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IL Amends Exclusive Remedy Provisions of WC and OD Acts

On May 17, 2019, Governor JB Pritzker signed SB 1596 into law as Public Act 101-0006. The new law amends the Illinois Workers’ Compensation Act and the Occupational Diseases Act by removing the exclusive remedy provisions of those Acts as to employees whose latent work injuries manifest more than 25 years after the last date of their employment.

Previously, these actions were barred by the statute of limitations period in the Workers’ Compensation and Occupational Diseases Acts. (“In any case of injury caused by exposure to radiological materials or equipment or asbestos, unless application for compensation is filed with the Commission within 25 years after the last day that the employee was employed in an environment of hazardous radiological activity or asbestos, the right to file such application shall be barred.” 820 ILCS 305/6(d) & 820 ILCS 310/6(c)). Direct civil actions against the employer are, of course, barred by the exclusive remedy provision in section 5 of each Act.

As a result of this new law, however, an employer whose WCA/ODA liability for such injuries was extinguished after 25 years now faces litigation and potential liability for this work-related exposure in circuit court.

The new legislation is in response to the Illinois Supreme Court’s November, 2015 decision in Folta v. Ferro Engineering, 43 N.E.3d 108 (2015). In Folta, the Plaintiff worked for the Defendant from 1966 to 1970. During this time period, he was exposed to asbestos, but this exposure did not manifest itself into an “injury” until 41 years later, when he was diagnosed with mesothelioma, a disease associated with asbestos exposure.

Folta brought a civil action against numerous defendants, including his former employer. The trial court dismissed the claim against the former employer on exclusive remedy grounds. As a result, his only remedy against his employer would be in the WC or OD Acts.

Since Folta’s last employment exposure to asbestos was in 1970, however, the 25-year period of repose cited above in section 6 had long since expired by the time that exposure manifested itself into mesothelioma. Plaintiff was thus left without a remedy against his former employer.

This new legislation would now allow future Plaintiffs to bring a civil claim against their former employer if the injury manifests more than 25 years from the last date of exposure.

Public Act 101-0006 states that it is “effective immediately,” which suggests that it applies to exposure dates as of May 17, 2019 and thereafter. By its terms, however, an employee who was exposed to the specified items up to 24+ years ago, but whose condition from the exposure – mesothelioma, e.g. – does not manifest itself until more than 25 years after the exposure now has a right to sue his employer civilly for an exposure that occurred before this law was enacted. Such a right, and such potential exposure for the employer, did not exist for the past 25 years before May 17, 2019.

Enterprising plaintiff’s/petitioner’s attorneys may thus attempt to have this law apply to cases that arise in the future from exposures that predate the effective date of this law. In addition, a question that needs to be answered is whether the same enterprising attorneys can use it to bring a new action for those claims that were previously barred by the statute of limitations provision of the WC or OD Acts. This is a question left open to Court interpretation by the language in the statute.

As a practical matter, injuries that manifest at any time in the future (tomorrow, 5 years, 45 years) from exposure to injury-causing materials are now forever lurking, and will never be fully extinguished. It will be difficult to plan for this as the very nature of these injuries are hidden (“latent”) until sometime significantly after the exposure.

Certainly, there are some industries where this is a known risk, who have at least had to deal with the 25-year period under the WC and OD Acts already. As we have seen recently with baby powder litigation, however, these types of injuries may arise in situations in the future in areas that are not entirely foreseeable. It is this unknown that is perhaps the most disconcerting aspect of this new law.

The above hypotheticals will also likely generate insurance coverage issues, as claims brought for conditions that manifest themselves more than 25 years after the exposure remain barred by the Act, but are now subject to civil liability. This perhaps means that workers’ compensation policies are not implicated in such actions (though there is some discussion that section 1B coverage of such policies might apply).

Likewise, most general liability policies contain a coverage exception for workplace injuries, which could leave employers without coverage from any policy for this new set of potential civil claims.

One final thing to consider. The new law creates two classes of people: those whose injuries manifest 25 years after the exposure, who now can bring a civil suit against their employer; and those whose injuries manifest within 25 years of the last employment, whose recoveries are found within the WC and OD Acts.

The former class generally will have a tougher task in proving liability, but is not constrained by statutory caps on the amount of damages they can recover, whereas the latter class may more easily prove liability against the employer but is subject to statutory caps on their compensation.

In addition, the fact that such injured employees often have worked for multiple companies where they could have been exposed over 25-plus years could create a two-track system where the employee has to file cases at the Commission against certain of his former employers, and can file civil suits against longer-ago employers, all for the same injury. This could lead to determinations of liability for the injury being made in two different forums, and against different employers, all for the same injury.

While the intent behind this new law may have been to correct the perceived wrong to the Plaintiff in Folta, we expect the above potential problems, and others unforeseen at this time, will be litigated and decided in the appellate courts for the long foreseeable future.

Thanks to Partner Jack Shanahan and Attorney Frank Johnston for the discussion of this important development and its potential implications.

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