurance is renewed, extended or otherwise continued by such
 8    carrier.   The  insurance so certified shall not be cancelled
 9    or in the event that such insurance is not renewed,  extended
10    or   otherwise   continued,   such  insurance  shall  not  be
11    terminated until at  least  10  days  after  receipt  by  the
12    Industrial  Commission  of  notice  of  the  cancellation  or
13    termination of said insurance; provided, however, that if the
14    employer   has   secured  insurance  from  another  insurance
15    carrier, or has otherwise secured the payment of compensation
16    in accordance with this Section, and such insurance or  other
17    security  becomes effective prior to the expiration of the 10
18    days, cancellation or termination may, at the option  of  the
19    insurance  carrier  indicated in such notice, be effective as
20    of the effective date of such other insurance or security.
21        (c)  Whenever  the  Commission  shall   find   that   any
22    corporation,    company,    association,    aggregation    of
23    individuals,  reciprocal  or interinsurers exchange, or other
24    insurer effecting workers'  compensation  insurance  in  this
25    State  shall  be insolvent, financially unsound, or unable to
26    fully meet all payments and  liabilities  assumed  or  to  be
27    assumed for compensation insurance in this State, or has been
28    shown  by  clear and convincing evidence to have engaged in a
29    pattern and shall practice a policy of  fraudulent  delay  or
30    unfairness toward employees in the adjustment, settlement, or
31    payment  of  benefits  due such employees, the Commission may
32    after reasonable notice and hearing  order  and  direct  that
33    such   corporation,   company,  association,  aggregation  of
34    individuals,  reciprocal  or   interinsurers   exchange,   or
 
                            -6-      LRB093 07561 WGH 07736 b
 1    insurer,  shall  from  and  after  a date fixed in such order
 2    discontinue the writing of  any  such  workers'  compensation
 3    insurance in this State.  Subject to such modification of the
 4    order  as  the  Commission  may  later  make on review of the
 5    order, as herein provided, it shall thereupon be unlawful for
 6    any such corporation, company,  association,  aggregation  of
 7    individuals, reciprocal or interinsurers exchange, or insurer
 8    to  effect any workers' compensation insurance in this State.
 9    A copy of the order shall be  served  upon  the  Director  of
10    Insurance  by registered mail.  Whenever the Commission finds
11    that any service or adjustment company used or employed by  a
12    self-insured  employer or by an insurance carrier to process,
13    adjust, investigate, compromise or  otherwise  handle  claims
14    under  this  Act,  has practiced or is practicing a policy of
15    delay or  unfairness  toward  employees  in  the  adjustment,
16    settlement  or  payment  of  benefits due such employees, the
17    Commission may after reasonable notice and hearing order  and
18    direct that such service or adjustment company shall from and
19    after   a  date  fixed  in  such  order  be  prohibited  from
20    processing,   adjusting,   investigating,   compromising   or
21    otherwise handling claims under this Act.
22        Whenever  the  Commission  finds  that  any  self-insured
23    employer has practiced or is practicing delay  or  unfairness
24    toward  employees in the adjustment, settlement or payment of
25    benefits  due  such  employees,  the  Commission  may,  after
26    reasonable notice and hearing, order and direct that after  a
27    date  fixed  in the order such self-insured employer shall be
28    disqualified to  operate  as  a  self-insurer  and  shall  be
29    required  to  insure his entire liability to pay compensation
30    in some insurance carrier authorized, licensed and  permitted
31    to  do  such insurance business in this State, as provided in
32    subparagraph 3 of paragraph (a) of this Section.
33        All orders made by  the  Commission  under  this  Section
34    shall  be  subject to review by the courts, said review to be
 
                            -7-      LRB093 07561 WGH 07736 b
 1    taken in the same manner and within the same time as provided
 2    by Section 19 of this Act for review of awards and  decisions
 3    of  the  Commission, upon the party seeking the review filing
 4    with the clerk of the court to which said review is  taken  a
 5    bond  in  an  amount to be fixed and approved by the court to
 6    which the review is taken, conditioned upon  the  payment  of
 7    all  compensation  awarded  against  the  person  taking said
 8    review pending a decision  thereof  and  further  conditioned
 9    upon such other obligations as the court may impose. Upon the
10    review  the  Circuit  Court  shall  have  power to review all
11    questions of fact as well as of law.  The penalty hereinafter
12    provided for in this paragraph shall not attach and shall not
13    begin to run until the final determination of  the  order  of
14    the Commission.
15        (d)  Upon  a  finding by the Commission, after reasonable
16    notice and hearing, of the  knowing  and  wilful  failure  or
17    refusal  of  an employer to comply with any of the provisions
18    of paragraph (a) of this Section or the failure or refusal of
19    an employer, service or adjustment company, or  an  insurance
20    carrier to comply with any order of the Industrial Commission
21    pursuant  to  paragraph (c) of this Section disqualifying him
22    or her to operate as a self insurer and requiring him or  her
23    to  insure  his or her liability, the Commission may assess a
24    civil penalty of up to $500 per day  for  each  day  of  such
25    failure   or   refusal  after  the  effective  date  of  this
26    amendatory Act  of  1989.  The  minimum  penalty  under  this
27    Section shall be the sum of $10,000. Each day of such failure
28    or   refusal   shall   constitute  a  separate  offense.  The
29    Commission  may  assess  the  civil  penalty  personally  and
30    individually against the corporate officers and directors  of
31    a   corporate   employer,   the   partners   of  an  employer
32    partnership, and the members of an employer limited liability
33    company, after a finding of a knowing and willful refusal  or
34    failure  of  each  such  named  corporate  officer, director,
 
                            -8-      LRB093 07561 WGH 07736 b
 1    partner,  or  member  to  comply  with  this  Section.    The
 2    liability for the assessed penalty shall be against the named
 3    employer first, and if the named employer fails or refuses to
 4    pay  the  penalty  to the Commission within 30 days after the
 5    final order of  the  Commission,  then  the  named  corporate
 6    officers, directors, partners, or members who have been found
 7    to  have  knowingly and willfully refused or failed to comply
 8    with this Section shall be liable for the unpaid  penalty  or
 9    any  unpaid  portion of the penalty.  All penalties collected
10    under this Section  shall  be  deposited  in  the  Industrial
11    Commission Operations Fund.
12        Upon  the  failure or refusal of any employer, service or
13    adjustment company or insurance carrier to  comply  with  the
14    provisions  of  this  Section  and  with  the  orders  of the
15    Commission under this Section, or the order of the  court  on
16    review  after  final adjudication, the Commission may bring a
17    civil action to recover the amount of  the  penalty  in  Cook
18    County   or  in  Sangamon  County  in  which  litigation  the
19    Commission shall be represented by the Attorney General.  The
20    Commission shall send notice of its finding of non-compliance
21    and assessment of the civil penalty to the Attorney  General.
22    It  shall  be the duty of the Attorney General within 30 days
23    after receipt of the notice, to  institute  prosecutions  and
24    promptly prosecute all reported violations of this Section.
25        (e)  This Act shall not affect or disturb the continuance
26    of  any  existing  insurance,  mutual aid, benefit, or relief
27    association or department, whether maintained in whole or  in
28    part  by the employer or whether maintained by the employees,
29    the payment of benefits of  such  association  or  department
30    being  guaranteed  by the employer or by some person, firm or
31    corporation  for  him  or   her:   Provided,   the   employer
32    contributes  to  such association or department an amount not
33    less than the full compensation herein provided, exclusive of
34    the cost of the maintenance of such association or department
 
                            -9-      LRB093 07561 WGH 07736 b
 1    and without any expense to the employee.  This Act shall  not
 2    prevent  the organization and maintaining under the insurance
 3    laws of this State of any benefit or  insurance  company  for
 4    the purpose of insuring against the compensation provided for
 5    in  this  Act,  the  expense  of  which  is maintained by the
 6    employer. This Act shall  not  prevent  the  organization  or
 7    maintaining  under  the  insurance  laws of this State of any
 8    voluntary mutual aid, benefit  or  relief  association  among
 9    employees  for  the  payment  of  additional accident or sick
10    benefits.
11        (f)  No existing insurance, mutual aid, benefit or relief
12    association or department shall, by reason of anything herein
13    contained, be authorized to discontinue its operation without
14    first discharging its obligations  to  any  and  all  persons
15    carrying  insurance  in  the  same  or  entitled to relief or
16    benefits therein.
17        (g)  Any  contract,  oral,   written   or   implied,   of
18    employment  providing for relief benefit, or insurance or any
19    other device whereby the employee  is  required  to  pay  any
20    premium  or  premiums  for insurance against the compensation
21    provided for in  this  Act  shall  be  null  and  void.   Any
22    employer  withholding  from  the  wages  of  any employee any
23    amount for the purpose of paying any such  premium  shall  be
24    guilty of a Class B misdemeanor.
25        In  the  event the employer does not pay the compensation
26    for which he or she is liable,  then  an  insurance  company,
27    association  or  insurer which may have insured such employer
28    against such liability shall become primarily liable  to  pay
29    to  the  employee,  his  or  her  personal  representative or
30    beneficiary the compensation required by  the  provisions  of
31    this  Act to be paid by such employer.  The insurance carrier
32    may be made a party to the proceedings in which the  employer
33    is  a  party  and an award may be entered jointly against the
34    employer and the insurance carrier.
 
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 1        (h)  It shall be unlawful  for  any  employer,  insurance
 2    company  or  service or adjustment company to interfere with,
 3    restrain or coerce an employee in any  manner  whatsoever  in
 4    the  exercise of the rights or remedies granted to him or her
 5    by this Act or to discriminate, attempt to  discriminate,  or
 6    threaten  to  discriminate  against  an  employee  in any way
 7    because of his or her exercise  of  the  rights  or  remedies
 8    granted to him or her by this Act.
 9        It  shall  be  unlawful for any employer, individually or
10    through  any  insurance  company  or  service  or  adjustment
11    company, to discharge or to  threaten  to  discharge,  or  to
12    refuse  to  rehire  or recall to active service in a suitable
13    capacity an employee because of the exercise of  his  or  her
14    rights or remedies granted to him or her by this Act.
15        (i)  If  an  employer  elects  to obtain a life insurance
16    policy on his employees, he may  also  elect  to  apply  such
17    benefits  in  satisfaction  of  all or a portion of the death
18    benefits  payable  under  this  Act,  in  which   case,   the
19    employer's compensation premium shall be reduced accordingly.
20        (j)  Within  45 days of receipt of an initial application
21    or  application  to  renew  self-insurance   privileges   the
22    Self-Insurers  Advisory  Board  shall  review  and submit for
23    approval by the Chairman of the Commission recommendations of
24    disposition of all initial applications  to  self-insure  and
25    all  applications to renew self-insurance privileges filed by
26    private self-insurers pursuant  to  the  provisions  of  this
27    Section   and   Section  4a-9  of  this  Act.   Each  private
28    self-insurer  shall  submit  with  its  initial  and  renewal
29    applications the application fee required by Section 4a-4  of
30    this Act.
31        The  Chairman  of  the Commission shall promptly act upon
32    all initial applications and applications for renewal in full
33    accordance with the recommendations of the Board  or,  should
34    the  Chairman disagree with any recommendation of disposition
 
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 1    of the Self-Insurer's Advisory Board, he shall within 30 days
 2    of receipt of such recommendation provide  to  the  Board  in
 3    writing  the  reasons  supporting his decision.  The Chairman
 4    shall also promptly  notify  the  employer  of  his  decision
 5    within 15 days of receipt of the recommendation of the Board.
 6        If  an  employer  is  denied  a renewal of self-insurance
 7    privileges pursuant  to  application  it  shall  retain  said
 8    privilege   for  120  days  after  receipt  of  a  notice  of
 9    cancellation of  the  privilege  from  the  Chairman  of  the
10    Commission.
11        All  orders made by the Chairman under this Section shall
12    be subject to review by the courts, such review to  be  taken
13    in  the  same  manner and within the same time as provided by
14    subsection (f) of Section 19 of this Act for review of awards
15    and decisions of the Commission, upon the party  seeking  the
16    review  filing  with  the  clerk  of  the court to which such
17    review is taken a bond in an amount to be fixed and  approved
18    by  the  court to which the review is taken, conditioned upon
19    the payment of all compensation awarded  against  the  person
20    taking  such  review  pending  a decision thereof and further
21    conditioned upon such other  obligations  as  the  court  may
22    impose. Upon the review the Circuit Court shall have power to
23    review all questions of fact as well as of law.
24    (Source:  P.A.  91-375,  eff.  1-1-00;  91-757,  eff. 1-1-01;
25    92-324, eff. 8-9-01.)

26        Section 10.  The Workers' Occupational  Diseases  Act  is
27    amended by changing Section 4 as follows:

28        (820 ILCS 310/4) (from Ch. 48, par. 172.39)
29        Sec.  4.  (a)  Any employer, including but not limited to
30    general contractors and their subcontractors, required by the
31    terms of this Act or by  election  to  pay  the  compensation
32    provided for in this Act shall:
 
                            -12-     LRB093 07561 WGH 07736 b
 1             (1)  File  with  the  Commission  an application for
 2        approval as a self-insurer which shall include a  current
 3        financial   statement.   The  application  and  financial
 4        statement shall be signed and sworn to by  the  president
 5        or vice-president and secretary or assistant secretary of
 6        the  employer  if  it  be a corporation, or by all of the
 7        partners if it be a copartnership, or by the owner if  it
 8        be   neither  a  copartnership  nor  a  corporation.   An
 9        employer may elect to provide  and  pay  compensation  as
10        provided  for in this Act as a member of a group workers'
11        compensation pool under Article V  3/4  of  the  Illinois
12        Insurance  Code.   If  an  employer becomes a member of a
13        group workers' compensation pool, the employer shall  not
14        be relieved of any obligations imposed by this Act.
15             If  the sworn application and financial statement of
16        any such employer does not satisfy the Commission of  the
17        financial  ability  of the employer who has filed it, the
18        Commission shall require such employer to:
19             (2)  Furnish   security,   indemnity   or   a   bond
20        guaranteeing  the  payment  by  the   employer   of   the
21        compensation provided for in this Act,  provided that any
22        such employer who shall have secured his or her liability
23        in part by excess liability coverage shall be required to
24        furnish  to  the  Commission  security, indemnity or bond
25        guaranteeing his or her payment up to the amount  of  the
26        effective  limits  of  the  excess coverage in accordance
27        with the provisions of this paragraph, or
28             (3)  Insure his or her entire liability to pay  such
29        compensation   in   some  insurance  carrier  authorized,
30        licensed or permitted to do such  insurance  business  in
31        this  State.   All  policies  of  such insurance carriers
32        insuring the payment of compensation under this Act shall
33        cover  all  the  employees  and   all   such   employer's
34        compensation liability in all cases in which the last day
 
                            -13-     LRB093 07561 WGH 07736 b
 1        of the last exposure to the occupational disease involved
 2        is within the effective period of the policy, anything to
 3        the  contrary  in  the policy notwithstanding.  Provided,
 4        however,  that  any  employer  may  insure  his  or   her
 5        compensation  liability  under  this  Act  with 2 or more
 6        insurance carriers or may insure a part and qualify under
 7        Subsection 1, 2, or 4 for the remainder of his  liability
 8        to  pay  such  compensation, subject to the following two
 9        provisions:
10                  Firstly, the entire liability of  the  employer
11             to  employees  working at or from one location shall
12             be insured in one such insurance carrier or shall be
13             self-insured.
14                  Secondly, the employer  shall  submit  evidence
15             satisfactory  to  the  Commission  that  his  or her
16             entire liability for the compensation  provided  for
17             in this Act will be secured.
18             Any  provision  in  a  policy  or in any endorsement
19        attached thereto attempting to limit or modify in any way
20        the liability of the insurance carrier issuing the  same,
21        except  as  otherwise  provided  herein,  shall be wholly
22        void.
23             The  insurance  or  security  in  force   to   cover
24        compensation  liability  under this Act shall be separate
25        and distinct from the insurance  or  security  under  the
26        "Workers'  Compensation  Act"  and any insurance contract
27        covering liability under either Act need  not  cover  any
28        liability  under  the  other.   Nothing  herein contained
29        shall apply to  policies  of  excess  liability  carriage
30        secured  by  employers  who  have  been  approved  by the
31        Commission as self-insurers, or
32             (4)  Make some other provision, satisfactory to  the
33        Commission,   for   the   securing   of  the  payment  of
34        compensation provided for in this Act, and
 
                            -14-     LRB093 07561 WGH 07736 b
 1             (5)  Upon  becoming  subject   to   this   Act   and
 2        thereafter  as  often  as  the  Commission may in writing
 3        demand, file with the Commission in form prescribed by it
 4        evidence of his or her compliance with the  provision  of
 5        this Section.
 6        (a-1)  Regardless   of  its  state  of  domicile  or  its
 7    principal place of business, an employer shall make  payments
 8    to  its insurance carrier or group self-insurance fund, where
 9    applicable, based upon the premium rates of the  situs  where
10    the work or project is located in Illinois if:
11             (A)  the   employer  is  engaged  primarily  in  the
12        building and construction industry; and
13             (B)  subdivision (a)(3) of this Section  applies  to
14        the  employer  or  the  employer  is  a member of a group
15        self-insurance plan  as  defined  in  subsection  (1)  of
16        Section 4a.
17        The  Industrial Commission shall impose a penalty upon an
18    employer for violation of this subsection (a-1) if:
19             (i)  the employer  is  given  an  opportunity  at  a
20        hearing  to present  evidence of its compliance with this
21        subsection (a-1); and
22             (ii)  after the hearing, the Commission  finds  that
23        the  employer    failed to make payments upon the premium
24        rates of the situs where the work or  project is  located
25        in Illinois.
26        The  penalty shall not exceed $1,000 for each day of work
27    for which  the employer failed  to  make  payments  upon  the
28    premium  rates  of  the  situs  where the  work or project is
29    located in Illinois, but the total penalty shall  not  exceed
30    $50,000  for  each  project  or each contract under which the
31    work was  performed.
32        Any penalty under this subsection (a-1) must  be  imposed
33    not   later  than  one  year  after  the  expiration  of  the
34    applicable limitation period specified in subsection  (c)  of
 
                            -15-     LRB093 07561 WGH 07736 b
 1    Section   6  of  this  Act.   Penalties  imposed  under  this
 2    subsection (a-1)  shall  be  deposited  into  the  Industrial
 3    Commission  Operations  Fund  created  under Section 4 of the
 4    Workers' Compensation Act.
 5        (b)  The sworn application and  financial  statement,  or
 6    security, indemnity or bond, or amount of insurance, or other
 7    provisions,   filed,  furnished,  carried,  or  made  by  the
 8    employer, as the  case  may  be,  shall  be  subject  to  the
 9    approval of the Commission.
10        Deposits   under   escrow   agreements   shall  be  cash,
11    negotiable  United  States  government  bonds  or  negotiable
12    general obligation bonds of the State of Illinois.  Such cash
13    or bonds shall be deposited  in  escrow  with  any  State  or
14    National  Bank or Trust Company having trust authority in the
15    State of Illinois.
16        Upon the approval of the sworn application and  financial
17    statement,   security,   indemnity   or  bond  or  amount  of
18    insurance, filed, furnished, or carried, as the case may  be,
19    the  Commission  shall send to the employer written notice of
20    its approval thereof.  Said certificate of compliance by  the
21    employer  with the provisions of subparagraphs (2) and (3) of
22    paragraph (a) of this  Section  shall  be  delivered  by  the
23    insurance  carrier to the Industrial Commission within 5 days
24    after the effective date of the  policy  so  certified.   The
25    insurance so certified shall cover all compensation liability
26    occurring during the time that the insurance is in effect and
27    no  further  certificate need be filed in case such insurance
28    is renewed, extended or otherwise continued by such  carrier.
29    The  insurance  so certified shall not be cancelled or in the
30    event  that  such  insurance  is  not  renewed,  extended  or
31    otherwise continued, such insurance shall not  be  terminated
32    until  at  least  10  days  after  receipt  by the Industrial
33    Commission of notice of the cancellation  or  termination  of
34    said  insurance;  provided, however, that if the employer has
 
                            -16-     LRB093 07561 WGH 07736 b
 1    secured insurance from  another  insurance  carrier,  or  has
 2    otherwise  secured  the payment of compensation in accordance
 3    with this Section,  and  such  insurance  or  other  security
 4    becomes  effective  prior  to the expiration of said 10 days,
 5    cancellation  or  termination  may,  at  the  option  of  the
 6    insurance carrier indicated in such notice, be  effective  as
 7    of the effective date of such other insurance or security.
 8        (c)  Whenever   the   Commission   shall  find  that  any
 9    corporation,    company,    association,    aggregation    of
10    individuals, reciprocal or interinsurers exchange,  or  other
11    insurer  effecting workers' occupational disease compensation
12    insurance in  this  State  shall  be  insolvent,  financially
13    unsound, or unable to fully meet all payments and liabilities
14    assumed  or  to be assumed for compensation insurance in this
15    State, or has been shown by clear and convincing evidence  to
16    have  engaged  in  a  pattern  and shall practice a policy of
17    fraudulent  delay  or  unfairness  toward  employees  in  the
18    adjustment, settlement,  or  payment  of  benefits  due  such
19    employees,  the  Commission  may  after reasonable notice and
20    hearing order and  direct  that  such  corporation,  company,
21    association,   aggregation   of  individuals,  reciprocal  or
22    interinsurers exchange, or insurer, shall from  and  after  a
23    date  fixed in such order discontinue the writing of any such
24    workers' occupational disease compensation insurance in  this
25    State.   It   shall   thereupon  be  unlawful  for  any  such
26    corporation,    company,    association,    aggregation    of
27    individuals, reciprocal or interinsurers exchange, or insurer
28    to effect  any  workers'  occupational  disease  compensation
29    insurance in this State.  A copy of the order shall be served
30    upon  the Director of Insurance by registered mail.  Whenever
31    the Commission finds that any service or  adjustment  company
32    used  or  employed  by  a  self-insured  employer  or  by  an
33    insurance carrier to process, adjust, investigate, compromise
34    or  otherwise  handle claims under this Act, has practiced or
 
                            -17-     LRB093 07561 WGH 07736 b
 1    is  practicing  a  policy  of  delay  or  unfairness   toward
 2    employees   in  the  adjustment,  settlement  or  payment  of
 3    benefits  due  such  employees,  the  Commission  may   after
 4    reasonable  notice  and  hearing  order  and direct that such
 5    service or adjustment company shall from  and  after  a  date
 6    fixed in such order be prohibited from processing, adjusting,
 7    investigating,  compromising  or  otherwise  handling  claims
 8    under this Act.
 9        Whenever  the  Commission  finds  that  any  self-insured
10    employer  has  practiced or is practicing delay or unfairness
11    toward employees in the adjustment, settlement or payment  of
12    benefits   due  such  employees,  the  Commission  may  after
13    reasonable notice and hearing order and direct that  after  a
14    date  fixed  in the order such self-insured employer shall be
15    disqualified to  operate  as  a  self-insurer  and  shall  be
16    required  to  insure his entire liability to pay compensation
17    in some insurance carrier authorized, licensed and  permitted
18    to  do  such  insurance business in this State as provided in
19    subparagraph (3) of paragraph (a) of this Section.
20        All orders made by  the  Commission  under  this  Section
21    shall  be  subject  to review by the courts, the review to be
22    taken in the same manner and within the same time as provided
23    by Section 19 of this Act for review of awards and  decisions
24    of  the  Commission, upon the party seeking the review filing
25    with the clerk of the court to which said review is  taken  a
26    bond  in  an  amount to be fixed and approved by the court to
27    which said review is taken, conditioned upon the  payment  of
28    all compensation awarded against the person taking the review
29    pending  a decision thereof and further conditioned upon such
30    other obligations as the court may impose.  Upon  the  review
31    the Circuit Court shall have power to review all questions of
32    fact as well as of law.  The penalty hereinafter provided for
33    in this paragraph shall not attach and shall not begin to run
34    until the final determination of the order of the Commission.
 
                            -18-     LRB093 07561 WGH 07736 b
 1        (d)  Upon  a  finding by the Commission, after reasonable
 2    notice and hearing, of the knowing and wilful failure  of  an
 3    employer  to  comply  with any of the provisions of paragraph
 4    (a) of this Section or the failure or refusal of an employer,
 5    service or adjustment company, or insurance carrier to comply
 6    with any order  of  the  Industrial  Commission  pursuant  to
 7    paragraph  (c)  of  this  Section the Commission may assess a
 8    civil penalty of up to $500 per day  for  each  day  of  such
 9    failure   or   refusal  after  the  effective  date  of  this
10    amendatory Act of 1989.   Each day of such failure or refusal
11    shall constitute a separate offense.
12        Upon the failure or refusal of any employer,  service  or
13    adjustment  company   or insurance carrier to comply with the
14    provisions of this Section and orders of the Commission under
15    this Section, or the order of the court on review after final
16    adjudication, the Commission may  bring  a  civil  action  to
17    recover  the  amount  of  the  penalty  in  Cook County or in
18    Sangamon County in which litigation the Commission  shall  be
19    represented  by  the  Attorney  General. The Commission shall
20    send notice of its finding of non-compliance  and  assessment
21    of  the  civil  penalty to the Attorney General.  It shall be
22    the duty of the Attorney General within 30 days after receipt
23    of  the  notice,  to  institute  prosecutions  and   promptly
24    prosecute all reported violations of this Section.
25        (e)  This Act shall not affect or disturb the continuance
26    of  any  existing  insurance,  mutual aid, benefit, or relief
27    association or department, whether maintained in whole or  in
28    part  by the employer or whether maintained by the employees,
29    the payment of benefits of  such  association  or  department
30    being  guaranteed  by the employer or by some person, firm or
31    corporation  for  him  or   her:   Provided,   the   employer
32    contributes  to  such association or department an amount not
33    less than the full compensation herein provided, exclusive of
34    the cost of the maintenance of such association or department
 
                            -19-     LRB093 07561 WGH 07736 b
 1    and without any expense to the employee.  This Act shall  not
 2    prevent  the organization and maintaining under the insurance
 3    laws of this State of any benefit or  insurance  company  for
 4    the purpose of insuring against the compensation provided for
 5    in  this  Act,  the  expense  of  which  is maintained by the
 6    employer. This Act shall  not  prevent  the  organization  or
 7    maintaining  under  the  insurance  laws of this State of any
 8    voluntary mutual aid, benefit  or  relief  association  among
 9    employees  for  the  payment  of  additional accident or sick
10    benefits.
11        (f)  No existing insurance, mutual aid, benefit or relief
12    association or department shall, by reason of anything herein
13    contained, be authorized to discontinue its operation without
14    first discharging its obligations  to  any  and  all  persons
15    carrying  insurance  in  the  same  or  entitled to relief or
16    benefits therein.
17        (g)  Any  contract,  oral,   written   or   implied,   of
18    employment  providing for relief benefit, or insurance or any
19    other device whereby the employee  is  required  to  pay  any
20    premium  or  premiums  for insurance against the compensation
21    provided for in  this  Act  shall  be  null  and  void.   Any
22    employer  withholding  from  the  wages  of  any employee any
23    amount for the purpose of paying any such  premium  shall  be
24    guilty of a Class B misdemeanor.
25        In  the  event the employer does not pay the compensation
26    for which he or she is liable,  then  an  insurance  company,
27    association  or  insurer which may have insured such employer
28    against such liability shall become primarily liable  to  pay
29    to  the  employee, his personal representative or beneficiary
30    the compensation required by the provisions of this Act to be
31    paid by such employer.  The insurance carrier may be  made  a
32    party to the proceedings in which the employer is a party and
33    an  award may be entered jointly against the employer and the
34    insurance carrier.
 
                            -20-     LRB093 07561 WGH 07736 b
 1        (h)  It shall be unlawful  for  any  employer,  insurance
 2    company  or  service or adjustment company to interfere with,
 3    restrain or coerce an employee in any  manner  whatsoever  in
 4    the  exercise of the rights or remedies granted to him or her
 5    by this Act or to discriminate, attempt to  discriminate,  or
 6    threaten  to  discriminate  against  an  employee  in any way
 7    because of his exercise of the rights or remedies granted  to
 8    him by this Act.
 9        It  shall  be  unlawful for any employer, individually or
10    through  any  insurance  company  or  service  or  adjustment
11    company, to discharge or to  threaten  to  discharge,  or  to
12    refuse  to  rehire  or recall to active service in a suitable
13    capacity an employee because of the exercise of  his  or  her
14    rights or remedies granted to him or her by this Act.
15        (i)  If  an  employer  elects  to obtain a life insurance
16    policy on his employees, he may  also  elect  to  apply  such
17    benefits  in  satisfaction  of  all or a portion of the death
18    benefits  payable  under  this  Act,  in  which   case,   the
19    employer's  premium  for coverage for benefits under this Act
20    shall be reduced accordingly.
21    (Source: P.A.  90-109,  eff.  1-1-98;  91-375,  eff.  1-1-00;
22    91-757, eff. 1-1-01.)