AUGUSTA — The director of the Maine Workers Compensation Board blamed the media and politics Wednesday for the controversy surrounding his decision to remove an injury claims resolution officer from cases involving the NewPage paper mill in Rumford.
Democrats on the Legislature’s labor committee said Paul Sighinolfi could have avoided so much scrutiny if he had been transparent about a decision that raised questions of whether he was siding with a major employer over injured workers.
Through nearly three hours of testimony and inquiry, Democrats pursued questions that cast Sighinolfi as making a secretive decision after NewPage officials complained about unfavorable rulings and met with him and other LePage administration staffers more than two years ago.
The Labor, Commerce, Research and Economic Development Committee sought to shed light on Sighinolfi’s actions, and determine whether any wrongdoing may have occurred and whether a more formal investigation is warranted. The hearing also gave Democrats a chance to take political shots at an appointee of Republican Gov. Paul LePage.
Sighinolfi confidently dismissed the questions one by one, saying his decision was purely operational, “hidden within plain sight” and well within his duties and authority as the board’s executive director.
Republicans on the committee characterized the proceeding as political theater designed to further muddy the image of LePage, who is seeking re-election this year and is cast as favoring business over workers.
Rep. Lawrence Lockman, R-Amherst, described the hearing as a “witch hunt” before leaving in protest.
At issue is the removal of hearing officer Glen Goodnough from cases involving NewPage after the company complained to Sighinolfi and LePage’s staff in November 2011.
Sighinolfi said NewPage’s human resources director approached him with cases in which Goodnough had ruled against the company. Sighinolfi told the Portland Press Herald in March that he reviewed those cases, as well as random cases that he selected, before creating a rotation of officers to handle dispute hearings involving NewPage.
Goodnough was supposed to be included in that rotation, but he never was. Sighinolfi described the omission as a miscommunication between him and his staff.
Goodnough was reinstated after a confrontation between Sighinolfi and labor advocates at a Workers Compensation Board meeting March 11. It was during that meeting that Sighinolfi revealed he had removed Goodnough from NewPage cases.
Asked by the Press Herald last month if his review of Goodnough’s cases showed evidence of bias against the company, Sighinolfi said no.
“There’s a decisional range, from conservative to people who are liberal,” he said. “There was a concern that he was being too liberal. Anytime there’s a perception of things not being entirely fair, perception turns into reality.”
He reiterated that explanation Wednesday.
PERCEPTION issues and politics
Rep. Anne-Marie Mastraccio, D-Sanford, pushed Sighinolfi to reconcile his concern about the perception of unfairness toward NewPage with the perception that he favored a major employer with his decision.
“You’ve said one of the reasons you made this decision was, even though you said that Mr. Goodnough didn’t do anything wrong and you have no problems with the decisions, perception was everything. Well, why was it then that you can’t now understand the perception about what you did … that making a unilateral decision might be the same kind of perception issue?”
He replied, “Because we’re 2½ years later and there’s been no complaints and no problems at all.”
Mastraccio said, “But nobody knew about it, and maybe that’s why you haven’t had any complaints.”
Rep. Erin Herbig, D-Belfast, the committee’s House chair, questioned whether the decision sent a message to other hearing officers to decide more cases in favor of NewPage.
“Could it have? Possibly,” Sighinolfi said. “Did it? I doubt it.”
Republicans questioned the motives for the hearing. Sen. Andre Cushing, R-Hampden, said the controversy had been “stage-managed” and played out in the media before Wednesday’s “political comedy.”
He later defended Sighinolfi, saying he believes the director adequately explained his decision and protected his staff. He said he didn’t object to Sighinolfi making a unilateral decision after one company complained.
“To play this out in the media before you have a hearing says to me that there’s another agenda here besides getting to the bottom of the issue,” Cushing said. “To a degree, I think they staged this as a media event to accomplish an agenda related to a certain statewide race that’s coming up. It doesn’t take long to connect the dots and see who is involved with certain candidates who had representatives sitting in that room today.”
Cushing’s reference was to organized labor’s history of backing Democratic candidates. Unions spent heavily in the 2012 elections to remove Republicans from power, and have signaled that they will be big spenders in Democrats’ bid to unseat LePage.
Local 900 is the Rumford-based affiliate of the national Steelworkers Union, which recently contributed $300,000 to the Maine Democratic Party.
FAIRNESS OF COMP SYSTEM AT ISSUE
Democrats dismissed suggestions of a political motive, saying Sighinolfi could have avoided the scrutiny by informing the compensation board.
Sighinolfi, who has the tie-breaker vote on a board that’s evenly divided between representatives of labor and employers, acknowledged Wednesday that he had taken other personnel matters to the board, but didn’t think the NewPage decision warranted such action.
Sen. John Patrick, D-Rumford, a member of Local 900 and the Senate chair of the labor committee, said balance is critical to the fairness of the workers compensation system. Workers compensation insurance premiums are paid by companies to replace the wages of workers who are injured on the job. The premiums increase when injuries increase or when claims disputes are ruled in favor of employees.
Patrick noted Wednesday that Tony Lyons, a spokesman for NewPage, told the Press Herald in March that the mill in Rumford paid $5 million for workers compensation insurance in 2011, twice as much as any of the other eight mills owned by NewPage.
Patrick said that if the premiums were high, it was because workers were getting hurt.
“Mr. Sighinolfi single-handedly created – or perhaps even reinforced – a perception problem for a system meant to be immune to meddling,” Patrick said in a statement after the meeting. “This should not be a pick-your-own-judge justice system.”
Patrick and Herbig said the committee will consider the information it received Wednesday before making any decisions about its next steps.
Steve Mistler can be contacted at 791-6345 or at: