Employment Law Council Update
March Edition 2010
Governor Calls for More Borrowing, Tax increase for Education
Governor Pat Quinn offered his budget message this past week to the Illinois General Assembly.
Fighting for Illinois is Governor Quinn’s plan to attack the state’s $13 billion fiscal deficit. Governor Quinn’s plan centers on Five Pillars of Recovery: Creating Jobs, Cutting Costs, Strategic Borrowing, Continued Federal Assistance and Increased State Revenues.
The FY 2011 budget proposal also includes more than $2 billion in proposed cuts, including a deep reduction in education funding. In his budget address, Governor Quinn called on the General Assembly to rescue education from devastating cuts by passing a one-percent income tax surcharge for education. The surcharge for education would restore the education budget to its current level.
The Governor's "Creating Jobs Pillar" focuses on implementation of the capital legislation from last year, a $2500 tax credit for small employers (50 and under) that create jobs, financial incentive packages to certain employers, and beginning of the building of high speed rail system.
Unfortunately, the Governor's economic plan is woefully inadequate. It relies on state spending and the notion that government creates jobs. It fails to recognize that establishing a sound economic climate is what grows jobs. Illinois will not have enough resources to outbid the states which tout better job creation environments. The Governor and General Assembly need to aggressively address where we are uncompetitive such as reforming our workers' compensation system.
Legislature Advances Bills that Will Increase Cost of Doing Business:
Limits on Employer Inquiries of Job Applicants… HB 4658 (Franks-D-McHenry) prohibits an employer from using an employee’s or prospective employee’s credit history in an employment related decision. Certain situations such as individuals responsible for handling cash or required to be bonded are excluded. HB 5154 (Chapa LaVia-D-Aurora) which prohibits the disclosure of performance evaluations under the Personnel Records Review Act has been amended limiting the change to performance reviews subject to the Freedom of Information Act. HB 5394 (Howard-D-Chicago) expands criminal convictions that may be expunged to include offenses of assault, battery, solicitation of a sexual act, and patronizing a prostitute.
Abusive Work Environment Act… Rep. Art Turner (D-Chicago), sponsor of HB 374, has indicated that he will hold his bill pending appointment of a task force and report on the issue. SB 3566 (Delgado-D-Chicago) is pending on the Senate floor. It dramatically expands legal liabilities for public employers.
Wage Payment and Collection Act Penalties Expansion...The Council is working with other business groups to amend SB 3568 (Delgado) which adds significant penalties for employers who fail to pay workers properly. The bill is pending in the Senate.
Prevailing Wage Expansion... HB 6112 (Flider-D-Decatur) expands the Prevailing Wage Act to include the transportation of aggregate to public works projects. A similar measure, SB 3813 (Jacobs-D-E. Moline) will be heard in Senate Labor Committee this week. Go to the Chamber website for our position paper.
The Council is actively lobbying against each of these proposals and urges our members to contact their legislators to ask them to vote “no” on them.
Council Successful in Holding Up the Following Bills:
7 Paid Days of Sick Leave… HB 3665 (Hernandez-D-Chicago)/SB 3835 (Sandoval-D-Chicago)
Employer "gag" law... HB 5155 (McGuire-D-Joliet)
Paid Leave for military funerals... HB 5284 (Moffitt-R-Gilson)
Crime Victim Leave... HB 5425 (Jefferson-D-Rockford) HB 5426 (Jefferson)
Mandates Employers Use E-Verify... SB 3186 (Hultgren-R-Wheaton) and SB 3187 (Burzynski-R-Clare)
House Labor Committee Establishes WC/UI Subcommittee
The House Labor Committee has created a subcommittee to hear concerns and solutions to Illinois' workers' compensation and unemployment insurance systems. Labor Committee Chair, Rep. Harry Osterman (D-Chicago) has advised the Council that the subcommittee will be taking testimony later this month. Several measures helpful to employers have been introduced in the House this session.
Unemployment Insurance Fraud…HB 5105 (Tracy-R-Liberty)
Workers’ Compensation Alcohol/Drugs…HB 5721 (Zalewski-D-Chicago)
Workers’ Compensation Workplace Prevailing Cause…HB 6159 (Reis-R-Willow Hill)
Workers’ Compensation Coverage of Sole Proprietors… HB 6266 (Rose-R-Mahomet)
Mandates Increase Costs on Small Business Health Plans
Healthcare mandates drive healthcare costs for small employers. Legislative mandates adversely impacting small employer health plans are out of committee and preparing to be voted upon by Illinois lawmakers.
HB 4726 (Sente-D-Vernon Hills) mandates that coverage for test strips for glucose monitors as durable medical equipment rather than as pharmaceuticals and supplies. Test strips require a prescription and therefore are properly covered under drug benefit provisions. This proposal will effectively eliminate copays and/or deductibles being applied to test strips. A better approach is to encourage employers to add drug benefits to their plans and adopt wellness benefits that focus on diabetes.
HB 4924 (Mulligan-R-Des Plaines) mandates small employer health plans to cover operations to implant cochlear implants and post-treatment services for children identified within one year of birth as being deaf or hearing impaired and audiological services and hearing aids for children up to 18 years of age.
HB 5085 (Harris-D-Chicago) mandates that benefits for oral drug treatments for cancer are treated the same as benefits for intravenous treatments. A one-size fits all approach is inappropriate as there are different protocols, costs and potential side-effects between the two approaches. HB 5085 also extends new benefits for clinical cancer trials. Small employers should not be required to pay the research and development costs that are the responsibility of drug company investors and government. We are working with Rep. Harris to address the clinical trial definitions to better protect patients and employer health plans.
HB 5766 (Feigenholtz-D-Chicago)/SB 3480 (Steans-D-Chicago) mandates small employer health plans to provide coverage or reimbursement of at least $500 for a tobacco use cessation program for insureds who are 15 years of age or older. This benefit is more appropriate for an employer wellness program. It also appears to limit the use of preferred provider agreements for delivery of the services.
HB 6061 (Feigenholtz) mandates small employer plans provide maternity benefits. This is an expensive benefit that some small employers are unable to afford. Federal law also provides protections such as the Pregnancy Discrimination Act which requires businesses with 15 or more employees to cover expenses for pregnancy and medical conditions related to pregnancy on the same basis as coverage for other medical conditions.
HB 6066 (Lang)/SB 3545 (Crotty-D-Oak Forest) prohibit a health plan from charging a copayment or deductible for any prescription or device that is prescribed for the treatment of psoriasis. Approval of this measure would undermine an employer's ability to control healthcare costs and would trigger a deluge of all other diseases to call for prohibiting the application of copayments or deductibles.
SB 2516 (Silverstein-D-Chicago) mandates coverage for hearing aids. We are negotiating a mandatory offer of such coverage to allow an employer to opt for the coverage and add it to its benefit plan akin to vision and dental care.
Other issues that will impact employer health benefit plans:
HB 3814 (M. Davis-D-Chicago) creates a CUB-like organization for healthcare issues. OPPOSE
HB 4679 (Flowers-D-Chicago) prohibits certain limitations and provisions regarding pre-existing conditions. OPPOSE
HB 5107 (Harris) limits recoupment of over payments for healthcare services to 180 days after original payment for services. This will limit cost controls for employer health plans and likely will lead to more frequent audits and higher administrative costs. OPPOSE
HB 5471 (Flowers) establishes external review procedures, data reporting requirements of health insurers and an 85% loss ratio requirement which are in conflict with HB 3923 recently signed into law by Gov. Quinn. The Chamber supported HB 3923. OPPOSE
HB5473 (Flowers) establishes external review procedures which are in conflict with HB 3923 recently signed into law by Gov. Quinn. The Chamber supported HB 3923. OPPOSE
HB 6156 (Nekritz-D-Des Plaines) restricts rescission of health policies to a fraud standard. OPPOSE |
