State News

The Alabama Court of Civil Appeals recently released its decision in the case ofIn re: Jeffrey Donaldson v. Sears Roebuck and Co. on May 11, 2018. It’s decision confirmed that when compensability is disputed, an employer cannot be compelled to provide medical treatment until after an evidentiary hearing on the issue is held, and compensability has been established. In rendering this decision, the Court upheld the principles outlined in it’s earlier decision,Ex parte Publix Super Markets, Inc., 963 So. 2d 654 (Ala. Civ. App. 2007).

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This blog submission was prepared by Karen Cleveland, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Cleveland by e-mailing her at kcleveland@fishnelson.com or by calling her directly at 205-332-1599.

Jeremy Christensen worked as a patrol officer for the Warner Robins Police Department in the State of Georgia.  He completed a required 12-week certification training program.  However, he experienced shooting pains and leg cramps while driving on September 2, 2013. Nonetheless, he finished the program and began a one-year probationary period required for all new city employees.

Christensen experienced more shooting pains on October 8, 2013, and his hands shook uncontrollably.  Another officer had to drive him home from work.  He was advised to get a medical release from his physician, which he obtained from Dr. Al-Shroof.  However, the doctor did not clear petitioner to drive, so Christensen was assigned to a light-duty desk position in the Criminal Investigations Division. Eventually, Dr. Al-Shroof cleared petitioner to work with no restrictions except for a continued restriction against driving.

The City documented four specific disputes with Christensen during the one-year probationary period, the most serious of which was that Christensen only entered 10 of 270 supplemental reports to the CID’s electronic case management program in 2014.  As a result of these four disputes, the City terminated the employment of Christensen for unsatisfactory performance.

Christensen sued alleging disability discrimination.  The City in turn argued that Christensen was not a qualified individual under the ADA because he could not drive, and driving was admittedly an essential job function for a patrol officer.  Christensen disagreed and argued that he was able to work light duty for 10 months, and that he was qualified to perform the light duty position.  He seemed to argue that he was entitled to indefinite light duty.  The Court disagreed.  “The City accommodated Christensen’s disability by giving him light duty work that did not require him to drive. . . . That accommodation did not enable him to perform the essential function of a patrol officer; he still could not drive.”

Christensen further argued that the City could have continued him on light duty, and its past efforts to accommodate his driving restriction showed that the City could make long-term accommodations.  The Court again disagreed.  “Further, the City’s past accommodations, which exceeded the requirements of the ADA, do not bind the City to anything outside the requirements of the ADA.” The Court also agreed that the City offered valid, non-discriminatory reasons for terminating Christensen’s employment.

For these reasons, the Court granted the City’s motion for summary judgment.  The case shows that the elimination of an essential job functions is never required.  Christensen had to prove he could perform all the essential job functions.  The Court said that the mere fact that the City tried to accommodate Christensen for a lengthy period of time could not be held against the City.  This case can be found at Christensen v. City of Warner Robins, GA., 2018 WL 1177250 (D. GA 2018).

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Written by: Matt Marriott

Every employer has been there before.  You hire a new employee and everything is going smoothly, until one day you receive a letter from the North Carolina Department of Revenue compelling you to withhold an amount from your new employee’s paychecks to satisfy an outstanding tax obligation the employee owes.  In the boilerplate of that garnishment letter is language stating the employer will be held responsible for the employee’s tax obligation in the event the employer fails to withhold and pay the garnishment amount.  Knowing that you never want to ignore a letter from the state or federal department of revenue, you comply with the letter and begin withholding the tax lien amount.  But what happens in cases where the employee with the tax obligation was injured at work and is receiving ongoing temporary total disability benefits instead of a normal salary check?  Must the defendants withhold a weekly amount from each TTD/TPD check or from a settlement to satisfy the outstanding tax lien?

Though the North Carolina Industrial Commission and Appellate Courts have not directly ruled on this issue, some plaintiffs’ counsel have argued that, based on state and federal statutes, the Department of Revenue cannot recover a tax lien from weekly TTD/TPD checks or from a lump sum settlement.

N.C. Gen. Stat. § 97-21 provides in relevant part “[n]o claim for compensation under this Article shall be assignable, and all compensation and claims therefor shall be exempt from all claims of creditors and from taxes.”

The Federal Tax Code also includes a provision that seems to exempt workers’ compensation benefits from tax liens.  § 6331(a) of the U.S. Tax Code provides the government authority to garnish the wages of employees who have failed to pay their taxes; however, it carves out a few exemptions from that general rule.  § 6331(a) states as follows:

“If any person liable to pay any tax neglects or refuses to pay the same within 10 days after notice and demand, it shall be lawful for the Secretary to collect such tax (and such further sum as shall be sufficient to cover the expenses of the levy) by levy upon all property and rights to property (except such property as is exempt under section 6334) belonging to such person or on which there is a lien provided in this chapter for the payment of such tax.”

Section 6334(a)(7), which sets out specific exemptions from the wage garnishment rule cited above, specifically states that workers’ compensation benefits cannot be garnished to satisfy outstanding tax obligations.  Therefore, the U.S. Tax Code seems to suggest that the government is prohibited from asserting tax liens against workers’ compensation benefits.

While the statutes above seem to support that neither the N.C. nor U.S. Department of Revenue can assert a tax lien against workers’ compensation benefits, there are a few Appellate cases in North Carolina that have allowed parties that would seem to qualify as “creditors” under § 97-21 to, nevertheless, assert liens against workers’ compensation benefits.  In State of North Carolina v. Miller, the Court of Appeals held that N.C. Child Support enforcement was not barred by N.C. Gen. Stat. § 97-21 from recovering child support payments out of a plaintiff’s weekly workers’ compensation benefits. SeeState v. Miller, 77 N.C. App. 436, 438 (1985) (holding Child Support Enforcement was not barred by § 97-21 because “the obligation to support one’s children is not a ‘debt’ in the legal sense of the word.”)  Similarly, in Sara Lee Corp. v. Carter, the North Carolina Supreme Court allowed a Trial Court Order to stand which declared that the plaintiff’s weekly workers’ compensation benefits were to be held in constructive trust for the benefit of Sara Lee Corporation, since the Trial Court found the plaintiff had defrauded Sara Lee and breached the fiduciary duties he owed Sarah Lee, entitling Sarah Lee to damages from plaintiff worth $322,729.20. See Sara Lee Corp. v. Carter, 351 N.C. 27 (1999).

Because the aforementioned cases allowed parties to recover what seemed like “debts” from workers’ compensation benefits, it is unclear how North Carolina or federal courts would treat a case addressing whether the N.C. or U.S. Department of Revenue could assert a tax lien against a plaintiff’s workers’ compensation benefits.

Practice Tip: In situations where the Department of Revenue sends defendants a letter asking defendants to garnish a plaintiff’s wages, the best approach is to see if the plaintiff will consent to the wage garnishment.  Because the plaintiff will accrue interest on any outstanding tax obligation the longer he/she fails to pay it, there is a significant benefit to the plaintiff in having the tax debt paid off.  However, if the plaintiff will not consent to wage garnishment to satisfy the tax lien, defendants may need to seek guidance from the Commission on how to proceed.   Where disputed tax lien or garnishment issues arise, employers and insurance carriers should consult with defense counsel to determine defendants’ obligations.

As the state of North Carolina continues its efforts to combat the opioid crisis, the Rules Review Commission, part of the North Carolina Industrial Commission, approved nine rules regarding opioids, prescriptions, and pain management in workers’ compensation claims that go into effect today, May 1, 2018. The rules are specifically meant to address problems arising from the intersection of the opioid epidemic and workers’ compensation claims. They are also meant to ensure that injured workers are provided the services and care intended by the Workers’ Compensation Act and medical costs are adequately contained.

No letters of objection were received during the preliminary period. The Rules Review Commission made some minor technical changes; however, they did not change the substance. The final version of the rules can be found here. The Industrial Commission also adopted a Companion Guide that will assist in implementing and understanding these Rules. The Guide can be found here on the Opioid Rules Resource Page.

Please reach out to a member of our workers’ compensation team with any questions or to discuss this issue in more detail. Our team also released a brief overview of the content and potential implications of the Rules, which you can read here.

Supreme Court Appears to “Flip” on Coming and Going Rule in Vicarious Liability Case
On April 13, 2018, the Supreme Court reversed the judgment of the Court of Appeals inPainter v. Amerimex Drilling - a negligence case involving an MVA that occurred while a drilling company employee was driving his coworkers from a drill site to housing provided by the employer at the end of their shift.  The Supreme Court held that the employer was not entitled to summary judgment on the injured employee’s vicarious-liability claim.  The injured crew members and the families of the crew members killed in the accident filed suit against Amerimex, alleging vicarious liability for the driver’s negligence. The trial court granted summary judgment for Amerimex, and the Court of Appeals affirmed. The Supreme Court reversed, holding that Amerimex was not entitled to summary judgment on either no-evidence or traditional grounds on the crew members’ vicarious-liability claim.
 
In a dissenting opinion, Justices Green and Brown disagreed with the ruling, noting that, two years earlier, the Supreme Court found in favor of Sandridge Energy (the company that hired Amerimex to drill the well from which the crew members were being transported) in a suit arising out of the same accident.  The dissenting opinion opined that the Supreme Court in the Sandridge Energy case found that the driver was not Sandridge’s employee, as a matter of law, “at least with respect to transporting the crew” and Sandridge was therefore entitled to summary judgment in the vicarious liability claim against Sandridge.  The dissenting justices believed that the same legal rationale should hold true for the drilling company, Amerimex, because the driver was not (as a matter of law) the employee of the drilling company either. 
 
The majority in the Amerimex litigation disagreed and found that there were fact questions to be resolved regarding the driver’s employment status at the time of the MVA.
 
Adding Assault to Injury
The claimant, a special education diagnostician, was assaulted by a parent of one of her students and sustained injury.  During the time she was unable to work, she received assault leave pay from her employer in an amount equal to that of her pre-injury wage.  The Appeals Panel, in Decision No. 180294 (decided March 29, 2018) determined that, because the claimant had performed no personal services for the employer in exchange for the assault leave pay she received, the pay was not properly considered wages under the Texas Workers' Compensation Act.  Therefore, the Appeals Panel reversed the decision by the Administrative Law Judge that the claimant had no disability while receiving assault leave pay.
 
There’s a Reason It Wasn’t the Season
In APD No. 180270, decided March 28, 2018, the Appeals Panel concluded that the claimant, a professional football player, did not qualify as a seasonal employee, even though his salary was only paid in 17 installments during the actual football season.  For the remainder of the year, the claimant was required by contract to further the business affairs of the employer by way of mandatory participation in charitable events, maintenance of his physical condition, production of memorabilia for auctions, cooperation with news media, and protecting the reputation of his team.  The Appeals Panel determined that the claimant's employment does not demonstrate "a pattern of seasonal, cyclical employment," and therefore no adjustment to the claimant's average weekly wage applied.
  
Splitting Headaches
Appeals Panel decisions have been known to cause headaches, but this is ridiculous.  The Administrative Law Judge decided that the claimed headaches were not part of a compensable injury based on a designated doctor's assessment that "the claimant's minor head contusion would not result in ongoing headaches, and this diagnosis should not be considered compensable."   In APD No. 180458, decided March 29, 2018, the Appeals Panel drew a distinction, stating that "headaches" and "ongoing headaches" are two separate injurious conditions.  Because the condition appears sans adjective in the issue, the Appeals Panel concluded that the designated doctor had not considered the proper diagnosis and reversed the ALJ's extent of injury determination.

—Stone Loughlin & Swanson, LLP

According to the US Department of Labor’s Inspector General, Dallas attorney Tshombe Anderson and his family stole patient information from over 200 federal workers and then used the information to fraudulently bill the federal workers’ compensation system over $30 million.  Anderson enlisted his entire family in the scheme, including his 84-year-old mother.  Several of those family members have entered guilty pleas and are awaiting sentencing.  Anderson received a 10-year maximum sentence in federal court on April 19, 2018, and his law license has been suspended by the State Bar of Texas.

—Stone Loughlin & Swanson, LLP

Effective immediately, the DWC has announced a plan to hold designated doctors accountable for their work product. Performance factors that will be considered include evaluating the number of closed complaints with warning letters issued by DWC, closed complaints with a letter of education, the number of complaints referred for a medical quality review or referred directly to Enforcement, the number of instances wherein a DD agrees to a consent order or receives a default judgment from SOAH related to a violation of the Texas Workers’ Compensation Act or DWC rules, the number of letters of clarification approved by DWC, the number of MQRP reviews where the outcome is “referral to enforcement” or “refer subject to the appropriate medical licensing board,” the number of Presiding Officer Directives (PODs) issued for re-examination, and the number of reports not adopted at a contested case hearing.
http://www.tdi.texas.gov/wc/hcprovider/documents/ddperform0418.pdf

—Stone Loughlin & Swanson, LLP

Chief Administrative Law Judge (ALJ) Lesli G. Ginn has found herself in the crosshairs of SOAH staff, administrative law professors, and lawmakers alike, after requesting and receiving the resignation of ALJ Hunter Burkhalter “in lieu of termination.” ALJ Burkhalter issued a contested case ruling against the Texas Medical Board, who complained to the Chief ALJ, which resulted in the controversial termination. Ginn’s action has been widely criticized as violating the integrity of SOAH’s administrative hearing process, long perceived as “an independent forum” respected for its fair process and objectivity. Reaction has been strong, both inside and outside of the agency, and there have been calls for Ginn’s removal as Chief ALJ. Her term is set to expire at the end of April.

—Stone Loughlin & Swanson, LLP

The DWC is combining its annual educational and safety conferences this year, and is promising an interesting lineup of topics to include challenges in the gig economy, first responder claim handling, telemedicine, safety for the millennial generation, and disaster recovery.  Speakers include folks from Uber and the National Safety Council.  Two hours of ethics credits have been approved for adjusters.  Conferences are in San Marcos (May 15-17) and Irving (June 27-29).

—Stone Loughlin & Swanson, LLP

The DWC has announced several rule changes and proposed rule changes in the past 30 days.  Here is a rundown of what you need to know:

New Adopted Rules
 
Preauthorization Required for Compound Drugs
Rules 134.500, 134.530 and 134.540 have been amended to require preauthorization for compounded drugs in both network and non-network claims and to exclude from the closed formulary prescription drugs created through compounding. 
https://www.tdi.texas.gov/wc/rules/adopted/documents/ao1340418.pdf 
 
Fewer Reporting Requirements and Removal of Private Vocational Rehab Registry
HB2112 mandated changes to certain reporting and notification requirements.  DWC made changes to those rules and repealed a couple of others.  Employers may now submit a notice of termination of coverage to DWC by any means; and, certain building and construction contractors, contractors and subcontractors, and motor carriers and owner-operators are no longer required to file certain agreements with the DWC.  The SIBs rules and definitions were also changed to remove the requirement for private providers of vocational rehabilitation services to register with the DWC. That registry has been removed and the DWC is no longer required to review and determine the unemployment/underemployment status of injured employees.
https://www.tdi.texas.gov/wc/rules/adopted/documents/ao136rpt0318.pdf.
 
Who Needs Personal Touch? Not Injured Workers
New Rule 133.30 permits health care providers to bill and be reimbursed for telemedicine or telehealth services, regardless of where the claimant is located at the time the services are provided. The new rule will be effective September 1, 2018.
https://www.tdi.texas.gov/wc/rules/adopted/documents/ao1340418m.pdf
  
New Proposed Rules
 
Hearing Officers Are Now Administrative Law Judges and Other Hearings Changes
The folks formerly referred to as DWC “Hearing Officers” will now formally be acknowledged as “Administrative Law Judges” (ALJs), not only in the hearing room but also in the proposed rules.  New informal rules also proposed changes to the way parties practice in front of those ALJs.  Those changes include a requirement that the parties include a certificate of conference on any motions presented to the DWC, and make changes to the ”no-show” procedures which would allow the ALJ to issue a decision on a finding of no good cause or failure to respond, rather than convening a second hearing.  The DWC is also clarifying that the automatic reset of a BRC upon a request within 10 days of receiving notice is limited to the first scheduled session.  The informal comment period had a relatively short window: April 9, 2018 through April 20, 2018, and is now closed. 
https://www.tdi.texas.gov/wc/rules/documents/dralj0418m.pdf
 
PAs to OK 73s
Proposed Rule 129.5 will permit treating doctors to delegate authority to complete work status reports to a physician’s assistant.
https://www.tdi.texas.gov/wc/rules/documents/drdwc0730418m.pdf
 
TDI Tightens Up Rules to Regulate Sales of Comp-like Insurance Products
TDI has posted an informal draft that would amend rules regulating the sale of insurance products that could be misrepresented or misunderstood as substitutes for workers' compensation insurance.
http://www.tdi.texas.gov/rules/pc/documents/wcsubtext.pdf

—Stone Loughlin & Swanson, LLP