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On November 4, 2015, the Illinois Supreme Court reversed the decision of the Appellate Court of Illinois, for the First District in Folta v. Ferro Engineering. The Supreme Court held that the Workers’ Compensation Act and Workers’ Occupational Diseases Act provides the exclusive remedy for an employee’s injury arising out of and in the course of his or her employment, even when the employee first learns of the injury after the expiration of the applicable statutes of repose. Folta v. Ferro Eng'g, 2015 IL 118070, ¶ 52, 43 N.E.3d 108, 120

In Folta, the plaintiff’s decedent was allegedly exposed to asbestos while working at a plant owned by Defendant Ferro Engineering from 1966 to 1970. Forty-one years after his last date of employment with Ferro, Mr. Folta was diagnosed with peritoneal mesothelioma. The Supreme Court explained, “the fact that through no fault of the employee’s own, the right to seek recovery under the acts was extinguished before the claim accrued because of the statute of repose does not mean that the acts have no application or that Folta was then free to bring a wrongful death action in circuit court.” The Supreme Court acknowledged that although the exclusive remedy provisions of the Acts may sometimes render harsh results in asbestos exposure cases, “[i]t is the province of the legislature to draw the appropriate balance. It is not [the courts’] role to inject a compromise but, rather, to interpret the acts as written.” Id. at ¶ 43. More than three years after the Folta decision, the Illinois General Assembly took steps to overturn this decision.

On March 14, 2019, the Illinois House of Representatives passed Senate Bill 1596, which was passed by the Illinois Senate on March 6, 2019. The bill now awaits Governor Pritzker’s signature.

Senate Bill 1596 amends the Illinois Workers’ Compensation Act and the Workers' Occupational Diseases Act to allow an employee or employee’s heirs the right to bring a civil action for claims that would have otherwise been barred by the statute of repose. Specifically, Senate Bill 1596, in pertinent part, states:

Subsection (a) of Section 5 and Section 11 do not apply to any injury or death sustained by an employee as to which the recovery of compensation benefits under this Act would be precluded due to the operation of any period of repose or repose provision. As to any such injury or death, the employee, the employee's heirs, and any person having standing under the law to bring a civil action at law, including an action for wrongful death and an action pursuant to Section 27-6 of the Probate Act of 1975, has the nonwaivable right to bring such an action against any employer or employers.

Subsection (a) of Section 5 and Section 11 of the Workers’ Compensation Act and the Workers' Occupational Diseases Act limit the remedies available to an employee to that specifically prescribed under the Acts. To contravene limitations imposed by Subsection (a) of Section 5 and Section 11, Senate Bill 1596 gives employees and their heirs a nonwaivable right to bring a civil action for claims that would otherwise be precluded by the application of the Acts’ statute of repose. Thus, under this provision it is plausible to reason that latent disease claims, including those related to asbestos exposure, against Illinois employers, with limited exceptions, now have perpetual existence.

Understandably, the possible future interpretation of Senate Bill 1596, which takes effect immediately if signed by Governor Pritzker, has caused a great deal of anxiety for Illinois employers, their insurers, and their respective attorneys. Employers should be concerned about an array of issues, including, but not limited to, the potential for the courts to retroactively apply Senate Bill 1596 and the impact of Senate Bill 1596 on claims that are not time barred. Fortunately for employers, Illinois precedent may offer some guidance and limit the scope of the “unknown.”

1. Can Senate Bill 1596 be applied retroactively to revive claims which were time barred prior to its effective date?

Perhaps the greatest concern arising out of Senate Bill 1596 for employers is the uncertainty as to how the courts will apply this bill if it becomes law. Will this bill revive already time-barred claims? In particular, would employees with claims that were time barred prior to the law’s effective date now be permitted to pursue claims in civil court? Fortunately for employers, it appears that Illinois law answers these questions in the negative.

To determine whether a new statutory amendment is to be applied retroactively, the Illinois Supreme Court directs inquiry as to whether the legislature has prescribed the temporal reach of the new amendment. Commonwealth Edison Co. v. Will County Collector, 196 Ill. 2d 27, 38 (2001). Senate Bill 1596 does not indicate whether it is to be applied retroactively. Thus, according to the Illinois Supreme Court, section 4 of the Statute on Statutes must be plugged in as the default guide for the temporal reach of a new statute. Allegis Realty Investors v. Novak, 223 Ill. 2d 318, 331-332 (2006). In pertinent part, section 4 of the Statute on Statutes provides:

No new law shall be construed to repeal a former law, whether such former law is expressly repealed or not, as to any . . . right accrued, or claim arising under the former law, or in any way whatever to affect any such offense or act so committed or done, or any penalty, forfeiture or punishment so incurred, or any right accrued, or claim arising before the new law takes effect, save only that the proceedings thereafter shall conform, so far as practicable, to the laws in force at the time of such proceeding.

5 ILCS 70/4.

Section 4 of the Statute on Statutes permits the retroactive application of “procedural or remedial provisions,” but explicitly “prohibits retroactive application of statutory changes that affect substantive provisions or vested rights.” People v. Glisson, 202 Ill. 2d 499, 509 (2002). (Emphasis added.) It is well established by Illinois precedent that the “legislature lacks the power to reach back and breathe life into a time-barred claim.” Sepmeyer v. Holman, 162 Ill. 2d 249, 254 (1994). This long standing principle is centered upon the view that a defendant has a constitutionally protected right to not be sued after a plaintiff’s claim becomes barred by the applicable statute. See Bd. of Educ. of Normal Sch. Dist. v. Blodgett, 155 Ill. 441, 446 (1895) (holding “when the bar of a statute of limitations has become complete by the running of the full statutory period, the right to plead the statute as a defense is a vested right, which cannot be destroyed by legislation . . . .”) See also M.E.H. v. L.H., 177 Ill. 2d 207, 218 (1997) (finding “a defense based on the expiration of a limitations period is a vested right protected by the constitution and beyond legislative interference.”)

In applying the parameters established by section 4 of the Statute on Statutes, we must first determine the point at which an employer impacted by Senate Bill 1596 accrues a “vested right.” Pursuant to Illinois law, the expiration of a prescribed statutory period for a cause of action creates a vested right protected by the State’s constitution. See M.E.H., 177 Ill. 2d at 218; Sepmeyer, 162 Ill. 2d at 255; and Blodgett, 155 Ill. at 446. Therefore, under Illinois law, any Workers’ Compensation or Workers' Occupational Diseases claim that was time barred before the would be effective date of Senate Bill 1596 will continue to be time barred, because the employer has accrued a vested right to assert this statute of repose defense.

2. Does Senate Bill 1596 impact Workers’ Compensation and Occupational Diseases claims that are not time barred?

From a plain reading of Senate Bill 1596, it appears that Senate Bill 1596 is intended to effect only time-barred claims. Senate Bill 1596 directs that “Subsection (a) of Section 5 and Section 11 do not apply to any injury or death sustained by an employee as to which the recovery of compensation benefits under this Act would be precluded due to the operation of any period of repose or repose provision.” Senate Bill 1596 does not contain any language that would alter any other provision of the Workers’ Compensation Act or Workers' Occupational Diseases Act. Further, during the final House debate of the bill on March 14, 2019, one of the sponsors of Senate Bill 1596, Rep. Jay Hoffman, clarified that this bill would only apply to employees diagnosed with an occupational injury or disease after the 25-year statute of repose and does not otherwise impact the limitations prescribed in the Workers’ Compensation Act or the Workers' Occupational Diseases Act.

HeplerBroom will continue to monitor this bill and any other developments in the Illinois Legislature.