THE RECODIFICATION OF THE IDAHO WORKERS’ COMPENSATION ACT (1969-71)
John F. Greenfield
Reprinted from the December, 2012 Advocate

The only wholesale recodification of the Idaho workers’ compensation law took place over a two-year period between 1969 and 1971. The recodification resulted in hundreds of changes, large and small, to the original act passed by the Idaho legislature in 1917. This was no small feat given the fact that our workers’ compensation act encompasses no less than one and one-half volumes of the Idaho Code.1

Reprinted from the December, 2012 Advocate

Some of the changes had become necessary because of natural phenomena that had not existed in 1917, like the advent of chronic inflation which began to emerge in the 1960’s. Other changes were needed to correct flaws that slowly revealed themselves after lawyers, industrial commissioners and Idaho Supreme Court justices began working with the original law. The recodification was a lengthy and serious undertaking. It was accomplished by an ad hoc committee of in-state experts on workers’ compensation mainly representing business and labor interests.2 Their efforts vastly improved this crucial law, which governs the redress of industrial injuries for every employer and employee in the state of Idaho.

The work of the Recodification Committee officially went into effect on January 1, 1972. While the act has been amended from time to time since that date, the main framework of the recodified law remains intact. As a result, the Idaho workers’ compensation system is viewed as fair, efficient and stable by both employers and employees. This is truly important because Idaho employers and employees are the principal objects of the act.

It is noteworthy that the Idaho law is constantly being studied by surrounding states for clues as to how they can improve their own workers’ compensation systems. Essentially, our statute is regarded by other jurisdictions as something of a model act. These admirers need to know that the strength of our modern workers’ compensation act emanates from a broadbased bipartisanship, exercised 40 years ago on a massive scale by the men of good will who served on the Recodification Committee.

The original Idaho Workers’ Compensation Act of 1917 The original Idaho workers’ compensation act was enacted in 1917 after a primal series of negotiations between the forces of business and labor within the state of Idaho. The creation of the Idaho act was contemporaneous with the creation of other workers’ compensation laws across the country. Nearly all of these statutes were enacted around the turn of the 20th century.

The birth of American workers’ compensation followed an earlier wave of workers’ compensation legislation in Europe. These laws included the 1897 British act to which American drafters paid particular attention as we hammered out our own systems on a state by state basis. This is because workers’ compensation would replace Anglo American tort jurisprudence which had developed, over centuries, in the common law of both the United Kingdom and the United States. The exchange of common law tort remedies for statutory workers’ compensation systems presented similar drafting issues for both nations.

Workers’ compensation legislation was necessitated by new economic and workplace realities created by the Industrial Revolution of the 1800’s. When people started getting their hands cut off in machines instead of merely blackening their thumbnails with hammers, negligence was difficult to prove in either direction. Moreover, proof of fault was seen, by employers and employees alike, as less important than the medical and vocational restoration of the injured worker. Negligence-based tort remedies were soon regarded as “inconsistent with modern industrial conditions.”3 Here, I quote from the seminal portion of the original Idaho workers’ compensation act in which the 1917 Idaho legislature “withdrew” industrial injuries “from private controversy.” By saying this the legislature meant that it was withdrawing the legal redress of workplace injuries from the negligence- based law of torts. It was simultaneously replacing the tort system with a workers’ compensation system, citing to its “police and sovereign power” under the Idaho State Constitution as authority for doing these things.4

A different way of compensating industrial injury was clearly needed. The common law tort system, with its litigious aspects of fault, negligence, and damages proved in jury trials, was unworkable when it came to the redress of industrial injury. For one thing, the tort system could not guarantee immediate and reasonable medical treatment for an injured worker without requiring him to prove that his injury was his employer’s fault, but immediate medical treatment without proof of fault was seen as an imperative. So was a systematic method of immediately compensating wage loss, regardless of fault.

Reprinted from the December, 2012 Advocate

Clearly, a no-fault insurance program was the answer. Contributory and comparative negligence would be irrelevant in a no-fault system. Also irrelevant to such a system would be traditional tort damages for pain and suffering. The return of the injured employee to work as soon as possible would be the policy, as would vocational rehabilitation when necessary to this objective. Remuneration for permanent loss of wage-earning capacity would also part of the new system. By contrast, punishing the employer for his negligence in causing an employee’s accident would not be a component of the new system. It must be understood that none of these changes would have occurred had leaders of business and organized labor not agreed to them and been proactive in their enactment. When the two main “stakeholders” of Idaho industry joined together in the spirit of compromise to get it done, it got done. They took it upon themselves to develop the Idaho workers’ compensation system, drafted the act, arranged for its introduction in the 1917 Idaho legislature, and pressed for the legislation’s passage.

Idaho’s original workers’ compensation act of 1917 worked pretty much as intended but, after about 50 years, serious cracks were identified by both business and labor. Virtually all forms of “social insurance” feature government-mandated insurance coverage that is viewed by a political majority as benefiting the public as a whole. This is true, in the United States, of Social Security and Medicare. It is also true of workers’ compensation. A major difference between the first two programs and workers’ compensation is that the latter involves private insurance coverage. Employers pay the premiums as a cost of doing business. Employees enjoy the coverage, knowing that they have traded tort remedies for it. These workers are willing to make the trade so long as the medical treatment and maintenance level wage-loss benefits are “sure and certain.”5 Usually, if not always, this is the case. In America, workers’ compensation was adopted on a state by state basis. This may have been because the economies of the various states were somewhat different, or because the tort remedies that workers’ compensation would replace were more oriented to state than national law. In any event, the United States has never seen fit to adopt a national workers’ compensation system.

The Recodification
1. The Organization of the Recodification Committee in 1969 Idaho’s original workers’ compensation act of 1917 worked pretty much as intended but, after about 50 years, serious cracks were identified by both business and labor. At this point in 1969, the two stakeholders agreed to modernize and recodify the statute. They approached legislative leadership and arranged for a recodification process under the nominal auspices of the Idaho Legislative Council. The Legislative Council, composed exclusively of state senators and representatives from both political parties, agreed to sponsor such a recodification. The Legislative Council chose a chairman, then effectively bowed out of the process and let the Recodification Committee do its work. The chairman of the Recodification Committee was E.B. Smith, a Boise lawyer who was also a former chief justice of the Idaho Supreme Court. Justice Smith was the only member of the Committee who was paid by the State of Idaho. The other members of the Committee, all of whom represented various factions of either business or labor, were compensated for their time by those private interests. Only one member of the Committee was a sitting legislator and he appears to have been paid by his private clients.

Justice Smith personally recruited the members of the Recodification Committee. Each of these members represented important sectors of either business or labor, and each of them had significant knowledge of, and experience in, Idaho workers’ compensation law. The Committee members representing business included Samuel Kaufman, a Boise lawyer and sitting Republican state senator. Mr. Kaufman officially represented self-insured employers on the Committee. Such large employers included J.R. Simplot Co., Boise Cascade, Potlatch Corporation, FMC Corporation, the Amalgamated Sugar Company, Albertson’s, Inc. and a dozen others. Mr. Kaufman had previously represented these kinds of self-insured employers in his legal practice, but he had also defended private sureties.

Business was also represented by Glenn A. Coughlan, another Boise lawyer who practiced workers’ compensation defense. His largest client was the Idaho State Insurance Fund, a quasi-private carrier which insured nearly half of all employers in Idaho (now over 70%).

Lawrence G. Sirhall was the manager of the state’s largest private workers’ compensation insurance carrier, the Industrial Indemnity Co. He represented the interests of all private sureties on the Committee. Mr. Sirhall would later be appointed to the three-person Industrial Commission where he served for many years as the commissioner from the world of business. Labor interests on the Recodification Committee were represented by Robert W. MacFarlane, the president of the Idaho State AFL-CIO. Also representing labor was George A. Greenfield, a Boise claimants’ lawyer and a former state chair of the Idaho Democratic Party.

Important consultants to the Committee’s factions included John W. Barrett, a Boise defense attorney who assisted business interests. Paul C. Keeton, a veteran claimants’ lawyer from Lewiston, was of service to labor interests. It was an impressive, experienced group, and extremely well-rounded.

2. The Work of the Committee From the beginning, it was recognized by Justice Smith and the Recodification Committee members that they should utilize the work of a bi-partisan national think-tank on workers’ compensation as a template for Idaho’s recodification. The group was known as the Council of State Governments. It was headquartered in Washington, D.C., and was partially composed of national figures from business and labor. The national committee’s chairman was Arthur Larson, a Duke University law professor who was generally recognized as the foremost authority on workers’ compensation in the United States. The venerable Larson treatise on workers’ compensation bears his name. The Council of State Governments had analyzed most of the knotty problems that were arising in workers’ compensation throughout the country by the late 1960’s. The Council drafted a Model Act, painstakingly addressing these modern problems. Each section of the Model Act was accompanied by explanatory comments. Access to the pristine language of the Model Act helped the Idaho recodifiers immensely, mainly because every statute in a workers’ compensation law interrelates with other statutes in the same act. Among the most serious problems facing the Idaho Recodification Committee was chronic monetary inflation. This phenomenon began to infect all American and European monetary systems in the years following World War II. When chronic inflation crept into the woodwork, it immediately began to devalue the wage loss schedules in every workers’ compensation act. Workers continued to suffer workplace injuries, but were getting less in workers’ compensation benefits because of inflation.

At first, the Idaho legislature dealt with the problem by periodically raising the benefit schedules. This cumbersome process proved unsatisfactory. The Idaho legislature only met every two years in those days, and some of its legislators actually equated raises in workers’ compensation benefits with raising taxes. Business and labor leaders soon recognized that a permanent cost-of-living mechanism was needed to automatically adjust the schedules each year. The Idaho recodifiers devised a permanent costof- living adjustment mechanism for the “wage loss” benefit schedules. Their new “COLA” would be tied to the annual increase (or theoretical decrease) in Idaho’s average weekly state wage.

Another deep-seated problem was of a kind that was rooted in the original act but was not appreciated until practitioners and judges had worked with the original statute for several years. It involved the definition of the word “accident.” The definition of a compensable industrial “accident” in the original law required an injured worker to identify, with complete precision, the time when and the place where his accident had occurred. This definition led to many inequities.

Reprinted from the December, 2012 Advocate

Both business and labor leaders came to recognize, after some years, that an “accident” should be “reasonably” identified as to time and location, rather than “precisely” identified as to time and location. This change had been recommended by the Council of State Governments and had been drafted into its Model Act. Idaho’s Recodification Committee would secure this change in our definition of “accident.” The change eliminated defenses based on a worker’s inability to identify, with absolute precision, something that could not always be identified with such precision. For example, a workman might be finishing a floor on his hands and knees, subjecting his knees to trauma over the course of several hours and causing serious soft tissue injury to one of his knees necessitating surgery. Prior to the recodification, that worker was stymied. Unable in such a situation to identify precisely when and where his accident occurred he could not establish a valid workers’ compensation claim, as the Idaho Supreme Court formally determined in decisions interpreting the old “accident” rule.6

The recodified definition of the word “accident” compelled the Idaho Supreme Court to find compensability in such cases, and in similar cases – where an individual went to work without a disc herniation, participated for a day or so in work which could easily cause a disc herniation like driving a front end loader (or hyster) with bad springs in the seat, then realized, at the end of the workday, that a gradual pain he began suffering that day in his low back (or neck) was due to a freshly herniated lumbar (or cervical) disc. Such cases were obviously work-related but they had been found non-compensable prior to the recodification. After the recodification, such injuries were determined to be compensable – bringing the law into conformance with the realities of the workplace as well as modern medicine.7

A third problem involved inadequate “death benefits” for the widows and widowers of workers killed on the job. These benefits were insufficient for the grieving spouse as well as the dependent children of the deceased. Remarkably, the recodification’s needed increase in death benefits went into effect just 5 months before some 91 miners died in the legendary Sunshine Mine disaster in the Coeur d’Alene mining district on May 2, 1972. The Sunshine Mine widows never would have made it otherwise. Pre-recodification death benefits had not been enough to feed a family. Post-recodification death benefits provided surviving spouses and dependent children with sufficient (if bare-bones) death benefits and burial expenses.

Another sweeping change in the recodified statute involved occupational diseases. Prior to the change, the only compensable occupational diseases were those contained on a short list residing in the occupational disease section of the Idaho workers’ compensation statutes. The recodified law retained the original list but added a proviso that the list was not to be deemed exclusive.8 Any non-listed disease that could be medically linked to one’s work was now equally compensable. The architects of the recodification specifically noted, in its amendment to the statute, that since new industrial toxins were constantly being invented, and then used (and sometimes misused) in the modern workplace, the law must recognize this fact of life.9

Hundreds of other changes were made to the law but the above-discussed examples reflect the range and depth of the recodification process. Later changes to the act, like the 1997 amendment that finally repealed the provision excluding farm workers from the Idaho workers’ compensation system, were discussed by Recodification Committee members but were left to another day. At the time of the recodification, there was insufficient political resolve to repeal this racist exclusion which denied workers’ compensation coverage to tens of thousands of the hardest working people in our society. Without the recodification, however, the average Latino farm worker might have been better off under the tort system.

By 1971, the Recodification Committee had organized recommendations for literally hundreds of legislative improvements to the law. The Committee placed its proposed legislation in a comprehensive component known as an “omnibus bill.” The Committee then presented the omnibus bill, containing all of its recommendations in a single package, to the 1971 legislature. Because the recodification was officially sponsored by the Idaho Legislative Council, because the Recodification Committee members were recognized experts in workers’ compensation, and especially because the proposed legislative changes recommended by the Committee represented a carefully crafted compromise by the chief stakeholders of the workers’ compensation system itself, i.e., business and labor, the legislature had absolutely no interest in tinkering with the bill.

The omnibus bill was signed in 1971 by Governor Cecil D. Andrus, a Democrat who had just been elected chief executive in November 1970. The recodification process had commenced two years earlier under a Republican Governor, Don Samuelson. The recodification is a profound example of a bipartisan undertaking.

In only 40 years, such bipartisan problem solving, nationally and statewide, has sadly vanished. If they seek to move Idaho forward in the coming years, today’s political leaders would do well to study the 1969-1971 recodification of the Idaho Workers’ Compensation Law.

The Advocate • November/December 2012

Endnotes
1 Volumes 11 and 11A, Idaho Code.
2 The proceedings of the Recodification Committee are lodged, somewhat organized, at the Idaho Legislative Reference Library on the first floor of the Idaho Capitol Building. The Legislative Reference Library is maintained by the Idaho State Legislature and not the Idaho Supreme Court, although both libraries are open to the public.
3 1917 Idaho Session Laws, Chapter 81, Part I, Section 1(b); later codified at Idaho Code Section 43- 902; now codified, since 1972, at Idaho Code Section 72-201. See, discussion of Justice Raymond L. Givens in Arneson v. Robinson, 59 Idaho 223 at 239, 82 P.2d 249 (1938).
4 It should be of interest to the bench and bar that the “seminal” portion of the Idaho workers’ compensation act was phrased somewhat differently in the original 1917 version than it is today. The problems with handling industrial injury under the tort system were painfully obvious in 1917. Accordingly, the drafters of the new workers’ compensation act chose to discuss these problems in the seminal portion of the act itself, possibly to ensure passage. By the time of the 1972 recodification, 50 years later, the long running operation of the workers’ compensation system had alleviated those concerns. This evidently negated the need for the Recodification Committee to discuss them when restating the “seminal” statute in recodification at Idaho Code Section 72-201. The two versions of the seminal statute are set forth below. The italicized portion of the original act does not exist in the recodified act.

“The Common Law System governing the remedy of workmen against employers for injuries received in industrial and public work is inconsistent with modern industrial conditions. The administration of the common law system in such cases has produced the result that little of the cost to the employer has reached the injured workman and that little at large expense to the public. The remedy of the workman has been uncertain, slow and inadequate. Injuries in such employments formerly occasional have become frequent and inevitable. The welfare of the State depends upon its industries, and even more upon the welfare of its wage workers. The State of Idaho, therefore, exercising herein its police and sovereign power, declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for injured workmen and their families and dependents, is hereby provided regardless of questions of fault and to the exclusion of every other remedy, proceeding or compensation, except as is otherwise provided in this Act, and to that end all civil actions, and civil causes of action for such personal injuries, and all jurisdiction of the courts of the State over such causes are hereby abolished, except as in this Act provided.” 1917 Idaho Session Laws, Chapter 81, Part I, Section 1(b). [The original statute]. (Emphasis added.)

“The common law system governing the remedy of workmen against employers for injuries received and occupational diseases contracted in industrial and public work is inconsistent with modern industrial conditions. The welfare of the state depends upon its industries and even more upon the welfare of its wage workers. The state of Idaho, therefore, exercising herein its police and sovereign power, declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for injured workmen and their families and dependents is hereby provided regardless of questions of fault and to the exclusion of every other remedy, proceeding or compensation, except as is otherwise provided in this act, and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished, except as in this law provided.” Idaho Code Section 72-201. [The present statute].
5 Id.
6 See, i.e., Carlson v. Batts, 69 Idaho 456, 458, 207 P.2d 1023 (1949).
7 Wynn v. J.R. Simplot Co., 105 Idaho 102, 666 P.2d 629 (1983); Stevens-McAtee v. Potlatch Corp., 145 Idaho 325, 179 P.3d 288 (2008).
8 Idaho Code Section 72-438.
9 Id.

Reprinted from the December, 2012 Advocate