Call to Order and Roll Call
The 3rd meeting of the Interim Joint Committee on Labor and Industry was held on Tuesday, September 10, 2013, at 2:30 PM, in Room A of the Convention Center at Kentucky Dam Village State Resort Park. Representative Rick G. Nelson, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Representative Rick G. Nelson, Co-Chair; Senators Julian M. Carroll, Perry B. Clark, Ernie Harris, Jimmy Higdon, Dennis Parrett, and Mike Wilson; Representatives Lynn Bechler, Denver Butler, Will Coursey, Jeffery Donohue, C.B. Embry Jr., Richard Henderson, Dennis Horlander, Joni L. Jenkins, Adam Koenig, Mary Lou Marzian, Charles Miller, Terry Mills, Tanya Pullin, Tom Riner, Jim Stewart III, and Brent Yonts.
Guests: Secretary Thomas O. Zawacki, Education and Workforce Development Cabinet; Commissioner Beth Brinly, Department of Workforce Development; Commissioner Dwight Lovan, Department of Workers’ Claims; Doug Gott, Administrative Law Judge; Secretary Larry Roberts, Kentucky Labor Cabinet.
LRC Staff: Carla Montgomery, Matt Ross, Adanna Hydes, and Betsy Nickens.
Co-Chair Nelson welcomed the committee members and attendees of the 36th annual Labor-Management Conference. The minutes of the meeting held on July 18, 2013, were approved by voice vote. As the elected representative from Marshall County, Representative Coursey thanked the members for their continued support of the Kentucky Labor-Management Conference, held at Kentucky Dam Village State Resort Park in Gilbertsville.
Unemployment Insurance Update
Secretary Zawacki, Education and Workforce Development Cabinet, along with Commissioner Beth Brinly, Department of Workforce Development, testified about the status of the unemployment insurance trust fund. Commissioner Zawacki explained that Kentucky’s unemployment insurance system had been relying on the accumulated trust fund balance to pay out benefits, but on January 28, 2009, contributions from employers were no longer sufficient to pay claims. Kentucky was the sixth state to borrow federal money to pay unemployment insurance claims. In March 2009, Governor Beshear created a task force to deal with bringing the trust fund back into solvency. Commissioner Zawacki stated that recommendations from the task force, codified in House Bill 5 (2012 Special Session), have been implemented. In 2012, contributions exceeded claims. Through a joint effort with the Division of Unemployment Insurance, the Cabinet Office of Technology Services, and the Commonwealth Office of Technology, a third party consultant recommended 60 improvements to process and procedures titled, “The Business Process Efficiency and Effectiveness Report.” Twenty of the recommendations to improve efficiency and morale have been implemented, the remaining 40 recommendations are being considered in order of priority.
Over $7.5 million from delinquent claimants and employers has been recovered through the federal treasury offset program initiated in 2013. In 2014, the program will begin to intercept payments made through travel reimbursements from employers who are delinquent. Commissioner Zawacki stated the cabinet is on target to pay all federal Title XII advances by 2017, five years earlier than originally anticipated. The cabinet expects to lower the federal unemployment insurance loan by over $162 million in 2013, bringing the balance to $675 million. The original loan was $1 billion.
New Procedures for Medical Fee Disputes
Commissioner Dwight Lovan of the Department of Workers Claims and Doug Gott, Administrative Law Judge (ALJ) testified about new procedures for litigation in medical disputes. Commissioner Lovan said medical fee disputes have been an area of concern for the department for several years. In January 2013, a panel of attorneys and physicians made recommendations to deal with the growing number of medical disputes. All medical disputes have since been assigned to two administrative law judges. Judge Doug Gott, an ALJ assigned specifically to medical disputes, said the new procedures have expedited the tremendous volume and made the litigation much easier to navigate for claimants. Medical providers involved in a claim are now involved in the litigation process. The result has been more efficient and less costly for all involved.
Labor-Management Relations and Apprenticeship and Training
Secretary Larry Roberts, Kentucky Labor Cabinet, thanked the committee for taking part in the Labor-Management Conference. The Apprenticeship and Training Conference, which was first held in 1959 has been a lead-in to the Labor-Management Conference since 2000. Growth of the apprenticeship conference has been impeded by the success of the larger labor-management group and the decision has been made to move the conference to another location in order to expand participation.
Secretary Roberts discussed the participation of the Economic Development Cabinet, the Education and Workforce Development Cabinet, and the Office of Career and Technical Education in initiating the Tech Ready Apprentices for Careers in Kentucky (TRACK) program. Piloted in 11 Kentucky school districts, the program identifies students for the program and employers within the community commit to developing registered apprenticeship programs. Secretary Roberts said the Labor Cabinet will seek legislation in 2014 to modify the apprenticeship statutes in KRS 343 in order to comply with the changes that have been adopted by the federal government.
Representative Miller commended the TRACK program and Senator Carroll spoke about the importance of trained and qualified career ready graduates.
There being no further business the meeting adjourned.