State News : New Jersey

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New Jersey

CAPEHART SCATCHARD

  856-235-2786

Reasonable accommodation has its limits as is noted in the case of Belasco v. Warrensville Heights City School District, 2015U.S. App. LEXIS 21493 (6th Cir. 2015).  Norma Belasco, a long-time teacher, began to have serious health issues in 2007, starting with renal failure with an eventual kidney transplant in 2013.  She also had heart surgery in 2010 and suffered from shortness of breath, balance problems and fatigue, sometimes requiring the use of a walker. 

Over time her class became more and more uncontrolled with students fighting frequently and the Principal having to intervene fairly regularly.  The school security guard testified in a deposition that she had to respond to Belasco’s classroom four or five times a day.  Students would be out of their seats, playing loud music, and sometimes laying on the floor.  One student would occasionally draw lesson plans for other students to work on. 

Belasco conceded in a deposition that she needed assistance but maintained that the assistance she needed was related to her disabilities. 

Q. So when you requested assistance, you were requesting assistance to deal with their behaviors, not assistance to perform your duties as a result of the limitations that you experienced?

A. Well, they were related, obviously.

Q. How were they related?

A. As I said, my balance and things like that were not perfect, so I was a little afraid that the children would hurt each other, but also could knock me down, which has happened with teachers.

The School District was also concerned that Belasco was not implementing a program called “Action 100,” which was a Reading Challenge program.  Belasco was entering false data into the database, claiming she was instructed to do so.  She was absent from work frequently, missing 26 days in one semester, and was frequently late for school.

The School District arranged a fitness-for-duty examination which Belasco failed to pass.  She challenged the results of the fitness exam and set up her own examination, which she also failed.  Both fitness exams noted that Belasco could not ensure safety of students because that required quick reactions on the part of the teacher.  Belasco had poor balance and shortness of breath with minimal tasks.  Following these examinations, the District conducted a hearing in which Belasco requested the assignment to her of a teaching aide and the use of a walker.

The District refused to hire a teaching aide but did agree to allow the use of a walker if Belasco’s doctor could certify that using the walker would enable Belasco to perform the essential functions of her job.  After further hearings, the District terminated Belasco’s employment.  Belasco sued alleging that she was discriminated against based on her disabilities.

The federal court found in favor of the District, and Belasco appealed to the Court of Appeals for the Sixth Circuit.  The Court found that Belasco failed to show that she could safely perform the essential functions of her job, even if she was disabled.  The Court added that “Belasco does not explain why her failure to pass the relevant aspects of the fitness-for-duty tests cannot independently support the examiners’ conclusions that she was unable to perform essential functions of her job – namely, supervising students, ensuring their safety, and responding in emergencies.”

With regard to her requests for reasonable accommodations, the Court said that Belasco failed to produce a medical certification explaining how the use of a walker would allow her to perform the essential functions of her job.  Further, the Court said that the ADA does not require an employer to hire another person to help someone with a disability perform the essential job functions.  In this case the union collective bargaining agreement prohibited hiring part-time educational aides without the express consent of both the prospective aide and the union.  The union refused to provide its consent. Lastly, the Court said that Belasco’s request to shift unruly students to another classroom was unreasonable because the District should not have to reassign essential job functions to another employee.

The case illustrates a number of important principles: first, that requests for accommodations must be linked to helping the employee perform the essential job functions. Moreover, certain requests for accommodation are unreasonable on their face, particularly those requests that would require other employees to do part of the disabled employee’s job. 

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

Wellness programs are becoming a new area of litigation as can be seen in Equal Employment Opportunity Commission  v. Flambeau, Inc., 2015U.S. Dist. LEXIS 173482 (W. D. Wisconsin December 31, 2015).  The case involved a manufacturer of plastic products which offered its employees various employee benefits, including participation in a health insurance plan.  Employees were not required to participate in the health insurance plan, but for those employees who wanted to be in the plan, the company established a “wellness program.”

The wellness program had two parts:  a health risk assessment and a biometric test.  The health risk component required a participant to complete a questionnaire regarding his or her medical history, diet, mental and social health and job satisfaction.  The biometric test was akin to a routine physical examination, including height and weight measurements, a blood pressure test and a blood draw.

The information from the health risk assessment was only reported to the company in the aggregate, so as to make sure that the company had no idea of any individual participant’s results.  This information helped the employer estimate the cost of providing health insurance as well as appropriate premiums and co-pays.  The information also was useful to the company in formulating weight loss competitions and modified vending machine options.

For the year 2011, the company gave employees a $600 credit if they participated and completed both the health risk assessment and the biometric test.  This credit was eliminated in subsequent years, and health insurance was only offered to those employees who completed the wellness program. 

This particular litigation arose from one employee, Mr. Arnold, who refused to complete the program tests.  That led the company to discontinue Arnold’s health insurance.  After losing his coverage, Arnold filed a union grievance and a complaint with the EEOC.  Eventually Arnold decided to participate in the program, and his benefits were reinstated.  However, the EEOC filed a law suit anyway, challenging the program.

The EEOC charged the company with violating the ADA alleging that the company could not show that it had a job related need for the medical examination.  The company countered that the ADA has a “safe harbor” provision for insurance benefit plans.  Section 12201(c)(2) provides that the ADA “shall not be construed to prohibit or restrict” an employer from establishing or administering ‘the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks.”

The federal court Judge who heard the challenge agreed with the employer.  He held that the safe harbor noted in the ADA does apply to wellness programs as a term of defendant’s benefit plan.  The Judge also found that the wellness program was “based on underwriting risks, or administering such risks.”  42U.S.C. 12202(c)(2). The Court said that underwriting risks, classifying risks or administering risks refer to the process of developing an insurance plan. 

The wellness program requirement was clearly intended to assist defendant with underwriting, classifying or administering risks associated with the insurance plan.  The undisputed evidence establishes that defendant’s consultant used the data gathered through the wellness program to classify defendant’s projected insurance costs for the benefit year.  They then provided recommendations regarding what defendant should charge the plan participants for maintenance medications and preventative care.  They also made recommendations regarding plan premiums, which included a recommendation that defendant charge cigarette smokers higher premiums. Finally, after identifying the risks through the wellness program, defendant decided to purchase stop-loss insurance as a hedge against the possibility of unexpectedly large claims.  These types of decisions are a fundamental part of developing and administering an insurance plan and therefore fall squarely within the scope of the safe harbor.

The Court also rejected the EEOC’s argument that the purpose of the ADA was to prohibit employers from asking for medical and disability-related information. The Court said the real purpose of the ADA is to eliminate discrimination against individuals with disabilities.  

“Regardless of their disability status, all employees that wanted insurance had to complete the wellness program before enrolling in defendant’s plan.  Furthermore, there is no evidence that defendant used the information gathered from the tests and assessments to make disability-related distinctions with respect to employees’ benefits.”

Employers can expect more challenges to wellness programs in the future, as the EEOC seems to be decidedly opposed to such programs. 

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

The case of Cabrera v. Cousins Supermarket, A-5287-13T1 (App. Div. February 23, 2016) covers a point not previously addressed underN.J.S.A. 34:15-40, the provision dealing with the employer’s subrogation rights to third party recoveries.

Jose Cabrera injured his right hand while operating a meat perforating machine and recovered workers’ compensation benefits under an order approving settlement in 2010.  He received both temporary and permanent disability benefits. 

Cabrera also brought a civil complaint against the manufacturer of the machine and his employer, but the arbitrator found no liability.  However, pursuant to a “high/low” agreement, Cabrera did recover counsel fees of $25,000. Those fees went to his attorney and to cover costs, but nothing went to Cabrera.

In May 2012, Cabrera issued a subpoena on Amerihealth Casualty, his health insurance carrier, to find out the amount of medical bills paid on his behalf in relation to the work injury.  Cabrera asked if Amerihealth Casualty was asserting lien rights.  Amerihealth did not respond to the subpoena.  Three months later (just prior to the arbitration) Cabrera contacted Cousins’s counsel with a request that counsel call Amerihealth to obtain the lien number.  Cousins was not informed of the impending arbitration.  The next day, Cabrera advised Cousins that he would not be honoring any lien because the lien amount had not been provided to Cabrera.  Cousins responded that it was not waiving any lien.  One day after the arbitration, the lien figures were provided to Cabrera.

Cousins filed a motion to enforce the lien underN.J.S.A. 34:15-40, arguing that there can be no waiver of lien rights where the plaintiff is already aware of the existence of a lien.  Cabrera countered that he did not get any money at all from the third party case, so there could not be a Section 40 lien.  The Appellate Division disagreed: “When a plaintiff recovers from a third party, a lien attaches regardless of whether the cumulative awards are sufficient to fully compensate for all injuries.” (citing toFrazier v. N.J. Mfrs. Ins. Co., 142N.J. 590 (1995).

The Court specifically rejected the notion that a plaintiff can avoid a workers’ compensation lien by making a demand for specific lien information and putting a deadline on supplying the lien figures.  “As to the waiver of the right to assert a lien, we do not find the argument has sufficient merit to warrant discussion in a written opinion.”   The Court added that there are sometimes risks to bringing a third party action.  “The decision to pursue a third-party action with its attendant costs is a known risk, one that is part and parcel to litigation.”

This case is interesting for two reasons:  the plaintiff got no money at all from the third party case, but the award of counsel fees was considered a double recovery.  Secondly, plaintiff’s ploy in setting a deadline to provide lien information was rejected by both the Judge of Compensation and the Appellate Division.  While it is true that the respondent was not aware of the pending arbitration hearing when the subpoena was served, the key to the decision is that Cabrera was aware of the potential lien and that was enough to establish the lien rights of the employer. 

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

Many of you have been contacted by petitioners’ attorneys about their inability to obtain conditional payments over the past several months due to a revision in Medicare protocols and processes.  This article gives an overview of the changes to the process and we will provide more information as the full extent of the changes come to light.

Workers’ compensation carriers were required to report compensation claims to Medicare online since 2009 under Section 111 of the Medicare Act.   However, Medicare allowed both the petitioners’ attorneys and the carriers to seek conditional payment information by reporting a claim, providing proof of representation and utilizing the Medicare portal.  Conditional payments were coordinated through Medicare’s Benefit Coordination & Recovery Center (BCRC).

Medicare has now created a new entity to determine when it paid medical bills that should have been paid by a compensation carrier:  the Commercial Repayment Center (CRC).  This entity is responsible for seeking payment for recoveries initiated after October 1, 2015 while the BCRC will continue to handle open claims prior to that date.

The focus of the CRC is different:  rather than creating an itemization of payments and divulging it to the first party who requests it, the CRC will have direct contact with the carriers regarding obligations it believes they owe.

An overall description of the process is set forth athttps://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/InsurerServices/Insurer-NGHP-Recovery.html

The process indicates that when Medicare learns that a beneficiary has workers’ compensation insurance through a carrier report or a beneficiary report, it updates its records and then begins identifying claims it believes were paid based upon the type of injury or illness alleged.  The search will include claims from the date of injury forward.

The CRC will then issue a Conditional Payment Notice (CPN) to the carrier.  The notice will advise the carrier that certain actions must be taken within 30 days of the date on the notice or the CRC will automatically issue a demand for payment.  The notice will list all of the claims and advise the carrier how to dispute items that are not related to the case.  A courtesy copy will be sent to the beneficiary and his attorney.  If a carrier has designated a specific recovery agent, they will also receive a copy of the notice.

Note: If a beneficiary or his or her attorney or other representative reports a no-fault insurance or workers’ compensation situation before the carrier submits a Section 111 report, the CRC will send the carrier a Conditional Payment Letter (CPL). The CPL provides the same information as a CPN, but there is no specified response timeframe. When this occurs, the applicable plan is encouraged to respond to the CPL to notify the CRC if it does not have ongoing responsibility for medical treatment (ORM) and will not be reporting ORM through Section 111 reporting or if the applicable plan would like to dispute relatedness.

The carrier has 30 days to challenge the claims in the CPN.  The carrier may contact the CRC or use the portal to dispute the charges.

Medicare will then issue a demand for payment to the carrier and request reimbursement within 60 days of receipt of the letter.  If the CRC agrees that some items need to be removed, they are omitted from the demand letter.

The carrier then has 120 days from receipt of the demand letter to file an appeal.  It appears that when Medicare seeks recovery from a carrier, only the carrier has appeal rights.  The beneficiary cannot appeal.  An attorney or a vendor may act on behalf of a carrier (plan) with proof of representation. Seehttps://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/InsurerServices/Downloads/Appeal-Rights-for-Applicable-Plans.pdf.  Medicare has its own appeal process and it clearly states it is not required to establish causation to prove a debt. https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/InsurerServices/Downloads/Applicable-Plan-Appeals-Presentation.pdf

If no appeal is initiated, the carrier makes payment and the CRC will send a letter that the debt was resolved but that new claims may be demanded if the carrier is obligated to provide ongoing medical.

Interest accrues from the date of the demand letter and if the debt is not resolved within 60 days, the interest is applied every 30 days.  If the carrier fails to make payment, the matter is referred to the Department of Treasury for collection.

This new process imposes significant burdens on carriers as they will be expected to ensure all Medicare beneficiary claims are reported, scrutinize the demands for payment to verify which diagnosis codes are related to the claim and timely dispute them.  However, the Medicare website acknowledges that the carriers may retain vendors and agents to work out conditional payment obligations if an authorization is received that meets its specifications.  https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/InsurerServices/Downloads/2015-Insurer-Services-Whats-New-Archive.pdf

The exact nature of the process and the degree to which it excludes petitioners’ attorneys from acting on their clients’ behalf to resolve conditional payment issues is unknown at this point.  Many petitioners’ attorneys are frustrated because the Medicare offices are no longer allowing them to report workers’ compensation claims to initiate the conditional payment process.  They are being told by Medicare representatives that only the carrier can report and develop the case.  This appears contrary to the information on the CMS website that both a beneficiary and the carrier may report the claim to trigger the CRC to open a file, compile conditional payments and send them to the carrier for consideration for payment.  See https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Recovery/InsurerServices/Insurer-NGHP-Recovery.html

Another concern is whether outstanding conditional payments should hold up settlement of the underlying workers’ compensation case.  At a recent meeting of the New Jersey State Bar, there was no consensus how the conditional payment issue should be handled if a carrier fails to fulfill its obligations to communicate with the CRC and if the workers’ compensation settlement must be held up for resolution of the conditional payment process.  Some petitioners’ attorneys argued that they should be allowed to settle their claims without conditional payments being resolved since Medicare was not looking to the beneficiary for payment.  Other attorneys suggested that they will file motions for penalties if the carrier does not comply.  The Division of Workers’ Compensation does not yet have a formal policy and the State Bar Executive Committee proposed to present a seminar on the topic at the Mid Year Bar meeting in May 2016.

The impact upon resolution of New Jersey workers’ compensation cases is problematic.  Once can foresee serious complications in denied occupational claims where there may be multiple employers and carriers involved.  How will the CRC handle apportionment of liability and demands for payment amongst multiple employers and carriers involving the same petitioner?  The answer is anyone’s guess.  In addition, the settlement of the compensation case and the negotiation of the conditional payment obligations may be on two wholly separate timelines and the petitioners’ attorneys and judges are not going to want to delay resolution of the compensation matters.  However, settlement of the compensation case may prejudice the carrier since it will lose access to a motivated petitioner or petitioner’s attorney who may be needed to provide information to assist an appeal when liability for payments is disputed.

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Nancy J. Johnson, Esq., is a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Ms. Johnson concentrates her practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation. Should you have any questions or would like more information, please contact Ms. Johnson at 856.813.4142 or by e‑mail at njohnson@capehart.com. 

Terrence Preddie was employed from 2010-20This 11 as a fifth-grade teacher at Columbus Signature-Codrea Elementary School in Indiana.  Dr. Diane Clancy assessed Preddie’s job performance in the first school term as effective in some areas and needing improvement in others.  One specific area where improvement was needed was in leaving organized lesson plans for substitute teachers.  Another concern was Preddie’s missing time from school in part to care for his son, who had Sickle Cell Disease. Preddie claimed that Clancy told him that he was missing too much time and asked whether there was anyone else who could pick up his son from the hospital or care for his son.

During the 2010-2011 school year, Preddie recorded 23 days of absence, five of which were for “family illness,” and seven of which were for “sick days.”  Two days were missed for his own problems with diabetes and six were missed for his own hypertension and kidney failure.  The Board recorded three of the absences as “personal days” and the other three as “leave without pay” because Preddie had already exhausted his allotment of paid sick days.

After Peddie used all his sick days, he spoke with Clancy who said that he could apply for leave under the FMLA but he would need to make a written application for that leave.  Preddie never requested leave under the FMLA.

At the time of Preddie’s second semester review, Preddie said that Clancy advised he could not take any more time off for his son because it was affecting his classroom.  On one occasion, Preddie called his wife to come down from Indianapolis to pick up their son since he was worried about his job. Preddie’s second semester review received lower grades as “needing improvement” in all categories.  Clancy recommended non-renewal of Preddie’s contract, and the Board followed that recommendation.

Preddie sued under the ADA and FMLA.  First he argued that the non-renewal violated his rights under the ADA.  The federal court and the Court of Appeals rejected this argument for two reasons.  The Court pointed out that attendance is an essential job function, and the ADA does not protect persons with erratic attendance.  Additionally, Preddie was not entitled to reasonable accommodation because his sporadic attendance rendered him not a qualified individual under the law.

On the FMLA issue, Preddie argued that the Board interfered with his rights. The Court of Appeals disagreed with the federal court, which had ruled for the Board.  The Court said that an individual need not mention rights under the FMLA or specifically ask for FMLA leave.  The burden is on the employer to provide information about the FMLA once the employee provides enough information that he or she needs FMLA qualifying leave.  The Court found sufficient evidence that Preddie had provided detailed information to the Board about his son’s Sickle Cell Disease and his need to care for him.  That information should have caused the Board to provide Preddie with FMLA paperwork.

Of extreme importance was the Court’s comment that the Board may have used protected leave under the FMLA as a negative factor in evaluating Preddie’s performance.  The conversation about Preddie’s need to spend less time caring for his son, if believed by a jury, could be sufficient for Preddie to establish interference with his rights under the FMLA.  An employer cannot discourage an employee from using federally protected FMLA rights.  The Court therefore permitted Preddie to bring his case before a jury on the FMLA interference issue.

Most employers know that they must provide information about the FMLA when an employee provides information that should lead the employer to realize FMLA rights have been triggered.  However, some employers continue to misunderstand the difference between the ADA and FMLA.  Under the ADA, the burden is on the employee to request an accommodation, but the employee under the FMLA does not have to specifically reference the FMLA.  If an employee has provided sufficient information to the employer that a leave may be needed for FMLA reasons, the employer must provide FMLA information.  This case can be found atPreddie v. Bartholomew Consol. Sch. Corp. 31 AD Cases 1761 (7th Cir. 2015).

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

Paul Williams worked for ten years for the Township of Lakewood in the Department of Public Works (DPW).  On March 28, 2013, the Township Manager received an anonymous letter concerning Mr. Williams.  The writer said he was a co-worker and that he and other co-workers were in fear of their safety because Williams allegedly exhibited outbursts and tirades on a daily basis. The writer said three union stewards (initials provided for the stewards) witnessed such an outburst that very day.  The writer claimed to have complained to a former Director, and the writer maintained that Williams was a time bomb waiting to explode and that co-workers feared for their safety.

The Township took no action on the letter for eight months.  On December 2, 2013, The Township advised Williams that he must submit to a psychological fitness-for-duty examination, noting that failure to attend the exam would result in disciplinary action.  Williams challenged the examination as not meeting the ADA standard of being “job related and consistent with business necessity,” and he refused to attend the examination.

On December 18, 2013, The Township served Williams with a Preliminary Notice of Disciplinary Action seeking to remove him from employment for failing to report for the fitness-for-duty examination. Williams requested a public hearing, which took place on January 6, 2014. The Township rejected Williams’s argument and then issued a Final Notice of Disciplinary Action terminating his employment. 

Following an appeal, the Office of Administrative Law heard testimony from the DPW Director.  He stated that Williams was sometimes confrontational and sometimes would walk away from someone who tried to speak with him.  The Director stated that he did not fear Williams.  He only wrote up Williams once over many years and never took any prior disciplinary action against Williams.  He further stated that as far as his work, Williams was no different than any other employee.

The Administrative Law Judge reversed the Township’s decision to remove Williams, observing that the Township did not investigate the accuracy of the letter’s allegations against Williams.  The ALJ also found no basis to connect the fitness-for-duty examination with Williams’ work duties.  The ALJ also criticized the Township’s eight month delay in acting on the letter.  Finally, the ALJ said that the Township could not discipline Williams for failing to attend an examination that the Township had no right to require.

Following the decision of the ALJ, the Township filed exceptions and on March 5, 2015, the Civil Service Commission reversed the ALJ’s determination.  However, the Commission did not mention the ADA at all in its reversal but rather focused on the insubordination of Williams in not attending the exam.  The Commission found against removal but imposed a six-month suspension.  Additionally, the Commission ordered that Williams submit to a psychological evaluation. 

On appeal to the Appellate Division, Williams argued that psychological examinations are the same as any other medical examinations in that there must be a showing that the exam is job-related and consistent with business necessity under 42.U.S.C.A. 12112(d)(4)(A).  The Court commented that the EEOC further defined the “job-related and consistent with business necessity” standard as follows:

Generally, a disability-related inquiry or medical examination of an employee may be ‘job-related and consistent with business necessity’ when an employer ‘has a reasonable belief, based on objective evidence, that: (1) an employee’s ability to perform essential job functions will be impaired by a medical condition; or (2) an employee will pose a direct threat due to a medical condition.’

The Court further drew from 29 C.F.R. 1630.2(r) for the proposition that “direct threat means a significant risk of substantial harm to the health or safety of the individual or others that cannot be eliminated or reduced by reasonable accommodation.”  The Court went on to cite to EEOC Guidance that an employer may be given credible evidence by a reliable third party that an employee has a medical condition or the employer may observe symptoms that an employee has a medical condition which impairs job performance or may pose a direct threat of harm to the employee or others.

The problem in this case, according to the Court, was that the Township had no reliable information from a third party (the anonymous letter did not meet the standard without investigation) and had not made independent observations of Williams’ alleged behavioral problems at work.  It said:

In other words, the employer must reasonably believe, either through direct observation or through reliable information received from credible sources, that the employee’s perceived medical condition is affecting his or her work performance or that the employee poses a direct threat.  Then, and only then, may the employer lawfully require the employee to undergo a psychological fitness-for-duty examination.

When information comes from a third party about an employee, the employer should reflect on the EEOC Guidance, which suggests that employers focus on the following: “(1) the relationship of the person providing the information to the employee about whom it is being provided; (2) the seriousness of the medical condition at issue; (3) the possible motivation of the person providing the information; (4) how the person learned the information (e.g., directly from the employee whose medical condition is in question or from someone else); and (5) other evidence that the employer has that bears on the reliability of the information provided.”

In ruling that the Township violated the ADA, the Court noted that there was no objective evidence of any threat posed by Williams and that even the DPW Director stated his performance was satisfactory.  The Court said the anonymous letter was not reliable. The identity of the writer was unknown, and there was no investigated done to confirm the allegations in the letter.    The case was remanded to the Civil Service Commission for a calculation of back pay due to Williams upon his reinstatement to work at the Township.

This case is well reasoned and extremely helpful to employers in dealing with fitness-for-duty issues. Employers should keep this case at their desk when fitness-for-duty examinations are being contemplated because the case provides sensible guidance.  It is among the best cases an employer will read on the rules for fitness-for-duty examinations.

The Appellate Division tried to explain that the Township could have solicited information from the DPW Director and other supervisors regarding Williams’ performance.  That kind of credible information could have satisfied the job-related standard.  Or the Township could have contacted the three union stewards named in the anonymous letter for information on the alleged outbursts that took place.  In other words, the Township had to verify the allegations of the anonymous letter in order to reach a conclusion that the employee may pose a threat to himself or others. In this case, the Township failed to take these steps.  Vague rumors or innuendos about an employee clearly do not suffice under the law to justify a fitness-for-duty examination.  Direct observations by the employer are obviously the best evidence, but evidence from other employees that has been verified can also form the basis for a fitness-for-duty examination under the job-related and consistent with business necessity test.

This case can be found at In the Matter of Paul Williams, Township of Lakewood, 2016N.J.Super. LEXIS 15, (App. Div. January 25, 2016).

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

Jennie Rosario worked for the State of New Jersey as a case worker for the Division of Youth and Family Services.  She left the Division’s Maplewood office intending to get into a State-owned vehicle on May 23, 2006 to perform her duties as a field case-worker.  As she was leaving the office, her ex-husband assaulted her with a knife, slicing her head.  A fellow Division employee managed to distract the ex-husband, who then stabbed himself with the knife.  Petitioner then filed a workers’ compensation claim for her injuries.

Days before the attack, petitioner Rosario had been granted a divorce judgment.  Rosario had also previously obtained a domestic violence final restraining order against her ex-husband for attempting to murder her mother. Her supervisor had a copy of the restraining order. Security guards were notified of the threat posed to Rosario.  Indeed, she asked for the transfer to the office in Maplewood from the East Orange Division office because she was worried about her ex-husband’s release from jail.  She feared that he would come to the East Orange office location. 

When Rosario’s ex-husband got released from jail, he devised a plan to reach out to her in order to apologize to her for his past criminal acts.  On release from jail, her ex-husband contacted the Division’s East Orange office to find her.  The receptionist told the ex-husband that she had just been transferred to the Maplewood office. That information led the ex-husband to travel to the Maplewood office where the assault occurred.

The Judge of Compensation held that this attack was a purely personal risk, not incident to Rosario’s employment, and therefore not compensable.  Petitioner’s ex-husband testified that the reason that he went to see Rosario was both to apologize for his criminal behavior and to see if the two could reconcile.  The Judge of Compensation reasoned that this assault could have occurred anywhere.  The ex-husband tried calling petitioner on her cell phone first without success, and he only contacted the Division because he wanted to meet her in a public place.

Rosario argued that since the State disclosed her new location in Maplewood, this was no longer a personal risk.  She contended that the State’s actions led to the likelihood that the assault would occur at work.  Rosario’s contention was that the State had a duty not to disclose her location given that it was in possession of the restraining order. 

On appeal, the court reviewed the case of Howard v. Harwood’s Rest. Co., 25 N.J. 72 (1957) for the proposition that when an attack arises out of a personal relationship, there is no right to workers’ compensation. The Court concurred with the Judge of Compensation that the attack stemmed not from work but from a personal relationship outside work.  The Court disregarded the argument that the State had been negligent in offering petitioner’s new location. “Whether an employer actually commits a negligent act is irrelevant to determining compensability – the sole issue is whether the injury is work-related.”

This case is now the second in a few months in which the Appellate Division has found assaults that occurred at work were not compensable because of the personal relationship between the criminal actor and the petitioner victim.  This case can be found atRosario v. State of New Jersey, A-4526-13T3 (App. Div. January 28, 2016).

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

In an extension of the principle established in Cunningham v. Atlantic States Cast Iron Pipe Co., 386N.J. Super. 423 (App. Div. 2006), the Appellate Division ruled on January 22, 2016 that an employee who was fired while on light duty was not entitled to temporary disability benefits because the firing was not related to his injury.   

The case, entitled Katzenstein v. Dollar General, A-1141-13T3 (App. Div. January 22, 2016) arose from a compensable accident on August 22, 2012 when Mr. Katzenstein, a store manager, injured his knee, requiring authorized treatment.  On September 19, 2012, Dollar General returned Katzenstein to light duty work.  On September 28, 2012, Dollar General terminated Katzenstein for leaving several employees in the store without supervision while he went to the bank to deposit the previous day’s earnings.

Following his termination, petitioner Katzenstein filed for unemployment benefits; however, he was denied benefits because he was terminated for misconduct.  On October 17, 2012, Dr. Basch, the authorized treating doctor, opined that petitioner could not work due to his knee injury.  Katzenstein continued to treat with Dr. Basch, who maintained the light duty restriction with no lifting over 25 pounds. 

Katzenstein filed a motion for medical and temporary disability benefits in the Division of Workers’ Compensation. He relied on Dr. Basch’s opinion that he could not work at all because he needed knee surgery. 

On February 28, 2013, a consent order was entered providing that the parties agreed without prejudice that petitioner would receive temporary disability benefits from November 14, 2012 to February 14, 2013.  When the three months ended, Katzenstein filed a motion to enforce the order and to obtain ongoing temporary disability benefits. 

In his motion, Katzenstein misstated the reason he did not get unemployment.  He asserted that he lost his unemployment claim because “was unable to engage in employment due to the injury to my right knee.” He did not mention that he had been denied benefits because he had been fired for misconduct.  The Judge of Compensation focused on this misrepresentation and the fact that Katzenstein’s injury was not the reason he left his job. Rather, he was fired for misconduct.  The Judge noted petitioner was lacking in candor and also noted that there was no evidence that petitioner had any prospect of new employment.  Petitioner then filed an appeal.

One week before the Judge of Compensation issued his decision, the Board of Review overturned the denial of unemployment benefits on the basis that petitioner’s conduct was reasonable and not an act of misconduct.  

The Appellate Division applied the rule in Cunningham and said that the two cases were similar because the petitioner inCunningham was injured on the job, returned to work, but was subsequently terminated and found not entitled to continuing temporary disability benefits while recovering from surgery.   In this case petitioner was injured on the job, placed on light duty, and then fired for a violation of company policy.  The court said that the burden was on petitioner to prove that he would have worked.  The Court said, “In determining that Katzenstein was not credible, the judge found he was neither offered employment after he was terminated nor declined employment due to his work-related disability.”  The Court wrote:

Here, the judge of compensation properly applied Cunningham.  The judge assessed whether Katzenstein, after being terminated, had a promise or prospect of employment that he had to forego due to his disability.  In determining that Katzenstein was not credible, the judge found he was neither offered employment after he was terminated nor declined employment due to his work-related disability.

This case is an important one.  It is the first Appellate Division case dealing with the right of the employer to terminate temporary disability benefits following job termination after an employee has been placed on light duty. The case does not discuss the rule in Harbatuk, which is that an employer can terminate temporary disability benefits to someone who turns down light duty.  This employee accepted light duty and presumably thought his temporary disability benefits would continue until he could either return to work full duty or until maximal medical improvement.  The Katzensteincase now applies the Cunningham rule to situations where someone is fired while on light duty for reasons unrelated to the work injury.  Petitioner was not able to show that he was fired because of his injury or that he had prospects of employment which he was unable to perform because of his injury. 

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


 

Penelope Bertolotti worked for Autozone, Inc. as a Divisional Human Resources Generalist.  She was hired in early 2012 and sought a leave of absence due to personal illness on October 15, 2012.  She returned to work on October 29, 2012 only to request another leave of absence commencing on November 5, 2012.  At first her doctor put her out of work until December 3, 2012, but in subsequent notes he kept her out of work until February 1, 2012.  Her doctor noted that she would need surgery for her condition, which was gastroparesis, an incurable disease that affected Bertolotti’s ability to digest foods and liquids.  She wore a pacemaker to assist in digestion.  Bertolotti ended up having surgery on January 3, 2013.

In a letter dated December 12, 2012, AutoZone advised Bertolotti that the company intended to replace her as Regional HR Manager but would attempt to place her in another position at such time as she might return to work. 

Bertolotti did not return to work on February 1, 2013.  Her physician indicated that he anticipated her new return-to-work date as March 28, 2013.  The doctor added certain permanent restrictions such as no exposure to theft detectors, power stations and no excessive or repetitive bending, twisting or stretching.  Plaintiff later contacted her supervisor to ask what position she would be offered when she could return to work.  She said she needed to know what the job would be to determine if she could perform it.  Her supervisor responded that he would not engage in discussions about accommodations until such time as Bertolotti was ready to return to work.

The next note that Bertolotti produced was on April 1, 2013, which added some other permanent restrictions which would remain in effect until May 24, 2013, but the doctor still did not provide a return-to-work date. 

On April 11, 2013 AutoZone wrote to Bertolotti to advise that the company hired someone to replace her as the Regional HR Manager, adding that when she could return to work, the company would engage in the interactive process with her. 

On May 24, 2013, Bertolotti’s doctor prepared another note stating that she could return to work without any restrictions effective August 21, 2013.  Bertolotti later sued under the New Jersey Law Against Discrimination.  After completion of discovery, AutoZone moved for summary judgment.

Plaintiff argued that there was direct evidence of discrimination by virtue of the December 12, 2012 letter from the company. That letter noted that plaintiff was not eligible for FMLA (having worked less than a year) and that she would be replaced as Regional HR Manager.  AutoZone countered that plaintiff was not qualified to perform the essential job functions because she had never been released to return to work.

The key document in the case was the December 12, 2012 letter.  Plaintiff argued that this letter proved disability discrimination. AutoZone argued that the letter did not really matter because the company did not actually terminate her position in December 2012 but waited until April 2013.  The Court disagreed:  “However, the crucial question is not how long it actually took Plaintiff to recover, or how long it took Defendants to hire a new employee, but what Defendants knew and expected of Plaintiff’s condition at the time they decided to remove her from the position of Regional HR Manager.” Plaintiff’s supervisor testified that the decision was made in December 2012 to replace her because of the uncertainty of her medical condition.  This decision was made at a time when the company expected plaintiff to be able to return to work by February 1, 2013.

The Court acknowledged a key principle of New Jersey law, namely that an employer is not required to provide a disabled employee an indefinite leave of absence if such a request would pose an undue hardship on the employer.  “Here, however, Plaintiff was not seeking an indefinite leave of absence at the time Defendants decided to remove her as Regional HR Manager.  She had an anticipated return date of February 1, 2013.  At that time, Defendants had no reason to believe that Plaintiff would not be returning on February 1, 2013 as planned.”

The Court was also critical of AutoZone for not engaging in the interactive process in a timely manner.  The Court noted that in 2006 the New Jersey Administrative Code was amended to remove language that exempted employers from engaging in the interactive process only when disabled employees were “presently” able to perform their job duties.  It said, “The interactive process requires employers to make a good faith effort to seek accommodations.”

Once Plaintiff requested an accommodation, Defendants were required to do more than tell Plaintiff that she could not return to work without a release.  While defendants argue that they needed to know a date certain for recovery and a medical release before engaging in the interactive process, at least one court in this district has rejected a similar argument. . . . ‘[t]he law does not require that the employer know that an accommodation is possible before making reasonable efforts to identify an accommodation.  Instead, the law requires an interactive process, the purpose of which is to search out accommodations that might suffice, not to explore those obvious to the employer before the process even occurs.’

For New Jersey employers, this case is a warning shot on the issue of the need for employers to engage in the interactive dialogue once an employee requests accommodations and not to wait until the employee proves he or she can return to work.  The problem with the defense in this case centered on the December 12, 2012 letter which the Court noted came only after three weeks from the commencement of plaintiff’s leave of absence.  The Court clearly thought that the company may have jumped the gun so soon after the leave began, allowing a jury to decide whether the company indeed acted in a discriminatory manner. 

This case reaffirms the rule that a request for an indefinite leave of absence is almost always unreasonable.  But what is a reasonable period of time?  There is no hard and fast rule but clearly, this Court is saying that three weeks did not seem reasonable in the context of these facts.  The Court felt that it was problematic for AutoZoner to make a decision to terminate an employee three weeks after commencement of leave,full knowing that the employee at that time expected to return to work in a couple of months.  One suspects that the outcome of this case would have been different if the employer had waited until April to advise that it was removing plaintiff from her position.  By that point in time, plaintiff still had not obtained a return to work date, and the company would have had a stronger argument.   The Court also questioned the company’s position that the HR position was so critical  that it had to replace plaintiff in December 2012.   If that were true, why did the company wait another four months to hire the replacement and how did the company manage for that four month period?  These questions clearly bothered the Court and raised questions for the jury to eventually address regarding the intent of the December 12, 2012 letter.

            This case can be found at Bertolotti v. AutoZone, Inc., 32 AD Cases 435 (D. N.J. September 22, 2015).  

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

On Monday, January 11, 2016, Governor Chris Christy issued vetoes of two bills long supported by the petitioners’ bar in New Jersey and strongly opposed by employers and carriers. 

S-374/A-3403 involved legislation sponsored by attorneys for injured workers to increase their legal fees.  This particular legislation was aimed at voluntary offers that employers have been making for many decades under the law.  N.J.S.A. 34:15-64 provides that if an employer makes a voluntary offer of permanency within 26 weeks of the date of maximal medical improvement or return to work, whichever date is later, the employer pays no counsel fees on the amount offered, and neither does the injured worker.  This provision is an inducement to employers to make offers of permanency long before the case settles.  The voluntary offers put money quickly in the hands of injured workers and save counsel fees for both parties. 

Claimants’ attorneys sought to eliminate the benefit to the employer and employee of not paying counsel fees on the amount offered.  The bill was pushed hard by attorneys for injured workers solely to augment their legal fees even though this would have meant that injured workers would pay more as well as employers.  For example, if an employer offered $5,000 early in the case within a few weeks of maximal medical improvement, the proposed bill would allow the claimant’s attorney to obtain a fee of $1,000 on the $5,000 offer.  That $1,000 fee would be paid $400 by the injured worker and $600 by the employer.  Current law provides that the claimant’s attorney gets no fee on the $1,000 early offer.  But current law does permit the claimant’s attorney to obtain a fee on any benefits paid to claimants at the end of the case in excess of the amount of the early offer.

S-264/A-1347 involved a series of proposals targeted to benefit certain public safety workers.  One of the provisions of this bill would create a rebuttable presumption that any cancer must be presumed to be work related to a New Jersey firefighter, if that firefighter has seven years of service.  In other words, even if the firefighter developed skin cancer in his foot, the judge must presume that it is work related unless the employer can prove that it is not.  All internal cancers – colon, prostate, liver, bladder, etc – would be presumed to be work related. 

Another aspect of this bill provided that illness due to vaccines received in connection with an employee’s employment would be work related, if the vaccine pertained to potential bioterrorism or epidemics.  This proposal applied to all employees, not just public safety workers. 

The bill also covered public safety workers who get exposed to communicable disease, biological warfare or epidemic-related pathogen in the course of employment.  Such workers would be covered under workers’ compensation as far as medical treatment even if the worker does not have the disease.  Should the worker subsequently contract the disease there is a rebuttable presumption that the condition is work related. 

While the Governor rejected these two bills, he did pass one less significant bill which raised the amount that an evaluating physician can receive to $600 for an evaluating report.

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