Legislature(2003 - 2004)
03/25/2003 01:32 PM Senate L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 120-CLAIMS BY STATE-EMPLOYED SEAMEN
CHAIR BUNDE announced SB 120 to be up for consideration.
MS. SUSAN COX, Assistant Attorney General, explained that SB 120
would have the state limit its waiver of sovereign immunity as
it pertains to injury claims brought by state employees who
happen to be seamen and instead provide for worker's
compensation coverage for those state employees. The Governor's
transmittal letter indicates that the intent of the bill is to
provide state employees who are seamen with worker's
compensation coverage, similar to all other state employees. To
do that, the statute by which the legislature has waived the
state's sovereign immunity, thereby opening itself up to
litigation in tort claims, personal injury claims, and maritime
personal injury claims, must be amended.
MS. COX explained that amending AS 09.52.050 is an approach that
was identified in a 1963 Attorney General's opinion and was
referenced in an Alaska Supreme Court decision on a case known
as the State of Alaska Department of Public Safety vs. Robert
Brown in 1990. At that time, the [court] held that the Alaska
Workers' Compensation Act could not be applied to be the
exclusive remedy of state employees, because the state had
waived its immunity without limitation for personal injury
actions. If the state wanted to withdraw its consent to suit and
apply worker's compensation to its state employees who are
seamen, it could do so in a bill like this.
She explained from 1983-1991 most state employed seamen who
worked aboard our state ferries had collective bargaining
agreements that provided for workers' compensation benefits in
lieu of the Jones Act and other maritime remedies. For eight
years those employees enjoyed workers' compensation coverage in
lieu of litigation. In 1991, a different Alaska Supreme Court
decision, another (Dale) Brown decision, said that collective
bargaining agreements providing for workers' compensation
instead of the Jones Act were void and therefore couldn't be
negotiated as a matter of union contract.
MS. COX said the purpose of this bill is to bring the state
employees who are seamen under workers' compensation and take
the state out of the realm of maritime remedies and Jones Act
coverage. The Department of Law expects it to ultimately save
the state money. The effective date is July 2003, but if
enacted, it would apply only to injuries or illness occurring
after that date. So, anyone who was injured in the last three
years, because of the three-year statute of limitations under
the Jones Act, would still be able to bring suit under the laws
that exist now.
MS. COX expects a legal challenge if this law is passed. She has
looked at legal arguments pertaining to those. The Robert Brown
decision from the Alaska Supreme Court and other cases from
several jurisdictions point in this same direction. She added
that decisions by the U.S. Supreme Court in the last five years
have made it clear that if a state does not consent to be sued,
the Congress cannot impose liability upon the state.
2:57 p.m.
CHAIR BUNDE asked what the volume of claims is, how it compares
with workers' compensation and what the state's net gain would
be.
MS. COX replied that at this point in time the Department of Law
handles the litigation with ferry employees. The department
expects to see a continuation of some cases for injuries that
occurred in the last three years. Starting with the effective
date of this law, new injuries and illnesses would go to the
workers' compensation system. The state is self-insured and
workers' compensation is obviously a no-fault remedy. The
department would expect to see, by and large, automatic coverage
of workers' compensation matters and an eventual reduction in
the amount of litigation the Department of Law would have to
handle.
CHAIR BUNDE asked about the volume of claims the department is
dealing with. He also asked if all employees of the Alaska
Marine Highway System are seamen and whether they have to meet
other criteria under this legislation.
MS. COX replied that for all intents and purposes, those who
work aboard the vessels are seamen and are covered under the
maritime remedies that she referred to. Office workers onshore
are not necessarily seamen. The department deals with a much
higher volume of claims with respect to the maritime workers in
the ferry system than other state agencies.
SENATOR STEVENS asked about the Dale Brown decision and the
basis for voiding the contract.
MS. COX answered in the Dale Brown decision, the Alaska Supreme
Court decided as a matter of labor law, that unions could not
bargain away their individual members' rights, pre-injury, under
the federal law.
SENATOR FRENCH asked if this would put all state employees under
the same workers' compensation scheme.
MS. COX replied that is the plan.
SENATOR SEEKINS asked if she had seen the letter from Beard,
Stacy, Trueb and Jacobsen.
MS. COX replied that she saw it in the hall.
SENATOR SEEKINS asked for her opinion based on the theories of
law that were set forth in it.
MS. COX said she would be happy to do that and noted she has
already evaluated some of the theories because she frequently
deals with that firm in her cases. Mr. Trueb has expressed an
interest in a uniform approach to maritime remedies for all
seamen. The Governor disagrees and she disagrees with a number
of the points Mr. Trueb raised in his letter.
SENATOR SEEKINS said he was particularly interested in a couple
of representations in the letter about the jurisdiction of all
state courts in regard to injuries.
MR. BRAD THOMPSON, Director, Division of Risk Management, said
this division acts as the self-insurer and handles the claims
filed by state employees. He noted he provided members with a
chart that compares maritime claims to those of other state
employees. The frequency of claims in 100 full time equivalent
positions (FTE) for all state employees is 8 per 100 FTE. The
Departments of Corrections, Transportation, Public Safety, and
Administration have 10 per 100 FTE. The average cost of maritime
workers' claims is $197,000 per 100 claims compared to $64,000
for workers' compensation claims.
CHAIR BUNDE said he frequently hears that commercial fishing,
logging and aviation are very high risk jobs and asked if he had
information on how the Alaska Marine Highway System jobs
compare.
MR. THOMPSON replied that he thought the Worker's Compensation
division would have a rate per 100 FTE on its annual report; he
estimated it was about 10.
CHAIR BUNDE asked if the expanded number of claims is due to the
fact that working on ferries is inherently dangerous or because
ferry workers are more inclined to present a claim.
MR. THOMPSON replied that the remedy is different. Wages are
paid to the end of the voyage and that is perhaps an incentive
for frequency of claim. Workers' compensation only compensates
for a time loss greater than three days. He pointed out that
within the Robert Brown decision, the court clearly stated that
if the state desires to limit its tort liability to the Workers'
compensation Act, it may do so by legislative enactment of an
exception to the waiver of sovereign immunity, which is what SB
120 is proposing.
SENATOR SEEKINS asked what is so dangerous about working on a
ferry and noted the claim rate is very high.
MR. THOMPSON agreed the rate of claims is high.
MR. JOE GELDHOF, Marine Engineers Beneficial Association, said
his organization represents the marine engineers on the Alaska
Marine Highway System and licensed engineers on Alaska tankers.
SB 120 only relates to state workers who are seamen and a small
number of people in the Departments of Fish and Game and Public
Safety. He said this problem has been around for years and he is
not convinced it is really good to go at this time.
TAPE 03-15, SIDE A
MR. GELDHOF noted that the marine engineers and other maritime
unions have worked with the state administration and with Susan
Cox, who has a lot of historical knowledge, in the past. He said
significant legal problems within the bill need to be addressed
before it moves out of committee. He explained in one Brown
case, the court struck down provisions based on a challenge to
contractual language brought by an individual mariner. The other
Brown case, which preceded that one by about two years,
addressed sovereign immunity and how to fix the problem, but it
was based on an attorney general's opinion issued in 1963 when
Lyndon Johnson was in the first year of his presidency. He said
that opinion is fairly dated and suggested the current attorney
general update it.
MR. GELDHOF said one theory is that sovereign immunity is
imbedded in the Alaska Constitution so it would require a
constitutional amendment rather than a statutory change. He
thought it would be wise to get an opinion from legislative
counsel and to then refer the bill to the Judiciary Committee.
He noted the bill also needs a fiscal note regarding the
administration of workers' compensation.
He added that real differences account for what appears to be
substantially more claims coming from marine activities. For
example, cooking during an 8-hour shift in a prison is
fundamentally different than on a ship when the weather gets
rough. He maintained:
If you take the Tustumena out to Dutch Harbor, it's
probably not a stationary deck and it's long days.
People are often sleep deprived.... There really are
genuine differences in the maritime trades from
landlubbers like me.
CHAIR BUNDE asked Ms. Cox to provide a fiscal note and said that
interesting legal points were raised, but the Senate President
would decide whether to refer SB 120 to the Judiciary Committee.
With no further business to come before the committee, he
adjourned the meeting at 3:15 p.m.
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