CT reaches tentative deal with unions on disability pay controversy

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Lisa Grasso Egan, undersecretary for the Office of Policy and Management\’s labor relations unit.

Negotiators for the state and its employee unions have reached a tentative agreement that could resolve a long-running controversy over state disability pension payments, the state’s chief labor negotiator said Thursday.

Lisa Grasso Egan, who heads the Office of Labor Relations, also told the State Employees Retirement Commission that she expects the State Employees Bargaining Agent Coalition to consider the tentative deal later this month.

At issue is a requirement that disabled employees unable to return to their original jobs be considered for placement in “suitable and comparable” positions. Injured workers specifically are supposed to receive medical exams and be considered for alternative job placement to receive disability pensions for longer than two years.

State Auditors Robert M. Ward and John C. Geragosian reported last month that the state hasn’t been conducting medical reviews since the fall of 2013. That report stemmed from a whistleblower complaint filed by a former attorney for the state’s retirement system.

And for several years before the state had employed a weaker standard for returning to work that — according to the auditors — probably resulted in the improper payment of millions of dollars in disability benefits. Connecticut had allowed injured workers to continue receiving disability benefits as long as they were unable to return to their original job.

Comptroller Kevin P. Lembo, whose office administers pension benefits, said this practice was established before he took office in January 2011.

Lembo said he immediately raised concerns and urged the administration and unions to address the matter through negotiations. In 2012, when the matter still was unresolved, the comptroller undertook his own review of the “suitable and comparable” standard.

The state’s Medical Examining Board, which performs medical reviews for disability benefits, followed the more stringent standard espoused by Lembo in September and October 2013. The auditors noted this resulted in a “significant increase” in denials of disability benefits.

But after it also prompted complaints from state employee unions, the comptroller suspended the medical reviews and again urged the state and the unions to negotiate and reach agreement on a re-employment standard for disabled workers.

“It’s encouraging to hear that an agreement is imminent. I continue to urge labor and management to immediately finish their work to protect the interests and integrity of the State Employees Retirement System,” Lembo said Thursday of Egan’s announcement.

“The parties have reached a mutual understanding on the correct interpretation of the ‘suitable and comparable’ standard in the agreement,” Hartford attorney Daniel Livingston, chief negotiator for the State Employees Bargaining Agent Coalition, said Thursday. “SEBAC leadership is expected to take action at their August meeting.”

Virginia Brown, an attorney for the retirement services division within the comptroller’s office from September 2012 through November 2014, filed a lawsuit in federal court in May alleging that she was pressured by Lembo and his top staff not to disclose these and other problems with the pension system. She also filed the whistleblower complaint with the auditors.

Lembo denies any coercion or retaliation occurred.