Legislature(2017 - 2018)BARNES 124

02/06/2017 03:15 PM LABOR & COMMERCE

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Audio Topic
03:22:51 PM Start
03:23:41 PM HB69
04:07:47 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 69 REPEAL WORKERS' COMP APPEALS COMMISSION TELECONFERENCED
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                        February 6, 2017                                                                                        
                           3:22 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Sam Kito, Chair                                                                                                  
Representative Adam Wool, Vice Chair                                                                                            
Representative Andy Josephson                                                                                                   
Representative Louise Stutes                                                                                                    
Representative Chris Birch                                                                                                      
Representative Gary Knopp                                                                                                       
Representative Colleen Sullivan-Leonard                                                                                         
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Mike Chenault (alternate)                                                                                        
Representative Bryce Edgmon (alternate)                                                                                         
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 69                                                                                                               
"An Act  repealing the Workers' Compensation  Appeals Commission;                                                               
relating  to decisions  and orders  of the  Workers' Compensation                                                               
Appeals Commission; relating to  superior court jurisdiction over                                                               
appeals  from  Alaska   Workers'  Compensation  Board  decisions;                                                               
repealing  Rules  201.1,  401.1,   and  501.1,  Alaska  Rules  of                                                               
Appellate  Procedure, and  amending Rules  202(a), 204(a)  - (c),                                                               
210(e), 601(b), and 603(a), Alaska  Rules of Appellate Procedure;                                                               
and providing for an effective date."                                                                                           
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 69                                                                                                                   
SHORT TITLE: REPEAL WORKERS' COMP APPEALS COMMISSION                                                                            
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
01/20/17       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/20/17       (H)       L&C, JUD                                                                                               
02/06/17       (H)       L&C AT 3:15 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
HEIDI DRYGAS, Commissioner                                                                                                      
Department of Labor & Workforce Development (DOLWD)                                                                             
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HB 69 on behalf of the governor.                                                               
                                                                                                                                
DEBBIE BANASZAK, Legislative Liaison                                                                                            
Office of the Commissioner                                                                                                      
Department of Labor & Workforce Development (DOLWD)                                                                             
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Gave an overview of  the sectional analysis                                                             
for HB 69.                                                                                                                      
                                                                                                                                
MARIE MARX, Director                                                                                                            
Division of Workers' Compensation                                                                                               
Department of Labor & Workforce Development (DOLWD)                                                                             
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions about HB 69.                                                                          
                                                                                                                                
ANDREW HEMENWAY                                                                                                                 
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered questions about HB 69.                                                                          
                                                                                                                                
NANCY MEADE, General Counsel                                                                                                    
Office of the Administrative Director                                                                                           
Alaska Court System                                                                                                             
POSITION STATEMENT:  Answered questions about HB 69.                                                                          
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
3:22:51 PM                                                                                                                    
                                                                                                                                
CHAIR  SAM KITO  called  the House  Labor  and Commerce  Standing                                                             
Committee meeting  to order at  3:22 p.m.   Representatives Wool,                                                               
Josephson, Stutes, Birch, Knopp,  Sullivan-Leonard, and Kito were                                                               
present at the call to order.                                                                                                   
                                                                                                                                
         HB 69-REPEAL WORKERS' COMP APPEALS COMMISSION                                                                      
                                                                                                                                
3:23:41 PM                                                                                                                    
                                                                                                                                
CHAIR KITO  announced that  the only order  of business  would be                                                               
HOUSE BILL  NO. 69, "An  Act repealing the  Workers' Compensation                                                               
Appeals  Commission;  relating to  decisions  and  orders of  the                                                               
Workers'  Compensation Appeals  Commission; relating  to superior                                                               
court   jurisdiction   over    appeals   from   Alaska   Workers'                                                               
Compensation Board  decisions; repealing Rules 201.1,  401.1, and                                                               
501.1, Alaska  Rules of Appellate  Procedure, and  amending Rules                                                               
202(a), 204(a) - (c), 210(e), 601(b), and 603(a), Alaska Rules                                                                  
of Appellate Procedure; and providing for an effective date."                                                                   
                                                                                                                                
3:24:45 PM                                                                                                                    
                                                                                                                                
HEIDI DRYGAS, Commissioner, Department of Labor & Workforce                                                                     
Development (DOLWD), presented HB 69 on behalf of the governor.                                                                 
She remarked:                                                                                                                   
                                                                                                                                
     HB 69, which  is before you, would  repeal the Workers'                                                                    
     Compensation Appeals Commission  and return the appeals                                                                    
     process  from the  Workers' Compensation  Board to  the                                                                    
     courts.   The commission was created  to streamline the                                                                    
     appeals process from  the Workers' [Compensation] Board                                                                    
     and    provide   expertise    in   handling    workers'                                                                    
     [compensation]  cases.   Since  its  creation in  2005,                                                                    
     however, 50 percent of  the commission's decisions have                                                                    
     been reversed  by the Alaska  Supreme Court.   The high                                                                    
     reversal rate underscores the  fact that the commission                                                                    
     is  ineffective.    The commission  is  essentially  an                                                                    
     appellate court just like  the [Alaska] Superior Court,                                                                    
     and  almost every  appellate court  in  the country  is                                                                    
     composed of  a panel a  lawyers.  Yet  the commission's                                                                    
     lay   commissioners   have   no  legal   training   and                                                                    
     contribute very little in the  way of legal analysis to                                                                    
     the issues being  decided by the commission.   It falls                                                                    
     to the  commission's chair alone,  who is  an attorney,                                                                    
     to  resolve the  legal issues  with minimal  input from                                                                    
     lay commissioners.  Further,  the chair also writes the                                                                    
     decisions.   Therefore, the commission's  decisions are                                                                    
     the work  of one person,  and not  the work of  a panel                                                                    
     with  legal  expertise  in workers'  compensation  -  a                                                                    
     further  departure  from  the original  intent  of  the                                                                    
     legislation.  By  eliminating the Workers' Compensation                                                                    
     Appeals Commission,  the department anticipates  a cost                                                                    
     savings of  $220,400 for the  remainder of  Fiscal Year                                                                    
     18,   due  to   the   transition   provisions  in   the                                                                    
     legislation,  and  ... a  savings  of  $440,800 ...  in                                                                    
     subsequent years.   The  impact on  the public  will be                                                                    
     minimal.   By  repealing  the  commission, the  appeals                                                                    
     process  will  revert  back to  the  [Alaska]  Superior                                                                    
     Court  which was  the process  in state  from statehood                                                                    
     until 2005.  The court  system would see an increase of                                                                    
     approximately 20-30  cases per  year.  This  volume can                                                                    
     easily be absorbed by the court system.                                                                                    
                                                                                                                                
3:27:27 PM                                                                                                                    
                                                                                                                                
DEBBIE   BANASZAK,    Legislative   Liaison,   Office    of   the                                                               
Commissioner,  Department   of  Labor  &   Workforce  Development                                                               
(DOLWD), gave  an overview of  the sectional analysis for  HB 69.                                                               
She  noted  that  "board" refers  to  the  Workers'  Compensation                                                               
Board,  and  "commission"  refers to  the  Workers'  Compensation                                                               
Appeals Commission.  She said  HB 69 would repeal the commission.                                                               
She  stated  that some  technical  changes  are being  made  with                                                               
[consultation from] the  Department of Law and  will be available                                                               
shortly.   She  paraphrased  from the  sectional analysis,  which                                                               
read as follows [original punctuation provided]:                                                                                
                                                                                                                                
     Section  1  amends  AS  23.30.005,   by  adding  a  new                                                                    
     subsection,   clarifying   that  unless   reversed   or                                                                    
     modified   by  a   court,  decisions   of  the   former                                                                    
     commission have the force of legal precedent.                                                                              
     Section   2  amends   AS   23.30.107(b),  by   removing                                                                    
     reference to the commission.                                                                                               
     Section   3  amends   AS   23.30.108(d),  by   removing                                                                    
     reference to the commission.                                                                                               
     Section   4  amends   AS   23.30.108(e),  by   removing                                                                    
     reference to the commission.                                                                                               
     Section 5  amends AS  23.30, by  adding a  new section,                                                                    
     clarifying when a board order  becomes effective and is                                                                    
     final, when it  may be stayed, and  clarifying when the                                                                    
     board's  findings  are  conclusive  and  binding  on  a                                                                    
     reviewing court,  and when  the director  may intervene                                                                    
     in an appeal or petition for review.                                                                                       
     Section  6  amends  AS  23.30.155,   by  adding  a  new                                                                    
     subsection  changing  a  statutory reference  from  the                                                                    
     commission to the superior court.                                                                                          
     Section  7  amends  AS  39.50.200(b)(31),  by  removing                                                                    
     reference to the commission.                                                                                               
     Section 8  amends the  uncodified law  of the  State of                                                                    
     Alaska,  by amending  Rule  204(c)(2)  Alaska Rules  of                                                                    
     Appellate  Procedure,  to   address  bonds  for  appeal                                                                    
     purposes.                                                                                                                  
     Section  9  repeals  Rules  201.1,  401.1,  and  501.1,                                                                    
     Alaska Rules of Appellate Procedure.                                                                                       
                                                                                                                                
3:30:11 PM                                                                                                                    
                                                                                                                                
MS.  BANASZAK  stated  paraphrasing   again  from  the  sectional                                                               
analysis  at   section  10,  which  read   as  follows  [original                                                               
punctuation provided]:                                                                                                          
                                                                                                                                
     Section 10 repeals  AS 23.20.007, 23.30.008, 23.30.009,                                                                    
     23.30.009, 23.30.125,  23.30.127, 23.30.128, 23.30.129,                                                                    
     23.30.155(f),   23.30.395(10);  AS   39.25.110(40);  AS                                                                    
     44.64.020(a)(12), and 44.64.020(a)(13).                                                                                    
     Section 11  amends the uncodified  law of the  State of                                                                    
     Alaska, by  adding a new  section relating  to indirect                                                                    
     court rule amendments.                                                                                                     
     Section 12  amends the uncodified  law of the  State of                                                                    
     Alaska, by adding conditional  effect language that the                                                                    
     Act takes effect only if secs.  8, 9 and 11 receive the                                                                    
     two-thirds  majority vote  of  each  house required  by                                                                    
     art. IV, sec. 15 of the Alaska Constitution.                                                                               
     Section 13  amends the uncodified  law of the  State of                                                                    
     Alaska,   by  adding   a   new   section  relating   to                                                                    
     applicability  of  amendments  to  proceedings  pending                                                                    
     before the Commission.                                                                                                     
     Section 14  amends the uncodified  law of the  State of                                                                    
     Alaska,  by  adding  transitional  language  clarifying                                                                    
     proceedings  seeking review  of  a  board decision  and                                                                    
     order  that   have  not  yet  been   filed  before  the                                                                    
     Commission, must be  filed in the superior  court on or                                                                    
     after June  1, 2017  Any appeals  not completed  by the                                                                    
     Commission  on  or  before December  1,  2017  will  be                                                                    
     transferred to the superior court  on December 2, 2017,                                                                    
     and    clarifying   procedures    for   requests    for                                                                    
     reconsideration during the transition period.                                                                              
     Section 15  amends the uncodified  law of the  State of                                                                    
     Alaska, by adding transitional language.                                                                                   
     Section 16 clarifies when the Act takes effect.                                                                            
                                                                                                                                
MS.  BANASZAK  added that  statutes  relating  to the  commission                                                               
would remain in  existence until December 2,  [2017], even though                                                               
the bill  would be enacted  on June 1,  [2017].  This  would give                                                               
time for the commission to  finish its pending cases and transfer                                                               
files before  the terms of  the commissioners expire  on December                                                               
31, 2017.  The commission would  not take any new cases after May                                                               
31, [2017],  and would  have six  months to  wind up  its pending                                                               
cases by December  1, [2017].  She stated that  the proposed bill                                                               
would  essentially put  into place  the  procedures that  existed                                                               
before the commission was created.                                                                                              
                                                                                                                                
3:34:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOSEPHSON  asked Ms. Drygas what  the impact would                                                               
be of moving 20-30 cases to  the Alaska Superior Court.  He asked                                                               
how  the  court would  adapt,  and  if  the  money saved  by  the                                                               
department would be transferred to the court.                                                                                   
                                                                                                                                
3:34:39 PM                                                                                                                    
                                                                                                                                
MS.  DRYGAS stated  that the  department would  see the  savings.                                                               
She mentioned that  last year a similar bill was  drafted and had                                                               
a  zero  fiscal note.    She  stated  that  the number  of  cases                                                               
[potentially shifted  to the  Alaska Superior  Court] is  a small                                                               
fraction  of  the  court's  work.    She  noted  that  since  the                                                               
commission's  inception, the  number  of appeals  filed has  been                                                               
dropping:  in 2007 there were 49,  but in 2016 there were only 20                                                               
appeals.   The figure  of 20-30  cases per  year was  pulled from                                                               
this information.                                                                                                               
                                                                                                                                
REPRESENTATIVE JOSEPHSON asked  whether the department considered                                                               
using the Office  of Administrative Hearings (OAH) to  act as the                                                               
first "trier of fact" and the  Alaska Superior Court to act as an                                                               
intermediate  appellate court  or something  similar.   He stated                                                               
that the OAH is used to dealing with appeals.                                                                                   
                                                                                                                                
MS.  DRYGAS answered  yes, it  was considered.   She  stated that                                                               
after hearing  from practitioners,  she learned that  the process                                                               
prior to 2005  had worked.  She stated her  concern regarding the                                                               
current practice of having two  layers of administrative hearings                                                               
- going from the  board to the OAH - before  getting a case heard                                                               
in  court at  either  the  Alaska Superior  Court  or the  Alaska                                                               
Supreme  Court.   She stated  that a  litigant is  entitled to  a                                                               
review of his/her case in court.                                                                                                
                                                                                                                                
3:37:55 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH  asked  for  clarification  on  the  appeal                                                               
process for an injured employee.                                                                                                
                                                                                                                                
3:39:38 PM                                                                                                                    
                                                                                                                                
MARIE   MARX,  Director,   Division  of   Workers'  Compensation,                                                               
Department of  Labor & Workforce Development  (DOLWD), summarized                                                               
the  process of  reporting  an injury.   She  stated  that if  an                                                               
employee is injured,  the employer must report the  injury to the                                                               
division  and immediately  begin paying  benefits.   Most of  the                                                               
time, benefits are provided seamlessly  to an injured worker, and                                                               
the board doesn't  need to intervene.  If a  dispute arises about                                                               
whether or  not benefits  are owed,  then the  dispute resolution                                                               
process  begins.   She reviewed  that the  employee would  file a                                                               
workers'   compensation   claim    with   the   Alaska   Workers'                                                               
Compensation Board.   Both  parties engage  in discovery  and the                                                               
employer can either admit or deny  the claim.  After discovery is                                                               
complete,  the parties  can either  settle or  request a  hearing                                                               
before the board.   She explained that the board  has 18 members,                                                               
but  only  a three-member  panel  hears  each  case.   The  panel                                                               
consist  of:    one  member   from  [the  portion  of  the  board                                                               
affiliated  with] labor,  one  member from  [the  portion of  the                                                               
board affiliated  with] industry -  both of whom are  lay members                                                               
of  the community  who serve  on the  board -  and one  full-time                                                               
hearing officer, who  is a full-time staff member  and chairs the                                                               
hearing.   She  stated  that the  hearing  panel takes  evidence;                                                               
listens  to opinions  from the  treating  doctor, the  employer's                                                               
medical evaluator,  and sometimes  doctors from the  board's list                                                               
of  recommended doctors;  decides  which opinion  to believe  the                                                               
most;  and issues  a  decision  within 30  days  of the  hearing.                                                               
Afterwards, either party  may appeal the board's  decision to the                                                               
Workers'   Compensation  Appeals   Commission,   which  makes   a                                                               
determination on  the appeal request.   From there,  either party                                                               
may appeal to the Alaska Supreme  Court, which is briefed by both                                                               
parties and issues a decision.                                                                                                  
                                                                                                                                
3:42:02 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH  noted  that the  commission  dismissed  56                                                               
cases, and he  asked whether the dismissals were in  favor of the                                                               
employee or employer.                                                                                                           
                                                                                                                                
MS.  MARX stated  the cases  can be  dismissed for  a variety  of                                                               
reasons,  which  include  time  deadlines,  requirements  of  the                                                               
appeal, and briefing timeframes.                                                                                                
                                                                                                                                
REPRESENTATIVE BIRCH  asked for  the total  number of  cases that                                                               
end up before the Workers' Compensation Board.                                                                                  
                                                                                                                                
MS. MARX  answered that approximately  1,200 reports  of injuries                                                               
are  filed each  year  and, of  those, about  250  claims end  up                                                               
before the  board.  She  explained that  about 10 percent  of the                                                               
cases before the board go further in the dispute process.                                                                       
                                                                                                                                
3:44:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE STUTES asked how many commissioners there are.                                                                   
                                                                                                                                
MS.  MARX   responded  that  each   case  before   the  [Workers'                                                               
Compensation  Appeals]  Commission  is heard  by  a  three-member                                                               
panel.    The  three-member  panel is  selected  from  two  labor                                                               
members,  two   industry  members,  and  one   full-time  appeals                                                               
commissioner.                                                                                                                   
                                                                                                                                
REPRESENTATIVE STUTES asked if the  full-time commissioner is the                                                               
only person on the payroll.                                                                                                     
                                                                                                                                
MS. MARX  stated her belief  that there  is one staff  member who                                                               
assists the chair with  administrative functions like maintaining                                                               
case files and providing notices to parties.                                                                                    
                                                                                                                                
REPRESENTATIVE  STUTES   asked  how   many  positions   would  be                                                               
eliminated  or  repositioned  if  the cases  move  to  the  court                                                               
system.                                                                                                                         
                                                                                                                                
3:45:52 PM                                                                                                                    
                                                                                                                                
MS.  DRYGAS  stated  that  two full-time  positions  are  on  the                                                               
payroll for the commission:   one full-time chair position filled                                                               
by  an  attorney and  one  full-time  support staff  position  to                                                               
assist  the  chair  with  getting   decisions  out  and  noticing                                                               
hearings.                                                                                                                       
                                                                                                                                
REPRESENTATIVE STUTES asked if the  positions would be eliminated                                                               
or repositioned.                                                                                                                
                                                                                                                                
MS. DRYGAS stated the positions would be eliminated.                                                                            
                                                                                                                                
3:46:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON asked  who  finds the  facts along  the                                                               
procedural pathway  and he asked  if the commission  revisits the                                                               
details of the injury.                                                                                                          
                                                                                                                                
3:47:03 PM                                                                                                                    
                                                                                                                                
MS. MARX  stated that generally the  trial court - served  by the                                                               
board  in  this  capacity  -  is  the  fact-finding  body.    The                                                               
appellate level  decides questions of  law and whether  the lower                                                               
court erred.   She stated  her understanding that  the commission                                                               
is not fact-finding.                                                                                                            
                                                                                                                                
3:47:56 PM                                                                                                                    
                                                                                                                                
ANDREW HEMENWAY answered questions about  HB 69 and drew upon his                                                               
experience   as  the   former  chair   of  the   Alaska  Workers'                                                               
Compensation Appeals Commission.   He responded to Representative                                                               
Birch's previous question about  dismissals in the Alaska Supreme                                                               
Court.   He stated  that when dismissed  from the  Alaska Supreme                                                               
Court,  the decision  of  the  board is  final.   Whichever  side                                                               
appealed  would  lose  the  dismissed  case.    He  responded  to                                                               
Representative   Josephson's  question   and   stated  that   the                                                               
appellate court has no fact-finding  authority or role concerning                                                               
the merits of  the case, except in matters where  a request for a                                                               
stay  is  made.    The  commission can  determine  if  there  was                                                               
sufficient evidence to support the findings made by the board.                                                                  
                                                                                                                                
3:50:08 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH  stated his interest  in the outcome  of the                                                               
process.    He asked  how  often  injured employees'  claims  are                                                               
upheld through the board, the commission, and the court.                                                                        
                                                                                                                                
MR.  HEMENWAY  stated  that  the  spreadsheet  [included  in  the                                                               
committee  packet]  shows the  outcome  from  the Alaska  Supreme                                                               
Court of  decisions that were  appealed from the commission.   Of                                                               
those cases,  20 were affirmed,  15 were reversed, and  a smaller                                                               
number were  affirmed in  part or  reversed in  part.   He stated                                                               
that this is  an indication of the commission's  decisions in the                                                               
Alaska  Supreme Court.   He  stated that  he is  not sure  of the                                                               
numbers on appeals from the board  to the commission.  He offered                                                               
his belief  that employees  are often  unsuccessful on  appeal in                                                               
cases  where the  primary  issue  of the  appeal  is the  board's                                                               
factual findings -  when a party disputes that the  worker had an                                                               
injury.    Generally the  board's  fact  findings are  sustained,                                                               
although there  may be  a reversal  if the  commission determined                                                               
that the board applied an  incorrect legal standard or considered                                                               
evidence inappropriately.   He remarked that  he couldn't venture                                                               
to say  which parties tend to  be more successful on  appeal.  He                                                               
stated that employees are less likely  to succeed if they are not                                                               
represented by an  attorney.  He observed that  when both parties                                                               
are represented by counsel and  have legal issues on appeal, "You                                                               
win some, you lose some."                                                                                                       
                                                                                                                                
3:54:25 PM                                                                                                                    
                                                                                                                                
MR. DRYGAS followed up with  more information about funding.  She                                                               
stated that  when the board was  created in 2005, no  funding was                                                               
given  to the  department;  the department  had  to use  existing                                                               
funding from  the Workers Safety and  Compensation Administration                                                               
Account  (WSCAA).   She  offered  her opinion  that  it would  be                                                               
unfair to give  funding to the court system when  the Division of                                                               
Workers' Compensation  is already  "pretty strapped"  to function                                                               
as is, as a result of previous funding cuts.                                                                                    
                                                                                                                                
3:55:36 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KNOPP noted  that 100  appeals have  gone to  the                                                               
Alaska Supreme  Court, of which only  15 have been reversed.   He                                                               
asked if this shows ineffectiveness.   He asked if a three-person                                                               
panel is the problem, and suggested  that more members on a panel                                                               
might increase effectiveness.                                                                                                   
                                                                                                                                
3:56:43 PM                                                                                                                    
                                                                                                                                
MS. MARX  clarified that  there are 18  board members,  1 appeals                                                               
commissioner,  and  4  lay  members who  serve  on  the  Workers'                                                               
Compensation Appeals Commission.   She stated the appellate panel                                                               
is made up of five individuals.                                                                                                 
                                                                                                                                
REPRESENTATIVE KNOPP  asked which  level has one  hearing officer                                                               
and two members.                                                                                                                
                                                                                                                                
MS. MARX  responded that  is at  the Workers'  Compensation Board                                                               
level - essentially the trial court level.                                                                                      
                                                                                                                                
REPRESENTATIVE KNOPP  again asked  if 15 out  of 100  cases being                                                               
reversed is a sign of inefficiency.                                                                                             
                                                                                                                                
3:57:31 PM                                                                                                                    
                                                                                                                                
MS.  DRYGAS  stated  that  56   cases  were  dismissed,  20  were                                                               
affirmed,  15 were  reversed, and  4  were affirmed  in part  and                                                               
reversed  in  part.   She  offered  her interpretation  that  the                                                               
[Workers'  Compensation] Appeals  Commission  is  not getting  it                                                               
right enough  of the time.   She  mentioned that there  are other                                                               
measures of ineffectiveness.  She  stated that she spoke with two                                                               
board chairs  who told her  they were essentially doing  the work                                                               
of the commission - writing  the decisions with little input from                                                               
commissioners - and she offered her  concern of its effect on the                                                               
significant reversal rate.   She stated that it  is possible that                                                               
a difference  could have been  seen with  a bigger panel,  but it                                                               
would  depend on  how  the panel  was  made up.    The cases  are                                                               
legally intensive,  and the appellate level  determines questions                                                               
of  law.   She stated  that the  members of  the commission  have                                                               
expertise on  workers' compensation, but the  commission's job is                                                               
to  do an  evaluative process  of  law.   She opined  that a  lay                                                               
person  is at  a disadvantage  to determine  if the  law and  the                                                               
facts "measure  up." She stated that  this is likely part  of the                                                               
problem with  the structure  of the commission.   She  noted that                                                               
this  issue   has  been  before   the  legislature   in  previous                                                               
iterations  in  2015 and  2016,  and  at  that time  neither  the                                                               
legislature nor  the department heard from  individuals' opinions                                                               
one way or  the other.  She offered her  understanding that there                                                               
is a  consensus that  the current  process is  not working.   She                                                               
stated  that she  does  not see  why the  earlier  process was  a                                                               
problem - returning  to the courts after going  through one layer                                                               
of administrative review.                                                                                                       
                                                                                                                                
4:01:02 PM                                                                                                                    
                                                                                                                                
NANCY  MEADE,  General  Counsel,  Office  of  the  Administrative                                                               
Director, Alaska  Court System, stated  that the court  system is                                                               
neutral on  the proposed legislation  and had submitted  a fiscal                                                               
note showing zero impact to the Alaska Court System.                                                                            
                                                                                                                                
4:01:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE STUTES  asked how a  zero fiscal note  is possible                                                               
with additional work for the Alaska Court System.                                                                               
                                                                                                                                
MS. MEADE  stated that  the Alaska Court  System tries  to absorb                                                               
changes, to  the extent  it can,  without a  fiscal impact.   She                                                               
emphasized the  Alaska Court System  aims to be  extremely honest                                                               
when producing  fiscal notes.   She  stated that  Alaska Superior                                                               
Court  judges would  have more  work, and  she acknowledged  that                                                               
workers'    compensation   cases    are   sometimes    difficult.                                                               
Notwithstanding that, she  said it's not the sort  of impact that                                                               
would require hiring  a new judge or clerk.   She stated that the                                                               
20-30  new  cases  per  year  would be  spread  among  40  Alaska                                                               
Superior Court  judges.   She stated  that individual  judges may                                                               
get  one to  three more  administrative  appeals per  year.   She                                                               
stated  that the  court system  already  handles between  160-170                                                               
administrative  appeals per  year,  so adding  30  to 33  appeals                                                               
would be an impact, but not  such an impact to require additional                                                               
resources to handle it.                                                                                                         
                                                                                                                                
4:03:12 PM                                                                                                                    
                                                                                                                                
CHAIR  KITO related  the  impact  to a  pick-up  truck with  four                                                               
wheels carrying  a load:   At  a certain  point, the  wheels will                                                               
pop, but, "I think what Ms.  Meade is saying is the wheels aren't                                                               
quite ready to pop yet."                                                                                                        
                                                                                                                                
4:03:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOSEPHSON stated  his sense  that although  these                                                               
appeals come  with relatively  short hearings, in  order to  do a                                                               
good  job,  the  judges  would  likely  be  working  weekends  to                                                               
research cases and  write opinions, which are  often 20-30 pages.                                                               
He asked for confirmation that this is intensive academic work.                                                                 
                                                                                                                                
4:04:26 PM                                                                                                                    
                                                                                                                                
MS. MEADE responded,  "That is not inaccurate."   She stated that                                                               
appeals  cases  are  difficult  and the  court's  mission  is  to                                                               
resolve controversies.   She  agreed that  administrative appeals                                                               
are different from  trials and often involve: more  desk time and                                                               
studious time,  a hearing, and longer  decisions.  Administrative                                                               
appeals are often  not as urgent as other  matters judges handle,                                                               
such as children's matters or  scheduled hearings.  She mentioned                                                               
that the  appeals can  take longer than  the public  expects; the                                                               
Alaska  Court System  has lost  positions with  budget cuts,  and                                                               
some things  are taking more time.   She remarked, "On  the other                                                               
hand,  we  need  to do  this  sort  of  work.   So,  if  ...  the                                                               
legislature passes  a bill that says  we will get 30  more cases,                                                               
we will do  30 more cases.   Our judges will handle  these in the                                                               
course  of their  work, and  perhaps they'll  be coming  in on  a                                                               
Saturday to do it, or maybe they'll squeeze it in."                                                                             
                                                                                                                                
MS.  MEADE related  that DOLWD  has  been very  receptive of  her                                                               
proposed  language  changes  or  additions  which  would  clarify                                                               
statute and  make it  easier for  the courts  to take  the cases.                                                               
She  stated her  belief  that through  working  with DOLWD,  some                                                               
revisions  will  be   suggested  to  make  it   work  better  for                                                               
everybody, including the injured workers and employers.                                                                         
                                                                                                                                
4:07:17 PM                                                                                                                    
                                                                                                                                
CHAIR KITO opened public testimony on HB 69.                                                                                    
                                                                                                                                
[HB 69 was held over.]                                                                                                          
                                                                                                                                
4:07:47 PM                                                                                                                    
                                                                                                                              
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
4:08 p.m.                                                                                                                       
                                                                                                                                

Document Name Date/Time Subjects
HB069 Supporting Document-WCAC cases 1.30.2017.pdf HJUD 2/27/2017 1:00:00 PM
HJUD 3/10/2017 1:30:00 PM
HJUD 3/20/2017 1:00:00 PM
HL&C 2/6/2017 3:15:00 PM
HL&C 2/10/2017 3:15:00 PM
HB 69
HB069 Transmittal Letter 1.30.2017.pdf HL&C 2/6/2017 3:15:00 PM
HL&C 2/10/2017 3:15:00 PM
HB 69
HB069 ver A 1.30.2017.pdf HJUD 2/27/2017 1:00:00 PM
HL&C 2/6/2017 3:15:00 PM
HB069 Fiscal Note DOLWD-WC 1.30.2017.pdf HL&C 2/6/2017 3:15:00 PM
HL&C 2/10/2017 3:15:00 PM
HB 69
HB069 Sectional Analysis ver A 1.30.2017.pdf HJUD 2/27/2017 1:00:00 PM
HJUD 3/10/2017 1:30:00 PM
HJUD 3/20/2017 1:00:00 PM
HL&C 2/6/2017 3:15:00 PM
HL&C 2/10/2017 3:15:00 PM
HB 69
HB069 Fiscal Note JUD-ACS 2.6.17.pdf HL&C 2/6/2017 3:15:00 PM
HL&C 2/10/2017 3:15:00 PM
HB 69