distinctions in the administrative process judge david torrey (pa) and judge sheral kellar (la),...

Distinctions in the Administrative Process

Judge David Torrey (PA) and Judge Sheral Kellar (LA), Facilitators

Brian Addington, Moderator

17th ANNUAL

WORKERS’ COMPENSATION

EDUCATIONAL CONFERENCE

Text 208938 and your Questions to 22333

17th Annual TN WCECDISTINCTIONS

OF THE ADMINISTRATIVE PROCESS:

ADMINISTRATIVE ADJUDICATION OF DISPUTED WORKERS’ COMPENSATION CASES;

THE CHALLENGE TO DECISIONAL INDEPENDENCE

Sheral Kellar, Workers’ Compensation Chief Judge Baton Rouge, LO

David B. Torrey, WCJPittsburgh, PA Text 208938 and your

Questions to 22333

17th Annual TN WCEC

Sheral Kellar, Workers’ Compensation Chief Judge Baton Rouge, LO


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David B. Torrey, WCJAdj. Prof. of Law, Univ. Pittsburgh School of Law

Pittsburgh, PA Text 208938 and your Questions to 22333

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Members, National Association

of Workers’ Compensation Judiciary


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TOPICS

1. Short History of How WC Cases Have Been Adjudicated

2. Typical Current Adjudication Structures

3. Trend Towards WCJ as Final Fact-finder

4. WCJ Order, Appeal, and Stay

5. Perennial Issues … including Decisional Independence of the WCJ


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APPROACHA comparative analysis … with an eye towards the …

Tennessee Reform Law of 2013 and historic creation of the WC Court of Claims


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A SHORT HISTORY

Most states adopted adjudication within a Board or Commission

… though many provided for appeal de novo, sometimes with jury, in civil court …

examples: PA, NY, CT, MA, CA


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Fourteen states, however, including TN (1919), and Louisiana (1914), originally followed the

approach of England and retained adjudication in civil court.


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A Continuing Trend …

Shift of Adjudication from Civil Court to Administrative Agency

New Mexico (1986)Wyoming (1986)

Louisiana (1983/1988/1989)


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Remarkable Feature of the Trend … In each state, WCJ became final fact-finder, and appeal

is directly to judicial branch …

… But this was not thethe Tennessee

Reform Approach


17th Annual TN WCECNEW MEXICO

First attempt (1957) unsuccessfulConstitution amended (1986)

WCJ is final fact-finderAppeal is “whole record”

substantial evidence reviewlike in federal courts


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WYOMING

Since 1986, hearing examiner of office of independent officers is final fact-finder

Appeal based on substantial evidence

Medical disputes over permanent impairment referred to Medical Commission “acting as hearing examiner”Text 208938 and your

Questions to 22333

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LOUISIANA

1983: Creation of OWC1988: Hearing Officers as Judges

1988-1989: Upheaval … Law declared unconstitutional in Moore v. Roemer (La. 1990) 1990: Constitution amended


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Louisiana, continued` (1) WCJ is final Fact-finder

(2) Review in Courts of Appeals is under the “manifesterror/clearly wrong”standard


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SOME THEORY Nature of WC Adjudication within WC Agency:

Judicial … not “Institutional”


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Some theory, continued

Point: An agency may have several functions, but when it is adjudicating cases, it is like a court:

LARSON: “In the spectrum of administrative agencies . . . the compensation commission . . . while deciding controverted claims . . . is as far towards the judicial end of the spectrum as it is possible to go without

being an outright court.” Text 208938 and your Questions to 22333

1 7th Annual TN WCEC

MORE HISTORY: THE JURY TRIAL ISSUE

Why, in general, no right?

U.S. Supreme Court: parties do not have a right, under the U.S. Constitution, to trial by jury in a contested workers’

compensation case, because trial by jury not a right protected by the

Fourteenth Amendment.

Seventh Amendment, meanwhile, only provides for jury trials in cases brought in federal court.Text 208938 and your

Questions to 22333

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The Jury Trial issue, continued

Some state constitutions specifically allow for administrative adjudication (CA)

Some states do not read their constitutions to demand jury trial in a WC case (PA)

Some states, by tradition, because of state constitutional concerns, allow appeal to jury trial after exhaustion of WC administrative

proceedings:

(MD, OH, TX, VT, WA)Text 208938 and your Questions to 22333

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TYPICAL ADJUDICATION STRUCTURES

Appeal Directly to Appellate Court (AZ, MT, FL, LA, NM, WY)Thus, in FLORIDA …

Cases litigated before JCC, appeal to 1st Dist. Ct. Appeals (special jurisdiction over WC cases), with appeal thereafter to supreme

court. Text 208938 and your Questions to 22333

17th Annual TN WCECTypical Adjudication Structures, cont.

Appeal of WCJ to review within the agency (PA, DC, KY, GA, VA)

Thus in PENNSYLVANIA ….

Cases litigated before WCJ; appeal to Appeal Board, which reviews for substantial evidence/error of law.

Appeal thereafter to Commonwealth Court and then, with permission, to supreme court.


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Typical Adjudication Structures, cont.

Appeal within agency and then jury trial (MD, OH, TX, VT, WA) … Thus, in WASHINGTON …

WC cases litigated before IAJ (who issues proposed D&O), with appeal to BIIA. Appeal thereafter to superior court (trial court),

which may involve a jury trial. Judicial review to Court of Appeals, and then to state supreme court.


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TREND: WCJ AS FINAL FACT-FINDER

Originally, virtually everywhere, WCJ or equivalent only proposed a decision for the

Board or Commission

Some early courts called the WCJ a “special master” (a subordinate), and the Board the

“chancellor” (the trial court and fact-finder). Text 208938 and your Questions to 22333

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Trend, WCJ as final fact-finder, cont.

In present day, Board as Chancellor (final fact-finder)

continues just barely as majority rule :

“Of fifty-two critical jurisdictions – fifty states, the Longshore Act (LHWCA), and the District of Columbia (D.C.) – twenty-six state programs hew to the majority

rule. A full twenty-two states, plus the LHWCA and D.C., subscribe to the minority rule.” ~ Torrey (2012)


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Trend, WCJ as final fact-finder, cont.

Majority include NY, CA, GA, MS, VA Minority include PA, KY, MA, MN, LWHCA

Motives: Finality, efficiency, decisional independence

Tennessee: Reform places state in majority rule – WCAB

not bound by WCJ decision; Supreme Court review is de novo.


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The WCJ Order and the Stay Effect of Appeal

States that employ multiple levels of adjudication within the agencies differ on whether the appeal from the WCJ

to Board creates a stay.

In 1999, a WCRI researcher reported that “[a]mong 22 of the 36 jurisdictions with an administrative appellate

forum an appeal stays the formal hearing decision without qualification. In five jurisdictions, an appeal stays part of

the formal hearing decision.” Text 208938 and your Questions to 22333

17th Annual TN WCECOrder and stay, cont.

Tennessee thus adopts what is a very common rule. See Section 83 of the Reform Act (“[I]f a request for … review is timely filed, the order issued by the [WCJ] shall not become final …, until the [WCAB] issues a written decision certifying the order as a final order.”).


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PERENNIAL ISSUES IN ADMINISTRATIVE ADJUDICATION


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Perennial issues, cont.

1. Accountability of the WCJ (I): Reasoned Decisions

Several state workers’ compensation laws have explicitly codified the rule that the WCJ must

provide reasons for his or her decision. Among these states are

Michigan, Pennsylvania, and Nebraska.Text 208938 and your Questions to 22333

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2. Accountability of the WCJ (II):Competence and Performance

“The ultimate reliance for the fair operation of any [appellate review] standard is a judiciary of high competence and character and the constant play of an informed professional critique upon its work.”

~ Justice Frankfurter (1951) Text 208938 and your Questions to 22333

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Accountability of the WCJ (II):Competence and Performance

(1) High competence and character

(2) Appellate Review

(3) Employee Performance Evaluation

(4) Bar Association Evaluations

(5) Ethical Codes Text 208938 and your Questions to 22333

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3. Growth of Mediation in Admin. WC Systems

The need for case resolution, and the ability to settle cases, have prompted the growth of mediation in

workers’ compensation systems.

Tennessee system is similar to that of Florida: True Mandatory Mediation


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4. Innovation of Medical Fact-finding and Advising

To reform the “dueling doctors” practice, a number of jurisdictions have amended their laws to employ

medical professionals to advise/inform the WCJ

(e.g., ME, FL, UT, WY)Text 208938 and your Questions to 22333

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A PERENNIAL (AND SERIOUS) ISSUE …

5. THE THREAT TO JUDICIAL INDEPENDENCE


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The Issue, in general:

The “independence” concern has been, and is, that executive branch officials will try to pressure WC judges to make findings or legal conclusions in some particular way, to in turn vindicate some

internal or external goal.

Such efforts deprive the fact-finder of “decisional” independence.

Presumably, trial court judges, sitting in another branch of government,

do not have this as such a concern.Text 208938 and your Questions to 22333

17th Annual TN WCEC


The issue, in particular:

When workers’ compensation cases are moved from the civil district court to executive agency

adjudications they become extremely vulnerable to administrative influence.


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The Louisiana Experience (1990-2014)

The Executive Secretary’s admonition: (1988): Judge should assist in keeping “employers economically healthy in this state.”

Is this the role of a judge?Text 208938 and your Questions to 22333

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The Recent Maine Controversy (2014)

Agency head admittedly removed Hearing Officer from cases dealing with a large employer after ex parte

complaints from employer that the Hearing Officer was issuing unfavorable decisions in employer’s disputed cases.

Is this how an impartial court operates?Text 208938 and your Questions to 22333

17th Annual TN WCEC


The Challenge:

As long as WCJ’s are employed in the executive branch of government and are supervised by non-judges, conflict will exist

between the agency goals and the role of the judge to ensure due process.

The challenge for both WCJ and administrator is to create a system where the judge (who is an impartial decision- maker and an agency employee), can co-exist without impropriety or the

appearance thereof. Text 208938 and your Questions to 22333

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The Challenge to Tennessee:

Administrator has responsibility, among other things, “for the administration of a workers’

compensation system that protects the life, health, and safety of Tennessee’s workforce and ensures

the continued viability of Tennessee’s business environment.”


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Perennial issues, cont.Need for WCJ’s to remain impartial … despite this statutory admonition …

It can be done!


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The goals of the administrator and the judge need not be mutually exclusive.

The goals of both can be achieved while maintaining the integrity of the system if

appropriate standards are observed.


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Solution: Building and Maintaining Ethical Walls

(1) Establishment of uniform rules and procedures for the employee judges, collectively, rather than for

any single judge – unless a disciplinary decision is implicated that can

be supported by empirical facts and data. Text 208938 and your Questions to 22333

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Perennial issues, cont. Building & Maintaining Ethical Walls, cont.

(2) Implement a uniform system of performance evaluations for all judges in order to

(a) objectively evaluate the performance of judges; (b) document sub-standard performance necessary to support removal; and (c) document satisfactory performance in support of re-appointment after the expiration of the six (6) year term for Tennessee judges.


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Perennial issues, cont. Building & Maintaining Ethical Walls, cont.

(3) Ex parte communication between an administrator and a judge can have a chilling effect on a judge’s decisional authority. Therefore, administrators must take special precautions and craft special rules for inquiries regarding open claims. A best practice: speak through the Chief Judge, as provided by the Reform Law.


17th Annual TN WCECDISTINCTIONS OF THE ADMINISTRATIVE PROCESS

THE ENDText 208938 and your Questions to 22333

distinctions in the administrative process judge david torrey (pa) and judge sheral kellar (la),...

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