State News : New Jersey

        Joe Wilkerson worked for Boomerang Tube, LLC  first as a general laborer and then as a mill operator. He injured his left hand on December 13, 2010 while operating the mill.  He returned to work on restricted duty on December 17, 2010.  On that evening at work, he reinjured his hand requiring another visit to the emergency room for stitches and antibiotics.  He returned to work on December 20, 2010.  There was a dispute whether he returned on light duty or full duty initially, but he did eventually return to full duty.

             In April 2011 Wilkerson popped a ligament in his right hand and was placed on light duty.  He was scheduled for hand surgery on April 27, 2011.  In the meantime, he was offered light duty with instructions not to use his injured hand.  There was a good deal of dispute regarding the events of April 21, 2011, which is the date Wilkerson was terminated.  Wilkerson claimed that his supervisor was trying to make him do activities that were unsafe for him with one hand and Wilkerson allegedly kept asking if he could work in the store room.  He said his supervisor refused to allow this.

                Boomerang disputed this version and said that even before the shift started, the company planned to have Wilkerson clean offices.  The supervisor claimed that he told Wilkerson to go get the cleaning supplies but fifteen minutes later Wilkerson had done nothing.  Wilkerson asked his supervisor if he could work in the storeroom.  The supervisor said that Wilkerson did not get to choose the type of light duty he would have to perform.  Wilkerson said he could not use a mop or a broom, so his supervisor told him to get some Simple Green and a box of rags to wipe down all the restroom and breakroom fixtures. According to the supervisor, he told Wilkerson he was being insubordinate, to which Wilkerson replied that he would leave and go home.  Wilkerson refused to do any wiping down work with one hand.  The supervisor called his superior, who then gave approval to fire Wilkerson for insubordination.

                Wilkerson sued and alleged that Boomerang discriminated against him based on his disability.  He further contended that he could have performed the essential functions of his mill operator job with reasonable accommodations.  He suggested the following accommodations:  1) receiving assistance from his supervisor; 2) being assigned a trainee; 3) job restructuring or being permitted to wipe down walls and fixtures; 4) receiving a transfer to a vacant position in the storeroom; or 5) being allowed a short leave of absence.

                The Court held that plaintiff failed to show that any of these accommodations was reasonable.  First, it held that it is unreasonable to require an employer to assign an existing employee to perform essential functions or to hire new employees for this purpose.  Second, it held that the company did not have to relieve Wilkerson of the essential functions of his mill operator job.  The purpose of reasonable accommodation is to allow the employee to perform his or her job.  Third, the Court said that there is no requirement that the company create a new job in the storeroom for Wilkerson or transfer him to a new job since he never proved that such a job was available and that he was qualified for that job. The Court also held that a request for a short leave of absence is not reasonable because it would not help Wilkerson perform the essential job functions.  (This aspect of the Court’s ruling is contrary to New Jersey law).

                 Since Wilkerson could not show that he could perform his job with any reasonable accommodation, the Court dismissed his law suit.  This case can be found atWilkerson v. Boomerang Tube, LLC, 2014U.S. Dist. LEXIS 146695 (E.D. Texas October 15, 2014).

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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.  

Robin Williams was injured working for Ready Pack on May 18, 2006 and May 22, 2006.  A settlement was approved for 10% of partial total for the left shoulder on August 11, 2008.   Thereafter, Williams moved to Philadelphia and left the employment of Ready Pack.

On August 10, 2008, petitioner filed a reopener application alleging that her condition had worsened and seeking additional treatment.  She failed to appear for an appointment with respondent’s expert on August 25, 2011.  On September 2, 2011, she was murdered.  Ready Pack was not aware of the petitioner’s demise and scheduled two more appointments. 

On December 5, 2011, the Judge of Compensation was advised of the death of petitioner.  The hearing on that date was adjourned till March 19, 2012.  Because nothing was happening with respect to the case, respondent filed a motion to dismiss, which was granted on September 24, 2012.

In September 2013 counsel for Williams filed a motion to restore the case.  That motion was heard on October 28, 2013.  The Judge of Compensation denied the motion to restore with prejudice on the ground that petitioner failed to show good cause to reopen the case.

The issue in this case centered on the meaning of “good cause shown” under N.J.S.A. 34:15-54. The Judge of Compensation noted that all petitioner’s attorney had done in nearly 11 months was write two letters in an attempt to find petitioner’s representatives.  The Judge noted that Williams left no surviving dependents, so the purpose of the workers’ compensation statute had been fulfilled.

The petitioner appealed and argued that good cause had been shown.  The Appellate Division said the following:

The phrase ‘good cause’ has been interpreted as ‘a substantial reason that affords legal excuse for the default.’ . . . N.J.S.A. 34:15-54 ‘is intended to bring a compensation case to an end regardless of the merits in the event the claimant does not diligently prosecute his petition. ‘Good cause,’ therefore, is concerned not with the merits alone but as well with the excuse for the delay.

The Court added that the judge’s “concern regarding counsel’s failure to promptly address William’s lack of response and to attempt to keep the court informed is warranted.”  Nonetheless, the Court reversed the Judge of Compensation stating,“It is tempting to affirm the JWC’s order because, other than her death, counsel does not identify another factor in her favor.  Death is, however, a quite substantial factor.  The JWC’s discretionary ruling obviously prejudiced the substantial rights of Williams’s estate and her beneficiaries.”   The Court said that it would be inequitable to bar the door to Williams’ heirs if she was entitled to a recovery. 

What this case shows is that the language of Section 54 requiring a case that has been dismissed to be reinstated within one year for “good cause shown”  is a very low bar indeed.  If a motion to reinstate is filed within one year from the dismissal date, the case will almost certainly be reinstated, no matter how weak the reasons for reinstatement.  The case can be found atWilliams v. Ready Pack, A-1689-13T2 (App. Div. January 23, 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. 

           There has been a great deal of controversy about respondent’s lien rights in motor vehicle accident cases since the unreported ruling inDever v. New Jersey Mfrs. Ins. Co., No. A-3102-11T2 (App. Div. October 23, 2013).  In one decision from last summer, an Atlantic City Superior Court Judge rejected the application of theDever rule in a similar set of facts. 

            The Atlantic City case, Colmyer v. Vicki S. Abline, Docket No. ATL-L-5766-1 (August 12, 2014), involved a car accident between plaintiff, Timothy Colmyer, and defendant, Vicki S. Abline.  The Little Egg Harbor Municipal Utilities Authority, plaintiff’s employer, paid workers’ compensation benefits and asserted a lien in the amount of $31,768.  The MUA intervened in the case to protect its lien rights underN.J.S.A. 34:15-40.  The defendant argued that N.J.S.A. 39:6A-12 bars the introduction of evidence of amounts “collectible or paid” by Personal Injury Protection.  Defendant further argued that it made no difference whether the medical expenses were paid through workers’ compensation or PIP or any other source: the statutory bar precludes evidence of such payments.

            The MUA countered that there was a double recovery in this case to the extent of its medical payments and that it was entitled to reimbursement under the statutory formula.  Superior Court Judge, Honorable Allen Littlefield, J.S.C., first examined the two statutes.  The Judge also noted that both plaintiff and defendant relied upon the unpublished decision inDever, supra.  Judge Littlefield wrote, “In Dever, the Appellate Division held that a plaintiff is statutorily precluded from recovering medical expenses from a tortfeasor where such expenses were paid by the plaintiff’s workers’ compensation carrier.” 

            Judge Littlefied next observed that Section 12 of Title 39 was adopted after Section 40 of the New Jersey Workers’ Compensation Act.  He said that the legislature was fully aware of the provisions of Section 40 when it adopted Section 12.  The logic is that the legislature could have abrogated respondent’s lien rights under Section 40 in adopting Section 12, but it did not.

            Judge Littlefield further observed that “the Appellate Division decision inLefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988) is still good law and should be followed by the Court.” The rule inLefkin is “that a plaintiff must pay the medical expense portion of a workers’ compensation lien out of his recovery from the tortfeasor defendant.”  The Court inLefkin said: 

Where only workers’ compensation benefits and PIP benefits are available, the primary burden is placed on workers’ compensation as a matter of legislative policy by way of the collateral source rule ofN.J.S.A. 39:6A-6. (citations omitted). And when only PIP benefits and tortfeasor liability are involved, the primary burden is placed as a matter of policy on the PIP carrier byN.J.S.A. 39:6A-12.

The court in Lefkin concluded that there is no bar against recovery of the medical expenses collected or collectible in workers’ compensation from the tortfeasor.  The Court reasoned as follows:

This is so because PIP benefits are not available to an insured if workers’ compensation benefits are also available to him.  Consequently, PIP benefits in that situation are neither collectible nor paid.  Hence,N.J.S.A. 39:6A-12, which bars evidence in the third-party action only of  ‘amounts collectible or paid’ under PIP coverage, is inapplicable, and there is no other impediment to the plaintiff-insured-employee recovering his medical expenses from the tortfeasor even though that recovery will ultimately be subject to the compensation lien. 

Judge Littlefield concluded, “Because MUA is entitled to recover from Plaintiff’s recovery, it logically follows that evidence of Plaintiff’s medical expenses must be admissible at trial.  If the medical bills were precluded, the compensation carrier would be unable to secure reimbursement from the Plaintiff pursuant to N.J.S.A. 34:15-40.”

There are now countless cases in New Jersey where plaintiffs who have both workers’ compensation recoveries and settlements in car accidents are refusing to reimburse medical expenses based on the theory advanced inDever.  This decision is not the final word on this subject but it shows that at least one Superior Court has flatly rejected the recent ruling inDever.  

            It is very difficult to appeal a Judge of Compensation on the level of permanency awarded following trial.  That lesson can be seen in Huesser v. United Airlines, A-5959-12T3, (App. Div. July 14, 2014). 

             Elaine Huesser worked as a flight attendant for United Airlines since 1998.  She suffered her first injury on September 28, 2005 when her flight seat broke, causing her to fall and injure her left shoulder and lower back.  That case settled in March 2009 for 42.5% of partial permanent disability, apportioned 27.5% for the left shoulder and 15% for the low back.

             The second injury occurred on September 28, 2008, when petitioner suffered a massive rotator cuff tear of the right shoulder while lifting a suitcase into an overhead compartment.  She had four surgeries following this incident, culminating in a shoulder replacement procedure. 

             Huesser reopened the first award and sought an increase in permanency.  She had invasive pain management treatment , including lumbar injections and lumbar nerve ablations after the initial award was entered.  Both the reopener claim and the right shoulder claim were tried to a conclusion before the Judge of Compensation with the only issue being the nature and extent of permanency.

             The job of flight attendant was demonstrated to be very physical, with occasional lifting of up to 75 pounds, pushing metal carts weighing 250 pounds, lifting bins of sodas, reaching to close overhead bins, lifting luggage, and opening and closing heavy flight doors.  Huesser testified that she returned to work in November 2010 after two years of treatment following her four right shoulder surgeries.  She had seniority with United Airlines which permitted her to avoid some of the heavy lifting duties.  She became a purser, a job which involved lifting lighter bags and doing more supervisory work.  Eighty five percent of the time she did not have to do the very heavy lifting, but the remaining 15% of the time she still did some of the physical tasks, which she would perform in pain.  She said she learned to compensate for the pain in her right shoulder and adjusted the way she did things.

             At the time of her testimony, petitioner said she had constant pain in her mid to lower back which had worsened since her testimony at the time of her first award for the 2005 accident.  The pain had begun to travel down to the left and right sides of her buttocks.  Her sleep was deleteriously affected.  Her husband testified that she did no longer cooked, cleaned or gardened. 

             Respondent produced two employees who said that petitioner was never written up for being unable to perform her job, and she never complained about inability to do her job duties. 

             Petitioner’s expert, Dr. Gaffney, testified that her level of disability increased since the original award.  He raised his estimate of disability for her back by 45%. Dr. Tobias, petitioner’s expert for the right shoulder, said she had a disability of 75%.

             Respondent’s expert, Dr. Zazzo, increased his disability on the back by 2.5% and left shoulder.  He estimated 33% disability for the right shoulder, and he increased that percentage at trial to 38.5%. 

             The Judge of Compensation found an increase of 10% in the low back, meaning that her award for the 2005 accident was 52.5% credit 42.5% ($52,035), and he awarded petitioner 45% on her right shoulder ($120,150), which was only marginally higher than the very high estimate of respondent’s expert, Dr. Zazzo.   Respondent appealed both judgments, contending that they were not based on adequate and credible evidence.  The Judge of Compensation found no increase on the left shoulder.

             The appellate division dispensed with the argument that the Judge of Compensation had not considered the fact that petitioner had not complained about her job duties since returning to work in November 2010.  The court noted that her seniority allowed her to avoid some of the heavier tasks and noted that she simply worked in pain.  The court also rejected the notion that the mere fact that petitioner successfully returned to work negated such high awards.  It citedN.J.S.A. 34:15-36: “nothing in this definition shall be construed to preclude benefits to a worker who returns to work following a compensable accident even if there be no reduction in earnings.”

             In the end, the appellate division deferred to the expertise of the Judge of Compensation in finding the correct level of disability.  “We recounted in detail the compensation judge’s findings and conclusions because they demonstrate a comprehensive and thoughtful review of all of the testimony and evidence presented.  The judge made credibility determinations and clearly set forth the basis for his findings and conclusions.  We find the judge’s determinations of disability are supported by the weight of the evidence.” 

            We live in a world where terrorism unfortunately poses genuine insurance risks. The Terrorism Risk Insurance Act (TRIA) was passed by President George W. Bush on November 26, 2002 to establish a backstop for insurance claims arising from acts of terrorism.  This coverage includes workers’ compensation claims.  Before September 11, 2001, insurance companies generally did not charge for nor specifically exclude terrorism coverage.  However, much of the cost from the 9/11 attacks fell on reinsurance companies, leading some to withdraw coverage for terrorism from the market place.

             TRIA was passed to provide protection for employers and insurers in the event of acts of terrorism.  It creates something like a federal reinsurance program in cases of terrorism.  In exchange for this protection, the insurance industry must offer terrorism coverage and cover a certain amount of losses before federal assistance kicks in.  The law has been extended several times since 2002, but regrettably Congress let it lapse on December 31, 2014. 

             With a new Congress convening this week, employers and insurers are hopeful that TRIA will be renewed shortly.  Without TRIA protection, businesses and insurers could be left without adequate insurance in the event of a terrorist attack.  The risks are probably greatest in urban areas, particularly in large American cities. Congress is playing with fire in allowing TRIA to lapse. 

             Employers and practitioners should be aware of the importance of TRIA in workers’ compensation and should consider contacting their Congressional representatives to urge the renewal of TRIA as soon as possible.  

Under the New Jersey Workers’ Compensation Act, the independent contractor defense is seldom successful, but one area where the defense is still viable is in the horse racing industry as seen in the recent decision of Perry v. Robert Horowitz Stable, A-3845-12T2 (App. Div. December 9, 2014). 

Randolph Perry was a licensed horse owner and trainer and agreed to train horses for Robert Horowitz Stable (hereinafter “Horowitz”) at the Meadowlands Race Track.  In January 2004, he slipped on a patch of ice and was seriously injured.  He filed  a workers’ compensation claim against Horowitz.  He also recovered a substantial third party suit against the Meadowlands Race Track.  In the workers’ compensation trial, Perry argued that under both the control test and the relative nature of the work test, the court must find employment. 

Perry argued that Horowitz controlled his duties sufficient to render him an employee.  He said that Horowitz would specify how many miles the horses would run, how to care for the horses’ feet, and how much the horses were to be fed.  In response, Horowitz argued that the stable did not have an ongoing training relationship with Perry.  While Horowitz did provide instructions related to the amount of miles to jog the horses and how to care for their feet, Horowitz countered that Perry had discretion to control other aspects of training.

Horowitz further contended that it did not furnish any equipment or stalls, nor provide Perry with food to feed the horses.  Horowitz said that the stable did not specify the type of food needed.  Rather, Perry would buy the food himself.  Horowitz further argued that Perry disregarded his instructions on how much food to provide and in fact provided less food because of Perry’s view that horses should not eat as much food as Horowitz required.  

Perry maintained that he was substantially dependent on Horowitz under the relative nature of the work test.  However, it was noted in the record that Perry worked with many different owners for income over his 40-year career

The Judge of Compensation found for Perry on employment, but the Appellate Division reversed.  The court noted that Perry did not receive a W-2 or 1099 from any of the owners for whom he trained horses.  He was not paid a specific wage, and there were no deductions or withholdings from Perry’s pay.  It said,  “This is indicative of an independent contractor.”  The court also relied on the fact that Perry rented stalls directly from the Meadowlands Racetrack where he performed his work.  It said this too was consistent with being an independent contractor because it shows Perry carried on his own business.  The court felt that Perry used his own methods to run his business. 

There was one specific item of testimony that the court focused on in its opinion in favor of independent contractor status.  At trial Perry testified, “If I needed the money, I would [train the horses] for less.  If I didn’t need it, I would charge more.”  The court suggested that this was proof of an independent business, not employee status.  For much the same reasons, the court also found that Perry was not an employee of the New Jersey Horse Racing Injury Compensation Board. 

This decision could clearly have gone either way.  The Appellate Division focused on the facts that tended to show Perry was running his own business together with the absence of a W-2 or 1099, but there were clearly some elements of control that favored Perry’s argument on employment.  The Appellate Division decision does not disclose how much money Perry earned from Horowitz as opposed to other trainers, nor how many days he trained horses for Horowitz.   What is more clear is that a jockey would have a much stronger argument for employment than a horse trainer would because of the predominance in New Jersey of the relative nature of the work test.  

The case of Budhun v. Reading Hospital and Medical Center, 765 F.3d 245 (3d Cir. 2014) shows how complex return-to-work issues can be under FMLA.  The plaintiff in that case, Vanessa Budhun, worked as a credential assistant for Reading Hospital.  About sixty five percent of her job required typing.  Budhun took about four weeks of FMLA leave between March 31, 2010 and May 7, 2010.  An employee from a different department filled in for her during that time. 

            On July 30, 2010, Budhun broke the fifth metacarpal of her hand and came to work with a metal splint on her hand.  An HR manager emailed her stating, “Your supervisor has made us aware that you have an injury that prevents you from working full duty.”  Budhun was given FMLA forms and she left work to see a doctor.  She told her doctor that she could type with the five fingers on her left hand and just her thumb and index finger on her right hand, so Dr. Battista provided a note dated August 10, 2010 stating that Budhun could return to work “no restrictions in splint.”

            Budhun returned to work on August 16, 2010.  She advised HR that her doctor would complete the FMLA form she gave him within 10 to 15 days. She advised in an email that she could “type slowly and write a little bit, but not as fast as I used to . . . I could work but not fast.”   The HR manager wrote back replying that because her return to work note provided no restrictions, Budhun should be able to work at full speed.  She added that if she could not work full speed, she needed to contact her physician and ask for a note keeping her out of work.  The HR representative advised Budhun that she needed to be able to perform at the same capacity she had before her hand injury. 

            Budhun left work again and made contact with her physician, who then supplied a note keeping her out of work until August 16, 2010.  He checked off “yes” on the box referring to her being unable to perform all of her job functions.  He did not clarify which job functions she was unable to perform.  However, the final page of the medical certification was inconsistent in that it stated Budhun needed to be out of work until September 8, 2010.  Budhun underwent occupational therapy. On September 8, 2010, she faxed another note in which Dr. Battista stated she would be out of work until her next appointment in November.

            The hospital extended her FMLA leave until September 23, 2010, when her 12 weeks would run.  It approved non-FMLA leave until November 9, 2010. In mid-September the hospital offered  Budhun’s job to another employee. 

            On September 29, 2010, Budhun emailed the Hospital a note saying she could return to work on October 4, 2010. She was then told that she had been replaced by another employee.  Because of a prior written discipline charge, Budhun was unable to transfer to another position.  She was given the option to apply to the hospital essentially as an outsider for a position but Budhun did not pursue this route, and when her non-FMLA leave ran out in November, she was terminated.

            Budhun sued under the FMLA and argued that she had been able to return to work full duty on August 16, 2010 but the hospital prevented her from working.  The court sided with Budhun:

At the time she entered her place of work on August 16, all of the information that shehad from her treating physician, and all of the information that she had provided to Reading,indicated that she intended to return to work as of that day, and could do so with ‘no restrictions.’

The court said that Budhun’s fitness for duty certification stated she could return to work with no restrictions.  The court noted that Reading did not provide Budhun a list of essential functions for her to present to Dr. Battista, essentially laying the blame on the hospital for the lack of clarity in this area.  The court suggested that the hospital could have contacted Dr. Battista to clarify any issues but failed to do so.  However, it could not delay the return to work of an employee with a full duty return-to-work note. The court criticized the HR manager for overruling the doctor on the return-to-work issue. 

            This case is an important one for employers in the State of New Jersey which is part of the Third Circuit.  The downfall of the hospital here was the failure to provide the essential job functions to the physician, so the physician perhaps did not fully understand the job duties.  The court focused on a strict reading of the FMLA, which provides job reinstatement rights when the employee’s physician indicates that the employee can return to work. 

This case underscores an inherent dilemma in the FMLA for employers. Employees must be able to perform their job duties on return to work.  A return to work with restrictions is not a full-duty return-to-work note.  The question is who decides whether the employee has restrictions?  The FMLA does not allow employers to assess ability to perform essential functions; instead it places this obligation on the physician, who often may not fully understand the essential functions, particularly if the physician has no job description.  Further, physicians have limited time to address such issues with all the other competing demands on medical practices today.  In this case, the employee herself admitted she could only type slowly.  The response of the court on this point was very interesting: “Budhun admitted that it was not likely that she could type as quickly with seven fingers as she formerly could with ten.  But this alone does not mean that she could not perform this essential function.”