By:  Jeannette Herrera (Partner - Sacramento)

On June 29, 2022, the Senate Committee on Labor, Public Employment and Retirement voted 4 to 1 to pass Assembly Bill 1751, which extends the COVID-19 presumptions through January 1, 2025 for specified first responders and when there is an outbreak.  AB 1751 has now been re-referred to the Appropriations Committee.  Senate Bill 1159 initially enacted these presumptions.     

California Assembly Member Tom Daly (Anaheim) first introduced AB 1751 on February 1, 2022. 

SB 1159, enacted in September of 2020, created within the Labor Code a rebuttable presumption for COVID-19 illnesses contracted before July 5, 2020 (§ 3212.86), for specified peace officers and firefighters (§ 3212.87), and during an outbreak (§ 3212.88). AB 1751 would amend the expiration date of these Labor Code sections from January 1, 2023 to January 1, 2025.

Proposed AB 1751 would do nothing more than extend the expiration date of these sections by two years. Specifically, there are no other amendments other than to replace "2023" with "2025" in these three sections.

Like SB 1159, AB 1751 would place the burden on California employers to prove that specified employees did not contract COVID-19 at work. These presumptions can be disputed by, among other things, evidence of employer measures in place to reduce the risk of COVID-19 transmission and by evidence of an employee’s non-occupational risk of COVID-19 infection. The bill will go back to appropriations and then to the Senate floor before a final vote.

Learn more here:  https://highlights.hannabrophy.com/post/102hs6b/ab-1751-passes-in-committee-to-extend-covid-19-workers-compensation-presumptions

Written by: John Tomei

In these challenging economic times, which include inflation and rising costs of workers’ compensation coverage, one way employers can reduce their workers compensation insurance coverage costs is to request the inclusion in their policies of deductible provisions. In addition to premium cost savings, deductible plans can improve employers’ cash flow, provide increased tax deductions, and allow for more control over workers’ compensation costs.

An excellent source of information regarding workers’ compensation insurance deductibles can be found in the North Carolina Rate Bureau’s North Carolina Workers Compensation Basic Manual, particularly in Rule 5 – Policy and Endorsements, sections of which are referenced in italics below. Rule 5 – Policy and Endorsements of the North Carolina Workers Compensation Basic Manual

In North Carolina, each insurer transacting or offering to transact workers’ compensation insurance in North Carolina may offer deductibles to employers.  Deductible coverage is affected by attaching the Benefits Deductible Endorsement, WC 00 06 03 to the policy. However, it is important to know that an insurer is not required to offer a deductible to an employer.

To the extent an insurer is agreeable to offering a deductible to an employer, deductibles may be available for total combined medical and indemnity benefits in amounts of $100, $200, $300, $400, $500, $1,000, $1,500, $2,000, $2,500, and $5,000 per claim. A selected deductible applies on a per claim basis.  More specifically, the deductible must apply separately to each claim for bodily injury by accident or disease.

A deductible does not affect the claims adjustment process. If a claim occurs, the insurer will investigate the injury, pay providers for medical treatment, and make disability payments to eligible workers. The insurer will then bill the employer for the deductible portion of the claim.  As noted in the Manual, the claim is first paid by the insurer, which will then be reimbursed by the employer for any deductible amounts paid by the insurer.  The employer is liable for reimbursement up to the limit of the deductible chosen.  The payment or nonpayment of deductible amounts by the employer to the insurer is treated under the policy insuring the liability for workers’ compensation in the same manner as payment or nonpayment of premiums.

The applicable loss elimination ratio (LER) represents the percentage of losses removed when an employer is responsible for losses up to the deductible amount. LERs vary by deductible amount and hazard group.  As one might expect, the LER is a key variable used in determining the policy premium credit.

So, the good news for employers in North Carolina is that deductibles are permissible, with varied amounts, on a per claim basis. The insurer pays the claim, and then seeks payment of its deductible from the employer thereafter. If the employer does not repay the insurer for the deductible amount paid by the insurer, then it is treated as non-payment of a premium. Understandably, the amount of the deductible has an impact on the loss elimination ratio (LER), which is used to calculate the policy premium credit.

Simon Law Group, P.C.

720 Olive Street, Suite 1720, St. Louis, MO 63101

314-621-2828

MISSOURI WORKERS’ COMPENSATION CASE LAW UPDATE

April 2022 – June 2022

Knee Injury Sustained While Turning Not Compensable as Equally Exposed to Risk in Normal Non-employment Life

Overstreet v. Tamko Building Products, Inc. and Ace American Insurance Company, Case No. SD37171 (Mo. App. 2022)

FACTS:  The claimant worked as an asphalt plant operator for the employer. On the date of injury, he saw a truck arrive and began walking on the asphalt path to the load station when he realized he had forgotten his card to access the load station. He planted his foot to turn right, turned around to retrieve his card and heard a “pop” and felt tearing in his left knee. When he was seen at the hospital, he reported that he was “in a hurry and was walking very fast when he suddenly switched directions”. In both his deposition and hearing testimony, he stated that the area where he was walking on the date of injury was not out of the ordinary, not wet, not slick and the area was lit. He also claimed that he was walking “downhill” or “across a decline” or a “slope” when his knee popped. However, he did not indicate that the slope was a contributing factor to his knee popping. He also noted that although there were cracks in the area where he was walking, he could not be sure if he stepped on a crack. The claimant’s supervisor also testified that there were no other employees that had issues in this area due to any issues with the ground. Dr. Koprivica testified on behalf of the claimant and opined that the incident was the prevailing factor in causing his condition.

The ALJ found that the claimant did not sustain a compensable injury arising out of and in the course and scope of his employment because the risk source, walking on asphalt and changing directions was a risk to which the claimant was equally exposed to outside of his employment. The claimant appealed and the Commission affirmed. The claimant again appealed.

HOLDING: The Court noted that it is not enough that a claimant’s injury occurs at work or even while engaged in a work-related activity. To show causal connection between the injury and work, the risk involved must be one to which the worker would not have been equally exposed in his non-employment life. The Court found the claimant failed to meet his burden as he acknowledged that in his normal non-employment life, he often walks and changes directions. Also, the asphalt lot was not dissimilar from numerous other asphalt lots in his community which had similar cracks, unevenness and slopes. Therefore, the Commission’s denial of benefits was affirmed.

Injury Compensable as Claimant Not Exposed to Twisting in Tight Space and  Working at Fast Pace Outside Of Work in Non-employment Life

Durr v. Clarks Mountain Nursing Center, Americare Systems, Inc. and Safety National Casualty Company, Case No. SD37212 (Mo. App. 2022)

FACTS: The claimant worked as a CNA for the employer. On March 5, 2015, she was performing one of her job duties which included freshening each resident’s pitcher with water and ice. She took the pitcher from the resident’s room out to the cart which remained in the hallway for sanitary purposes and brought the pitcher back into the resident. There was testimony this was performed at a “very quick pace” as there was only one water/ice cart provided by the employer and this was to be shared with the other three §s.

In order to access this particular resident’s pitcher on the bedside table, she had to step sideways through a narrow space between the bed and the wall and then to exit the space she had to pivot to her right to get out of the room. On her date of injury, the top of her left leg went with her body and the bottom of her left leg stuck resulting in a twisting motion of the knee. Ultimately the claimant underwent surgery on her own.

The ALJ concluded that the claimant’s injury was compensable as the injury to her left knee did not come from a hazard or risk unrelated to her employment to which she would have been equally exposed to in her normal non-employment life. The ALJ found that passing out ice required the claimant to move about in a tight, narrow space between the resident’s bed and the wall to deliver fresh water and ice. Furthermore, the claimant was wearing the recommended non-skid shoes while navigating this tight space and that non-skid shoe stuck to the floor causing a twisting injury to the left knee.

The Commission reversed the decision of the ALJ. It found that testimony showed there was no time limit for passing out ice and the claimant was not required to wear closed-toed, non-skid shoes. The Commission noted she would be equally exposed to twisting in her normal non-employment life. The claimant appealed.

HOLDING: The Court of Appeals reversed the decision of the Commission and noted that the claimant’s injury arose out of the particularized working conditions and work requirements of the job. It noted for this particular resident, the employer placed the bedside table in the one-foot gap between the wall and the bed so that his wheelchair would not bump into the bedside table. Also, it was the employer’s preference that the claimant wear closed-toed non-skid shoes and it was part of the claimant’s job duties to fill water pitchers in an expedient fashion which required her to navigate the one-foot gap in a dark room and to pivot between facing forward and backward within that confined area. In light of this, it was determined that the claimant was not equally exposed to this same risk in her normal non-employment life and the decision of the Commission was reversed and remanded for an entry of an Award consistent with the Award of the ALJ.

Sitting in Parked Vehicle on Public Street is Noncompensable as a Risk Source of Injury for Which the Public is Equally Exposed

Flemons v. Land of Oz Academy and FirstComp Insurance Company, Injury No. 17-003266

FACTS: Claimant and his wife owned a child care center, Land of Oz, the employer. The claimant and his wife would eat lunch while sitting in employer’s vehicle parked on Kingshighway while working for employer. While eating lunch, they discussed business activities. Although there is a staff lounge inside employer’s building, they prefer to eat in the truck for privacy and avoid phone calls for employee questions during the lunch hour. During lunch, they were rear ended by a vehicle traveling on Kingshighway and sustained injury. The ALJ found that claimant’s injury was not in the course and scope of employment.

HOLDING: The Commission affirmed the Judge’s denial of compensation. The risk source of cliamant’s injury was not work related or related to a risk to which the employee was not equally exposed. The claimant was not placed in an unsafe location due to his employment but chose to eat lunch in the parking lane of Kingshighway rather than the available conference room and office space inside employer’s location. The risk source is the immediate cause of the injury. In this case, discussing business was not the risk source causing the injury. Instead, the risk source was being lcoated in the parking lane of a busy thorogouhfare. Parking on Kingshighway Boulevard was a risk freely available to the public.

Claimant Must Show a Causal Link Between Work Activities and New Alleged Injury After Prior Settlement For Fusion Surgery

Toska v. American Pulverizer, Injury No. 17-075220

FACTS: Claimant started working for employer in 2006. In March 2009, claimant sustained a work injury and had severe pain in his low back and left leg. In September 2009, the claimant underwent surgery at L4-5 by Dr. deGrange but continued to have pain. In August 2011, he underwent a fusion at L4-5 by Dr. Kitchens. The fusion helped claimant’s pain in his back and he no longer had pain in his leg. The 2009 injury settled for 30% of the body.

When claimant returned to work following the fusion, he had pain “all of the time” but was able to fully perform his job. On cross-examination, claimant admitted he was still having pain after his August 2011 surgery, but did not tell anyone he needed to see a doctor. On Septmeber 9, 2017, the claimant went to the ER and reported that over the last two months, his low back pain redeveloped and was worse everyday. Although he did not recall an injury, he reported his work activities exacerbated his back pain. He saw Dr. Kitchens on September 10, 2017 and underwent surgery the next day. Dr. Kitchens performed a revision of the hardware at L4-5 and a L3-4 decompressive laminectomy, discectomy and fusion.

The claimant’s expert, Dr. Volarich testified that the claimant had been able to perform all of his usual duties at work following his 2011 surgery until September 8, 2017. He opined that the heavy lifting the claimant performed for the employer was the prevailing factor causing his severe increase in back and leg pain. He testified that heavy lifting, moving in awkward positions and twisting would lead to a herniation above the level of the previous fusion. He found 35% PPD for the prior 2009 injury and additional 35% PPD to the back for the 2017 injury and concluded claimant was permanently and totally disabled as a result of his 2009 and 2017 back injuries.

On cross-examination, Dr. Volarich admitted the claimant did not report an accident occuring on September 8, 2017 but did report an accident in July 2017. He admitted it was not unusual for adjacent levels to break down after a spinal fusion. He also conceeded a disc herniation can occur spontaneously and more likely in someone with preexisting degernative disc disease.

Dr. Kitchen testified for the employer. He said the claimant was returned to work with no restrictions after his fusion surgery for the 2009 work injury. He then saw the claimant on Septmeber 10, 2017, after the ER visit. The claimant gave a history of pain for a couple of months that had worsened over a couple of days before he went to the ER. The claimant did not give an indication to Dr. Kitchen that his back pain was related to work activities.

Dr. Kitchens further testified the claimant sustained a large disc herniation at L3-4 and given the size, he would not expect a person to be able to perform heavy job duties. He stated that the claimant would not have been able to work a full shift on Friday, September 8, 2017 given the amount of pain he was in on September 10, 2017.

Dr. Kitchens opined that the actual herniation is an acute event. A disc herniation has to be linked in time to a particular activity in order to be medically casually linked to that activity. He opined the claimant had a spontaneous herniation due to age related degeneration.

HOLDING: The ALJ found that claimant failed to prove by medical evidence that there was a causal link between his new back injury and some distinct feature of his job duties for the employer and therefore, the claim was denied. The Commission affirmed the decision.

Claimant Must Prove Work is More Likely Than Not the Prevailing Factor of Carpal Tunnel and Not One of Several Factors Such as Age and Prediabetes

Nevois v. Meramac Industries, Injury No. 19-078979

FACTS: The claimant was a 56 year old factory worker who developed carpal tunnel syndrome. His first position for the employer was as a packer for six years. Then, the claimant worked for 2-3 months as a taper. In July 2019, he began a machine operator job for employer and worked 30 days in late July and August.

The claimant had preexisting medical conditions of obesity (BMI 35-39), smoking addiction and prediabetes. The claimant did not experience any hand complaints while working as a packer or taper but reported complaints after 2-3 weeks as a machine operator.

Employer’s medical expert testified that 2 weeks as a machine operator was not long enough exposure to cause carpal tunnel, even if the clamps on the machine required significant force to close. He noted that there is a correlation between BMI’s over 30 and the development of carpal tunnel syndrome. The doctor opined that the claimant’s work as a machine operator did not accelerate or cause the carpal tunnel syndrome to manifest. He also opined that older age was a causative factor.

The claimant’s medical expert testified that the claimant’s repetitive work with his hands for the employer, in particualr, the machine operater position, which required repetitive and forceful closing of clamps, was the prevailing factor causing the carpal tunnel syndrome and need for treatment. The doctor did not have an opinion as to whether the claimant’s obesity was a contributing factor, but stated it was not the prevailing factor causing the carpal tunnel syndrome. However, he was uncertain whether prediabetes could cause the condition.

HOLDING: The Judge denied the claim. He noted that the burden of proof for compensation is on the claimant and he did not prove more likely than not that work was the prevailing factor causing his medical condition and disability. The experts in the case were evenly divided and neither was overwhelming. Based on the evidence, the judge concluded that the cause of the claimant’s carpal tunnel syndrome was multifactorial, including obesity, prediabetes and claimant’s hand intensive job for 30 days and all appear to be substantial factors. The claimant’s work as a machine operator may have been a triggering factor but none of the factors were more important than the other factors. The Commission affirmed the judge’s decision.

The Employer and Insurer on the Day of Last Exposure Prior to the Date of Injury are Liable for the Toxic Exposure; Also, Date of Injury is Date of Diagnosis

French (deceased) v. Bill’s Truck Repair and the Larson Group, Inc. d/b/a MidAmerica Peterbuilt and Bloomington Compensation Insurance Group, Missouri Employer’s Mutual Insurance Company and Standard Fire Insurance Company, Injury No. 14-080361

FACTS: The employee worked as a diesel mechanic at Bill’s from 1989 to 2006. He began working as a diesel mechanic at MidAmerica in July 2006. He last physically worked at MidAmerica on October 1, 2014.

In September 2014, the employee began to experience leg pain. Ultrasounds revealed blood clots in both legs and employee was prescribed medication and special hosiery. On September 30, 2014, the employee returned to the doctor for difficulties with memory and controlling his emotions. On October 1, 2014, after working at MidAmerica for four hours, employee left work and went directly to the hospital and was admitted for a TIA. He suffered a second stroke on October 4, 2014 and on October 7, 2014, a biopsy revealed stage III. B adenocarcinoma of the lung with metastasis. The employee underwent treatment including chemotherapy for his lung cancer and other cancer related conditions. He ultimately passed away on July 24, 2015 of a stroke as a consequence of underlying metastatic lung cancer.

Prior to October 1, 2014, the employee worked full time and had not been diagnosed with lung cancer.

The claimant’s medical expert opined that the claimant’s employment as a diesel mechanic caused his exposure to diesel fumes which led to the development of the lung cancer from which the employee ultimately died. The employers and insurers did not present contrary evidence. The ALJ found that the employer, MidAmerica and their insurer, Standard Fire Insurance Company liable for the medical care, TTD, death benefits and funeral expenses.

HOLDING: The Commission affirmed the ALJ’s decision. Based on the standard set forth in

§287.063.3 RSMO 2005, “the moment it becomes reasonably discoverable and apparent that an injury has been sustained related to such exposure, is the date of injury in an occupational disease. As such, the date of injury for the employee was October 1, 2014.” The employee was last exposed to diesel fumes that caused his death from lung cancer on October 1, 2014. Therefore, the employer, MidAmerica, is liable for the death of employee. The Workers’ Compensation carrier for MidAmerica as of October 1, 2014, was Standard. Therefore, Standard is the liable carrier.  

A Preexisting Non-Compensable Injury Does Not Qualify as a Preexisting Condition Under the Statute for Fund Liability if it is Unrelated and Does Not Aggravate or Accelerate the Primary Injury

Schebaum v. Treasurer of the State of Missouri / Custodian of the Second Injury Fund, Case No. WD84765 (Mo. App. 2022)

FACTS: The claimant became deaf in both ears as a child. Many years later, he sustained a compensable work injury to his right knee in 2007 and settled with the employer for 45% PPD of the right knee. In January 2014, the claimant sustained a new compensable work injury to his knee and was unable to work thereafter due to the physical nature of the job. He settled with the employer for the 2014 injury for 25% PPD of the left knee but left his claim open against the Second Injury Fund for permanent total disability.

At the Hearing, both medical experts testified by deposition that the claimant was permanently and totally disabled as a result of the prior right knee disability and his hearing loss together in combination with the disability from the primary injury to his left knee. The claimant’s vocational expert did testify at the Hearing that the claimant’s permanent total disability was the result of only his prior right knee injury combined with the primary injury to his left knee. However, the vocational expert’s testimony was inconsistent with his opinions stated in his written reports and his testimony was found not to be credible. The Commission determined that the claimant had not established Fund liability for permanent total disability based on the credible evidence in the record.

HOLDING: The Court affirmed the Commission’s decision. Under §287.220.3, the hearing loss failed to meet the three criteria necessary to establish a permanent total disability claim against the Fund as required by the statute. Although the hearing loss exceeded the 50 week minimum threshold and was not a compensable injury, the preexisting hearing loss was unrelated and did not aggravate or accelerate claimant’s subsequent work related injury (his 2014 left knee injury) and therefore, the Commission properly disregarded the hearing loss when determining whether the claimant established a compensable PTD claim against the Fund.

The Court further agreed that by disregarding the nonqualifying hearing loss, the Commission was correct in finding no credible medical evidence in the record that the prior right knee injury alone, when combined with the current 2014 left knee injury rendered claimant permanently and totally disabled. Therefore, there was no PTD Fund liability.

Only Qualifying Pre-existing Conditions Can be Considered When Determining Fund Liability; Also Life Factors Can be Considered in Determining PTD

Klecka v. Treasurer of Missouri as Custodian of Second Injury Fund, Case No. SC99280 (Mo. App. 2022)

FACTS: In April of 2014, the claimant sustained a compensable injury to his left shoulder and settled with the employer for 35% of the shoulder and 21.5% of the body referable to depression as a result of the work injury. He then filed for perm total disability against the Fund alleging five separate injuries, a traumatic brain injury in 1981, a left knee surgery in 1982, an work related injury to the right thumb in 2005 which settled for 15% disability, a work-related hernia in 2006 which settled for 7.5% of the body and a 2007 work-related right shoulder injury which settled for 35% of the shoulder. Dr. Volarich and Ms. Gonzalez testified on behalf of the claimant who concluded that the claimant was PTD as a result of the work injury and all of his pre-existing medical conditions. The ALJ found that the Fund was responsible for PTD benefits. The Fund appealed arguing that the ALJ errored as the ALJ was limited to considering the claimant’s qualifying pre-existing disabilities of at least 50 weeks and only his right shoulder injury met that threshold. The Commission agreed and reversed the decision of the ALJ finding that the Fund was not responsible for benefits. The claimant appealed.

HOLDING: The Court found that the claimant’s experts’ opinions that he was PTD were not sufficient to show that he was entitled to Fund benefits as their testimony considered non-qualifying pre-existing disabilities in their PTD analysis. The Court noted that there was no evidence that the claimant’s primary injury combined with his one qualifying pre-existing disability resulted in PTD. However, the Court did note that the statute does not prohibit the consideration of other “life factors”, including but not limited to those discussed by the claimant including age, education, transferable skills and physical appearance. The Court noted that it was not clear from the record as to whether the Commission considered these factors but did note that it is proper to do so under the statute. Therefore, the Commission’s decision denying benefits from the Fund was affirmed.

Under Strict Construction, No Temporary Benefits Are Payable After Termination for Positive Drug Test After Primary Injury; Also Work Accident Must Cause Mental Injury to be Compensable

Crowley v. Clarcor/General Electric, Injury No. 14-101480

FACTS: The claimant filed a claim for alleged mental injury and physical injury to her hands and wrist due to carpal tunnel syndrome from repetitive trauma. After reporting in October 2014 that she thought her carpal tunnel symptoms were work related, she was moved to a light duty position. On November 19, 2014, the claimant reported an injury to her left wrist while pulling tape off a gasket. The employer’s policies included drug testing after acute injuries. The claimant was told to reveal any prescriptions she was taking and to supply pertinent medical records. She did not. The claimant tested positive for both methamphetamines and amphetamines. The results of a second test on the same sample by a different lab were the same. Based on the positive drug test, the claimant was terminated under employer’s drug policy.

In his Temporary Award, the Judge found the claimant was unable to compete in the open labor market since November 21, 2014 and awarded back TTD and additional TTD. He also found that the drug test had no significance because it was almost certainly a “false positive” due to claimant’s use of prescription Bupropion (Wellbutrin) for depression.

At the Final Hearing, there was testimony from a board-certified toxicologist that Bupropion can cause a “false positive” on the initial screening test but not on the subsequent confirmation test. The claimant submitted a report from a non-certified toxicologist, but it failed to explain why the claimant tested positive for both amphetamines and methamphetamines in the subsequent confirmation test.

The employer’s medical expert testified the claimant’s depression developed before 2008 and preceded any carpal tunnel complaints. The claimant’s expert testified that the claimant’s depression “correlated” with her carpal tunnel symptoms and was, therefore, the prevailing factor in causing the depression.

HOLDING: In the final Award, the Judge found the certified toxicologist more persuasive and that the employer had administered their policy relating to drug use appropriately. She found the claimant was terminated for post injury misconduct. She stated that with strict construction, when an employee is terminated for post injury misconduct, under §287.170.4, no temporary disability benefits are payable. As a result, neither TTD nor PTD were payable and the employer was entitled to a credit for the TTD paid in compliance with the Temporary Award.

Since the Judge found that the claimant was terminated based on post injury misconduct, the Final Award was not in accordance with the Temporary Award and the doubling of compensation provision of §287.510 does not apply. The claimant is not entitled to costs and legal fees under §287.560 as the employer did not unreasonably defend the claim leading to the Temporary Award.

Lastly, since the claimant did not allege a specific accident with regard to mental injury, she must prove her mental injury flows from her physical injury/the bilateral carpal tunnel syndrome. Under §287.120.9, if mental injury results from disciplinary action or termination, it is not compensable. The Judge found that the claimant did not meet her burden to prove her depression arose out of employment as a result of her carpal tunnel. The claimant’s expert opinion was not convincing. Just because one condition occurs at the same time as the other, it does not mean the conditions are causative of each other.

The Commission affirmed the ALJ’s Decision noting that the term “post injury misconduct” refers to misconduct after the primary workers’ compensation injury, in this case, the carpal tunnel and not the claimant’s November 19, 2014 acute injury. Therefore, the employer terminated the claimant post injury employment due to post injury misconduct and the claimant is not entitled to TTD due to strict construction of §287.170.4.

Court Undecided if Prior Employee Has Standing Under the Statute for Retaliation Claim for Refusal to Rehire

Lisle v. Meyer Electric Co., Inc., Case No. WD84620 (Mo. App. 2022)

FACTS: On April 27 and May 2, 2018, the employee, Lisle, asked his foreman to fill out an injury report because he was suffering from carpal tunnel. In response to his second request, the forearm told the employee that if he asked for an injury report, the employer would lay him off. On May 2, 2018, the employer’s president learned that the employee wanted to file an injury report and workers’ compensation claim. The next day, he terminated the employee.

On May 14, 2018, the employee filed a workers’ compensation claim and a lawsuit against the employer for termination in retaliation for exercising his rights under the Workers’ Compensation Law in violation of §287.780.

A year later, the employer posted a job opening and the employee expressed interest with the union which provided a referral. In a phone call, the foreman told the employee he would probably hire him back, but later that day, texted him that the employer’s president would not hire him back. The employer acknowledged that pursuant to an agreement with the union, the employee has priority over the other applicant who was hired.

The employee filed a second lawsuit against the employer alleging retaliation for exercising rights under the Workers’ Compensation Law in violation of §287.780. The employer filed a Motion for Summary Judgement which argued that because §287.780 provides a cause of action to “any employee” who has been discharged or discriminated against by his or her employer did not provide a cause of action for the claimant because he was not an employee when the employer refused to rehire him. The Court agreed and entered a Summary Judgement for employer.

HOLDING:  The Court stated that because §287.780 must be strictly construed, it concluded that the statute does not authorize a claim for retaliation based on acts that occur after any employment relationship has ended. However, because of the general interest and importance of the legal issue of first impression presented by this case, the Court did not rule on this appeal and instead, ordered a transfer to the Missouri Supreme Court.

The Court discusses employee’s argument that “employee” as used in §287.780 was not meant to be limited to current employees because there are other places where Chapter 287 uses “employee” for former employees to recover benefits for a workplace injury occurring during an existing employment relationship. Likewise, a claim for retaliatory discrimination under §287.780 also depends inherently on acts that occurred during an employment relationship.

The potential chilling effect of post-employment retaliation on a former employee’s willingness to exercise rights under the workers’ compensation law presents an important policy concern. On the other hand, if §287.780 is constructed to expose an employer to claims of retaliation based on conduct after an employment relationship has ended, the exposure would be perpetual and could have a potential chilling effect on the former employer’s willingness and ability to defend against workers’ compensation claims.

Commission’s Authority to Assess Costs Against a Party is Discretionary

Donnell v. Trans State Airlines and Insurance Co. of The State of Pennsylvania, Case No. ED110126 (Mo. App. 2022)

FACTS: Following the Hearing in August 2011, the ALJ awarded claimant TTD, PTD and future medical treatment. In December 2014, the claimant moved to commute her permanent total disability benefits. The employer objected to the Motion to Commute, requested a hearing and argued a new IME is permitted under §287.210.1. In 2015, the Commission used an Order remanding the case for an Evidentiary Hearing on the Motion. A year later, the claimant moved for the Commission to reconsider their 2015 Order, but the Commission issued a new Order in 2016 declining to reconsider their prior Order.

Five years later, the ALJ conducted the Remand Hearing. The ALJ submitted the findings and the Commission issued its final decision. The Commission denied claimant’s request to commute her PTD benefits, but they did commute claimant’s Award for future medical treatment because they found employer had failed to comply with the Final Award by discontinuing claimant’s coverage for medical treatment when she filed her Motion to Commute. However, the Commission expressly denied an award for costs, including attorney’s fees and other expenses, against either party under §287.560. The claimant appealed.

HOLDING: The Court affirmed the Commission’s decision. While §287.560 provides that the Commission may assess the cost of a proceeding against a party who brought prosecuted or defended the proceedings on unreasonable grounds, neither the statutory language nor caselaw compels such an Award. The Appellate Courts have cautioned the Commission to exercise their discretionary statutory power with great caution and only when the case for cost is clear and the offense egregious. Based on the evidence presented at the Remand Hearing, the Commission concluded that the delay was the result of “unreasonably antagonistic conduct” by both parties, and accordingly did not assess cost against either party. Because the Commission did not exercise its discretion to award costs, the Appellate Court’s standard of review is limited to an abuse of discretion.  The Court held that the Commission did not abuse its discretion but carefully considered the issue.

Medical Provider Not Entitled to Prejudgment Interest Under Statute

Surgery Center Partners, LLC D/B/A Timberlake Surgery v. Mondelez International, Inc. Case No. ED109776 (Mo. App. 2022)

FACTS: Employee suffered a work-related accident and sustained a torn rotator cuff. Employer’s Workers’ Compensation insurance carrier authorized surgery at Timberlake Surgery.

Thereafter, Timberlake filed an Application for Payment of Additional Reimbursement of Medical Fees with the Division of Workers’ Compensation but in the § of the Application asking for “Date Notice of Dispute Received From Employer/Insurer” they entered “TBD”. The Division accepted the Application and held a Hearing. The ALJ found Timberlake’s charges were fair, reasonable and permissible and did not charge more than allowed under §297.140.3 but was not entitled to additional reimbursement. She also concluded Timberlake was not entitled to prejudgment interest and neither party was entitled to attorney’s fees or costs. She also noted that the Division had jurisdiction and absence of the date regarding the notice of the dispute did not deprive the Division of jurisdiction. The Commission affirmed.

HOLDING: The Court dismissed employer’s appeal for their blatant disregard of Rule 84.04 regarding the requirements for appellate briefs. First and foremost, their brief failed to identify the ruling they challenged, state concisely the legal reasons for their claim of reversable error or explain in summary fashion, in the content of the case, the legal reasons supporting their claim of reversable error. Compliance with Rule 84.04 is mandatory.

The Court also dismissed Timberlake’s cross-appeal arguing that the Commission erroneously denied their request for prejudgment interest under Missouri’s general prejudgment interest statute, §408.20. The Commission had denied the prejudgment interest because under the strict construction of §287.800.1, prejudgment interest cannot be awarded without express statutory language. Nothing in §287.140, which governs Medical Fee Disputes, affirmatively provides a right to prejudgment interest. The Court stated that the statute does not allow the Commission to go beyond the language of the applicable statute to infer authority to award prejudgment interest.

Effective July 1, 2022, the mileage reimbursement rate for Alabama has been increased to 62.5 cents per mile, and 4 cent increase over the first half of 2022.

About the Author

This blog submission was prepared by Charley Drummond, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Mr. Drummond by e-mailing him at cdrummond@fishnelson.com or by calling him directly at (205) 332-3414.

The Alabama Supreme Court recently affirmed summary judgment in favor of Pilgrim’s Pride Corporation and its third-party workers’ compensation administrator, Sedgwick Claims Management entered by the Circuit Court of Franklin County, Alabama in regard to a claim for the tort of outrage brought by Florence King.  King initially asserted a workers’ compensation claim against Pilgrim’s Pride in October 2012, claiming that she suffered injuries to both shoulders and arms as a result of the repetitive nature of her job on Pilgrim’s Pride’s production line.  Although Pilgrim’s Pride disputed the compensability of King’s alleged injuries, it nevertheless provided King with medical treatment, which included surgery on one of her shoulders and pain management.  After King’s doctors determined she had reached maximum medical improvement, the claims adjuster at Sedgwick reached out to King and offered to settle her case as disputed.  King initially accepted the settlement offer, but then changed her mind.  When additional treatment prescribed by King’s treating physicians was not approved, King sued Pilgrim’s Pride for workers’ compensation benefits.  She also sued Pilgrim’s Pride and Sedgwick asserting a claim of outrage, for what she claimed was intentional infliction of emotional distress due to a delay in approving medical treatment related to her alleged injuries.  Pilgrim’s Pride denied the allegations of King’s Complaint, asserting that her alleged injuries were not compensable.  The workers’ compensation case proceeded to trial in September 2020.  The parties stipulated that the only issue in dispute at trial was whether King’s alleged injuries were compensable.  King’s orthopedist testified that he did not have a firm conviction as to whether King’s job duties caused or contributed to her alleged injuries.  However, the trial court found King’s alleged injuries compensable.  

Thereafter, both Pilgrim’s Pride and Sedgwick filed motions for summary judgment as to King’s outrage claim.  The defendants asserted that since the compensability of King’s alleged injuries was disputed, they had no duty to provide King with medical treatment until the trial court found those alleged injuries compensable.  The trial court agreed, and entered summary judgment in their favor.  King then appealed to the Supreme Court, and the Court affirmed the trial court’s decision without writing a formal opinion.

My Two Cents

Outrage is an extremely limited cause of action.  In order to prevail on a claim for the tort of outrage, a plaintiff must prove by clear and convincing evidence that the defendant intended to inflict emotional distress and that the defendant’s outrageous and extreme conduct caused emotional distress so severe that no reasonable person could be expected to endure it.  Alabama law has long held that a defendant cannot be liable for the tort of outrage by merely insisting on its legal rights – even if the defendant knows that doing so is likely to cause severe emotional distress.  Alabama law has also long held that it would be a violation of an employer’s right to due process of the law to require it to provide workers’ compensation benefits when there is a bona fide dispute as to the employer’s liability for the injury.  Therefore, the Supreme Court’s decision affirms the fact that an employer (or its insurer) cannot be found guilty of outrageous conduct for denying workers’ compensation benefits when there has been no admission or legal adjudication that the underlying injury is compensable.  

About the Author

 This blog submission was prepared by Charley Drummond, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Mr. Drummond by e-mailing him at cdrummond@fishnelson.com or by calling him directly at (205) 332-3414.

2x Multiplier and Return to Work

Helton v. Rockhampton Energy, LLC (2021-SC-0248-WC)

The 2x multiplier in KRS 342.730(1)(c)2 applies to permanent partial disability benefits only where an employee “returns to work” after a work-related injury at the same or higher wages and that work subsequently ends.  To qualify as a “return to work,” there must be a cessation of work followed by a resumption of work. Continuation of work is not a return to work.

Employee suffered a work-related injury on 11/16/18. He continued working his normal job at the same or greater wages until he was laid off for economic reasons on 9/2/19. Prior to being laid off, the employer never ceased working after the injury. The ALJ awarded the 2x multiplier since he was working making the same or greater wages post-injury and was then laid off. The Board reversed finding there was no “return” to work pursuant to KRS 342.730(1)(c)(2) because there was never a cessation of work followed by a resumption. The Court of Appeals and Supreme Court of Kentucky upheld the reversal.

3x Multiplier and Inapplicability of Public Policy Exclusion

Tractor Supply v. Wells (2021-SC-0286-WC)

In Livingood v. Transfreight, LLC, the Court held that if an employee returns to work making equal or greater wages and is subsequently fired for intentional misconduct with a reckless disregard to the consequences, the employee is not entitled to the 2x multiplier as awarding same would be against the public policy rule that no claimant should profit from own misconduct. Here, the employer sought to expand this public policy exclusion to the 3x multiplier which, pursuant to 342.730(1)(c)1, applies when the claimant no longer has the physical ability to return to the pre-injury job.

The employee was injured at work resulting in restrictions that prevented her from performing her pre-injury job duties. She returned to a light duty position and was subsequently terminated for allegedly providing false information during an investigation (unrelated to workers’ comp claim).

The ALJ awarded indemnity benefits with the 3x multiplier. The employer argued that claimant was not entitled to the 3x multiplier due to her misconduct, seeking to extend the holding in Livingood.

Affirming the decision of the ALJ, the Board, and Court of Appeals, the Supreme Court of Kentucky declined to extend Livingood to the 3x multiplier. The Court found that the 3x multiplier is concerned with the finding of disability and is not tied to any condition of employment. Because the 2x multiplier is related to leaving employment, it was reasonable for the court to determine that when the job loss is due to misconduct, awarding a double benefit would be unreasonable and against public policy. Here, the employee was entitled to the 3x multiplier because she could not return to her pre-injury duties and her subsequent termination was irrelevant.

Admissibility of Out of State Physician Reports

Toler v. Oldham County Fiscal Court (2021-SC-0356-WC)

In a case of first impression, the Supreme Court of Kentucky held that a written report by a physician not licensed in Kentucky cannot be submitted as evidence in a workers’ compensation case.

Overturning the ALJ, the Board and Court of Appeals, the Supreme Court first noted that the Kentucky Rules of Evidence (“KRE”) must be followed in all proceedings before an ALJ, except as varied by statute or 803 KAR 25:010. It then stated that KRS 342.033 provides that a party may introduce direct testimony from a physician through a written medical report. The Court also referenced 803 KAR 25:010 which states a party may file evidence from two physicians in accordance with KRS 342.033, either by deposition or medical report. Holding that the written report of a physician not licensed in Kentucky was inadmissible, the Court found that the plain language of KRS 342.0011(32) defining “physician” only included those who were licensed in Kentucky. It further found that the prefatory phrase in KRS 342.011 “unless context otherwise requires” did not apply.

The Court clarified that this holding does not apply to treating physicians because the “context otherwise requires” phrase required an expanded reading of physicians when dealing with treating physicians. Therefore, a treating physician not licensed in Kentucky may provide a written opinion on behalf of an employee. 

Note this case involved the admissibility of a written report. It is arguable that a medical opinion of an out of state physician introduced by deposition testimony would be admissible. In a 2005 case, the Supreme Court of Kentucky allowed the deposition testimony of a non-physician expert on the issue of causation, specifically stating that the definition of “physician” does not preclude an ALJ from considering other types of expert testimony if it is relevant to resolving a causation question. Dravo Lime Co., Inc. v. Eakins. Also, KRE 702 allows expert testimony on relevant issues, and it seems it would violate the KRE to refuse to admit deposition testimony of qualified experts, including out of state physicians.

Even if an out of state physician opinion would be admissible through deposition, it may now be difficult if not impossible to get the claimant to see an out of state physician if not licensed in Kentucky. KRS 342.205(1), in pertinent parts, states that “[a]fter an injury and so long as compensation is claimed, the employee, if requested by a party…shall submit himself or herself to examination, at a reasonable time and place, to a duly qualified physician or surgeon designated and paid by the requesting party.” (emphasis added).

Furthermore, if a claimant has moved out of state, it appears the employer will now have to pay to have the claimant travel back to Kentucky for an examination with a Kentucky licensed physician if they wish to submit a written report into evidence.

There are numerous places throughout KRS Chapter 342 and the applicable regulations that could be impacted by this decision, including regulations governing Utilization Review (“UR”) and Medical Fee Disputes. UR is currently being regulated by an emergency regulation while the new regulations work their way through the regulatory approval process. 803 KAR 25:195E defines “physician” as defined by KRS 342.0011(32). It further provides that “only a physician shall issue an initial utilization review denial.” (emphasis added). Final UR decisions also needed to be issued by a “physician.” Do UR denials now need to be made only by Kentucky licensed physicians? Can the UR decisions be admitted into evidence in medical fee disputes (“MFD”) if the physician is out of state? The DWC is working on current regulations to govern UR and MFD, so we anticipate the new regulations will provide clarification and guidance on these issues. Also, a Petition for Rehearing has been submitted to the Supreme Court requesting clarification on the impact this decision will have on the UR process. We will monitor closely and keep you updated on any developments.

Sixty-Day Submission Requirement for Medical Bills Applies Only Post-Award

Wonderfoil, Inc. v. Russell (2020-SC-0301-WC)

The Supreme Court of Kentucky held that the Board and Court of Appeals properly reversed the ALJ’s ruling that certain medical expenses were not submitted timely, holding that the 60-day deadline for submission of medical expenses by an employee only applies post-award. 

The Supreme Court of Kentucky reasoned that pre-award application of the 60-day deadline found in 803 KAR 25:096 would contradict other regulations requiring disclosure of unpaid medical bills during litigation. It cited a prior Board opinion, Brown Pallet v. Jones, which held that the 45-day deadline for submission of bills by medical providers found in KRS 342.020 only applies post-award. The Court also cited its earlier decision in R.J. Corman Railroad Construction v. Haddix holding that the requirement that employers pay medical bills within 30 days only applies post-award.

The Court explained that the claimant is still required to submit unpaid medical expenses in its Notice of Disclosure which must be filed within 45-days of the issuance of the Notice of Filing Application. Furthermore, the claimant then must turn over new medical expenses within 10 days of receiving same. And claimant must bring copies of unpaid medical bills and expenses to the Benefit Review Conference and failure “may” constitute a waiver to claim payment for those bills.

Exclusive Remedy and Up-the-Ladder Immunity

Cunningham v. Kroger Limited Partnership I (2021-CA-0704-MR)

Plaintiff worked for Penske, who agreed by contract to receive freight for Kroger Limited Partnership II (“KLP II) and deliver said freight to KLP II and to facilities of all KLP II’s divisions, subsidiaries or affiliates. Plaintiff was injured while making a delivery to Danville Kroger store, which is owned and operated by KLP I, a limited partner of the Kroger Company. KLP II is a subsidiary of the Kroger Company.

Plaintiff received workers’ compensation benefits from his employer, Penske. Plaintiff then filed civil suit against KLP I alleging negligence and seeking damages for medical expenses, lost wages and pain and suffering. The Court of Appeals affirmed the lower court decision granting KLP I summary judgment as an up-the-ladder employer immune from tort liability.

Application of 3x Multiplier to Injuries Sustained on Two Separate Occasions

Apple Valley Sanitation, Inc. v. Jon Stambaugh (2021-SC-0227-WC)

The employee sustained two separate work injuries, returning to work after the first injury until a subsequent injury 12 weeks later, after which he did not return to work. The employee was performing his pre-injury job except for a light duty restriction during 6 of the 12 weeks. The employee submitted a physician report stating he lacked the physical ability to perform his pre-injury job. The ALJ awarded benefits for both injury dates enhancing both by the 3x multiplier.

The employer argued that it was erroneous to enhance the award for the first injury date by the 3x multiplier because the employee returned to work performing the same job after the first injury. The Supreme Court of Kentucky affirmed the award of the 3x multiplier, finding that the employee’s continued work did not constitute a return to work reflecting a capacity to continue pre-injury work for the indefinite future.

Psychological and Psychiatric Conditions

Time Warner Cable, Inc. v. Smith (2020-SC-0580-WC)

The Supreme Court of Kentucky held that a Claimant's testimony is competent evidence as to his psychological medical condition, which the ALJ can rely on when determining the extent and duration of a disability. Here the claimant presented medical reports assessing physical and psychological impairments due to the work injury. The psychological report failed to assess restrictions based on the psychological condition. The ALJ noted that the physical injury and physical restrictions alone did not render the claimant permanently and totally disabled. Relying on the claimant’s testimony as to the affect his psychological condition had on his ability to work, the ALJ  found the claimant permanently and totally disabled and the Supreme Court affirmed.

Should you have any questions or wish to discuss any related matters, please contact us at your convenience.

H. Douglas Jones, Esq. – djones@jsbattorneys.com, 859.594.4200

Margo Menefee, Esq. – mmenefee@jsbattorneys.com, 859.594.4200

Chiropractic leads to lower costs in workers' compensation claims?

Color us skeptical, but new research suggests that chiropractic care may, indeed, lead to lower costs in some types of workers’ compensation claims. 

The Workers’ Compensation Research Institute (WCRI) announced last month the release of its new study titled Chiropractic Care for Workers with Low Back Pain, which considered data from 28 states, including Texas.  The results may be surprising to some. Among the study’s key findings were that claims with care provided exclusively by chiropractors were associated with lower costs and shorter duration of temporary disability than a set of claims with similar characteristics where care was exclusively provided by non-chiropractic providers.

More cocktail party trivia: According to its website, the WCRI is an independent, not-for-profit research organization based in Cambridge, Massachusetts. Organized in 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts which conform to recognized scientific methods. Objectivity is further insured through rigorous, unbiased peer review procedures. 

Copyright 2022, Stone Loughlin & Swanson, LLP 

Coming soon - your EDI data collection agent questions answered
 

If you have questions about the Division’s new EDI data collection agent and the billing registration process, you’re not alone. Insurance carriers have so many questions that the Division is hosting a Zoom call to address them. The call comes in the wake of the Division’s announcement that it is changing the process by which insurance carriers must report claim data through electronic data interchange (EDI). 

Currently, carriers are required to report EDI claim data using an antiquated standard  – to be precise, International Association of Industrial Accident Boards and Commissions (IAIABC) Release 1.0. But beginning July 26, 2023, the Division will be requiring carriers to use the current standard, IAIABC Release 3.1.4. This and other requirements are set out in new Division rules 124.100 - 124.108. 

As part of the conversion, the Division designated a private contractor, Verisk, as its data collection agent for claim EDI release 3.1 data. Verisk will bill insurance carriers, other than governmental entities, for the cost of data collection. Accordingly, insurance carriers were required to register their billing contact information with Verisk by June 13, 2022. 

Also, as part of the conversion, each insurance carrier will be required to designate one person as its claim EDI compliance coordinator and provide that person’s contact information to the Division. Carriers can report this information to the Division on new Form EDI-03. 

Bonus cocktail party trivia: According to its website, the IAIABC was founded in 1914 and is an association of workers’ compensation jurisdictional agencies from around the world, as well as private organizations involved in the delivery of workers’ compensation benefits and services. It works to identify best practices, develop and implement standards, and provide education and information sharing. 
 

Copyright 2022, Stone Loughlin & Swanson, LLP 

In Texas, the wheels of justice grind slowly

Speaking of appeals, we continue to await the decision of the appeals court in our legal challenge to the Division’s Supplemental Income Benefits rule.

Readers may recall that our firm, on behalf of an interested insurance carrier, filed suit challenging the validity of the SIBs rule on the basis that it impermissibly allows claimants to collect SIBs even if they do not document their work search with job applications as required by the Texas Workers’ Compensation Act. Travis County district judge Maya Guerra Gamble agreed with the carrier that the rule is invalid, and she enjoined the Division from applying it. But the Division appealed to the Third Court of Appeals and, because the Division is part of a state agency, the judgment is stayed during the appeal.

The parties filed legal briefs in the court of appeals, and on August 30, 2021 the court announced  that it did not need to hear oral argument and the case was “ready for disposition on the briefs.” That was 10 months ago. By comparison, in the recent case of Dobbs v. Jackson Women’s Health Organization, in which the Supreme Court of the United States ruled that the Constitution does not guarantee the right to an abortion, the court issued its decision 8 months and 11 days after briefing was complete. And one could conclude that the issues in that case are more complicated than the issues in our SIBs case. 

By the way, SLS partner Jane Stone will be discussing the SIBs case at the upcoming Texas Bar CLE Advanced Workers’ Compensation seminar in August, by which time the court might have issued a decision.   

Copyright 2022, Stone Loughlin & Swanson, LLP