Fund officials had planned to propose the bill at Thursday's Utah Labor Commission/Workers Compensation Advisory Council meeting but decided to dismiss the idea and not bring it up.

Lane Summerhays sits on the council as a nonvoting member and is the president and CEO of Workers Compensation Fund, a Utah insurer created by the Legislature but which has since become an independent agency. At the beginning of the meeting, he announced the fund's retraction and apologized for the uneasiness it created.

About 20 community members attended the meeting. After Summerhays' announcement, some Latinos said they still wanted to speak against the bill. But Deputy Commissioner Alan Hennebold, who was running the meeting, said they would have to wait until after the council's official business. Some three hours later, the council finally heard from those who stayed.

While the proposal was aimed at a "very small" number of disabled workers, as it was written it would have affected a greater number of people than intended, Summerhays said.

"We put forth a stupid proposal," he told the audience after listening to community comment. "We saw unintended consequences and threw it out."

Another council member, Dawn Atkin, also called the proposal "stupid," saying at least it was withdrawn.

On Monday, fund officials had said there has been an increase of cases in which disabled workers continue to get a disability paycheck - up to $630 a week - even though they are able return to work, but don't because of their own actions. For example, when they are undocumented immigrants, in jail, or were fired because of their own misconduct. The proposal would have changed state law to make sure people in these cases do not receive a disability paycheck, helping keep workers compensation insurance costs down for employers.

Medical benefits for undocumented workers were never affected by the bill.

On Thursday, Summerhays said he decided to kill the proposal Tuesday. He said he only knew of one such case involving an undocumented worker.

"It's not a big enough issue to open a Pandora's box," he said earlier in the meeting.

Summerhays stressed that the agency never asks workers about their U.S. immigration status.

Workers Compensation oversees some 30,000 claims a year statewide. It issues benefits for injured employees and provides workers compensation insurance mandated by the state for employers.

Attorney Mike Martinez, who waited about three hours to make a comment, asked Summerhays why he didn't go after the employers who hire the undocumented workers. He also said the drafted bill was discriminatory against Latinos because it linked people in jail with undocumented workers.

"He's saying our community is full of criminals," Martinez said of Latinos.

Latinos requested that the council hold a hearing to listen to the issues of Spanish-speaking workers.

At the end of the meeting, Summerhays invited some Latinos there to meet with him next week to continue talking about workers compensation and job training for Latinos.

"Let's take something that's been a negative - and make something positive out of it," he said later in an interview.

jsanchez@sltrib.com