State News

The average hourly rate for lawyers in Texas varies by practice type from $130 per hour for juvenile law to $415 per hour for mediation/arbitration, according to a report from Clio, a legal billing software company: https://www.clio.com/resources/legal-trends/compare-lawyer-rates/tx/

Comparing the hourly rates for workers’ compensation with other practice types, workers’ compensation attorney fees are the least expensive of any practice area other than juvenile law which usually involves court appointments for juvenile criminal court proceedings.  

From 1991 to 2015, workers’ compensation attorney fees were capped at $150 per hour.  In 2015, the Division raised the cap to $200 per hour where it remains today. However, many claimant and carrier attorneys charge less than the cap putting the average rate at around $175 per hour.

Comparing this rate to the rate for other practice areas makes workers’ compensation look like a real bargain.  Examples of the hourly rate for other practice types include administrative law at $317, bankruptcy law at $360, civil litigation $297, employment/labor law at $314, family law at $279, and real estate at $293.  The hourly rate for workers’ compensation is even on par with the hourly rate charged by some plumbers and auto mechanics, as demand for those services has increased.

The hourly rate for workers’ compensation law looks even better when considering the level of expertise of the workers’ compensation bar as a whole. Many of its practitioners are board-certified in workers’ compensation and have been in practice for twenty or more years. Also good news is that the average legal costs per claim have decreased since the elimination of in-person benefit review conferences. Attorneys no longer have to travel to attend BRCs now that they are all conducted by telephone or videoconference. This pandemic-induced change was made permanent effective December 9, 2021.

However, one downside of the low rates for workers’ compensation is that they seem to be attracting fewer new attorneys to the practice of workers’ compensation law.  The workers’ compensation bar is graying and as experienced workers’ compensation attorneys retire, they’re not necessarily being replaced.  There will also continue to be economic pressure on workers’ compensation attorneys to raise their rates (subject to the cap) due to the significant inflation our country is currently experiencing.

Copyright 2022, Stone Loughlin & Swanson, LLP

Sandra Bullock once played a character known as “Accident Amy” on the George Lopez Show. “Accident Amy” was so-named by her co-workers because she was accident prone and always getting hurt at work. You can see “Accident Amy” in action here: https://www.youtube.com/watch?v=e89asOS0rIU.  

We recently came across our very own “Accident Amy” when DWC’s response to our request for a record check revealed our claimant had a total of 12 workers’ compensation claims.  This prompted the following suggestion about how she ought to dress at work:
 

Copyright 2022, Stone Loughlin & Swanson, LLP

September 2022

Tennessee Appoints New Administrator and Workers’ Compensation Judge, Plus Other Recent Developments on the Firefighter Cancer Presumption and Mileage Reimbursement

New Administrator
Troy Haley, former Legislative Liaison of the Bureau, is now the new administrator for the Tennessee Bureau of Workers’ Compensation.  Troy succeeds Abbie Hudgens, who recently retired.

New Workers’ Compensation Judge in Memphis
Administrator Troy Haley has appointed Shaterra Reed Marion as a Judge on the Court of Workers’ Compensation Claims, the adjudicative function within the Tennessee Bureau of Workers’ Compensation (BWC). She will be located in the Memphis office of the BWC. Judge Marion has practiced law in Tennessee since 2012, primarily in workers’ compensation and insurance defense. She has been Field Counsel in Memphis for Liberty Mutual Insurance Company/Law Offices of Julie Bhattacharya Peak since 2014. She will replace the recently retired Judge Deana Seymour on the Court of Workers’ Compensation Claims in Memphis.

Firefighter Cancer Presumption
Effective July 1, 2022, Tennessee added leukemia and testicular cancer to the list of cancers (Non-Hodgkin’s Lymphoma cancer, colon cancer, skin cancer, and multiple myeloma cancer) for which a presumption is created that certain conditions or impairments of full-time firefighters arose out of employment, unless the contrary is shown by a preponderance of the evidence.

Mileage Reimbursement
Injured workers are entitled to request reimbursement for their travel expenses. Mileage reimbursement is a workers’ compensation benefit for injured workers who must travel outside a radius of 15 miles one way from their residence or workplace to an authorized medical provider or facility. The rate has been updated twice in 2022. For travel dates between January 2, 2022 to June 30, 2022, the reimbursement rate is $0.585 per mile.  For travel dates from July 1, 2022 to the present, the mileage reimbursement rate is $0.625.

For any questions, please contact:

Fredrick R. Baker, Member
Wimberly Lawson Wright Daves & Jones, PLLC
1420 Neal Street, Suite 201
P.O. Box 655
Cookeville, TN 38503-0655
Phone: 931-372-9123
Fax:  931-372-9181
fbaker@wimberlylawson.com
www.wimberlylawson.com    

Minnesota Workers’ Compensation Case Law Update and

Annual Rate Changes

NEW RATES EFFECTIVE 10/01/2022

Maximum Compensation Rate:  Injuries which occur on or after 10/01/2022 will have a new maximum compensation rate of $1,312.74.

Minimum Compensation Rate:  Injuries which occur on or after 10/01/2022 will have a new minimum compensation rate of $262.55 or the average weekly wage, whichever is lower.

Statewide Average Weekly Wage: The SAWW as of 10/01/2022 will be $1,287.00, which yields a minimum compensation rate of $836.55 for employees who are permanently and totally disabled.

.645 Adjustment:  The annual adjustment to the compensation rate for the upcoming year will be 4.46%.

Supplementary Benefits Rate:  As of 10/01/2022, the supplementary benefits rate is $837.00.

A complete list of rate changes that take effect on 10/01/2022 can be found here:

https://www.dli.mn.gov/sites/default/files/pdf/annladj.pdf

MINNESOTA CASE LAW UPDATE: December 2021 to September 2022

OCCUPATIONAL DISEASE – WORKPLACE EXPOSURE AND MEDICAL BENEFITS OF SETTLEMENT – PIERRINGER RELEASE

Sershen vs. Met Council (Minn. May 11, 2022)

Factual Background:

 v Counsel appealed the Compensation Judge’s and the Worker's Compensation Court of Appeal's decisions holding that the employee sustained an occupational disease of hearing loss. Further, counsel argued that the Compensation Judge and the W.C.C.A. improperly found the Employer and Insurer liable for medical benefits and erred by failing to consider the liability of the prior employers who settled with the employee pursuant to a Pierringer release.

Holding:

 v The Minnesota Supreme Court affirmed in part, reversed in part, and remanded to the Compensation Judge.

v The Supreme Court held that the employee established a workplace exposure to a hazard causing an occupational disease and that, consistent with Minn. Stat. § 176.135, subdivision 5 (2020), it was not an error to order payment of medical benefits by the employer where the employee was last exposed.

v The Supreme Court also held that the compensation Judge erred by concluding that all issues, other than medical benefits, were moot by not determining whether the last exposure employer has a right to reimbursement against the last significant exposure employer under Minn. Stat. § 176.135, subdivision 5, and Minn. Stat. § 176.66, subdivision 10 (2020).

v The Supreme Court remanded the matter to the Compensation Judge for determining whether the council was entitled to reimbursement and how that reimbursement is to be made consistent with the Pierringer principles.

POST TRAUMATIC STRESS DISORDER – PERSONAL INJURY STATUTE CONSTRUED

CHRC vs. Mower County (W.C.C.A May 9, 2022)

Factual background:

 v The employee began working for Mower County as a deputy sheriff in 2007. He was then diagnosed with PTSD, moderate to severe alcohol use disorder, and major depression in April 2019.

v The employee was recommended various forms of treatment for his PTSD and addiction.

v The employee's condition worsened, and effective March 31, 2020, the employee received duty-related disability benefits from the County, which included monthly income and ongoing health insurance, and he retired from his position.

v He filed a Claim Petition in May 2020 alleging entitlement to various benefits including wage loss benefits beginning April 1, 2020. Dr. Arbisi examined the employee upon the employer's request, and he determined that the employee did not meet the criteria for PTSD under the DSM-V, and that the employee had an unspecified adjustment disorder and alcohol use disorder related to his pending criminal charges. He also later testified that the employee did not follow the standard treatment protocol for PTSD, and instead relied on medication.

v The employee's treating psychiatrist and Dr. Slavik concluded that the employee had chronic PTSD caused by his employment activities as a deputy sheriff which were not resolved.

v Following a hearing, the Judge concluded that the employee had sustained work-related PTSD on April 3, 2019, and awarded wage loss benefits from April 1, 2020 to the present and continuing, though noted the employee had reached MMI and service of MMI occurred on May 18, 2021. The Judge also awarded 20% PPD as determined in Dr. Slavik's report. The employer appealed.

Holdings:

 v In a 2-1 decision, the W.C.C.A reversed the award of PPD, vocational benefits, and medical expenses for treatment after March 30, 2021, and modified the award of TTD benefits to allow TTD only to March 30, 2021.

v The W.C.C.A determined the employee had sufficiently recovered from his PTSD diagnosis to the point where he no longer met the criteria for PTSD under the DSM-V. Because an employer's liability for workers compensation benefits under Chapter 176 ends when an employee is no longer disabled, and the employee was no longer disabled by PTSD as of March 30, 2021, he was not entitled to workers compensation benefits after that date.

v The dissent contended that the majority's opinion resulted from a “narrow interpretation" of the PTSD statute and that the holding was “problematic and unworkable."

TERMINATION OF EMPLOYMENT - VOLUNTARY TERMINATION

TEMPORARY TOTAL DISABILITY - JOB SEARCH

Berglund v. Wildrose Health Care, LLC (W.C.C.A. January 7, 2022)

Factual Background:

v The employee appealed the compensation Judge’s determination that she voluntarily resigned from her employment and the denial of her claim for reinstatement of benefits. The employee sustained an admitted injury with the employer for which benefits were paid. The employee was released to work on a part-time, light-duty basis and the employee returned to work. The employer and insurer filed a notice of intention to discontinue temporary total disability (TTD) benefits and indicated temporary partial disability (TPD) benefits would be paid.

  The employee was upset by the discontinuance and advised the employer she would not be working her scheduled shifts that weekend. She then did not show for a meeting to discuss her concerns with her supervisor. Her supervisor considered the employee’s failure to work her scheduled shifts and attend the scheduled meeting along with her statements that she was “done with Wildrose” to be a voluntary resignation and provided the employee with a letter accepting her resignation. At a hearing on an objection to discontinuance, the compensation Judge found the employee voluntarily resigned from her employment and had not made a diligent search for other employment.

Holding:

v The W.C.C.A. affirmed the compensation Judge’s decision, indicating that the findings appealed by the employee were factual determinations made by the compensation Judge after considering the evidence and arguments of the parties. The W.C.C.A. concluded that substantial evidence existed to support the compensation Judge’s factual determinations. The Court found no evidence on the record that the employee searched for another job. She did work with a QRC, but testified that she had little discussion with her QRC about returning to work. In addition, the last stated rehabilitation goal was returning the employee to work with the date-of-injury employer.

JURISDICTION - SUBJECT MATTER

MEDICAL TREATMENT & EXPENSE

Warhol v. Corexpo, Inc. (W.C.C.A. December 7, 2021

v The W.C.C.A. previously decided this case on April 28, 2021, and affirmed the award of benefits for medical marijuana. The Supreme Court reversed the W.C.C.A.’s decision as it regards to the award of benefits for medical marijuana based on its decision in Musta v. Mendota Heights Dental Ctr. 965 N.W.2d 312 (Minn. 2021) (holding that the Controlled Substances Act preempts requirements under Minnesota Workers’ Compensation that obligate and employer to reimburse an injured employee for medical treatment when that treatment is an award for medical cannabis).

On August 24, 2022, the South Dakota Supreme Court issued its opinion in the matter of Douglas Ries v. JM Custom Homes, LLC, 2022 S.D. 52 indicating workers’ compensation was the only remedy available to Ries, an employee of JM’s subcontractor, under the workers’ compensation statutes SDCL 62-3-2 and SDCL 62-3-10.

Pine Tree Plumbing (“Pine Tree”) was a subcontractor of JM Custom Homes, LLC (“JM”). Ries was injured when he fell through a plywood stair while working as an employee of Pine Tree. Ries filed for workers’ compensation benefits against Pine Tree and Pine Tree’s insurer, Acuity Insurance. After Pine Tree and Acuity paid Ries’ workers’ compensation benefits, Ries filed a negligence claim against JM for failing to anchor the plywood or install handrails. In response, JM asserted the affirmative defense of statutory immunity under SDCL 62-3-2 and 62-3-10.

SDCL62-3-2 is an exclusivity provision, which limits an employee’s right to sue. The statute provides that, when an employer accepts liability for workers’ compensation, the employer is provided immunity against all other rights and remedies of an injured employee in return (except those arising from intentional torts). Also known as the “great compromise” the trade-off is a “quid pro quo” exchange inherently ingrained in South Dakota’s Workers’ Compensation Act.

SDCL 62-3-10 provides that a principal contractor (JM) is liable for workers’ compensation “to the same extent as the immediate employer” (Pine Tree). The statute extends liability upwards to general contractors for workers’ compensation claims from sub-contractor employees. However, it also extends the exclusivity provisions of SDCL 62-3-2 to general contractors, limiting a sub-contractor employees’ claims for injuries against higher-rung general contractors to workers’ compensation.

Under these statutes, JM argued that Ries’ sole remedy for his injuries was through workers’ compensation, and he could not sue JM for negligence. The circuit court agreed, and Ries appealed.

On appeal, Ries argued that JM’s insurance policy overrode the exclusive remedy provisions of SDCL 62-3-2. Ries argued that, under the language of the policy, JM was not liable for workers’ compensation claims of its subcontractors and, therefore, could not claim immunity from Ries’ negligence claims. In response, JM argued: (1) the language of the insurance policy was irrelevant; and (2) the policy provided coverage for workers’ compensation by stating “we will pay promptly when due the benefits required of you by workers compensation law.”

The Court determined the ultimate issue was whether JM accepted its obligation to be liable for workers’ compensation claims. If JM was deemed to have accepted its obligation by purchasing insurance coverage, Ries’ claims would be limited to workers’ compensation under SDCL 62-3-2, and JM would be entitled to immunity from Ries’ negligence claims. The Court determined that a private employer is deemed to have accepted its obligation under the Workers’ Compensation Act when it (1) purchases insurance (or enters into a reciprocal insurance agreement); or (2) complies with self-insurance rules.

The Court held the language of the insurance policy was relevant to determine whether JM had accepted its obligation to be liable for workers’ compensation. However, the Court found that JM’s policy secured the relevant coverage, so JM was deemed to have accepted its obligation under the Act. Accordingly, the Court held Ries’ sole remedy was limited to workers’ compensation, and affirmed the circuit court’s dismissal of Ries’ negligence claims against JM.

            Although the opinion reinforced long-existing precedent, it is also significant because it clarified the importance of, not only securing insurance coverage for workers’ compensation claims, but also ensuring that the policy’s language is sufficient to establish the employer’s acceptance of its workers’ compensation obligations under the laws of South Dakota. Failure to do so in this case may have exposed JM to liability for injuries of its subcontractor’s employee under a theory of negligence. As always, please feel free to contact us for more information.

On July 20, 2022, the South Dakota Supreme Court issued its opinion in the matter of Baker v. Rapid City Regional Hospital and Hartford Insurance, 2022 S.D. 40 affirming the denial of Permanent Total Disability (“PTD”) to the Claimant based in part upon deference to the South Dakota Department of Regulation, Division of Labor Management’s (the “Department”) factual determinations.

The Claimant, William Baker, was attacked by a patient and struck on the head in 2013 and 2014 while employed by the Rapid City Regional Hospital (“RCRH”). Baker was subsequently diagnosed with Post Concussive Syndrome (PCS), Post Traumatic Stress Disorder (PTSD), and anxiety. Years after the initial attacks, Baker continued to suffer from paranoia and obsession that purportedly limited his ability to work in public or interact with co-workers. However, it was unclear whether Baker’s symptoms were caused by the attacks at work or the stress from Baker’s ongoing litigation.

Baker argued the injuries he sustained at work remained a contributing cause of his mental impairments and he was entitled to PTD benefits. The Department held that even if Baker’s mental impairments were disabling, they were not caused by physical trauma from the injuries, and, therefore, he was not entitled to PTD. Baker appealed the Department’s decision to the Sixth Circuit Court, County of Hughes, Judge Christina Klinger presiding. The circuit court remanded the causation issue but affirmed the denial of PTD benefits.

Baker appealed the denial of PTD benefits to the Supreme Court, arguing: (1) the circuit court erred in denying his claim for PTD as he made a prima facie showing of obvious unemployability; and (2) RCRH and Insurer failed to meet their burden of proving suitable employment was available to Baker, because their vocational expert failed to inform potential employers of all of Baker’s limitations.

The Court agreed Baker did make a prima facie showing of obvious unemployability. However, the Court declined to impose “the exacting requirement suggested by Baker that the employer must speak with each prospective employer and inform them of claimant’s limitations.” Instead, the Court concluded an employer need only “show more than a general availability of jobs to persons with some of claimant’s disabilities.”

Baker further argued he was unemployable as he could not work around other people due to his mental condition. However, RCRH and Insurer’s vocational expert provided examples of 24 different available jobs, most of which would allow Baker to work without significant interaction with other co-workers. The positions were approved by one of Baker’s treating physicians, and Baker testified the positions would allow him to work individually. However, Baker never applied to any job position. Deferring to the Department’s personal observations regarding Baker and whether he was permanently totally disabled, the Court affirmed the Department and the circuit court’s determinations that Baker failed to meet his burden to show his impairments prevented him from obtaining employment.

Although the opinion generally reaffirms long-established precedent regarding odd-lot disability benefits, the opinion is unique insofar as it is the first time the Supreme Court has encountered a claim for odd-lot benefits based upon a mental condition, rather than a “physical condition” as stated in SDCL 62-4-53 (stating “An employee is permanently totally disabled if the employee’s physical condition . . . causes the employee to be unable to secure [employment]”). The Court questioned whether the Legislature ever intended to allow PTD benefits for a mental condition in the first place under the statutory language of SDCL 62-4-53. However, the Court declined to answer the question, as the issue was not challenged on appeal.

Code of Maryland Regulations Removed the Cap on Reimbursement of Expenses and Costs Due to Missed Medical Examination Appointments.

Effective October 18, 2021, Code of Maryland Regulations (COMAR) 14.09.03.08B(6) was revised to remove the $125.00 cap on the reimbursement of reasonable expenses and costs associated with a missed medical examination. The amendment allows for a party to seek credit or reimbursement for the entire amount of no-show fees, or other reasonable expenses and costs incurred due to a missed exam. The reimbursement amount is now subject to the presiding Commissioner’s discretion.

Maryland Court of Appeals Holds that a Workers’ Compensation Commission’s Summary Denial of a Motion to Reopen or Modify is Not Subject to Judicial Review or Appeal.

On December 17, 2021, the Maryland Court of Appeals handed down their decision in Linda A. Sanders v. Board of Education for Harford County, et al., 265 A.3d 1083. The Court had to decide whether the Commission’s summary denial of Sander’s (Petitioner) second request for modification under Maryland Code, Labor and Employment § 9-736(b) (hereinafter “LE” § 9-736(b)) was subject to judicial review. The Maryland Workers’ Compensation Commission issued an Award denying the Petitioner’s shoulder surgery. The Petitioner did not appeal or request a rehearing of that Award. Over three years later, the Petitioner filed a request for modification of the Commission’s Award, which was summarily denied. The Petitioner filed a petition for judicial review with the Circuit Court. The Respondents filed a motion to dismiss, which was subsequently granted. The Petitioner then filed a second request for modification of the Commission’s Award based on the same issues, with the Commission. The Commission, again, summarily denied the second request for modification of the Commission’s Award. The Petitioner appealed to the Circuit Court for judicial review on this second request, which was subsequently allowed. The Circuit Court remanded the case back to the Workers’ Compensation Commission for further consideration.  The Respondent’s appealed the Circuit Court’s Order of remand to the Court of Special Appeals. The Court of Special Appeals found in favor of the Respondents, that the Circuit Court erred in their Order as summary denial of the Workers’ Compensation Commission is not an appealable decision. The Petitioner then filed a writ of certiorari with the Court of Appeals in 2021. The Court of Appeals granted the petition and affirmed the Court of Special Appeal’s decision.

 The Court of Appeals found as follows:

·         According to the plain language of LE § 9-736(b), the Commission has wide discretion to either modify a finding or order that it has previously issued, or no do so. Although LE § 9-737 generally provides for judicial review of the Commission’s decision within thirty days of the Commission’s Order, Maryland’s case law makes clear that summary denial of a request to reopen or modify under LE § 9-736(b) is not subject to judicial review, as it is not a reviewable decision.

·         The Court reiterated its position as to why the Commission’s summary denial of a request to reopen or modify a prior decision is not subject to judicial review. The Court clarified in Jerry Blevins v. Baltimore County, 352 Md. 620, that where the Commission denies an application to reopen or modify without discussing the merits or propriety of the earlier order, it is evident that the earlier order has not been reconsidered and no new decision has been made. Thus, when the Commission summarily denies a request to reopen or modify, they are not making any new decision, thus the previous order remains unchanged, and there is nothing new for an appellate court to review.

·         The key takeaway from this decision is that if the Commission declines to reconsider their prior Award, that decision is not appealable.

Maryland Court of Special Appeals Holds That Employer/Insurers Do Not Waive Their Statutory Subrogation Interest Against Third Party Proceeds by Failing To Expressly Reserve their Right.

On July 18, 2022, the Maryland Court of Special Appeals decided the case of Charles D. Conley, et al v. Trumbull Insurance Company, 2022 WL 2800977. The Court was tasked with deciding whether Employer/Insurers waived their statutory right of reimbursement of third-party proceeds by failing to expressly reserve their reimbursement right in their full and final settlement agreement with the Employee. The Employee (Conley) sustained an on-the-job injury due to the negligence of a third-party. Conley resolved his workers’ compensation claim with his employer’s insurance company (Trumbull) by way of a full and final settlement, approved by the Workers’ Compensation Commission. Conley then proceeded to settle his claim against the negligible third-party and collected the proceeds. When Trumbull asserted their subrogation lien against the third-party settlement proceeds, Conley refused as he believed Trumbull waived their right to the third-party proceeds by failing to expressly reserve their statutory lien under the full and final settlement agreement of the workers’ compensation claim. Trumbull filed a complaint against Conley to enforce the Employer’s subrogation right under the Maryland Workers Compensation Act. The Circuit Court of Baltimore County found in favor of Trumbull, holding that the Employer/Insurer’s statutory lien survived the full and final settlement agreement, as Maryland law does allow for an employer’s insured’s lien to be reimbursed upon the settlement of a claim against a tortfeasor. Conley appealed the Circuit Court’s decision to the Court of Special Appeals. The Court of Special Appeals ultimately affirmed the Circuit Court’s decision, albeit for different reasons.

The Court of Special Appeals found as follows:

·         Maryland Code, Labor and Employment §9-722 (hereinafter “LE” §9-722) provides the rules for settling claims under the Maryland Workers’ Compensation Act. While LE §9-722 does not address the impact of settlement on Employer/Insurer’s right to third-party reimbursement, LE §9-902 provides a framework for handling post-settlement third-party claims under the Maryland Workers’ Compensation Act. Prior to October 2018, LE §9-902 did not address whether an Employer/Insurer’s subrogation interest was waivable. However, the Court further considered the issue in light of the Maryland Workers’ Compensation Act amendment history and other general provisions in the Act.

·         The Court considered the language of LE §9-104, which in short states that except as otherwise provided in this title, an employee or employer may not by agreement, waive a right of the employee or employer under this title.

·         In light of LE §9-104, the Court held that an Employer/Insurer’s statutory subrogation interest was a “right” of the employer under the Maryland Workers’ Compensation Act, and pursuant to LE §9-104, the Employer/Insurer’s subrogation interest was not waivable by agreement, therefore, Trumbull did not waive its subrogation interest by failing to expressly reserve it in the full and final settlement agreement with Conley.

LE §9-902 was amended in October 2018 to include subsection (g), which requires an employee who recovered from a third-party to reimburse the Employer/Insurer if the Employer/Insurer has not waived third-party reimbursement. However, LE §9-104 was not affected by the amendment.

Change in Maryland Regulations Now Allows for Attorney’s to Accept Service on Behalf of Employers.

While a small change, the current version of Code of Maryland Regulations (COMAR) 14.09.03.05(E) has been amended to allow service of subpoenas to be made in accordance with the Maryland Rules. Under Maryland Rule 2-510(d), service of a subpoena may be made to a person authorized by law to receive service for the person named, or by service upon the attorney of a represented party. Previously 14.09.03.05(E) limited to service by way of personal service or certified mail to the person specified in the subpoena request. Now, not only can attorney’s accept service of behalf of employers, but they can also receive service by means other than personal delivery or certified mail in certain instances. Maryland Rule 2-121(c) allows for service by way of any other means that a Court deems appropriate in the circumstances and reasonably calculated to give actual notice. 

Written by John Tomei

When employees in North Carolina sustain injuries by accident arising out of and in the course of their employment with employers, their ensuing workers’ compensation claims are generally compensable. However, what if the injured worker is a subcontractor? And, does it matter if the injured subcontractor is uninsured?

What if the injured worker is a subcontractor?

The answer to the first question is determined by the analysis of whether the worker was an employee or an independent subcontractor at the time of the injury. Many employers mistakenly believe that simply calling  workers “independent contractors” or “subcontractors” and paying them cash or with a Form 1099 makes their workers independent or subcontractors.  That is often not the case. Rather, in North Carolina, it is a multi-factored analysis as to whether an injured worker is an employee or an independent contractor, with the ultimate test being whether the contracting entity had the right to control the details of the injured worker’s work.

Some of the factors the Industrial Commission considers are whether the injured worker (1) was engaged in an independent business, calling, or occupation; (2) whether they had independent use of their special skill,  knowledge or training; (3) whether they were doing a specified piece of work at a fixed price, for a lump sum,  or on a quantitative basis; (4) whether they are not subject to discharge for choosing their method of work; (5) whether they are in the regular employ of the other contracting party; (6) whether they are free to hire assistants; (7) whether they have full control over their assistants; and (8) whether they select their own time. No single factor is determinative. Instead, the ultimate test is whether the contracting entity had the right to control the details of the injured worker’s work.

These cases are all fact-specific and often require careful factual and legal analysis. Some at the Commission give the benefit of any factual doubts to the injured worker. Moreover, if the injured worker was paid by the hour, the Commission will often give that factor great weight and find that the injured worker was an employee rather than an independent contractor, such that the worker’s claim would be found compensable.

Does it matter if the subcontractor is uninsured?

If the injured worker is a subcontractor, and they are uninsured for workers’ compensation purposes, can they successfully argue that the statutory employment protections of N.C.G.S.  97-19 should nonetheless apply to enable them to obtain workers’ compensation benefits? Fortunately for contracting entities and their carriers, the answer is likely “No.”

N.C.G.S. 97-19 provides, in relevant part, the following:

…shall be liable, irrespective of whether such subcontractor has regularly in service fewer than three employees in the same business within this State, to the same extent as such subcontractor would be if he were subject to the provisions of this Article for the payment of compensation and other benefits under this Article on account of the injury or death of any employee of such subcontractor due to an accident arising out of and in the course of the performance of the work covered by such subcontract. N.C.G.S. Ann. 97-19.

In an earlier version of the statute, the class of persons protected by this provision included not only employees of the subcontractor, but also the subcontractor himself. Southerland v. B.V. Hedrick Gravel & Sand Co., 345 N.C. 739, 483 S.E.2d (1997). However, in 1995, the General Assembly reinstated the pre-1987 language of N.C.G.S. 97-19 by deleting ” any such subcontractor, any principal or partner of such subcontractor or” preceding “any employee of such subcontractor” effective June 10, 1996. Boone v. Vincent, 127 N.C. App. 604, 609, 492 S.E.2d 356, 359 (1997), cert. denied, 347 N.C.573, 498 S.E.2d 377 (1998). (citing 1995 N.C. Sess. Laws ch. 555 sec.1).

Consequently, the current Act only protects injured employees of a subcontractor, and not the uninsured, injured subcontractor himself. Obviously, subcontractors can choose to purchase workers’ compensation insurance coverage to protect themselves, in addition to their employees, in the event of a work-related injury.

Claims Handling Practice Tips

At the inception of a claim, insurance carriers and their adjusters need to thoroughly investigate and confirm whether the injured worker was an employee or an independent subcontractor, bearing in mind the factors mentioned above.  If the injured worker is a subcontractor and uninsured, the Act does not provide any protection for that injured subcontractor. Rather, under the statutory employment scheme of N.C.G.S. 97-19, only injured employees of subcontractors are protected by the coverage, which is afforded by the general contractor’s workers’ compensation policy.

2022-23 Biennium Budget Bill Brings Pro-Employer Changes to Ohio Workers’ Compensation Law.

On June 29, 2021, Governor Mike DeWine signed into law the 2022-23 budget which enacted some changes to Ohio workers’ compensation law, including:

·         Requiring claimants in receipt of salary continuation to wait 26 weeks after their last payment to file an application for permanent partial disability compensation (“PPD”);

·         Requiring claimants who have previously been denied permanent total disability (“PTD”) to show new and changed circumstances before re-applying for the benefit; and

·         Reducing the statute of limitations for an occupational disease claim from two years to one year from the date of disability due to the disease began.

The budget bill also resulted in the return to in-person hearings in Ohio that may have come earlier than some expected. The Ohio Industrial Commission returned to in-person hearings on July 6, 2021, but the parties now have the option to calling rather than attend physically (this was always an option for injured workers, but rarely utilized). Parties who opt not to attend in person must waive their right to an in-person hearing. The waiver is not necessary for parties represented by attorneys or non-attorney representative attending in person. Otherwise, a waiver is required, either orally (if the party is represented by an attorney appearing remotely) or in writing (if the party is represented by a non-attorney representative appearing remotely).

Ohio General Assembly Limits Workers’ Compensation Coverage for Remote Employees

The Covid-19 pandemic has led to a dramatic increase in the number of employees who work remotely. In response to the various issues arising in connection with remote workers’ compensation claims, Governor Mike DeWine signed into law House Bill 447 (“H.B. 477”) on June 24, 2022 which amended Ohio Revised Code §4123.01(C) to exclude from the definition of “injury” any “[i]njury or disability sustained by an employee who performs the employee’s duties in a work area that is located within the employee’s home that is separate and distinct from the location of the employer[.]”  H.B. 447 does permit, however, an injury or disability sustained at the home to be compensable under Ohio workers’ compensation law if all of the following three factors are met:

(1)   The employee’s injury or disability arises out of the employee’s employment;

(2)   The employee’s injury or disability was caused by a special hazard of the employee’s employment activity; and

(3)   The employee’s injury or disability is sustained in the course of an activity undertaken by the employee for the exclusive benefit of the employer.

Ohio courts have defined “special hazard” as a “risk, either distinctive in nature of quantitatively greater than the risk common to the public.” H.B. 447 goes into effect on September 23, 2022.

Workers’ Compensation in Firefighter Cancer Claims

House Bill 17 (“H.B. 17”) is a proposed bill which would require the Ohio Bureau of Workers’ Compensation (“BWC”) to charge compensation and benefits paid from the State Insurance Fund for workers’ compensation claims involving firefighters disabled by cancer to the Surplus Fund Account. In a claim involving a firefight disabled by cancer where the employer is self-insured, the bill proposed that compensation and benefits payable to the firefighter be paid by the self-insured employer would be deducted from the paid compensation reported to the BWC.

BWC Updates on COVID Claims

Actual losses where Covid-19 was contracted by an employee during the period between the emergency declared under Executive Order 3030-01D, issued on March 9, 2020 and July 2, 2021, which is fourteen days after the Executive Order was repealed, shall be excluded from employer’s experience for the purpose of experience rating calculations.

In terms of how the Ohio BWC workers’ compensation system handled claims for Covid-19 allowances, hindsight has found that in very limited situations, some workers can file claims for workers’ compensation if they contracted Covid-19 at work. The Ohio BWC approved 836 claims for Covid-19 as of March 2021. As BWC guidance has set forth, it depends on how a person contracts it and the nature of the occupation. Generally, communicable diseases like Covid-19 are not workers’ compensation claims because people are exposed in a variety of ways, and few jobs have a hazard or risk of getting diseases in a greater degree or a different manner than the general public. However, if an individual works in a job that poses a special hazard or risk and contract Covid-19 from the work exposure, a claim could be allowed.

Voluntary Abandonment – State ex rel. Quest Diagnostics, Inc. v. Indus. Commission, 2022-Ohio-1093

The claimant’s husband was reassigned to work in California. The claimant notified her supervisor she would be moving to California at the end of October 2018 and submitted a request for a transfer to California, but in early October, she suffered her industrial injury. When she and the employer then learned, she would need to become licensed in California for a phlebotomist position, she submitted her resignation and then filed a motion for temporary total disability (“TTD”). The Ohio Industrial Commission found, based on her intent, the claimant did not voluntarily remove herself from her former position of employment and was entitled to TTD compensation.

The Tenth District Court of Appeals (Franklin County) disagreed and issued a writ of mandamus. The Court found that State ex rel. Klein v. Precision Excavating & Grading, Co., 155 Ohio St.3d 78, 2018-Ohio-3890, reasserted the fundamental tenant that a claimant is ineligible for TTD if the claimant’s workplace injury did not cause the loss of earnings. When the claimant removes herself from employment for reasons unrelated to the work-related injury she is no longer eligible for TTD. Here, an employee who quits her job for reasons unrelated to her workplace injury is ineligible for TTD because the circumstance of the injury did not cause the loss of earnings. Klein requires this result even if the claimant desired to retain her position and never intended to leave the workforce.

Scope of Employment

Owens v. Giant Eagle, Inc., 2022-Ohio-192 (8^th District Cuyahoga)

Claimant transported pallets of deli products from the delivery truck to the deli department. As he rounded the deli counter, he felt a pop at the back of his foot. His claim was disallowed for left Achilles tendon rupture. In his R.C. §4123.512 appeal, the court granted his employer’s motion for summary judgment on the grounds that the claimant’s injury was not sustained in the course of, and arising out of, his employment. The court of appeals found the claimant was working at the store location at the time of his injury, the employer had control over the scene, and the employer received a benefit from claimant’s presence at the scene up to the point of injury. The court found a genuine issue of material fact exists and revised and remanded to the trial court.

Hinerman v. Savant Systems, Inc., Hocking C.P. No. 21CV0053 (Nov. 21, 2021)

Claimant shut her finger in the door of her personal vehicle after she arrived for work but prior to entering the employer’s facility and starting her shift. She was in the employer’s parking lot, which was employer owned and controlled. The Commission denied her claim, finding she was not in the course and scope of employment when she was injured. In her R.C.  4123.512 appeal, the trial court granted the claimant’s motion for summary judgment finding she was a fixed situs employee in the zone of employment (the employer’s parking lot), she was on the employer’s premises for the specific purpose of going to work and was in the process of existing her vehicle when the injury occurred, all actions which benefited her employer.

Permanent Partial Disability Awards for Partial Loss of Sight – State ex rel. Bowman v. Indus. Commission, 2022-Ohio-233

Bowman’s claim was allowed for significant conditions to her eyes as a result of an E. coli infection caused by lunch meat provided by the employer at a holiday party. Bowman filed an application seeking a scheduled loss of use, pursuant to R.C. §4123.57. The District Hearing Officer disallowed the award entirely because the claimant had worn contacts prior to the injury. On appeal, the Staff Hearing Officer granted Bowman a 67% loss of vision award of uncorrected vision in her right eye and denied the request for loss of vision in her left eye. The Commission relied on the report of Dr. McGowan for this award.

Bowman filed for an increase to her prior award later requesting loss of uncorrected vision bilaterally in the amount of 70% (3% increase in right and 70% increase in left eye). She based this request on the prior report of Dr. McGowan, as well as a report of Dr. Harnish who opined that the AMA Guidelines were not applicable. The BWC had Bowman evaluated by Dr. Wareham who found a loss of 65% vision in the right eye and a 45% loss of vision in the left eye. Dr. Wareham agreed with Dr. Harish that the AMA Guidelines were not applicable. Further complicating the facts, all physicians agreed that her total loss of vision bilaterally was at least 70%.

At the first hearing on the request for the increased award, the DHO found a 45% loss of vision for the left eye only based on Dr. Wareham’s report. Since Dr. Wareham’s opinion on the right eye was 2% less than the prior award, the DHO did not give an increased award for the right. The SHO affirmed. The claimant appealed to the Ohio Supreme Court, arguing all the physicians agreed the use of the AMA Guidelines was insufficient to measure actual visual impairment, and thus, Dr. Wareham’s opinion was unreliable since it based on such. Further, Bowman reminded the Court that R.C. §4123.57(B) holds that an award of compensation shall not be made for less than twenty-five percent loss of uncorrected vision. The Court held that, while generally speaking, it would be acceptable for the Commission to select a percentage within the range of percentages stated by the physicians, it finds here, where all the physicians agree that Bowman’s actual visual impairment is 70% of greater, the Commission did abuse it discretion in finding that eh had a 65% impairment in the right eye and a 45% impairment in the left eye.

Refusal of Good Faith Job Offer/Entitlement to Temporary Total – State ex rel. Ryan Alternative Staffing, Inc. v. Moss, 2021-Ohio-3539.

Claimant sustained a work injury while employed by Ryan Staffing in a second-shift position, working 4:00 pm to midnight. Her workers’ compensation claim was allowed for a knee sprain, and she requested TTD. The employer offered claimant work within her medical restrictions, but on the day shift. Claimant refused the offer because she had to care for her granddaughter during the day while her daughter worked. The employer denied her request for TTD compensation because she had turned down the suitable job offer.

Claimant argued that the employer’s offer of employment was not made in good faith because it knew she was unable to work the day shift. The Commission granted her request for TTD compensation, finding both the offer and refusal were made in good faith. The Ohio Supreme Court held that while claimant may have had a good faith basis for her denial of suitable employment, this could not be used as a factor in justifying compensation under §4123.56. R.C. §4123.56(A) provides that payment for TTD compensation shall not be made for periods when work within the physical capabilities of the employee is made available by the employer, and read in conjunction with O.A.C. §4121-3-32(A)(6), which provides, “job offer” means a proposal, made in good faith, of suitable employment within a reasonable proximity of the injured worker’s residence, and “suitable employment” means work which is within the workers’ physical capabilities.

© Copyright 2022 by Christopher M. Ward, Calfee, Halter & Griswold, LLP. All rights reserved. Reprinted with permission.

This year’s legislative session brought about little substantive change in our code.  One anticipated change that has gone into effect are newly established caps for TTD, TPD, PPD and the maximums for Spousal dependency benefits where the surviving spouse is the sole primary beneficiary. The new established caps do apply only to dates of accident on and after July 1, 2022.

The new maximum rates for indemnity are as follows:

1. TTD goes from a maximum of $675 per week to $725,

2. TPD goes from a maximum of $450 per week to $483, and

3. PPD goes from a maximum of $675 per week to $725 due to the above changes in TTD rates.

 Also effective July 1, 2022 is a change in the maximum benefit payable to a surviving spouse with no other dependents. This figure goes from a maximum cap of $270,000.00 to $290,000.00 for dates of accident on or after July 1.

Effective July 1, 2022, there were also slight modifications to Board Rules 203 and 205.  The Board approved a new peer review organization in 2021. Claims Eval is the Board’s approved peer review organization and reviews disputes between medical providers and employers and insurers regarding medical charges. Some changes were made to the process and procedures for filing for peer review.

A change was also made to the rule to clarify that all medical treatment, items, and services covered by O.C.G.A. §34-9-200 can be included in the PMT process.  This latter change will be very helpful to the already successful PMT program that allows for requests and denials of certain medical procedures, items and services be done on an expedited basis.

Another note worth mentioning is the firm position that our Board continues to take on proper filing of Board forms in active claims.  Adjusters and other claims handlers will be held to a high standards as it relates to required filings and, when the opportunity arises, our Administrative Law Judges remind the section of this point.  Attorney’s fees and civil penalties will continue to be assessed for non-compliance issues and we should all consider ourselves on notice.

Finally, On October 19, 2021, the first Georgia Workers’ Compensation Claim involving Covid-19 in the workplace was litigated.. The claim was brought by a widower whose deceased spouse worked as a records clerk for a county jail. The ALJ issue an Award finding that in this particular claim, Covid-19 was not a compensable injury or disease under the Georgia statute. Interestingly, the claimant’s counsel argued that Covid-19 was not an occupational disease but was rather an injury leading to disease and brought on by injurious exposure.  The employer’s defense revolved around the deceased’s potential community exposure, as evidenced by bank records, as well as the extensive measures taken by the County to prevent the spread of Covid-19.  Although the finding was in favor of the employer in this case,  the Award left open the possibility that certain jobs or positions might lend a different result, and that is important to remember, especially for our first responder and health care clients who may be facing similar claims.