For Illinois local governments, the Public Safety Employee Benefits Act (“PSEBA”) can be a particularly onerous statute. The law requires that if a police officer or firefighter is “catastrophically” injured in the line of duty while responding to an emergency or when he “reasonably” believes that he is responding to an emergency, he is entitled to have the employer pay the full cost of his health insurance (including family coverage if he has elected it) until he reaches the age for Medicare eligibility. While PSEBA benefits are appropriate for police officers and firefighters who are truly catastrophically injured in the line of duty while responding to emergencies and who, as a result, are no longer able to work, they are extremely costly, usually unfunded and sometimes abused. For instance, many employees who are found to be eligible for the benefits also go on to work other full time jobs. Courts have generally ruled in favor of an expansive reading of eligibility, determining in one notable case that a firefighter who was injured during a training exercise could have “reasonably” believed that he was responding to an emergency and therefore was entitled to PSEBA benefits because his hose got tangled on a chair during the training. Employers must be vigilant in cases where it appears that PSEBA benefits may be sought.
The Illinois Supreme Court has held that a pension board’s finding that an employee is entitled to a line-of-duty-disability pension establishes a “catastrophic injury” for PSEBA purposes. The only other issue then becomes whether or not the firefighter or police officer reasonably believed that he was responding to an emergency. Many local governmental employers chose to seek to intervene in pension proceedings in order to protect their right to question PSEBA eligibility. Now the Illinois Supreme Court has ruled that failure to intervene in a pension proceeding essentially results in a municipality’s waiver of any rights to subsequently contest an applicant’s entitlement to PSEBA benefits.
In Village of Vernon Hills v. Heelan, 396 Ill.Dec. 111, 39 N.E.3d 937 (2015), the Village challenged an applicant’s entitlement to benefits under PSEBA. The Village sought a declaratory judgment alleging that Heelan did not meet the statutory requirement of suffering a “catastrophic injury” under section 10(a) of the Act and of having an injury that resulted from his response to what he reasonably believed was an emergency under section 10(b) of the Act. Ultimately, the parties were able to agree that Heelan satisfied the requirements of section 10(b) of the Act. This left only the issue of whether or not Heelan suffered a “catastrophic injury” under section 10(a). The Village did not file a petition to intervene in Heelan. Instead, the village manager and the village attorney just appeared at the hearing. They were listed as “also present.” The pension board awarded Heelan a line-of-duty disability pension. The Court reiterated it’s holding in Krohe that a pension board’s award of a line-of-duty pension establishes that the public safety employee suffered a “catastrophic injury” as required by section 10(a) of the Act. The Court held that because the Village failed to intervene in the pension proceeding, it was precluded from challenging the issue of catastrophic injury in a subsequent action for declaratory judgment. Specifically, the Court held that, “If an established procedure exists that appears to provide due process, a plaintiff cannot skip that procedure and use the courts to recover what plaintiff wants.”
Employers must seek to intervene in pension board hearings if they have any thoughts of denying PSEBA benefits at a later time. Heelan makes it clear that failure to intervene in the pension proceedings will act as a bar to subsequent efforts by an employer to litigate PSEBA entitlement.
If you have questions regarding intervention in pension proceedings or whether or not it is appropriate to intervene in such proceedings, contact Ancel Glink to discuss your concerns. Don’t wait on this issue. Time, like the Illinois Legislature and Supreme Court, is not generally the employer’s friend.