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Ex post facto law is defined by the freedictionary.com as "retroactively" changing the law. Specifically, doing so to "increase the punishment for a criminal act," or to "punish conduct that was legal when committed." It notes that in regards to criminal law, ex post facto laws "are prohibited by Article I, Section 10, Clause 1, of the U.S. Constitution." Furthermore, that such laws are "considered a hallmark of tyranny because it deprives people of" knowing what is or is not permitted. That it "allows for random punishment at the whim of those in power."
The Supreme Court of the United States concedes the literal meaning of ex post facto. However, it long ago (221 years ago) concluded:
"it has long been recognized by this Court that the constitutional prohibition on ex post facto laws applies only to penal statutes which disadvantage the offender affected by them. Calder v. Bull, 3 Dall. 386, 390–392, 1 L.Ed. 648 (1798)."
See Youngblood v. Collins, 497 U.S. 37 (1990). In the Court's view, ex post facto law in a civil setting is either less tyrannical per se or more acceptable tyranny. And, that conclusion ignores the literal meaning of the phrase "ex post facto," as the Court in Youngblood acknowledged. But, that conclusion is respectful of stare decisis as previously discussed on this blog.
In the same small portion of the Constitution, it also says that "no state shall" "pass any" "law impairing the obligation of contracts." This has been referred to as "The Contracts Clause" over the last 231 years (the Constitution was ratified in 1788). Constitution.law.com explains that
"Legal contracts are considered to be the glue that allows the general public, as well as the Government, to engage in honest and volitional business. The only instance in which contracts can be nullified is when they are ruled to in violation of public health and welfare."
Workers' compensation is effectively a contractual system. There existed a great many rights and obligation for employees and employers alike in the pre-workers' compensation world. But then states began to statutorily alter those. Workers' compensation has been referred to as a "grand bargain," an exchange, a social contract, in which employers and employees each gained benefits in exchange for yielding others. See Lyons v. Chittenden Central Supervisory Union, 185 A.3d 551, 555 (Vt. 2018).
Though negotiated on a broader level than an individual contract of employment, it can be said to be a statutory contract between labor and management. The "grand bargain" explanation of mutual renunciation of rights has been voiced by the supreme courts of numerous states. Among them are Alaska, Arkansas, Iowa, Montana, Oklahoma, North Dakota, Vermont, and Wyoming. There are more references to the phrase in various state's appellate court decisions.
Beyond this "grand" theory of contract, there are also a multitude of contractual relations intertwined in the very foundation of workers' compensation. Laws imposing this "grand bargain" typically place responsibility upon employers to provide compensation and medical care to workers who are injured on-the-job. Despite that, it is more common that such benefits are instead delivered by an insurance company.
That is, the employer has entered into a legal contract with someone else. In that contract, the employer has paid consideration (a "premium") in exchange for which the other party, the "carrier," has agreed to be responsible in the event a loss occurs. This concept of insurance is fundamentally a contract through which an employer and a carrier agree to an exchange of value for other value, perceived or actual. The carrier assumes risk (that an accident may occur) in exchange for some prescribed certainty (a set premium). That said, these contracts certainly can be far more complex, detailed, and confusing. But, the fundamental exchange between employer and carrier is this exchange of risk and benefit.
The employee's and employer's rights regarding substantive workers' compensation benefits are typically fixed as of the date of accident in workers' compensation. That is, the law in effect on the date of accident typically controls the quantum and quality of benefit to which an injured worker is potentially entitled, and for which the employer (or its carrier, by contract) is liable. The Florida appellate court has explained regarding statutory changes"
“If an amendment changes the amount of benefits a claimant may receive or impacts a claimant's entitlement to services, then it should be considered substantive. In contrast, if a statutory change does not alter vested substantive rights, then it applies retroactively.” Russell Corp. v. Jacobs, 782 So. 2d 404 (Fla. 1st DCA 2001).
The "rights" of the parties are thus "vested" at the time of accident or disease as to substantive benefits, the amount to which one side is entitled and for which the other is obligated.
I was reminded of these inalienable rights of the parties recently when a WorkCompCentral headline caught my attention: Bill Would Provide Benefits to Firefighters Hurt During Las Vegas Shooting. This details California Assembly Bill 932, introduced by "Assemblyman" Low, which would re-write that state's workers' compensation law and in effect re-write history. As a side note, it seems a bit genderist for California to continue to refer to people as "Assemblyman" in this day and age. Perhaps it would consider "Assemblyperson?"
In October 2017 there was a catastrophic event in Las Vegas. That city, among its other accolades and distinctions, is in Nevada. As a consequence of its being in Nevada, it is as clearly not in California. This may seem axiomatic, but you might be surprised at the emails and calls I get from a handful of careful readers. That Las Vegas is not in California is perhaps an important distinction.
California concluded there are instances in which the aid and assistance of firefighters is necessary, convenient, and to be encouraged. It recognized that those employees are, like the rest of us, sometimes "on duty" and other times "off duty." California therefore included in its workers' compensation law that any off- duty firefighter that elected to respond to an emergency in California is covered by workers' compensation. This to both encourage firefighters to rush to the aid of the public, and provide coverage if that response results in an accident or injury.
The critical point, stated clearly in that statute (which changes the common law as it existed before that statute) is that this coverage is afforded if the emergency is in California. As noted above, Las Vegas was, and remains, clearly not in California.
Assemblyman Low wants to change that law. He believes that this coverage should be extended by California cities, counties, or others for firefighters that suffer injury while responding to any emergency while off duty, regardless of where they may be at the time. Thus, if passed, and some firefighter is vacationing in France and responds to a fire, any injury suffered in France during that response would purportedly be covered by California workers' compensation.
Some will question what interest the taxpayers of California have in the extinguishing of a fire in France. Generally we would think of taxpayers because firefighters tend to be employed by cities, counties, and other government entities. However, there is an element of firefighting that is private instead, and some claim that segment of the firefighting industry, is "on the verge of catching fire." But, whether public or private employers, those entities are hiring firefighters to respond to emergencies in specific communities. Their services are retained for those specific communities.
When a company agrees to assume the risk for those benefits, that is when an insurance carrier agrees to be responsible for workers' compensation benefits for some employer, it will do so after assessing the probabilities both for the occurrence and severity of such injuries. Based upon its assessment of the potential of loss (having to pay or provide benefits), that carrier will determine what price (premium) to charge in exchange. In some jurisdictions, the premium it can charge may be set by the state (non-negotiable), in which case the carrier will instead decide simply whether to accept the risk in exchange for that mandated price or to decline.
This is an issue of contractual right. The two parties to that potential contract, employer and carrier, each assess what they will receive and what they will give. They each decide whether to enter the agreement. It is a voluntary exchange, based in no small part upon what the law requires of each. For example, deciding what to charge for coverage might depend upon the risk of loss; why does your automobile insurance company charge less to insure a 1992 Chevrolet Caprice ($900) than to insure a 2019 Lamborghini Aventador? Because replacing that Lamborghini will be inherently more costly ($410,000). In fact, replacing the side-view mirror on it might cost more than the whole Caprice.
Therefore, there is the potential in Assemblyperson Low's proposal that the price of coverage (premium) could be affected because the potential risks that are covered are thus expanded. To illustrate, what if you agree to repair or replace my Caprice ($900) if it was "damaged." And, when you made that decision, the law defined "damaged" as "diminished in value due to a collision." You might evaluate how often cars are in collisions and what collision repair of that particular model tend to cost, and quote me a price (premium) for you to take on that risk.
But, would you charge me more the next year if the law changed the definition of "damaged" to "diminished in value due to a collision or fire." It seems likely that you would want more compensation (premium) as you are now taking on more risk. You would then decide whether the price you could charge is worth the increased risk that you take.
Assemblyperson Low's bill is more intriguing than that however, He does not seek only to change the definition of the risk for firefighters in the future. He seeks to redefine the risk from 2017. His bill would allow firefighters that were in Nevada in October 2017 to seek workers' compensation benefits related to an event that was not covered by the California workers' compensation law at that time. Some would argue that Assemblyman Low seeks to pass an ex post facto law that impairs the contracts that were entered into by those parties in 2017.
Others will stress that ex post facto prohibitions in the U.S. Constitution are actually focused only upon criminal sanction, see above. They might be said to be ignoring thereby the underlying themes of justice and fairplay. Either argument might be both appealing and interesting (such arguments and discussions are the stuff of which great WCI Conference conversations are made).
But, the impairment of contract is a more direct impact. Those who employed firefighters in 2017 did so with an understanding of the implications of the risk of injury. Those implications, costs, and challenges, were defined by law. The parties to the 2017 employment contract relied upon that law. The parties to any 2017 insurance contract relied upon that law. For the State of California to consider retroactively changing that law impairs both those contracts of employment and any contracts of insurance.
There will be "angry old men in the balcony" at this point of the analysis, who are quick to point out that perhaps there are cities, counties, and others that did not purchase workers' compensation insurance. Those subdivisions would be labelled as "self-insured," so "what does this have to do with insurance contracts" they may say. They will note that government entities in many American jurisdictions are self-insured. The law allows entities with significant financial wherewithal to self-insure against losses. It is allowed because those entities are seen as financially responsible and dependable.
As an aside, in the case of a city or county, they are perceived as absolutely able to meet any financial risk. Government is in the ultimate "Doritos" position. In the 1990s Doritos advertised "crunch all you want, we'll make more." And in that spirit, government can confidently say "increase the risks all you want, we'll tax more." Government can always use the power of taxation to extract more from its citizens in pursuit of payments to others.
WorkCompCentral reports that Assemblyman Low's bill is not a novel California idea. Last year, the legislature there passed a retroactive workers' compensation liability upon employers of "peace officers who were injured during the Las Vegas shooting." The decision, whether constitutional or not, has been made in California to impair contracts and to retroactively amend laws. The current proposal merely expands upon that decision, in order to provide this retroactive support to firefighters as well.
It is natural to have sympathy for those injured or killed, as it is for their families. Events like those in Las Vegas are chilling and they strike at our souls. But, there is a benefit in law that is predictable, dependable, and consistent. The extraordinary act of making retroactive changes in law in response to a particular tragedy, however, is perhaps a slippery slope. It could undermine the faith Californians have in contracts, obligations, and the law. In the end, it could thereby do more harm than good.
Instead, the Assembly might have considered responding to the past tragedy in Las Vegas more similarly with the response to the terrorist attacks of September 11 in New York. The response there was a specific fund legislatively created to provide compensation due to the specific past facts and circumstances. Such a response to a past event would arguably be more conducive to stability and predictability of contracts. And, if coupled with a prospective change in contractual rights, a more rational remedy.
But, at the end of the day, the legislature has significant latitude in fashioning remedies. It will be interesting to see where California goes with this proposal.
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About The Author
About The Author
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Judge David Langham
David Langham is the Deputy Chief Judge of Compensation Claims for the Florida Office of Judges of Compensation Claims at the Division of Administrative Hearings. He has been involved in workers’ compensation for over 25 years as an attorney, an adjudicator, and administrator. He has delivered hundreds of professional lectures, published numerous articles on workers’ compensation in a variety of publications, and is a frequent blogger on Florida Workers’ Compensation Adjudication. David is a founding director of the National Association of Workers’ Compensation Judiciary and the Professional Mediation Institute, and is involved in the Southern Association of Workers’ Compensation Administrators (SAWCA) and the International Association of Industrial Accident Boards and Commissions (IAIABC). He is a vocal advocate of leveraging technology and modernizing the dispute resolution processes of workers’ compensation.
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