COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:0189H.02C Bill No.:HCS for HB 123 Subject:Workers Compensation; Labor and Management; Department of Labor and
Industrial Relations; Employees - Employers; Judges
Type:Original Date:March 6, 2025Bill Summary:This proposal modifies provisions related to workers' compensation
administrative law judges.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028
General Revenue*/**
$0 or Unknown to
(Unknown)
$0 or Unknown to
(Unknown)
$0 or Unknown to
(Unknown)
Total Estimated Net
Effect on General
Revenue
$0 or Unknown to
(Unknown)
$0 or Unknown to
(Unknown)
$0 or Unknown to
(Unknown)
*Oversight assumes an unknown savings for worker’s compensation claims and an unknown
savings from the restriction on ALJ salary increases. Oversight assumes the potential savings
could exceed $250,000.
**Oversight assumes $0 to (Unknown) OSCA impact would be less than $250,000 annually.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 0189H.02C
Bill No. HCS for HB 123
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on FTE 000
☐ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☒ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Local Government$0$0$0 L.R. No. 0189H.02C
Bill No. HCS for HB 123
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FISCAL ANALYSIS
ASSUMPTION
§§287.200, 287.615 and 287.835 – Workers’ compensation administrative law judges
Officials from the Office of the State Courts Administrator (OSCA) state HCS for HB 123
may have some fiscal impact but there is no way to quantify that amount currently. Any
significant changes will be reflected in future budget requests.
Oversight notes OSCA assumes this proposal may have some impact on their organization
although it can’t be quantified at this time. As OSCA is unable to provide additional information
regarding the potential impact, Oversight assumes the proposed legislation will have a $0 to
(Unknown) cost to the General Revenue Fund. For fiscal note purposes, Oversight also assumes
the impact will be under $250,000 annually. If this assumption is incorrect, this would alter the
fiscal impact as presented in this fiscal note. If additional information is received, Oversight will
review it to determine if an updated fiscal note should be prepared and seek approval to publish a
new fiscal note.
Officials from the Office of Administration (OA) state§287.200.3(2) of this proposal adds a
provision for an award of permanent total disability to suspend the lifetime payment when the
employee is restored to his or her regular work or its equivalent. This provision could potentially
decrease the cost of a workers’ compensation claim. The potential cost to the state is unknown.
The amount of cost decrease, if any, cannot be estimated as it would depend on the facts and
circumstances of each case and judicial interpretation of the changes.
Oversight has no information to the contrary and will range the fiscal impact of this proposal as
$0 to Unknown savings. It is assumed the potential savings would be less than $250,000
annually since the number of employees restored to his/her regular work would likely be very
low.
Officials from the Department of Labor and Industrial Relations (DOLIR) state §287.610
would have an impact if paying attorney fees on a complaint made against an ALJ by the
Director to AHC that was found to be invalid. However, the impact is unknown and incalculable
because DOLIR doesn't know how much an attorney fee would be.
Oversight assumes attorney fees related to a complaint filed would be minimal and absorbable
by DOLIR and will present no fiscal impact for this agency. Oversight further assumes, if fees
were significant, DOLIR could request additional funding through the appropriations process. L.R. No. 0189H.02C
Bill No. HCS for HB 123
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Officials from the Missouri State Employee's Retirement System (MOSERS) state as it
relates to MOSERS, this proposal, if enacted, would remove §287.835.1 and allow an
Administrative Law Judge (ALJ) and the ALJ’s beneficiary to remain entitled to ALJ plan
retirement benefits if the ALJ were removed from office by impeachment or for misconduct, or
disbarred from the practice of law.
This proposal would result in an unknown cost as it would allow the ALJ and the ALJ’s
beneficiary to receive a benefit that they would not otherwise receive under the current plan
provisions.
Oversight assumes this would impact a minimal number of ALJs. Therefore, Oversight assumes
this would not result in an increase in employer contributions.
In response to the previous version of this proposal, officials from the Office of Administration
- Budget and Planning (B&P) stated §287.470.2 is added which allows the name, information,
and fee arrangement to be changed on a PTD (permanent and total disability) and/or SIF (Second
Injury Fund) file so long as written permission is given by both the claimant and attorney. This
addition will have no fiscal impact.
Section 287.610.8 is repealed 287.610.2, 287.610.3, 287.610.4 and 287.610.5 are modified
allowing the Director of the Division of Workers' Compensation (DWC) to file a complaint
against an Administrative Law Judge (ALJ) who has committed and/or been convicted of a
criminal offense, is guilty of misconduct, habitual intoxication, willful neglect of duty,
corruption in office, or incompetency, or committed any immoral act or oppression in office. The
DWC director shall notify the ALJ the reasons for the complaint before filling it with the
administrative hearing commission (AHC). The ALJ has 90 days from the date of the complaint
to remedy behavior considered willful neglect of duty or incompetency. If the AHC finds
grounds for disciplinary action are met, the DWC director may remove the ALJ from office,
suspend the ALJ from the performance of their duties for a period of time, or other disciplinary
action the director determined by the director. Events or acts committed by an ALJ are deemed a
threat to the administration of provisions in chapter 287, RSMo shall be considered cause for
suspension of duties with pay without notice. These provisions do not impact total state
revenues.
Section 287.615.1(2) repeals the position of chief legal counsel and provides that administrative
law judge salaries are set by statute and not subject to increase when pay raises for executive
employees are appropriated. These provisions do not impact total state revenues.
Section 287.835.1, which prohibits ALJs who are removed from office from receiving benefits,
is repealed. These provisions do not impact total state revenues.
Section 621.045.4 is added allowing the AHC to conduct hearings in cases of complaints made
by the director of the DWC against ALJs as provided in section 287.610. These provisions do not
impact total state revenues. L.R. No. 0189H.02C
Bill No. HCS for HB 123
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Oversight assumes there could be a potential savings that could exceed $250,000 if ALJs are not
subject to the increase when pay raises for executive employees are appropriated.
Officials from the Joint Committee on Public Employee Retirement (JCPER) state its
review of the legislation indicates it would not affect retirement plan benefits as defined in
§105.660(9).
Officials from the Office of Administration - Administrative Hearing Commission assume
the proposal will have no fiscal impact on their organization. Oversight does not have any
information to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for
these agencies.
FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028GENERAL REVENUECosts Avoidance – OA (§287.200) –
potential savings in worker’s
compensation claims p.4-5$0 or Unknown$0 or Unknown$0 or Unknown
Cost Avoidance – ALJ’s – potential
savings in pay raises (§§287.615 &
287.835) p. 4-5$0 or Unknown$0 or Unknown$0 or Unknown
Costs – OSCA (§§287.200, 287.615
and 287.835) – increase in costs related
to disability and ALJ provisions p.3
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
ESTIMATED NET EFFECT ON
THE GENERAL REVENUE FUND
$0 or
Unknown to
(Unknown)
$0 or
Unknown to
(Unknown)
$0 or
Unknown to
(Unknown)
FISCAL IMPACT – Local GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028$0$0$0 L.R. No. 0189H.02C
Bill No. HCS for HB 123
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FISCAL IMPACT – Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
FISCAL DESCRIPTION
The bill provides that the compensation for Administrative Law Judges and chief administrative
law judges will be determined solely by the rate outlined in law and will not increase when pay
raises for executive employees are appropriated. (§287.615)
The bill repeals a prohibition on the payment of any retirement benefits under Workers'
Compensation law to any Administrative Law Judge who has been removed from office by
impeachment or for misconduct, or to any person who has been disbarred from the practice of
law, or to the beneficiary of any such persons. (§287.835)
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Office of Administration - Administrative Hearing Commission
Office of Administration - Budget and Planning
Department of Labor and Industrial Relations
Office of Administration
Joint Committee on Public Employee Retirement
Missouri State Employee's Retirement System
Office of the State Courts Administrator
Julie MorffJessica HarrisDirectorAssistant DirectorMarch 6, 2025March 6, 2025