State News : New Jersey

Kelly Queen, plaintiff, worked as a police dispatcher for the City of Bridgeton.  On October 16, 2006, she experienced a racing heartbeat and left work. Her family doctor referred her to a cardiologist.  He diagnosed her with a mitral valve prolapse condition which may have been responsible for tachycardia and dyspnea. She also underwent a cardiovascular stress test. 

Plaintiff returned to her family doctor on November 6, 2006. The doctor recommended no return to work until January 2007. She saw he doctor again on January 4, 2007 and January 25, 2007, and she was cleared to return to work on February 18, 2007. She never had any similar heart racing during her absence. She was able to return to work and continue in her job.

During her absence, plaintiff exhausted her 10 sick days as well as her FMLA leave. She therefore requested access to the City’s donated leave program referred to as “sick bank.” That policy was negotiated under a collective bargaining agreement in 2003.

The purpose of the sick bank policy was to allow City employees to donate earned sick time and/or vacation time to another City employee who was suffering from a catastrophic health condition or injury expected to require a prolonged absence from work. The policy provided that the employee seeking access to the sick bank must contact his or her department head, who in turn must require medical documentation concerning the nature, severity and duration of the medical emergency.

Plaintiff submitted notes from her doctor but not actual medical records. The City therefore denied the request finding the condition did not meet the test of a catastrophic event. Plaintiff filed a grievance, which was settled as follows:

The parties agree to settle the above grievance based upon permitting the grievant to invoke the procedures of Article 7 of the [CBA] without interference relative to donated medical leave if the employee’s treating physician documents a catastrophic health condition or injury as specified in the [CBA].

Plaintiff was given a second chance to provide medical documentation showing a catastrophic health condition but failed to do so. Instead, she sued alleging disability discrimination under the New Jersey Law Against Discrimination. She argued that the City failed to make reasonable accommodation to her by not approving her sick bank request. 

           The City proved that prior recipients of the sick bank had high risk pregnancy that required complete bed rest, Guillain-Barre Syndrome, breast cancer, a stabbing injury and esophageal cancer, and prostate cancer. One woman had been denied sick bank access who had been recuperating from pregnancy and had high blood pressure. Two men had been denied sick bank access who suffered from a back condition and from a heart condition. The Court contrasted this case with other suits alleging discrimination based on disability.

Unlike the typical claim, wherein an employee seeks an accommodation that would facilitate her return to work, maintain her employment, or remedy her condition, plaintiff here demands just the opposite, namely a monetary benefit that would permit her continued absence from work, and which defendants have no recognized legal duty to provide. Indeed, plaintiff never established that she was able to work with or without any accommodation.

As to the sick bank itself, the Court held there was no “blanket mandate” that an employer provide donated sick leave as a matter of right to anyone with a disability.  The Court said that plaintiff failed to show that the City acted arbitrarily in restricting access to the sick bank to those who have catastrophic injuries. In the end, the Court said that plaintiff simply did not qualify for the sick bank. 

           This case can be found at Queen v. City of Bridgeton, 2012N.J. Super. Unpub. LEXIS 2425 (App. Div. October 29, 2012).

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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. 

New Jersey is a state with relatively few retaliation law suits arising from workers’ compensation. For that reason, the decision in Peralta v. Joule Staffing Services, Inc., A-1004-11T3, A-1005-11T3 (App. Div. January 3, 2013) is drawing attention from practitioners.

           Ronald Peralta, a native of Peru, worked as a forklift operator for Joule Staffing Services from 2003 to 2007 at 12 different work sites.   On December 5, 2007, he was in a forklift accident at a warehouse owned by a co-defendant Customized Distribution Services, Inc. (hereinafter CDS). After the accident, one CDS supervisor requested that Peralta fill out an incident report. That did not occur, plaintiff alleged, because another supervisor said he would take care of this detail.

           The failure to fill out an incident report and the failure to undergo post-accident drug testing became an issue. Plaintiff alleged he had back pain after the work injury and missed his next shift for that reason. CDS claimed that plaintiff did not even say anything about being injured. The next day the Operations Manager at CDS advised his assistant to inform Joule not to send Peralta to their site any longer because he failed to comply with post-accident procedures following his accident, including drug testing.

           Joule’s Safety Transportation Manager also filled out an incident report on December 7, 2007 stating that Peralta was in an accident but had not been injured; nor did he fill out the post-accident report or submit to drug testing. Peralta  was thereafter suspended by Joule. The Branch Manager also advised Peralta to set up a meeting with the Safety Transportation Manager. At that meeting Peralta asked the Branch Manager if he could make a claim and was told to do it through the Safety Manager, who was not able to make the first meeting. 

           Peralta tried a second time to meet with the Safety Manager. When that failed he sought counsel, who contacted Joule on January 7, 2008 requesting treatment. On January 17, 2008, Peralta filed a workers’ compensation claim and was treated or examined by five doctors. Eventually he received $5,000 in a workers’ compensation award. 

           Peralta was medically cleared to return to work commencing January 24, 2008. However, he never received any further work assignments from Joule. Thereafter he sued in civil court contending that he was terminated in retaliation for filing a workers’ compensation claim. He also alleged a violation of the New Jersey Law Against Discrimination. Joule countered that it did not terminate Peralta’s employment. Rather, he received no more assignments because of a downturn in the economy.

           The trial court granted summary judgment to Joule and Peralta appealed. First, the Appellate Division held that retaliation claims in workers’ compensation should be analyzed under the “burden shifting” approach ofMcDonnell Douglas Corporation v. Green, 411 U.S. 792, 93S. Ct. 1817, (1973).  The Court said that Peralta must prove that he made a claim for workers’ compensation benefits and was discharged in retaliation for making that claim. The Court said that under McDonnell Douglas, once Peralta establishes a prima facie case, there is a presumption of retaliation. The burden then shifts to the employer to rebut the presumption by offering a legitimate reason for its treatment of the employee. The Court said, “Although the reported cases under the WCA (Workers’ Compensation Act) do not specifically refer to theMcDonnell Douglas burden-shifting framework, the logical underpinnings of the WCA’s antidiscrimination provisions make it sensible to apply such an evidential framework to WCA-based retaliation claims.” 

           Using this approach, Peralta argued he made out a prima facie case because he was injured, filed a compensation claim, and thereafter never got any more work assignments. That shifted the evidentiary burden to Joule.  The Court ruled that Joule successfully rebutted Peralta’s proofs by showing that it had a legitimate, non-discriminatory reason for not sending Peralta more assignments. The company reduced its business during the recession years and eventually closed the Passaic, New Jersey office where Peralta had worked. 

In addition, the mere fact that plaintiff failed to receive more work assignments after his injury at CDS and the filing of his compensation claim does not furnish a sufficient basis to infer that unlawful discrimination or retaliation occurred. Temporal proximity alone is generally insufficient to support an inference of a causal connection as part of a prima facie case of discrimination, unless the timing at issue is ‘unusually suggestive.’

The Court said that Peralta had not been able to rebut the legitimate reason offered by Joule for not sending Peralta back to CDS or giving him further assignments. Therefore, the Court affirmed the dismissal of Peralta’s case.

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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. 

Daniel Cordiero owned Danny’s Construction Company, which did masonry and concrete work. The company employed eight or nine employees.  Cordeiro purchased an investment property in Asbury Park, New Jersey. He listed Danny’s as the repair and renovation general contractor on the construction permits. As general contractor, Danny’s hired plumbing and electrical subcontractors and paid the going rate for their work.

            On June 17, 2010, Cordeiro drove two of his employees to a jobsite where they were supposed to perform concrete work. Due to jobsite conditions, the work they intended to perform could not be done. Cordeiro then decided to drive the two workers to the Asbury home where he and one of his co-workers climbed the roof to install a skylight. While doing cutting work, Cordeiro fell through the roof onto the concrete floor below. He suffered paraplegia from a spinal cord injury as well as multiple fractures and respiratory failure. The parties agreed that he was totally and permanently disabled from the fall.

            The insurance company, Sentinel, denied the claim and asserted that Cordeiro’s injuries resulted from his personal activities in his own home. The company also produced an underwriter who identified herself as an employee of The Hartford. She said that the workers’ compensation insurance policy only covered the installation of concrete slabs for residential homes. However, there was no specific policy language confirming such a policy limitation. 

            The Judge of Compensation ruled for petitioner and Sentinel appealed. In a fairly brief opinion, the Court affirmed the award of 100% permanent total disability to petitioner. The Court conceded that Danny’s employees generally performed concrete and masonry work, noting that some of the renovation work done on Cordeiro’s property was beyond the usual scope of work performed by Danny’s. In this case, Danny’s employees did pour the concrete floor in the room where Cordeiro was injured. 

            The reasoning of the Court was that Cordeiro should be covered under workers’ compensation because, as an employee of the company, he was performing a task assigned by the employer. The Court noted that “[t]he language of the [Act] must be liberally construed in favor of employees,” citingCannuscio v. Claridge Hotel, 319 N.J. Super. 342, 249 (App. Div. 1999). The holding in this case is not surprising because there are few if any published cases in New Jersey where the defense has been accepted that the activity that the company engaged far exceeded the specific terms of the application of insurance. The Court rejected the argument that petitioner’s claim should be barred because Danny’s employees only worked more than three feet above ground level doing concrete work. 

            This case can be found at Cordeiro v. Danny’s Construction, A-2714-11T3 (App. Div. December 13, 2012).

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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. 

Luz Lukasik agreed to provide house cleaning services for Marguerite Hollaway and two others. Respondents contacted Lukasik after hearing about her from an acquaintance. At that time she was cleaning five or six other houses and one office building on a regular basis. Petitioner Lukasik and her daughter went to the home of respondents and examined the house. A discussion occurred about the potential for doing laundry, but petitioner declined, stating that she would consider that in the future. The parties did agree to $100 per day for cleaning services.

           On January 16, 2007 petitioner came to the respondents’ home with a friend and began cleaning, using the supplies furnished by respondent. Within the first hour on the job, petitioner fell off a stool and injured her hand. An ambulance was called and petitioner received treatment for hand fractures. She came to the house on another occasion but directed someone else and her daughter in doing the cleaning. She told respondents that she needed to purchase supplies and expected to be reimbursed for those costs. Thereafter, respondent refused to pay her for the cleaning and supplies.

           Petitioner filed a workers’ compensation claim asserting that she was employed by respondents when she was injured. The Judge of Compensation ruled in petitioner’s favor and held she was an employee. The Judge focused on the right of control test and noted that respondents set the day for the work to be done, expected her to provide this service on a regular basis, and had the ability to direct her work even if they chose not to do so. The Judge found 45% of the hand or $22,170.75.

           Respondent appealed and contended that petitioner was an independent contractor under either the “control” test or the “relative nature of the work” test. The Appellate Division reversed inLukasik v. Marguerite Holloway, A-5913-10T3 (App. Div. August 22, 2012) holding that there was insufficient control of petitioner’s work activities to constitute an employer/employee relationship. The Court said that respondent did not control how petitioner did her cleaning, what supplies she used, or who did the cleaning. There was no discussion about the specific day of the week petitioner would clean and no agreement that petitioner herself would do the cleaning. In fact, on the second day of cleaning petitioner did no cleaning herself but directed her daughter and a friend. “An employee would not have the option to produce helpers or a substitute to do the employee’s work.”

        &nbspnbsp;  Other factors that argued against employment were that respondents set a price of $100 per day rather than pay wages to each of the persons performing the cleaning work. Additionally, petitioner herself purchased the supplies for the second cleaning and determined what equipment to use. Further, there was no proof of economic dependence by petitioner on respondents. “We conclude that respondents did not control petitioner’s work to the extent that an employer controls the work of an employee.” 

From time to time plaintiff’s counsel takes the position that respondent’s lien is applied to the net proceeds after deduction for plaintiff’s total costs of suit.  In Greater New York Mutual Insurance Company v. Calcagno & Associates, A-0900-11T4 (App. Div. September 20, 2012), that very issue was decided.

           John Phillips was injured arising from work, and the workers’ compensation carrier paid benefits in the gross amount of $29,733.84. Phillips also sued a third party and recovered $35,000.  Greater New York (hereinafter GNY) asserted its full lien.  In response, counsel for Phillips requested a lien compromise.  GNY refused to compromise its lien and insisted that it was due two thirds of $29,733.84 minus $750 for costs of suit for a balance of $19,073.55.

           Calcagno & Associates, counsel for Phillips, did not pay $19,073.55. Instead the law firm sent a check to GNY for $14,821.85 after deducting $12,767.23 for “disbursements of suit.” GNY then sued for the balance of $4,251.70.

           The trial judge ruled that the New Jersey subrogation statute (N.J.S.A. 34:15-40) is clear on its face in stating that costs of suit are limited to $750. Counsel for Phillips appealed and argued that N.J.S.A. 2A:13-5 governing attorney’s liens had priority over a workers’ compensation lien. Counsel also argued that the carrier’s lien only attached to the net settlement proceeds in the third party action.

           The Court rejected these arguments.  “N.J.S.A. 2A:13-5 is irrelevant to this matter, and defendants cite no authority for the proposition that this statute has priority over a workers’ compensation lien pursuant toN.J.S.A. 34:15-40.”  The Court further held, “Here, the third party tortfeasor or his insurance carrier paid Phillips $35,000 to settle the negligence lawsuit. The employer’s liability, therefore, was based on that sum, not the net sum.”

           The Court said that GNY was entitled to its full two thirds minus $750 or $19,073.55. It said that Phillips’ lawyer could seek reimbursement of the litigation costs in excess of $750 from Phillips pursuant to their retainer agreement.

            Defining what is a flare up from a new injury as opposed to objective worsening in the condition has always been more art than science. InAllison v. L&J Contracting Company, A-1352-11T4 (App. Div. September 27, 2012), the petitioner Allison injured his low back falling in a hole on July 27, 2006. He filed a claim petition against L&J, which admitted the accident. 

L&J subsequently moved to join a subsequent employer, Baumgardner Floor Covering, for two accidents occurring in June 2007 and March 2008.  Petitioner had returned to work for Baumgardner and found that his normal activities on that job and at home were worsening his back and leg. He claimed he was injured in June 2007 and in March 2008 while working for Baumgardner, but he never reported either incidents to Baumgardner, nor did he seek treatment. He himself thought these incidents were flare ups of his previous symptoms.

An MRI was done in 2006 showing small disc herniations at L4-5 and L5-S1 as well as a bulging disc at L3-4. Petitioner treated with Dr. Steven Valentino for the 2006 injury and got three injections of cortisone. Dr. Valentino did not observe radicular pain during his treatment in 2006. 

When Dr. Valentino saw petitioner in November 2007, he noted that petitioner’s symptoms had increased. He gave him epidural injections. Dr. Valentino saw petitioner in February 2008 but did not recommend surgery. 

On March 17, 2008, petitioner saw Dr. Valentino and reported lifting a 92 pound bag of sand at work (during Baumgardner’s employment) and experiencing low back pain with sciatic pain. Dr. Valentino found definite worsening related to lifting the 92-pound bag. A new MRI in April 2008 showed no change in the discs other than some increase at L4-5.

Dr. Valentino continued to treat petitioner and eventually performed surgery on October 3, 2008 consisting of a laminectomy at L4-5. After his surgery, petitioner experienced improvement.

The petitioner’s expert, Dr. Henry David, found an 80% disability, apportioning 65% to L&J and 15% to occupational exposures at Baumgardner. Baumgardner produced testimony from Dr. Tim Pinsky, who found that all of the disability was from the first accident with L&J. He said that petitioner had ongoing problems from the time of his first accident. Dr. A. Gregory McClure testified for L&J, making no attempt to apportion disability between the two employments.

The Judge of Compensation found that all of petitioner’s back problems stemmed from his 2006 accident. He said that the incidents in June 2007 and March 2008 were “descriptive of occupational activities” rather than “accidents or traumatic events.” The judge said that nothing petitioner did while working with Baumgardner was any different than his normal everyday occupational activities. The Judge assessed all responsibility for the claim against L&J, which filed an appeal.

The Appellate Division reviewed the rule inPeterson v. Hermann Forwarding Co.,267 N.J. Super. 493 (App. Div. 1993). In that case the first employer in a series of employments was held responsible for petitioner’s disability where the claimant continued to work after the original injury and the subsequent employments were not shown to have materially worsened his condition. The Appellate Division held that as inPeterson, the petitioner here got worse over time simply by the progressive worsening of his condition, not necessarily by the subsequent work. The Court said that there was only proof of one compensable accident in 2006 against L&J. Although the court does not discuss this point, it was no doubt problematic that petitioner never reported either incident, nor sought treatment for the two alleged subsequent incidents.

This case shows how difficult it can be to render subsequent employers liable after a significant initial injury. It is clear that this was a close case. One factor that no doubt hurt L&J was that its own expert did not apportion disability between the two employers. Most of all courts focus on objective testing, and there were legitimate differences of opinion among medical experts whether the second MRI showed any material difference from the MRI done immediately after the first incident in 2006.

The casual employee defense remains viable in New Jersey.  It is a difficult defense to make in certain lines of employment such as trucking, real estate agents, newspaper delivery persons and cab drivers, but it remains viable in situations involving home remodeling and home additions. A good illustration is the recent case of Cruz v. [...]