P.R. Laws tit. 11, § 8
I. Services organizations.— The following entities shall be in charge of rendering compensation services to workers and employees:
(a) The Office of the Administrator of the State Insurance Fund, which is hereby created, shall be in charge of the following duties and functions:
The Administrator shall establish the administrative structure of the State Insurance Fund, and shall establish, organize and administer its own adequate systems and appropriate controls regarding personnel, budget, purchases, and accounting, and any other administrative system necessary for an efficient and economic operation of the services, without being subject to the provisions of Act No. 345 of May 12, 1947, as amended, known as the “Personnel Act”, Act No. 96 of June 29, 1954, known as the “Procurement and Service Act”, and Sections 81 through 89 of Act No. 213 of May 12, 1942, as amended, known as the “Puerto Rico Planning and Budget Act”, with the exception of what is hereafter provided in regards to the Personnel Act.
The Administrator shall be empowered to purchase, contract or otherwise provide the SIFC with all the materials, supplies, equipment, parts, or services which he/she may deem necessary or convenient for its operation. He/she shall likewise be empowered to reinsure part of the risks that under the provisions of this chapter he/she is bound to insure, if he/she deems it necessary and advisable in order to safeguard the economic solvency of the State Insurance Fund.
He/she shall provide medical, hospital, and physical rehabilitation services; make compensation payments and liquidate the cases of workers and employees insured in the State Insurance Fund. He/she shall also constitute the insurer known as “State Insurance Fund”. Provided, That, in order to ensure the continuous and effective rendering of services in cases where the execution of a contract before rendering such services would not be possible, the Administrator may authorize payment for professional medical and hospital services, specialized medical services or any other services related to the health of the injured worker to providers that do not have a contract in effect with the State Insurance Fund at the time that the services are rendered. The SIFC shall adopt regulations governing the issuance of payment to providers without a contract within a term not to exceed ninety (90) days from the date on which this act takes effect. Likewise, said Administrator shall insure, pursuant to the law and regulations, all employers required by law to be insured with the State Insurance Fund. He/she shall authorize, oversee, and make all disbursements which, according to the law, should be made against the State Insurance Fund, and shall ensure the timely remittance of the imposition of workers’ compensation insurance premiums to the employers as well as to the municipalities, and in the case of the municipalities, he/she shall comply with the provisions set forth in § 1b-4 of this title, and shall perform all other duties conferred upon him/her pursuant to this chapter and to the regulations adopted thereunder. Provided, That payments made under the preceding provisions may be reimbursed to the State Insurance Fund and shall be credited to an account to be kept by the Administration of the Fund, which shall be known as “Outstanding Debts”; Provided, further, That both the warrants issued and the checks drawn in payment of the obligations contracted shall state on the face thereof the term within which they may be cashed, which shall not be less than six (6) months nor more than two (2) years from the issue date. The drawee of a check so reimbursed shall have the right to cash it in the manner established for the claims authorized and liquidated against the Commonwealth of Puerto Rico.
The Manager of the State Fund shall be the head of the said office, and shall be appointed by the Governor, by and with the advice and consent of the Senate, for a term of six (6) years.
The Manager of the State Fund shall furnish bond in the sum of twenty-five thousand dollars ($25,000) conditioned upon the faithful performance of his official duties, the premium on which shall be paid by the State Fund. Said bond shall be approved by the Secretary of the Treasury as to amount, and by the Secretary of Justice as to legal form.
The Manager of the Fund shall require the furnishing of a bond for such amount as he may deem adequate, from all officers or employees under his orders and who, for any reason, have charge of the handling of funds. The premiums on these bonds shall also be paid by the State Fund and shall be approved in the same manner as the bond of the Manager.
The Manager or the officer whom he may designate shall represent the State Insurance Fund before any agency or institution established by laws in force.
(b) Industrial Commission.—
(1) Creation and organization.— A Commission is hereby created, to be denominated as the “Puerto Rico Industrial Commission”, constituted by five (5) Commissioners appointed by the Governor with the advice and consent of the Senate of Puerto Rico, who shall be attorneys-at-law duly admitted to the bar in Puerto Rico. The Governor, with the advice and consent of the Senate, shall designate the Chair, who shall serve simultaneously as a Commissioner and the Administrative Head of this Agency, who shall set forth and administer the public policy with discharge rulemaking authority or to delegate such authority. In order to carry out this task, he/she shall preside and direct the functions of the Commissioner panel, whose appointments shall have an effective term of six (6) years.
Commissioners shall remain in office until their successors are legally designated and take office. The designations to cover vacancies that may arise for reasons other than the expiration of the term set forth by law shall be extended until the expiration of the term of the vacancy. Commissioners and Examining Officials, during their term of office, shall not engage in doing business or to the practice their profession privately.
The main headquarters of the Industrial Commission shall be located in San Juan, but [the] same may constitute itself or act anywhere within the Commonwealth of Puerto Rico, and establish the regional offices it deems necessary for the performance of its duties set forth by law.
The President shall be the administrative head and nominating authority of the Commission. To such effects, the President shall adopt all personnel determinations and shall be responsible for enforcing of the public policy and purposes of this chapter. He/she shall report directly to the Governor, and shall carry out all duties, responsibilities, and prerogatives of his/her office, pursuant to the regulation set forth by the Commission to these effects.
In addition, the President shall oversee the faithful compliance and uniformity of the adjudicative public policy set forth in this chapter. He/she shall also be empowered to hire and designate personnel and officials to perform the duties of the Commission, pursuant to the dispositions in this chapter. He/she may purchase, hire, or otherwise provide for the Commission all the materials, supplies, equipment, parts, or services he/she deems convenient for the operations of the Commission. Such powers shall be exercised according to the dispositions set forth by the applicable laws in effect.
The President may delegate the administrative duties set forth in reliance on this chapter upon an Executive Director, who shall be in office as long as same enjoys the confidence of the President. The President shall establish the duties and powers of the Executive Director, except for the exercise of the nominating authority.
The Industrial Commission shall be an agency excluded from the dispositions set forth in Act No. 5 of October 14, 1975, known as the “Puerto Rico Public Service Personnel Act”, except for matters pertaining to the essential areas of the merit principle. His/her personnel system shall be based upon the merit principle and in accordance with the rules and regulations adopted by the President. The Commission shall have the confidential charges allowed by the applicable laws in effect.
Since the source of funds for the operation of the Commission is the State Insurance Fund Corporation, which operates as a corporate instrumentality, pursuant to §§ 61 et seq. of Title 29, and do not burden the General Budget of Puerto Rico, the right of the employees pursuant to said sections to organize among themselves; constitute, affiliate, or assist labor organizations; negotiate collectively, including the establishment of procedures to hear claims and grievances by means of selected representatives, is hereby acknowledged. All allegations regarding illegal practices shall be handled by the Labor Relations Board.
All employees occupying equal or similar positions to those that comprise the appropriate negotiations unit acknowledged in the collective bargaining agreement in effect shall be included in said unit, with all guaranteed rights and duties entailed with the certification already in effect.
The final resolutions of the Industrial Commission may be revised by the courts of justice pursuant to the dispositions set forth in Act No. 1 of July 28, 1994, as amended, known as the “Puerto Rico Judiciary Act of 1994”. The recourse of revision shall be exempt from the payment of fees.
The Industrial Commission shall oversee compliance with the social objectives of this chapter and that the same are administered in such a manner that they respond to the needs of the times. It shall also have functions of a “quasi-tutelary” and “quasi-judicial” nature for the investigation and resolution of all cases of accidents in which the Corporation and the injured employee, or his/her beneficiaries, do not reach an agreement with regard to the compensation; and the Commission shall only represent the public interest in the discharge of its functions. All determinations requiring the action of the Commissioners shall be by the majority of its members and three (3) Commissioners shall constitute [a] quorum.
(2) Industrial Commission’s Budget.—
(A) The Governor shall submit the expense budget of the Industrial Commission to each Regular Session of the Legislature, pursuant to the provisions established by law, for its approval.
(B) The Corporation shall keep a fund or special account from which the Secretary of the Treasury shall transfer a sum to meet the expenses of the Industrial Commission; an amount that shall always be equal to four percent (4%) of the total receipts of the Corporation’s premiums during the previous fiscal year. In the event the authorized budget is greater than the amount transferred by the Corporation, the difference shall be charged to the general budget.
(C) The Secretary of the Treasury shall pay and charge against the fund or special account established in the previous clause, all warrants or vouchers drawn against the Industrial Commission, when they are authorized by the President, and approved by the Secretary of the Treasury.
II. Means and methods.—
(a) Arbitration Board.— There is hereby created an Arbitration Board to be composed of an authorized representative of the Manager, an authorized representative of the employees and workers of the State Insurance Fund and a third representative which they shall designate by mutual agreement. If the parties should not reach an agreement within ten days in regard to the selection of the third member, he shall then be selected by the Secretary of Labor and Human Resources. Provided, That the person designated by the Secretary of Labor and Human Resources shall not be an officer or employee of the Executive Branch.
The decision rendered by the majority of said Arbitration Board shall be binding upon all parties.
(b) Jurisdiction of the Labor Relations Board.— Jurisdiction is hereby conferred upon the Labor Relations Board of the Commonwealth of Puerto Rico over the State Insurance Fund, so that the employees and workers of said agency may exercise their rights to organize themselves and to collectively bargain with their employer through mediation of representatives of their own free choosing.
(c) Obligation of the employees and of the Agency.— The employees and the State Insurance Fund are under obligation to do all within their power to settle management-labor disputes through collective bargaining and through the fulfillment of the collective bargaining agreement entered into, and not otherwise, so as to prevent stoppage of the services they render to the public.
The provisions of §§ 91-97 of Title 29 shall apply when so required by the circumstances.
(d) Designation of conciliator.— If in the opinion of the Secretary of Labor the process of negotiating a collective bargaining agreement between the State Insurance Fund and its employees has come to a halt, the parties having exhausted all possible means to settle the dispute, the Secretary of Labor shall proceed to designate a conciliator, who shall, as soon as possible, get together with both parties in dispute and make all reasonable effort to arrive at a prompt and satisfactory solution of the conflict.
(e) Procedure for conciliation.— Should the conciliator fail to harmonize the parties in dispute within a term of thirty (30) days counting from the date of his designation, he shall so notify the Secretary of Justice, who may grant an additional term of fifteen (15) days for settling the dispute, and if the conciliator cannot attain it within said additional term, then action shall proceed according to the provisions hereafter provided.
(f) Grievance Committee.— Every collective bargaining agreement to be granted between the parties shall contain a clause providing for the creation of a Grievance Committee for the settlement of disputes, complaints and grievances. The Committee shall be composed of an equal number from both parties and presided over by an outsider unanimously chosen by the members of the Committee.
Should the Committee fail to agree as to the selection of a Chairman within the term of ten (10) days, the same shall be designated by the Secretary of Labor and Human Resources, but the person so designated shall not be a public employee or officer.
(g) Powers of the Committee.— The Grievance Committee shall have the following powers:
(1) Hold hearings;
(2) administer oaths;
(3) require the appearance of witnesses;
(4) issue subpoenas, and
(5) require all such information or proof as it may deem necessary for the settlement of the dispute.
(h) Disobedience of subpoena.— In case of nonappearance or of disobedience by any person of a subpoena issued by the Grievance Committee, any part of the Court of First Instance of Puerto Rico, within whose jurisdiction said person is found, resides, or does business shall, upon petition of the Committee, have jurisdiction to issue against such person a subpoena to appear before the Committee for the purposes of giving testimony or presenting documentary evidence with regard to the matter under investigation or hearing. Disobedience of such order, unless for a justified cause, shall constitute contempt of court.
(i) Service of orders, subpoenas, or other documents.— Orders, subpoenas, or other documents issued by the Committee or by its Chairman, may be served personally or by registered mail with acknowledgment of receipt, by telegraph or by leaving copy thereof at the main office or place of business of the person or organization to be notified.
An affidavit by the server shall be proof thereof, and the return of the post-office or telegraph receipt shall also be proof of the service.
(j) Cooperation of departments and agencies of the Government.— The various departments of the Government shall furnish the Grievance Committee, at the request thereof, all records, documents, and reports in their possession bearing upon any matter before the Committee.
(k) Findings of fact and decision.— The Grievance Committee shall submit, in writing, the decision containing its findings of fact and deciding on the matters object of the dispute. Decisions shall be made by the majority and shall be final and binding upon all parties.
(l) Interpretation of collective bargaining agreements.— When the dispute concerns only the interpretation or application of a collective bargaining agreement, the Grievance Committee shall only have authority to determine on the interpretation or application of the clauses object of dispute.
(m) Limitation of decisions.— The Grievance Committee shall not make any decision in violation of the rights of the agency to manage and direct its operations, or interfere with the internal administration of any employees or workers union, except when such rights of the agency or union are limited by any collective bargaining agreement in effect at the time the decision is made.
(n) Service of decisions. The Grievance Committee shall serve copy of its decisions on each party to the dispute and on the Secretary of Labor and Human Resources.
(o) Arbitration decisions and means of enforcing their compliance.— Arbitration decisions issued pursuant to the provisions of this chapter may be put into effect by the Supreme Court of Puerto Rico, either by legal action brought by any of the parties or through the procedure established by the Puerto Rico Labor Relations Act in § 70(2)(c) of Title 29.
(p) Provisional measures.— The Grievance Committee may adopt provisional measures concerning a dispute pending resolution.
(q) Interruption of services to the public prohibited.— It shall be the unavoidable duty of both the State Insurance Fund, as well as the union, to discuss and reach an agreement concerning their collective bargaining which governs their management-labor relations and neither the agency nor the union, nor any employee or group of employees shall interrupt or lessen or attempt to interrupt or lessen the services rendered by the said agency to the public by reason or by cause of the negotiation, adjustment, interpretation, or application of a collective bargaining agreement or as a result of any management-labor dispute.
(r) Compulsory arbitration.— If the parties fail to reach an agreement with the intervention of a conciliator designated by the Secretary of Labor, as previously provided in this chapter, they shall be under obligation to submit to the Arbitration Board any dispute that brings to a halt the negotiation of a collective bargaining agreement.
(s) Duties and powers of the Arbitration Board.— The Arbitration Board shall, in the fulfillment of its functions, have the same duties and powers as herein granted to the Grievance Committee, and its decisions shall be final and binding upon all parties and may be enforced pursuant to the provisions previously provided.
(t) Disciplinary measures.— It shall be unlawful for the State Insurance Fund to discharge, suspend, lower the wages of, or otherwise discriminate against any of its employees contrary to the purposes of this chapter, but it may take whatever disciplinary measures it may deem necessary in regard to those employees who violate the provisions previously provided in the part entitled “Interruption of Services to the Public Prohibited”.
(u) Appeal.— From every order imposing disciplinary measures appeal may be taken by the aggrieved party or parties or by the union, to the Grievance Committee, and the appeal shall be processed and decided as an ordinary dispute.
(v) Unlawfulness of lockout.— It shall be unlawful for the State Insurance Fund to resort to a lockout of all or parts of its divisions, activities or services on the ground that its employees engage in activities concerted in their interest or benefit, or in the interest or benefit of a labor organization of its own choosing, provided such activities do not result in a stoppage in whole or in part, of the works of the said agency.
(w) Rights of individual employees.— None of the dispositions set forth in this chapter shall be understood as compelling any employee to do work without his/her consent or to prohibit same from renouncing employment. In the exercise of the duties and powers conferred by this chapter to the Administrator or the Industrial Commission, [the] same may avail themselves, for summons of their investigations and compliance in general with this chapter, of the assistance of the Court of First Instance, the Puerto Rico Police, the Department of Labor and Human Resources, and the Department of the Treasury.
Any person who violates any of the dispositions set forth in this chapter, or of the duly approved and promulgated regulations, or who refuses to appear at the written subpoena issued by the Administrator or the Industrial Commission, and does not submit just cause for said refusal to appear to render testimony regarding an event of which same has knowledge, shall be guilty of a misdemeanor, and if convicted, shall be penalized by the court with jurisdiction with a fine of not more than fifty dollars ($50), or a jail term of not more than thirty (30) days.
The Industrial Commission shall have exclusively quasijudicial and quasitutelar[y] duties for the investigation and resolution of all accident cases in which the Administrator and the injured worker or employee, or his/her beneficiaries, do not reach an agreement regarding the compensation, as set forth in § 11 of this title, and in the exercise of their duties shall represent public interest only. A majority of the Commission shall constitute [a] quorum. The vacancy or absence of two members shall not hinder the rights of the remaining members to exercise all the duties and powers conferred by this chapter.
The Commission and the Manager of the State Fund shall have official seals to authenticate their orders, decisions, or resolutions, and the certified copies of their orders, resolutions, or decisions issued by the Secretary of the Commission or by the Manager under their seals shall be deemed, like the originals, to be evidence of their contents; Provided, That the records of the investigation of cases in accordance with this chapter, now in the possession of the Manager of the State Fund, shall be admissible as evidence by the Industrial Commission.
The sessions held by the Commission shall be public.
The Industrial Commission shall have the power to approve rules and regulations to carry out the provisions, powers, and duties prescribed for it by this chapter, and to make the proceedings before it simple and summary. Such rules and regulations, upon being approved by the Governor and duly published and promulgated, shall have the force of law.
(x) Advisory Board.— The Manager shall appoint an Advisory Board to include an equal number of employers and workmen representatives who may be reasonably considered such representatives because of their vocation, employment, or affiliation, and of such members in representation of the public interest as the Manager may deem convenient to appoint. Said board shall assist the Manager, through advice and recommendations, to obtain the most effective and broadest development of the compensation and service program for the workmen and employees. The Manager may, further, appoint special boards to fulfill proper services, following the same norm established herein for the general advisory board. The members of said boards shall hold office without remuneration, but they shall be paid a per diem of twenty dollars ($20) and travel expenses incurred in the performance of their duties. The advisory board shall meet as often as the Manager may deem necessary but never less than twice a year. Said board shall make reports on its meetings, including a record of the matters discussed and its recommendations. The Manager shall keep said reports at the disposal of interested persons or groups. Neither the Advisory Board nor the special boards shall exercise administrative functions.
(y) Finances; State Insurance Fund’s Budget.— The finances for the administration of this service shall be subject to the following rules:
The Office of the Administrator of the State Insurance Fund shall render the services entrusted to it by this chapter in accordance with its own annual budget, which, once it has been approved by the Governor of Puerto Rico at the proposal of the Administrator, shall have force of law. Said budget shall include the necessary appropriations or items to comply with the collective bargaining agreements granted by the Administrator of the State Insurance Fund. The State Insurance Fund shall set aside the funds needed for the payment of the services rendered by the Medical Services Administration of Puerto Rico to the Fund’s hospital, located on the Administration’s land. The sum reserved for the above purpose shall not be used for any purpose other than that provided herein. The criteria to be used to reserve said funds shall be determined by the Administration, in coordination with the State Insurance Fund, based on the experience of previous years, the volume of projected services, costs inflation and any other necessary factor. If there is any remainder from said funds, it shall be credited in the budget corresponding to the next fiscal year. On the other hand, in the event a sum greater than what is budgeted is spent, the same shall be included in the budget for the next fiscal year.
All expenses incurred to carry out the work entrusted by this chapter to the Office of the Administrator of the State Insurance Fund and to the Industrial Commission, shall be charged to the State Insurance Fund. Provided, That the budget of the Office of the State Insurance Fund, after deducting the expenses for medical and hospital services, shall never exceed twenty-two percent (22%) of the total receipts from premiums during the previous fiscal year.
The resulting differences between the sums spent annually by the Industrial Commission and the Office of the Administrator of the State Insurance Fund Corporation, and the total amount that said bodies may dispose of for their budget by virtue of this section, with the exception of the remainders of medical expenses, shall be covered annually into a savings account that is separate and independent from its operating budget, which may be used for administrative and operating expenses. Said use shall be authorized for a term of two (2) years and the expenses thus covered shall not encumber budgets beyond such term. Once the two-year term provided herein elapses, it may only be used for non-recurring items, in other words, expenses that shall not encumber future budgets. Provided, That for Fiscal Year 2015-2016, any balance in the savings and/or reserve accounts of the Industrial Commission shall be transferred to the “2015-2016 Legal Liability Fund”. Specifically, not to be construed as an exhaustive list of the transfer provided herein, there is hereby directed the transfer of the balance in the accounts of the Department of the Treasury’s accounting system, whose numbers are: 1050000-575-780-2004, 1050000-575-780-2005, 1050000-575-780-2006, 1050000-575-780-2007, 1050000-575-780-2008, 1050000-575-780-2009, 1050000-575-780-2010, 1050000-575-780-2011, 1050000-575-780-2012, 1050000-575-780-2013, and 1050000-575-780-2014, the sum of which is estimated in nine million, seven hundred and thirteen thousand, three hundred and forty-eight dollars ($9,713,348). Provided, further, That for Fiscal Year 2016-2017, the current balance in the following savings and/or reserve accounts of the Department of the Treasury’s accounting system, 1050000-575-098-2014, 1050000-575-098-2015, 1050000-575-780-2014, 1050000-575-780-2015 shall be transferred to the “Elections Support Fund”, the sum of which is estimated in one million, six hundred and forty thousand, five hundred and eighty-two dollars ($1,640,582).
History —Apr. 18, 1935, No. 45, p. 250, § 6; May 14, 1947, No. 462, p. 1004, § 1; May 1, 1950, No. 155, p. 414, § 2; May 11, 1951, No. 405, p. 1058, § 2; June 11, 1954, No. 57, p. 306; June 22, 1957, No. 94, p. 439, § 4; June 30, 1958, No. 136, p. 328; June 28, 1969, No. 103, p. 288, § 2; June 30, 1975, No. 117, p. 353; June 22, 1978, No. 67, p. 216; July 10, 1986, No. 114, p. 363, § 1; Oct. 29, 1992, No. 83, § 2; July 1, 1996, No. 63, § 1; Sept. 12, 1996, No. 219, § 1; May 11, 2002, No. 62, § 1; Mar. 25, 2003, No. 94, §§ 1, 2; Aug. 5, 2004, No. 198, § 2; Sept. 18, 2009, No. 98, § 1; Nov. 16, 2009, No. 141, §§ 1, 2; June 28, 2012, No. 127, § 1; July 2, 2015, No. 105, § 4; July 22, 2016, No. 81, § 2.