NWCDN Members regularly post articles and summary judgements in workers’ compensations law in your state.
Select a state from the dropdown menu below to scroll through the state specific archives for updates and opinions on various workers’ compensation laws in your state.
Contact information for NWCDN members is also located on the state specific links in the event you have additional questions or your company is seeking a workers’ compensation lawyer in your state.
TO MISCLASSIFY OR NOT TO?
By Jeffrey D. Snyder, Esquire
The Commonwealth Court’s Decision in Department of Labor and Industry, Uninsured Employers Guaranty Fund v. WCAB(Lin and Eastern Taste), decided on February 17, 2017, involved a questionable case at first impression, as to whether an individual who was remodeling a restaurant, was considered to be a misclassified independent contractor under the Construction Workplace Misclassification Act (Act 72) (CWMA), or was as alleged by the Claimant, an Employee of a restaurant that was undergoing remodeling.
The Commonwealth Court ultimately affirmed the initial Decision of the Workers’ Compensation Judge that the Claimant was not an Employee when injured, and that the CWMA did not apply to the facts of the case, as the Claimant was not working in the “construction industry”, as that term is not accurately defined under the CWMA.
A few facts always help.
The Claimant was injured while he was remodeling the Eastern Taste restaurant, which had yet to open for business.
Following his injury, he filed a Claim Petition against Eastern Taste, as well as later filing a Claim Petition against the Uninsured Employer Guaranty Fund (Fund).
Initially, before the Workers’ Compensation Judge, the Judge bifurcated the employment issue from the medical issues.
Following the bifurcation, the Claimant testified, with testimony being presented by the restaurant Owner, as well as another individual who was also working on remodeling the restaurant.
Based upon the fact testimony heard by the Workers’ Compensation Judge, the Judge found that certain facts were undisputed, to include:
The restaurant was, just a restaurant, and was not in the construction business or industry;
The Claimant had been hired to do remodeling, before the restaurant was even opened;
The most experienced person on the job, in terms of construction experience, was the Claimant;
The restaurant Owner’s husband, presuming the restaurant to be owned by a woman, had been in charge of what needed to be done in the course of the remodeling being undertaken;
The Claimant was paid on a per diem basis, as were three other individuals also involved in the remodeling; and,
The Claimant used his own tools, and his own van, with the restaurant Owner’s husband also having his own tools and materials.
Based upon the witness testimony that the WCJ heard, the WCJ determined that:
The Claimant was not an Employee of the restaurant;
The Claimant’s work was not in the regular course of the restaurant’s business;
The Claimant’s employment was casual in nature;
That the Claimant failed to sustain his burden of proving that he was an Employee of the restaurant; and,
That the Claimant was not considered to be an Employee under the CWMA, as the WCJ reasoned that the CWMA did not apply to the restaurant, as it was not in the construction industry.
Based upon the above conclusions, the WCJ denied the Claimant’s Claim Petitions, both against the restaurant, as well as against the Fund.
The Claimant appealed to the Appeal Board, which then issued an Opinion concluding that the Claimant was an Employee of the restaurant, and that the Claimant’s employment was not casual in nature.
Reversing the WCJ’s Decision, the Appeal Board remanded the case back to the WCJ for Findings and Conclusions that would support an Award of compensation.
In a not so subtle genuflection to the remand, the WCJ granted the Claimant’s Claim Petition, resulting in benefits being awarded to the Claimant.
The Fund then appealed to the Appeal Board, requesting that the Board’s Opinion be made final, for purpose of appealing to the Commonwealth Court. So holding, the case ascended to the Commonwealth Court under the Fund’s Appeal.
Before the Commonwealth Court, the Fund argued that the Board had engaged in impermissible fact-finding, an argument that resonated with the Commonwealth Court, which rebuked the Appeal Board’s conclusion that all of the Claimant’s construction experience had been in the role of an Employee, and that the Claimant had not been engaged in his own construction business, notwithstanding that, before the Workers’ Compensation Judge, there had been no evidence that the Claimant had established a business in which he held a proprietary interest.
Finding that the WCJ’s Findings and Conclusions that the Claimant was hired to do remodeling was supported by substantial evidence, the Commonwealth Court held that those Findings and Conclusions were binding on the Board and that the Board had erred by disregarding the Judge’s findings, thereby substituting its own findings that the Claimant was not hired to do anything specific from which it then inferred, erroneously, that the Claimant was working as a general laborer.
Following that the Board exceeded its authority by making its own findings, beyond those made by the WCJ, the Commonwealth Court did hold that the Board had engaged in impermissible fact-finding, relying on its own facts, to support its conclusion that the Claimant was an Employee, an erroneous conclusion in the opinion of the Commonwealth Court.
Concluding that the WCJ’s original findings were supported by substantial competent evidence and reasonable inferences deduced from substantial evidence, the Commonwealth Court held that the determination as to the existence of an Employer/Employee relationship is a question of law, and that the Court’s scope of review was plenary and the standard review isde novo.
Holding that Section 104 of the WC Act defines an Employee to be “synonymous with servant, and includes all natural persons who perform services for another for a valuable consideration, exclusive of… persons whose employment is casual in character and not in the regular course of the business of the Employer…” the Court noted that there is nobright line rule for determining whether a particular relationship is that of an Employer/Employee or Owner/Independent Contractor, although the Supreme Court inUniversal Am-Cam, Ltd. v. WCAB (Minteer), 762 A.2d 382 (Pa. 2000) had established several factors that have to be considered when making such a determination:
Control of manner of work is to be done;
Responsibility of result only;
Terms of agreement between the Parties;
The nature of the work or occupation;
Skilled required for performance;
Whether one is engaged in a distinct occupation of business;
Which Party supplied the tools;
Whether payment is by the time or by the job; and,
Whether work is part of the regular business of the Employer, and also the right to terminate the employment at any time.
The controlling takeaway from those factors is that “control over the work to be completed in the manner in which it is to be performed are the primary factors in determining Employee status,” and “…it is the existence of the right to control that is significant, irrespective of whether the control is actually exercised.”
Since the WCJ had originally found that the relationship between the Claimant and the restaurant was similar to that of the relationship between a Property Owner and Painters, Plumbers, Electricians, Carpenters, and other remodelers, it was reasonable for the Workers’ Compensation Judge to conclude that the restaurant Owner’s husband did not control the manner in which work was being completed and performed by the Claimant, as the restaurant Owner’s husband did not reserve control over the means of performing the contract, merely reserving control as to the result of the remodel.
The Commonwealth Court also considered that the Claimant had been hired to perform remodeling, with no expectation of working in the restaurant after the remodeling.
Keeping in mind that the Claimant bore the burden of proving an Employer/Employee relationship, and that all evidence has to be viewed in the light most favorable to the prevailing Party, the Commonwealth Court, in an Opinion authored by Judge Hearthway, held that the WCJ’s conclusion that the Claimant was not an Employee was reasonable, and that it could not, therefore, be construed to be in error as a matter of law.
Not finished, the Commonwealth Court also held, this being the issue of first impression, that the CWMA concerns the construction industry, effecting the determinations of whether someone is an independent contractor versus an Employee under the WC Act. Having already determined that the Claimant was not an Employee of the restaurant, the Commonwealth Court noted that an individual who performed services in the construction industry for remuneration will be deemed to be an independent contractor for purposes of workers’ compensation, with the converse being, that if a worker falls within the purview of the CWMA, and does not meet the requirements to be considered to be an independent contractor, then that individual is deemed to be an Employee for purpose of workers’ compensation.
Finding that the CWMA was not applicable, as the Workers’ Compensation Judge had concluded, the Commonwealth Court held that the restaurant was in the restaurant business and not in the construction business, and that the CWMA did not, therefore, apply to the facts of this case.
The dispositive question for determining whether one falls within the purview of the CWMA is whether the individual performed services for remuneration “in the construction industry,” a question that the Commonwealth Court held was one of first impression. Although the CWMA defines the term “construction,” it does not define the term “industry,” requiring the Commonwealth Court to construe that term according to its common and approved usage in accordance with the Statutory Construction Act of 1972, with “industry” being commonly defined as “skilled employment involving skill” and “a department or branch of a craft, art, business or manufacturer.”
Further noting that the CWMA was intended to limit those who would be deemed to be independent contractors, as opposed to Employees, it was intended to address concerns that Employers were, shockingly, misclassifying workers as independent contractors, rather than Employees, in order to avoid the payment of unemployment taxes, workers’ compensation premiums, and payroll.
The Court also noted that to apply the CWMA to any remodeling project would have the effect of potentially turning every individual that took on a remodeling project into becoming an Employer “in the construction industry,” significantly expanding the scope of what the Commonwealth Court interpreted the purpose of the CWMA to be.
The Takeaway
This one is kind of a head-scratcher, as there are many Workers’ Compensation Judges who probably would have found the Claimant to be an Employee, simply to plug the hole in the dyke with insurance, whether against the restaurant or, alternatively, against the Fund.
Presumably, the restaurant had workers’ compensation insurance for its operations as a restaurant, employing restaurant workers in whatever capacities it would have required to continue operations as a restaurant.
Here, the restaurant was not actually open, and was not in operation, and was not, therefore, actually acting as a restaurant, although it would have done so after the remodeling project was complete.
Left unanswered by the Court’s Decision is the status of the Claimant, and the three other individuals who are doing the remodeling work, as there is no reference in the Opinion that they were working for a company, or a business, nor is it entirely clear how those individuals became associated with the remodeling project.
There is also no reference in the Opinion to any discussion, at any of the levels that this case ascended through, from a WCJ through Appeal Board to the Commonwealth Court, as to whether there was a contract in place for the work that was being performed for the remodeling project, as contracts usually require evidence of insurance, if even limited to general liability insurance for any work being performed by the remodelers, including the Claimant.
Post-injury, everyone scrambled for cover.
Better to make sure that contracts are in place, and that insurance is incorporated into the contracts, for the protection of all involved, both in terms of general liability insurance and workers’ compensation insurance.
ConnorsO’Dell LLP
Trust us, we just get it! It is trust well spent!
We defend Employers, Self-Insureds, Insurance Carriers, and Third Party Administrators in Workers’ Compensation matters throughout Pennsylvania. We have over 100 years of cumulative experience defending our clients against compensation-related liabilities, with no attorney in our firm having less than ten (10) years of specialized experience, empowering our Workers’ Compensation practice group attorneys to be more than mere claim denials, enabling us to create the factual and legal leverage to expeditiously resolve claims, in the course of limiting/reducing/extinguishing our clients’ liabilities under the Pennsylvania Workers’ Compensation Act.
Every member of our Workers’ Compensation practice group is AV rated. Our partnership with the NWCDN magnifies the lens for which our professional expertise imperiously demands that we always be dynamic and exacting advocates for our clients, navigating the frustrating and form-intensive minefield pervasive throughout Pennsylvania Workers’ Compensation practice and procedure.
By: Elizabeth Ligon
In Holmes v. Associate Pipe Line Contractors, Inc., the Court of Appeals determined that post-offer contingencies, such as background checks and drug testing, constitute the “last act” necessary to create a contract of employment.
On October 29, 2013, Plaintiff, who was living in North Carolina, was contacted via telephone by a union representative and offered an assignment in Texas. Plaintiff traveled to Texas, where she was required to submit to a drug test and complete various forms, including an authorization for a Department of Transportation background check, before she could begin working. Two hours after taking the drug test, Plaintiff began working in Texas. She sustained two injuries on the jobsite in Texas in January 2014, and sought workers’ compensation benefits in North Carolina. Defendants denied the claims, citing lack of jurisdiction.
At hearing, witnesses for the defense testified that when workers arrive at the jobsite, they are required to take a drug test and consent to a background check. If they did not submit to either the drug test or the background check, they would not be hired. However, because it takes several days to receive the results, the worker begins work immediately after taking the drug test and signing the consent form. If the drug test or background check did not “come back clean,” the worker would be terminated and paid a per-day rate for the time worked versus the full hourly rate under the union agreement.
The Deputy Commissioner issued an Opinion and Award, dismissing Plaintiff’s claims based on lack of jurisdiction. Plaintiff appealed to the Full Commission, who upheld the Deputy Commissioner’s Opinion and Award. The Full Commission concluded that the submission to the drug test and consent to a background check outside of North Carolina were conditions precedent to Plaintiff’s hire, and were more than administrative paperwork. Consequently, the “last act” necessary to create an employment contract occurred in Texas. Because the contract of employment was not made in North Carolina, Defendant-Employer’s principal place of business was not in North Carolina, and Plaintiff’s principal place of employment was not in North Carolina, the Industrial Commission did not have subject matter jurisdiction.
Plaintiff appealed to the Court of Appeals, who agreed with the Full Commission. Plaintiff argued that the last act necessary to form her employment contract occurred in North Carolina, when she accepted the job from her home via telephone. The Court of Appeals rejected Plaintiff’s argument, noting that it was undisputed that Plaintiff’s submission to a drug test was a prerequisite to her employment. If Plaintiff had refused to submit to the drug test, she would not have been permitted to start working. Therefore, the drug test constituted the last act necessary to form a binding employment relationship. Because this act occurred in Texas rather than North Carolina, the Commission lacked jurisdiction.
RISK HANDLING HINT: Under N.C. Gen. Stat. § 97-36, jurisdiction is created (i) if the contract of employment is made in North Carolina, (ii) if the employer’s principal place of business is in North Carolina, or (iii) if the employee’s principal place of employment is in North Carolina. Holmes solidifies that post-offer requirements drug testing and background checks constitute the “last act” necessary to create an employment contract under prong (i). As part of their initial investigation of a claim, employers and their carriers should determine whether a claimant was required to meet any additional requirements after a job offer was extended, and where they took place.
Perhaps you have already heard as news travels fast but on May 8, 2017, a Jefferson County Circuit Court Judge issued an Order declaring the Alabama Workers’ Compensation Act to be unconstitutional. That’s right… the entire Act. I am sure that you have many questions. Here are a few answers.
QUESTION: Is the judge stating that the entire Act is unconstitutional? If not, why does he not just strike down the parts that are and leave the remainder intact?
ANSWER: The Judge is not saying that the entire Act is unconstitutional. However, he is of the opinion that (1) the statute which places a $220 weekly cap on permanent partial disability awards and (2) the statute that places a 15% contingency fee cap on legal fees are both unconstitutional. Since the Judge has found those 2 statutes to be unconstitutional, it has the effect of declaring the entire Act unconstitutional due to a non-severability (all or none) statute.
QUESTION: Can he do that?
ANSWER: Yes. A Circuit Court Judge is empowered to consider the constitutionality of statutes. In fact, there is an obligatory duty on courts to do so. However, it is important to remember that the proverbial buck does not stop there. In the event that this Order becomes final, then the parties will have the right to appeal the issue to the Alabama Court of Civil Appeals which has original jurisdiction over workers’ compensation matters. From there the parties can appeal to the Alabama Supreme Court.
QUESTION: The Judge gave the Alabama legislature 120 days to fix the parts of the Act that he deems unconstitutional. Do you think that is enough time and, if so, will amended bills get passed?
ANSWER: Probably not. There is not enough time with only 6 meeting days left in the 2017 Regular Session. Even if there was enough time, the issue has come up many times over the years. Bills are introduced which include too many controversial provisions. For the $220 cap or the 15% contingency fee to change, there needs to be a serious conversation between employee and employer interests to figure out the best way to effectuate that change. Simply introducing a bill and trying to force it down the other side’s throat is not going to work. Major changes were implemented in 1992 and that was due to a couple of years of meetings between all interested parties until a consensus was formed.
QUESTION: What happens if the Appellate Courts agree with the Circuit Judge?
ANSWER: Before I answer that, let me first address why they probably will not agree. The reason they probably will not agree is because it is a function of the legislature to make this needed change. The Circuit Judge has put a spot light on the need for the change and that is a good thing. However, the Appellate Courts are probably not going to send Alabama into the work accident dark ages because of 2 statutes regardless of how unfair they are deemed to be. The more likely scenario is that the Appellate Courts will either disagree and reverse or agree but reverse on the grounds that it is the legislature’s responsibility. In that scenario, my guess is that the Courts will encourage employer, employee, and medical interests to get together as they did 25 years ago in order to effectuate change.
QUESTION: What if you’re wrong?
ANSWER: Let’s all hope that I’m not! Workers’ Compensation was created for a couple of reasons. First, it provided immediate indemnity and medical benefits to injured employees through a system of no fault insurance. Second, it provided employers with protection from tort liability through the Exclusivity Doctrine. This was known as the Grand Bargain. Scrapping this system would result in the following:
Employers would no longer have any protection against tort lawsuits since the Exclusivity Doctrine would be gone.
Employees would be able to maintain tort lawsuits against employers.
Plaintiffs’ attorneys would enjoy much higher percentage contingency fees because there would be no statute placing any restrictions on how much they could take from the award or settlement of an injured employee.
In order to prevail against the employer, the employee would have to prove at a bare minimum the elements of negligence. In other words, they would have to prove that the employer breached a duty of care and said breach caused the accident and injury.
In all situations where an employee was injured and it was not the fault of the employer, the employee would have no access to a tort recovery or workers’ compensationbenefits. In other words, the employee would be receiving nothing.
A flurry of motions to dismiss pending workers’ compensation lawsuits will be filed all over the state.
Many employees in the insurance and legal industry would be out of a job.
In a nutshell, employee, employer, insurance, medical, and legal interests will all be adversely affected. While our system is far from perfect, it is the only one that we have. The alternative is far worse. Rather than pursue a final order deeming our current system to be void as unconstitutional, let us use this recent Order as a wakeup call to all concerned and open a dialogue between all interested parties. In 2019, we will celebrate 100 years of workers’ compensation in Alabama. Let’s work together to make sure that the system we have in place at that time is improved and fair to all concerned.
OSHA recently implemented its new "reporting and anti-retaliation rule", which went into effect January 1, 2017. Under the new rule, certain employers must now submit injury and illness information electronically. Most employers were already required to keep records of work related illnesses and injuries and to report fatalities and other certain serious injuries. However, under the new rule, companies that employ 250 or more employees must electronically submit OSHA Form 300 (Log of Work Related Injuries and Illnesses); OSHA Form 301 (Injury and Illness Incident Report); and OSHA Form 300A (Summary of Work Related Injuries and Illnesses) on a quarterly basis. Companies in the construction, manufacturing, utilities, and agriculture industries, which have historically high rates of occupational injuries and illnesses, must submit OSHA Form 300A annually when they employ between 20 and 249 employees. Additionally, OSHA may provide written notification to any smaller employers requiring them to submit information on a routine basis electronically.
The anti-retaliation rule allows OSHA to cite employers for taking adverse action against employees for reporting a work related injury or illness, even if the employee does not file a retaliation complaint. It also allows OSHA to cite employers who have systems in place that have traditionally been used to create safer workplaces, but OSHA now says discourage injury reporting. In the rule, OSHA specifically address concerns regarding safety incentive programs and post accident drug and alcohol testing.
OSHA states that employers may perform post-accident drug and alcohol testing only where (1) there is a reasonable possibility that the employee’s drug use contributed to the incident and (2) the drug test can accurately identify that the impairment was caused by the drug use. On the other hand, OSHA states that it is unreasonable to drug test an employee when it is clear that drug or alcohol use would not have made it more likely that the injury would occur (such as insect bites and repetitive strains occurring over a long period of time). OSHA’s reasoning is that allowing employers to drug test after every accident/injury discourages employees from reporting injuries. Safety incentive programs such as cash bonuses for departments or employees that remain accident free are also prohibited. OSHA says that employees who are injured may be reluctant to report it because they are afraid their co-workers will be hostile toward them for not getting the incentive.
OSHA can fine employers up to $12,471.00 for a single serious violation and up to $124,709.00 for willful or repeated violations. Therefore, all employers need to review their injury-illness reporting requirements, post accident drug and alcohol testing protocols and safety incentive programs.
My Two Cents
The new reporting requirements should not be a big deal for most employers, since the reporting does not really change - just the method of reporting. On the other hand, the "anti-retaliation" rule presents new issues and problems. While across-the-board drug testing may discourage drug users from reporting injuries, it also discourages drug use.
Did You Know?
If you receive a Notice of Citation from OSHA, you have a right to contest it and have the matter tried before a neutral judge. You also have the right to obtain information that OSHA obtained in its investigation, and to conduct your own investigation into the merits of the alleged violation(s).
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About the Author
This article was written by Charley M. Drummond, Esq. of Fish Nelson & Holden, LLC. Fish Nelson & Holden is a law firm located in Birmingham, Alabama dedicated to representing employers, self-insured employers, and insurance carriers in workers’ compensation cases and related liability matters. Drummond and his firm are members of The National Workers’ Compensation Defense Network (NWCDN). The NWCDN is a national and Canadian network of reputable law firms organized to provide employers and insurers access to the highest quality representation in workers’ compensation and related employer liability fields. If you have questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at cdrummond@fishnelson.com or (205) 332-3414.
Bo Liu worked for 4D Security Solutions, Inc. as an engineer. He was sent to test the company’s hardware and software at an army base in the United Arab Emirates (UAE). He worked alone on the base and after hours he would upload data to 4D in the United States using a company-issued Blackberry. One of his job requirements was to respond to inquiries from 4D’s employees in the United States.
Not long after his arrival in the UAE, Liu decided to visit a local museum because he had no “field work” to do on Friday, December 2, 2011. He was “on call” in the event that an employee in the United States might need assistance. He took his Blackberry with him while touring the museum. He testified that he visited the museum because he felt he needed to get to know the people and the culture he was working in. He did not recall getting any messages from the United States while he was there. After two hours in the museum, he fell and underwent surgery in the UAE. He filed a claim petition for workers’ compensation benefits.
The Judge of Compensation dismissed the petition because N.J.S.A. 34:15-36 provides that one who is on a special mission is only covered when performing the duties assigned or directed by the employer. Liu was merely touring a museum when he fell. On appeal, Liu raised two arguments for the first time: namely that he was “on call” and therefore working while in the museum, and secondly that he was covered because of the “mutual benefit” doctrine.
The Appellate Division noted that the only cases supporting petitioner regarding the “on-call” argument were pre-1979 decisions. The Court noted that the 1979 Amendments were designed to limit compensation to accidents occurring “when the employee is engaged in the direct performance of duties assigned or directed by the employer.” The Court observed that there was no evidence that US employees were trying to reach Liu while he was in the museum.
As for the “mutual benefit” doctrine, the Court commented that Liu failed to raise this issue below but even so, the Court said that there is no post-1979 decision that has applied this doctrine. The Court also said, “More importantly, Liu’s personal belief that a museum visit would help him understand the UAE’s history and culture so he could work better with those around him falls far short of demonstrating 4D would necessarily derive any tangible benefit from the museum visit.”
For these reasons the Appellate Division affirmed the dismissal of this case. This case can be found at Liu v. 4D Security Solutions, Inc., A-3591-15T1 (App. Div. May 1, 2017).
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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.
Walter Aston worked for Tapco International for 20 years as a shipping and receiving clerk, display builder and a maintenance worker. He suffered a heart attack in May 2010. The company granted 12 weeks of FMLA leave as well as an additional 14 weeks of short-term disability leave. The company policy was not to hold positions open for employees who are unable to return to work after their 26 weeks of absence.
Aston asked his doctor, Dr. Karabajakian, to complete a short-term pay extension form on November 4, 2010. The doctor noted that Aston would have an impending implantable cardioverter defibrillator surgery and could not return to work until January 1, 2011. However, Dr. Karabajakian checked “ok” next to all the job functions listed on page one of the job description with the exception of an inability to lift more than 30 pounds of weight. Dr. Karabajakian later testified in his deposition that when he filled out this note, he neither knew nor spoke to Aston about the amount of time Aston engaged in different job activities.
Tapco’s HR Director got the note and read about the impending surgery, which involved implanting a device to prevent sudden death. The HR Director, Ms. Brisson, told Aston that the company had pretty much decided to terminate his employment. Brisson told Aston to take long-term disability and noted that the company would not likely return him to work with medical restrictions.
After hearing this, Aston contacted Dr. Karabajakian and advised him that he was going to lose his job if the doctor did not give him a full duty return-to-work note. Dr. Karabajakian then turned around and wrote a completely different note stating that Aston could return to work immediately with only a 30 pound lifting restriction. Aston then called work and said he would be returning to the company on November 22, 2010.
The HR Director called Aston back and said the company was going to terminate him because the job would be too much for him to handle. The company had decided that long-term disability was the best choice for Aston. On the following Monday, when Aston intended to return to work, Brisson called Aston and told him that his position had been terminated. They followed up that with a note stating that Aston was being dismissed for failure to return for work full duty.
On May 31, 2012, eighteen months later, the company wrote to Aston offering reinstatement on a full-time basis with a few additional duties. Aston rejected the offer and sued under the ADA. The District Court ruled for Tapco, and Aston appealed.
The Sixth Circuit Court of Appeals commented that Aston had been unable to perform his job from May 23, 2010 until January 2011.
Here, Aston’s own doctor advised Tapco of Aston’s impending ICD and later testified that the standing, walking, bending, climbing, and reaching demands of Aston’s job extended beyond Aston’s physical capability and that Aston would not have been able to perform nearly half his duties had he returned to work on January 1, 2011. Therefore, had Aston returned to work on January 1, 2011 with or without accommodation, he would have been incapable of meaningfully completing any of the physical labor his job required of him.
The Court added that the relevant time frame in determining disability discrimination is at the time of discharge. The Court reviewed the deposition of plaintiff’s doctor, who indicated that the standing, walking, bending, climbing and reaching demands of Aston’s job were beyond his capacity as of November 2010. It ruled that since Aston was not able to perform the essential functions at that time, the discharge was not discriminatory.
The Court also commented that Tapco had a reasonable basis to question Dr. Karabajakian’s initial note saying that Aston could return to work on January 1, 2011. “Just a few weeks before terminating Aston, Dr. Karabajakian informed Tapco of another impending major medical procedure that Aston needed to undergo. This would doubtlessly require additional time for recuperation. Aston had already been on an extended 26-week leave, once before, in 2006, and, at the time of his termination, Aston was on his second leave of unknown duration, despite the request for return on January 1, 2011.” The Court said that Tapco had already provided a substantial leave to plaintiff and therefore additional leave would be an unreasonable accommodation.
The case is instructive on a number of levels. For one thing, the case illustrates a fairly common scenario in which a treating doctor reverses himself on a fitness assessment for no apparent reason. In this case, the reason for the reversal became apparent later in testimony, namely a phone call from the employee saying he was about to lose his job. Second, the case shows that employers have a reasonable basis to terminate when an employee simply cannot return to work and perform the essential job functions even after a period of substantial leave. The case can be found at Aston v. Tapco International Corporation, 631 Fed. Appx. 292 (6th Cir. 2015).
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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.
When an employee returns to work following a work injury, in many states that ends the workers’ compensation case, but not in New Jersey. In our state, that just moves the case to the final stage of permanency benefits for loss of function of the body member. The availability of loss of function awards following temporary and medical benefits explains why so many workers whose injuries occur in other states try hard to file a claim petition in New Jersey.
New Jersey, like all states, has rules on when someone who is injured in another state can file a petition in the New Jersey Division of Workers’ Compensation. The rules on jurisdiction are well explained in the recent reported decision in Williams v. Raymours Furniture Co., Inc., A-3450-15T4 (App. Div. April 19, 2017).
The case involved an injury to Keith Williams in the State of New York. Williams lived in New Jersey but worked in Suffern, New York in a warehouse. He tripped over a hand truck in 2014 in the New York warehouse, fracturing his elbow. The New York Workers’ Compensation Board directed the employer to provide medical treatment and indemnity benefits. When these benefits ended, Williams filed a claim petition in New Jersey for partial permanent disability benefits based on loss of function in the arm.
Raymours Furniture Company answered the claim by denying jurisdiction in New Jersey. Williams moved to strike the defense of lack of jurisdiction, but the Judge of Compensation ruled in favor of Raymours Furniture. The Judge noted that the accident happened in New York State, and petitioner always worked in New York State.
Williams appealed to the Appellate Division and argued that he was hired in New Jersey and lived in New Jersey. He pointed out that Raymours Furniture had called him at his home some time ago in Paterson, New Jersey to offer him a job as a warehouse worker. Williams accepted the offer during the phone call while he was in his home in Paterson. Williams therefore argued that New Jersey did have jurisdiction to entertain his permanency claim petition.
The Appellate Division agreed with Williams and reversed. The Court noted that New Jersey recognizes jurisdiction when an injury occurs in New Jersey, when the employment takes place in New Jersey or when the employee is hired in New Jersey. In this case the Court concluded that Williams was hired in New Jersey under the basic law of contracts. An offer was made and it was accepted in New Jersey when Williams agreed to take the job. That phone call established the place of contract in New Jersey. Further, Williams lived in New Jersey, so these two contacts with the state were sufficient for New Jersey jurisdiction.
There are many claims like this in New Jersey where the claim was accepted and paid in New York or Pennsylvania, only for the claimant to file a formal claim petition in New Jersey after the end of medical and temporary disability benefits. This is permitted so long as New Jersey has jurisdiction over the case. The receipt of permanency benefits is not considered a duplicate of temporary disability benefits because they are completely different benefits: temporary disability based on wage loss, and permanency benefits based on loss of function.
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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.
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UNSEASONAL EMPLOYMENT IN PENNSYLVANIA
By
Jeffrey D. Snyder
A recent Pennsylvania Commonwealth Court Decision in Tojio Orchards, LLC v. WCAB (Gaffney), revolved around seasonal employment, as well as addressing an issue of the Claimant’s entitlement to a healing period, in connection with a specific loss claim.
The Claimant had sustained a specific loss of his left eye on October 8, 2013, as a result of his eye contacting a tree limb, while he was driving a tractor.
The employer then issued a Notice of Temporary Compensation Payable (NTCP), and filed a corrected Statement of Wages (SOW). The SOW indicated an average weekly wage of only $35.10, resulting in the compensation rate of $31.59 per week being determined.
Subsequently, the TNCP was revoked, with the appropriate stoppage notice, and a “Medical Only” Notice of Compensation Payable being issued, immediately followed by the filing of a Claim Petition, seeking specific loss benefits for the loss of vision in the left eye.
Before the workers’ compensation judge, the petition proceedings were bifurcated, first addressing the issue of employment status and average weekly wage, to be followed by an adjudication of the medical issues.
The testimony presented to the workers’ compensation judge was that the Claimant was a friend of a principal of the employer. The Claimant and principal had gone to school together, the Claimant had then worked for the employer as an apple picker 30 years before. He was then hired for the apple harvesting season, driving a tractor, and moving bins for apple pickers as they lolligagged from tree to tree.
He was paid $9.00 per hour, with his normal working hours being between 7:00 a.m. and 5:00 p.m., 5 days a week, and he was never promised any extension of employment beyond the apple picking season, ending coincidentally when all the apples were picked.
Previously receiving Social Security Retirement Benefits, as the Claimant had retired about 6 years prior, the retirement benefits were stopped when he began working for the employer, although he then began to receive the retirement benefits after he was injured.
Interestingly enough, or maybe not, the employer had another employee who worked as a tractor driver for the employer year round.
The record then noted that the apple season lasts from September until November, and that the workers never work in the rain. A year round tractor driver position, held by another employee, involved spraying, taking care of the farm, computer duties, and during the harvesting season, hauling apples out of the orchard.
Concluding that the Claimant was engaged in exclusively seasonal employment, the workers’ compensation judge granted the Claim Petition, awarding benefits for seasonal employment, and then awarding specific loss benefits for the loss of vision in the eye, with the specific loss benefits being awarded for 275 weeks, which at $31.59 per week, resulted in an award of $8,687.25.
The Claimant then asked the workers’ compensation judge to enter an Interlocutory Order, in order that the decision could be appealed.
The claim was then appealed to the Appeal Board, with the Claimant arguing that he was not a seasonal worker. The Appeal Board believed that the workers’ compensation judge had imposed too narrow a construction on the Claimant’s employment, and that the judge should have focused on the nature of the work, not the period of time during which the Claimant was working for the employer, citing toFroehly v. TM Harten Company, 139 A.2d 727 (Pa. 1927) (post Andrew Jackson).
The Appeal Board characterized the Claimant’s employment as being that of “itinerant agricultural labor”, observing that employment, although short term, is not necessarily synonymous with seasonal occupation.
Another issue before the Appeal Board was the calculation of the Claimant’s average weekly wage, as the Claimant argued that he had worked less than 13 weeks, and did not have fixed weekly wages, with the Claimant alleging that he was working 50 hours a week, at $9.00 per hour, with the Claimant asserting that his average weekly wage should be $450.00.
The argument made by the Claimant over the calculation of his average weekly wage was rejected by the Appeal Board, determining that the Claimant’s gross earnings over the weeks worked, limited to 5 weeks, only totaled $1,755.00, yielding an average weekly wage of $351.00, and a compensation benefit rate of $315.90.
The Appeal Board also concluded that the Claimant was entitled to a 10 week healing period for a specific loss, modifying the judge’s specific loss award from 275 weeks to 285 weeks.
Shockingly, the employer appealed to the Pennsylvania Commonwealth Court. In response, the Claimant filed a Designation of Additional Issues on Appeal, again challenging the calculation of his average weekly wage.
Citing to Section 309(e) of the Pennsylvania Workers’ Compensation Act, the Commonwealth Court noted that occupations that are exclusively seasonal, meaning they cannot be carried on throughout the year, should result in an average weekly wage that would be 1/50th of the total wages which the Claimant or employee earned from all occupations during the 12 months immediately preceding the injury, and, if, for some reason, that calculation was deemed to be unfair, the calculation could be adjusted.
Noting that the Pennsylvania Workers’ Compensation Act does not specifically define what constitutes an “exclusively seasonal occupation”, the Court noted that the Pennsylvania Supreme Court had held inFroehly that “seasonal occupations logically are those vocations which cannot, from their very nature, be continuous or carried on throughout the year but only during fixed portions of it.”
As further noted by the Pennsylvania Supreme Court in Froehly, “a labor occupations possible of performance and being carried on at any time of the year, or through the entire 12 months, is certainly not seasonal.”
In Froehly, the Claimant had been working as a dishwasher for an amusement park that was only open during the summer, from June to September. The amusement park argued that the Claimant was a seasonal employee, because the park was only open for a few months, with that argument being rejected by the Supreme Court, which found that dishwashing is not a seasonal occupation, even though the employer park was only open for a few months of the year.
An exception to the Froehly rule, involving amateur sports, occurred when the Claimant, while playing for the Arena Football League, inRoss v. WCAB, 702 A.2 1099 (Pa. Cmwlth. 1997), was injured while playing as a football player under a contract. The AFL argued that the employee should be considered a seasonal employee, an argument that the Appeal Board endorsed. The Claimant argued, however, that he was not a seasonal employee, because although the employer (AFL) had a set season, the Claimant could still play football for other teams in other leagues at other times, although the Commonwealth Court disagreed, holding that the Claimant’s employment contract, in Ross, prohibited the Claimant from engaging in off-season play.
In Gaffney, the case under discussion, the Commonwealth Court agreed with the Appeal Board that the Claimant was engaged in “itinerant agricultural labor”, when he was injured, but that his position as a temporary tractor driver for the apple harvest was not seasonal employment under Section 309(e) of the Act.
This holding was supported, in the Commonwealth Court’s opinion, by the fact that the Claimant did not have a contract precluding him from performing services throughout the year for another employer.
As for the Claimant’s average weekly wage, the Court held that the Claimant’s average weekly wage of $351.00, resulting from $1,755.00 being divided by 5 weeks, and further resulting in a disability rate of $315.90 representing “economic reality” with that finding being upheld before the Commonwealth Court.
Lastly, the healing period issue was addressed, with the Commonwealth Court holding that a specific loss award entitles a Claimant to a rebuttal presumption that the specific loss entitles the injured worker to a healing period.
Decided by the Commonwealth Court on March 13, 2017, the Gaffney holding is seasonally appropriate, given that the harvest season is only a few months away.
Take Aways
The obvious take away is that seasonal employment is an extremely limited holding, which will, underFroehly, be limited to occupations that by their very nature are fixed to certain seasons, and are not carried on throughout the year. Conversely, any job that can be performed at any time of the year, will likely not be deemed to be seasonal under the Froehly holding.
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