In a year that have given us a global pandemic, violent demonstrations and protests, wildfires, locust swarms, murder hornets, and devastating hurricanes, it is appropriate that the Alabama Workers’ Compensation Blawg reaches its 13^th year.  Never, in the 100 years since it went into effect, has the language of the Alabama Workers’ Compensation Act been so analyzed and dissected.  Never before has our system of workers’ compensation been so affected by both executive orders from the Governor and special orders from the Alabama Supreme Court.  We have endeavored to keep our readers apprised of all developments as they occur and will continue to do so.  We would like to take this opportunity to thank you all for making this Blawg your go to resource for Alabama workers’ compensation news.  Wishing everyone a safe and healthy remainder of 2020!  Hopefully, there will be more positive things to report on our Blawg’s 14^th birthday.

About the Author

This blog submission was prepared by Mike Fish, 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 Fish by e-mailing him at mfish@fishnelson.com or by calling him directly at 205-332-1448.

Legal Update by Attorneys Nicholas Cooling & Alison Stewart and Law Clerk Jordan Gehlhaar

On July 30, 2020, Workers’ Compensation Commissioner Joseph Cortese II issued an appeal decision in Martinez v. Palvich, Inc. & National Interstate Insurance.

Joseph Martinez was injured on April 16, 2018 while hauling freight when his semi-truck was turned over and collided with another vehicle. He alleged that he sustained injuries to his bilateral lower extremities, right wrist, head and back. He returned to work with Pavlich approximately three months after the injury. Claimant performed light-duty work for one month before returning to his full-duty position. In September of 2018, he voluntarily left Defendant Pavlich to enroll in an apprenticeship program in the construction industry.

The deputy commissioner determined at the arbitration level that Claimant did not sustain a permanent injury to the head or back. The IME provider, Dr. Stoken’s, ratings were found most persuasive as they utilized the preferred AMA guides, Fifth Edition. Dr. Stoken’s rating was chosen as opposed to the rating assigned by Defendants authorized treater, who used the AMA Guides to Permanent Impairment, Sixth Edition, which is not applicable in Iowa. As such, Claimant was entitled to receive 100 weeks of permanency benefits for combined scheduled member disability pursuant to Iowa Code § 85.34(2)(s) (2016).

It was to be determined on appeal whether the deputy commissioner correctly calculated Claimant’s entitlement to permanent partial disability benefits under section 85.34(2). Commissioner Cortese determined that since the accident occurred in 2018, reliance on the 2016 version of the Iowa Code was in error. The language from former section 85.34(2)(s) was not modified, but it was renumbered to section 85.34(2)(t). It provides:

The loss of both arms, or both hands, or both feet, or both legs, or both eyes, or any two thereof, caused by a single accident, shall equal five hundred weeks and be compensated as such.
Iowa Code § 85.34(2)(t) (2019).

The main issue in dispute was whether claimant’s permanent injuries to three (3) scheduled members removed him from the provisions of section 85.34(2)(t) and placed him instead under the provisions of section 85.34(2)(v) “catch all” provision, calling for compensation based on reduction in earning capacity.

Claimant asserted the determination would not affect the outcome as he had returned to work with the same or greater salary which entitled him to compensation based upon his functional capacity only, and not his industrial disability.See Iowa Code § 85.34(2)(v) (2019). The Defendants argued that since Claimant voluntarily resigned to work for a different employer, his benefits should be calculated by his reduction in earning capacity under the industrial disability method. Defendants appear to have made this argument because they believed that Claimant’s industrial disability was less than his functional disability rating at the time. This issue of termination whether voluntary or involuntary had not been considered by the agency since the 2017 amendments.

The commissioner called the statutory change to these code sections “ambiguous.” He further determined that when read together, it appears the legislature only intended to address a scenario in which a claimant returned to work for the defendant-employer or was offered work by the defendant-employer for the same or greater earnings, but was later terminated. The commissioner recognized that the plain language of the statutes support claimant’s interpretation, but reasoned that such interpretation would result in “unreasonable outcomes.” He reasoned that in effect, it would be almost impossible for defendants to know when to volunteer benefits using the industrial disability method. Additionally, a claimant entitled to benefits under section 85.34(2)(v) may be better off not seeking employment after being terminated by a defendant-employer, which could not have been the legislature’s intention according to Commissioner Cortese.

It was determined that despite the fact that he was earning greater wages at the time of the Arbitration hearing than at the time of the injury, Claimant’s voluntary separation from Pavlich removed him from functional impairment analysis and triggered his entitlement to benefits using the industrial disability analysis.

Ultimately, even though his loss of earnings and ability to engage in suitable employment were minimal, the commissioner found Martinez sustained a 20% industrial disability based on permanent injuries to three different body parts. His entitlement to receive 100 weeks of permanent partial disability benefits was affirmed.

This opinion is a novel interpretation of the “catch all” provision § 85.34(2)(v) (2019) which calls for compensation based on a Claimant’s industrial disability, or reduction in earning capacity. This applies where a claimant has suffered an injury to more than two scheduled members, or has sustained a body as a whole injury. If a claimant returns to work or is offered work with the same or greater earnings, their compensation will be based on functional impairment. If later terminated, there may be reopening proceedings for determination of a reduction in earning capacity. However, if the claimant voluntarily resigns with the defendant-employer, the interpretation would not “reset.”

Peddicord Wharton will continue to monitor the case law on this interpretation.

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Peddicord Wharton Legal Updates are intended to provide information on current developments in legislation impacting our clients. Readers should not rely solely upon this information as legal advice. Peddicord Wharton attorneys would be pleased to answer any questions you may have about this update. ©2020 Peddicord Wharton. All Rights Reserved.

On Monday, September 14, 2020, New Jersey Governor Phil Murphy signed S2380 dealing with COVID-19 and essential workers in respect to workers’ compensation benefits.  The bill was signed on the very last day before the bill would have automatically become law. 

It is important to consider what this bill does and what it does not do.  The essence of the bill is that it creates a rebuttable presumption for essential employees that their contraction of the coronavirus is employment related for workers’ compensation purposes.   The employer can rebut the presumption by a preponderance of the evidence (more than 50%) by showing that the worker was not exposed to the disease while working in the place of employment.  Essential workers are defined as:

1.      Public safety workers or first responders;

2.      Those involved in providing medical and other healthcare services, emergency transportation, social services, and other care services, including services provided in health care facilities, residential facilities or homes;

3.      Those who perform functions which involve physical proximity to members of the public and are essential to the public’s health, safety, and welfare, including transportation services, hotel and other residential services, financial services, and the production, preparation, storage, sale and distribution of essential goods such as food, beverages, medicine, fuel, and supplies for conducting essential business and work at home, or;

4.      Anyone deemed an essential employee by the public authority declaring the state of emergency

The effect of a legal presumption is to shift the burden of proof to the employer to disprove the case. Normally the injured worker has the burden of proving his or her case by a preponderance of the evidence.  If a worker contracts COVID-19 and meets one of the categories above, then the workers’ compensation claim will be found to have arisen from work, unless the employer can rebut the claim by showing the worker contracted the disease in a non-work scenario.  Disproving the case may involve proof that the worker more likely contracted the disease from a family member, from an outside gathering, from travel out of state, or perhaps proof that there was no exposure to the coronavirus at work.

Readers need to reflect on what the bill does not do. A presumption of compensability is not a presumption of impairment.  There is no presumption of impairment under the law.  To receive an award of permanent partial disability in New Jersey, one must prove a work-related impairment which restricts the function of the body and causes either a lessening to a material degree of working ability or a substantial impairment of non-work functions.  If one has fully recovered from the illness, proof of impairment will often be very difficult.  Many of the claim petitions that have been filed in New Jersey do not indicate any particular impairment at all, just referring to “residuals of COVID-19.”  Some claim petitions refer to “respiratory illness” without any treatment having occurred by a pulmonologist.

The first issue is therefore whether the illness arose from work.  The presumption helps the injured worker in close cases on the issue of connection to work.  However, the second proof issue will be difficult for many of those who have recovered from the coronavirus, namely proof by objective evidence that the illness has caused a permanent partial or total impairment. That will require good science and good medicine.   The impairment must be a present one, not merely a potential for injury in the future. 

The effective date of the bill is March 9, 2020.  Clients have inquired whether this means that they should reevaluate all the COVID-19 cases that they made decisions on during the past six months.  The bill does not require this, and there is really little to be gained by doing this.  If there is a dispute over workers’ compensation benefits, the injured worker will likely address the issue with the employer or file a claim petition to obtain medical, temporary or permanent partial disability benefits.  Many recovered COVID-19 cases simply do not involve a dispute over workers’ compensation benefits.  Notably, numerous dependency claims have already been filed long before the passage of S2380.  Employers can expect the filing of more COVID-19 cases as a result of the passage of S2380, but the bill does not make it any easier for claimants to prove objective evidence of an impairment that meets the Supreme Court standard set forth in Perez v. Pantasote, 95 N.J. 105 (1984).

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

Many readers have asked about the status of two very significant bills affecting New Jersey workers’ compensation practice.  They are S2380 and A4134.

S2380 – The Essential Employees Bill

We are down to the wire on S2380.  The Governor has until September 13, 2020 either to sign this bill or veto it; otherwise, S2380 will become law automatically.  This bill creates a rebuttable presumption for essential employees that their contraction of the coronavirus is work related.  The employer can rebut the presumption by a preponderance of the evidence (more than 50%) by showing that the worker was not exposed to the disease while working in the place of employment.  Essential workers are defined as:

1.      Public safety workers or first responders;

2.      Those involved in providing medical and other healthcare services, emergency transportation, social services, and other care services, including services provided in health care facilities, residential facilities or homes;

3.      Those who perform functions which involve physical proximity to members of the public and are essential to the public’s health, safety, and welfare, including transportation services, hotel and other residential services, financial services, and the production, preparation, storage, sale and distribution of essential goods such as food, beverages, medicine, fuel, and supplies for conducting essential business and work at home, or;

4.      Anyone deemed an essential employee by the public authority declaring the state of emergency.

A4134 – Clarification of Hand And Foot Bill On Retroactivity

This Assembly bill has attracted less attention than S2380, but it is important.  It clarifies whether the legislation that became law on January 21, 2020 had secondary retroactive effect.  The bill created enhanced compensation for hand, foot and finger injuries. However, the bill contained no clear language on which cases it applied to.  Questions arose immediately among judges, claimants, practitioners, employers, carriers, and third party administrators regarding the application of the law to claim petitions pending in the Division of Workers’ Compensation as of January 21, 2020 but filed before the effective date of the law.

This bill clearly states that the enhanced compensation for hand, foot and finger injuries applies to all cases pending but not yet settled or filed on or after the date of enactment  –  January 21, 2020.  However, the bill states that the law will not be applicable to cases which have been reopened.  The law obviously would not apply to cases that were settled before January 21, 2020.

This bill is limited to the issue of secondary retroactivity and was passed by the Assembly on August 27, 2020.  It will be scheduled next for a hearing before the Senate.  Readers should be aware that another aspect of this bill raises the cost of burial expenses in cases of compensable accident or occupational disease from $3,500 to $5,000, and that provision too would be applicable to claim petitions pending in the Division of Workers’ Compensation as of January 21, 2020.

Readers who are interested in the method used to compute the enhanced compensation for hand, foot and finger injuries can view the January 23, 2020 blog addressing this subject.

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

NWCDN Case Summaries 

Claimant injured his back picking up work equipment and was admitted to the hospital due to a gastrointestinal bleed. A few weeks later, he was re-admitted with severe back pain. Diagnosed with lower extremity edema, compression fracture in thoracic spine and severs destruction in the T9-T10 vertebra with possible discitis versus neoplastic process. Blood cultures confirmed presence of staphylococcus lugdunensis. Due to the infection, claimant became wheelchair bound. An ALJ found claimant’s back injury created the conditions for the infection and was compensable. On appeal, respondents argued the infection and its consequences were only compensable if they were the natural result of claimant’s work-related injury. The Court of Appeals (COA) disagreed and viewed the case under the “chain of causation analysis,” which is reserved for cases in which the industrial injury leaves the body in a weakened condition and the weakened condition plays a causative role in the subsequent injury.Jarosinski v. Indus. Claim Appeals Office, 62 P.3d 1082, 2086 (Colo. App. 2002). COA found it was not necessary for the work conditions to have directly caused claimant’s infection. Instead, it was sufficient if claimant’s weakened back condition played a “causative role” resulting in his disability. COA found a connection existed because of weakened back was a perfect breeding ground for infection.

City of Colorado Springs, Colorado v. Industrial Claim Appeals Office of the State of Colorado and Theodore E. Martinez, 19CA1795

Claimant installed drywall for employer and fell 14-feet and suffered a broken pelvis and two fractured vertebrae. Employer denied request for workers’ compensation benefits, because they asserted he was an independent contractor. After a hearing, the ALJ found claimant was an independent contractor when he weight factors set out in § 8-40-202(2). The ALJ listed a number of factual findings; claimant had executed a sub-contractor agreement, no training provided, employer did not oversee work, claimant obtained own insurance, claimant had taxpayer identification number, employer gave 1099 with “Noe Lopez Construction” identification, and claimant identified himself as self-employed. Claimant appealed. The ICAO Panel set aside the ALJ’s order by balancing factors set forth in Industrial Claim Appeals Office v. Softrock Geological Services, Inc., 2014 CO 30. The Panel found the claim compensable and respondent liable for consequential medical expenses. Respondent appealed. The Court of Appeals (COA) set aside the Panel’s order because neither the Panel nor the ALJ had the benefit of Pella Windows & Doors, Inc. v. Industrial Claim Appeals Office, 2020 COA 9.Pella held the factors articulated in Softrock applied in a workers’ compensation case along with factors in C.R.S. 8-70-115(1)(c). However, COA found the Panel exceeded its authority by improperly re-weighing evidence and applyingSoftrock to the facts. Under §8-43-301(8), a panel may only “correct, set aside, or remand” a judge’s order if the findings of fact are not supported by evidence, or do not support an order or law. The COA cited howPella found whether a worker is an independent contractor is a factual determination for an ALJ. So the Panel erred by looking at additional evidence and overlooking the facts the ALJ found. The Panel should have remanded the case with instructions for the judge to consider Softrock.

Holsinger Drywall Inc. and Pinnacol Assurance v. Industrial Claim Appeals Office and Neo Lopez, 19CA1013, May 28, 2020.

Summaries completed by Craig Campos, Esq. from the Fort Collins, CO. office of Ritsema & Lyon, P.C.

Workers’ compensation claims professionals know how important it is to ask about prior injuries in workers’ compensation.  That information can bear directly on causation and will often lead to credits at the time of settlement. But an underrated area of investigation remains subsequent injuries that take place after the date of the workers’ compensation injury but before the workers’ compensation case actually settles.

Consider a case involving a work-related back injury.  The parties have each obtained their IMEs but before settlement occurs, the adjuster runs an ISO report. That report reflects a recent motor vehicle accident involving the low back.  This non-work injury is significant enough to lead to orthopedic treatment and a law suit for personal injuries against the other driver.  How does this information impact settlement negotiations?

Petitioner’s counsel might argue that it doesn’t really matter because counsel already has an IME estimating 45% permanent partial disability for an unoperated herniated disc and respondent’s counsel has an estimate of 5% permanent partial disability.  Respondent’s counsel will maintain that this information is of great importance to consider.  To get maximum impact from the new accident defense counsel must obtain all treating records from the subsequent car accident.  Let us assume in this hypothetical situation that these new records show treatment at the same level of the spine with a recommendation for future surgery.  This could be a game changer and may lead to several results:

1.      A section 20 settlement for considerably less money than had been anticipated on an Order Approving Settlement;

2.      An order approving settlement for a lower percentage with a statement that the overall disability is now greater, providing insulation from any reopener; or,

3.      Perhaps even a trial if the client insists on a dismissal of the case.

The argument that defense counsel has in its favor is that an award of permanent partial disability is based on present complaints, not on complaints given in the past to IME doctors.   That is the rule from Allen v. Ebon, which established that awards of permanent partial disability should be based on recent medical evaluations, not stale ones.  New exams may have to be ordered.  When it comes time to negotiate settlement, defense counsel can argue that the petitioner’s current complaints must inevitably relate to the subsequent injury.  The Judge of Compensation will ultimately have to decide whether the current complaints and permanent impairment reflect in part the prior work injury or mainly the new car accident.  In this hypothetical one thing is for sure: the new accident completely alters the negotiations and must lower the value of the case where the new injury is to the same body part as the original work injury.

This scenario often occurs in reopener cases.  Defense counsel will request answers to reopener interrogatories, and sometimes the answers to interrogatories contain information about a new, non-work injury to the same part of the body that was injured in the work accident. If the original injury was to the neck, and now petitioner admits to a new injury to the neck with a new MRI, what does respondent do?  The best argument, of course, should be for dismissal of the reopener.

As mentioned above, step one is to obtain all the new treating records, including any new MRIs, CT scans and x-rays.  Step two to send the records to the IME physicians for an opinion on whether the current diagnosis and complaints are causally related to the subsequent accident.  If there is evidence that the medical condition at issue has been worsened by the subsequent accident, defense counsel should have a very strong argument for a dismissal of the reopener petition.  Counsel for petitioner will try to argue that the condition was getting worse before the new accident occurred.  But that seldom makes logical sense.  Consider a motorist who got a crack in her car windshield from a fender bender caused by another driver.  Then one month later the motorist gets into another car accident caused by the negligence of some other driver, this time knocking out the entire windshield.  Would anyone seriously expect the insurance company from the first fender bender to pay for part of the windshield repair?  Of course not. The insurance company for the second accident would have to pay for the entire repair. 

The lesson is that workers’ compensation professionals need to put systems in place to make sure that a new ISO is run every six months or so during the progression of the case to see if there are new non-work injuries.  An ISO doesn’t cost much and it can lead to enormous savings.  The ISO may not be the only way to discover this information.  Sometimes the treating records, particularly PT notes, may make mention of a new injury; and sometimes the employer is aware of the new injury and communicates this information to the carrier or third party administrator. On occasion a petitioner’s own Facebook page may reveal a new injury.   No matter what, when testimony is taken at the time of settlement in support of any award, defense counsel must always ask the injured worker whether he or she has had any new accidents with additional treatment since the time of the accident or initial award.

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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information

On August 12, 2020, the Minnesota Supreme Court affirmed the Decision of the Minnesota Worker’s Compensation Court of Appeals dismissing the Petition for Payment of Medical Expenses filed by a medical provider, Keith Johnson, D.C.

The chiropractor was properly placed on notice of right to intervene pursuant to Minn. Stat. § 176.361 and chose not to file a Motion to Intervene, which would have made the provider a party to the claim. The Employee ultimately settled his claim with the Employer and Insurer and those providers which had intervened were included in the settlement. The Award extinguished the right of the chiropractor to recover payments pursuant to the statute and Minn. Rule 1420.1850.

Eight months after the Award was filed, the chiropractor filed a Petition for Payment of Medical Expenses. The Employee and the Employer and Insurer filed Motions to Dismiss and the compensation judge dismissed the Petition with prejudice, concluding that the chiropractor did not have standing to file such a Petition because there was no outstanding claim by the Employee. The chiropractor appealed to the Workers’ Compensation Court of Appeals, arguing: 1) the Award was unenforceable and invalid as his rights were extinguished on the basis he chose not to intervene; 2) the rule and statute relied upon by the compensation judge and Office of Administrative Hearings exceeded the express or implied authority granted by the legislature; and 3) he was entitled to full payment per case law as he was excluded from settlement negotiations.

The WCCA affirmed the Order dismissing the Petition, finding that the medical provider chose not to be a party to the case and avail himself of the remedies provided by statute when he chose not to intervene. Because he was not a party to the case, he had no authority or standing to bring a claim under Minn. Stat. § 176.291 or assert the Award collaterally. Due to the lack of standing, the WCCA did not address other arguments by the chiropractor.

The chiropractor appealed the WCCA’s decision to the Minnesota Supreme Court. Michael Johnson represented the Employer and Insurer at oral argument before the Supreme Court en banc on June 2, 2020.

The Minnesota Supreme Court affirmed the WCCA decision in its entirety, finding that a health care provider who voluntarily declines to intervene in a pending workers’ compensation proceeding after receiving timely and adequate notice of the right to intervene cannot initiate a collateral attack on the compensation award under Minn. Stat. 176.271, .291, or Minn. R. 1420.1850, subp. 3B.

The case affirms that under Minn. Stat. § 176.361, Subd. 2(a) and Minn. Rule 1420.1850, a potential intervenor who is properly provided notice of right to intervene and does not file a Motion to Intervene within 60 days of notice shall have their right to recover extinguished.

CWK attorneys Natalie K. Lund and Michael R. Johnson handled the case on behalf of the Employer and Insurer. Please contact either of them with any questions. Natalie can be reached at (952) 525-6951. Mike can be reached at (952) 525-6950

http://www.mncourts.gov/mncourtsgov/media/Appellate/Supreme%20Court/Standard%20Opinions/OPA200053-081220.pdf

On August 14, 2020 the Alabama Supreme Court issued Administrative Order No. 8 which extended its previous orders concerning workers’ compensation and taking witness testimony remotely during the pandemic.  This means that the following rules will be in effect through December 31, 2020:

1. Any workers’ compensation settlement hearing in any court may be conducted telephonically or by videoconferencing.
2. Any workers’ compensation settlement may be approved by an ombudsman of the Alabama Department of Labor (ADOL) or by a circuit judge. If a workers’ compensation case pending in a court is settled with written approval of an ombudsman from the ADOL, that settlement shall result in the dismissal of the workers’ compensation claim pending in court.

In addition to the above, the rules that provide for remotely swearing in and taking witness testimony are also extended through the end of the year.

About the Author

This blog submission was prepared by Mike Fish, 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 Fish by e-mailing him at mfish@fishnelson.com or by calling him directly at 205-332-1448.

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