NWCDN Members regularly post articles and summary judgements in workers’ compensations law in your state.
Select a state from the dropdown menu below to scroll through the state specific archives for updates and opinions on various workers’ compensation laws in your state.
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On July 20, 2017, Governor Roy Cooper signed House Bill 26 into law. In response to Wilkes v. City of Greenville, HB 26 amends G.S. § 97-82(b) of the Workers’ Compensation Act, specifically addressing the issue of medical presumption in Wilkes. Please reach out to a member of our Workers’ Compensation team with any questions or concerns.
Although overshadowed by the Wilkes v. City of Greenville opinion issued the same day, the N.C. Supreme Court came to a decision on another workers’ compensation matter last month. While not as significant as Wilkes in terms of future claim handling (at least until subsequent legislation takes effect), the decision in Harrison v. Gemma Power Sys., LLC did provide some insight on how the courts look at issues such as statute of limitations and permanent impairment. Harrison is also a good reminder of how litigation can often take years to wind its way through the system, an often overlooked factor in the early decision-making and settlement process.
The plaintiff in Harrison suffered a compensable neck injury and was quickly released without restrictions in 2001 after the treating doctor found no permanent impairment. Defendants continued to authorize treatment over the ensuing years, including two independent medical examinations. By 2009, defendants determined that the effects of the accident had subsided, and they refused to provide additional medical treatment after an MRI referral.
The case turned into a procedural quagmire, replete with technical arguments and what the courts determined to be deficient findings of fact. After remands and new decisions, the case ended up at the Court of Appeals twice before the N.C. Supreme Court heard the matter. From a risk handling perspective, the key takeaways are as follows:
After reviewing and attempting to reconcile the previous findings of fact and conclusions of law, the N.C. Supreme Court remanded the Harrison case so that the Industrial Commission could more adequately address whether plaintiff retains any compensable permanent impairment. Closure is thus still forthcoming. Even though no ground-breaking law has been established, the case does highlight that the time it takes for a party to obtain relief is often out of their control once a case moves into litigation mode.
On June 29, 2017 the North Carolina General Assembly passed House Bill 26 which amends G.S. § 97-82(b) of the Workers’ Compensation Act. As previously discussed,Wilkes v. City of Greenville held that when a claim was accepted as compensable pursuant to a Form 60 or section 1 of a Form 63 that a rebuttable presumption was created that any additional medical treatment was related to the compensable condition. The rebuttable presumption was not limited to the specific body part or medical condition accepted in the Form 60 or 63. The overall impact of the legislature’s change is to limit the scope of any medical presumption. The legislation has been passed by the General Assembly and is now awaiting approval by Governor Cooper before it can become law.
Amendment to G.S. § 97-82(b)
The reformed G.S. § 97-82(b) expressly states that filing a Form 60 or 63 shall not create a presumption that medical treatment for an injury or condition not identified in the Form 60 or Form 63 is causally related to the compensable injury. The amendment applies to all accrued or pending claims. A claimant can request a full evidentiary hearing to prove that any additional injury or condition is causally related to the compensable injury.
Recommendations for Claim Acceptances and Denials
Filing a Form 60 or 63
Teague Campbell’s recommendation is that employers and carriers handling workers’ compensation claims be as specific as possible when describing exactly which injuries or conditions are being accepted as compensable on a Form 60 or 63. There will be a medical presumption created for any listed injuries or conditions, but no presumption created for injuries or conditions that are not specifically listed. In addition, employers and carriers can still use a Form 63, section 2, to pay for medical treatment, in medical only cases, without prejudice. We do not recommend adding language to the Form 60 or 63 in an attempt to modify or limit the IC forms because those modifications will likely not be accepted by the Commission and would have no practical effect.
Filing a Form 61
We do not recommend filing a generic Form 61 attempting to provide a universal denial of all claims not specifically listed on the Form 60 or 63. This is not necessary and could pose some unintended consequences for defendants. Although filing a Form 61 with a Form 60 or 63 is not necessary because no presumption is created for conditions not specifically accepted, there may be certain circumstances where filing a Form 61 for a denied condition might be appropriate. Please contact Teague Campbell with questions regarding filing a Form 61 in these situations.
Consideration of Other Issues Raised by Wilkes
As part of the negotiations amend G.S. § 97-82(b), representatives for both employees and industry have agreed to continue to discuss issues raised byWilkes concerning how employees prove a disability during the remainder of the 2017-2018 legislative session. In addition, both sides have agreed to discuss the potential implications ofWilkes in medical only cases, including cases where medical benefits are paid without prejudice under Section 2 of a Form 63, and whether an expedited hearing process should be available to claimants seeking to prove that an additional condition or body part not listed on the Form 60 or 63 is related to the compensable injury.
Written by: Courtney Britt and Matt Flammia
In addition to creating a medical presumption for accepted claims, the North Carolina Supreme Court’s decision inWilkes v. City of Greenville has significantly altered the landscape for proving disability. The Court has held that an employee can prove a disability outside of the four methods outlined inRussell v. Lowes Product Distribution. The Court also stated that an employee may rely upon competent lay testimony, as to how the employee’s injury and related symptoms have affected his activities, to prove disability. In addition, the Court held that if an employee demonstrates an inability to work after taking into account his work-related conditions and pre-existing limitations, expert testimony is not required to prove a job search is futile.
Wilkes calls into question the framework parties have used to evaluate disability in workers’ compensation claims for more than two decades and leaves employers and carriers unsure of the standard to defend disability claims in the future. Wilkes suggests that disability can be proven by methods other than those outlined inRussell, but does not specify all of the ways an employee may prove disability. Also, the Court’s statement inWilkes that the Court may rely on competent lay testimony to support a disability claim may result in a greater number of disability determinations and is contrary to the prior conclusion of the Court of Appeals on the same issue. In cases of contested disability, employers and carriers should consult with defense counsel and consider obtaining expert review of medical and vocational issues to refute disability.
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Wilkes involved a compensable motor vehicle accident and a later dispute about whether Mr. Wilkes had an ongoing disability which was litigated by the parties. Regarding disability, The Deputy Commissioner found that it would be futile for Mr. Wilkes seek employment due to pre-existing conditions that were personal to him, including his age, IQ, work history, and physical conditions as a result of the at-work injury. Defendants appealed and the Full Commission reversed the Deputy Commissioner’s decision on disability, concluding that Mr. Wilkes had presented insufficient evidence that a job search would be futile. Mr. Wilkes appealed and the Court of Appeals held that he had successfully demonstrated that searching for work would be futile based on his pre-existing, personal conditions.
The Supreme Court affirmed the Court of Appeals, holding that the Commission failed to adequately evaluate plaintiff’s wage-earning capacity. Significantly, the Court expressly stated that it has not adopted theRussell methods of proving disability and that there are other ways an employee can prove disability. The Court noted the employee still bears the burden of proving disability and that once the employee has done so, the burden shifts to defendants to show not only that suitable jobs are available, but also that the employee is capable of getting one, taking into account both physical and vocational limitations. The Commission must consider the employee’s work-injury-related condition, age, education, prior work experience, pre-existing and co-existing conditions.
The Court held that Russell did not apply in Mr. Wilkes’ case because, unlike inRussell, Mr. Wilkes had numerous preexisting limitations, including being over age 60, having a limited IQ, education and work experience. Also, the Court concluded that where an employee demonstrates a total incapacity to work, expert testimony is not required to show a job search would be futile. The Court also suggests, in dicta, that expert testimony is not required to prove disability at all and further, that an employee’s own testimony and the testimony of other lay witnesses can be used to prove disability.
The Court then noted the Commission had denied Mr. Wilkes claim for anxiety and depression, but found his severe tinnitus was compensable. As such, the Court found that the Commission did not adequately address Mr. Wilkes’ wage earning capacity and remanded the case to the Industrial Commission to make specific findings of fact and, if necessary, take additional evidence regarding whether his compensable tinnitus, preexisting and coexisting conditions impacted his eligibility for future disability benefits.
On Friday, June 9, 2017, the North Carolina Supreme Court issued its eagerly anticipated decision in Wilkes v. City of Greenville, in significant part, unanimously affirming the Court of Appeals. Wilkes involves two primary issues. First, whether Johnnie Wilkes failed to meet his burden of establishing that his anxiety and depression were the result of a work-related accident and, more specifically, whether the “Parsons presumption” applied, giving Mr. Wilkes the benefit of a presumption that these conditions were related to his accident. The second issue is whether Mr. Wilkes was entitled to disability payments made after January 18, 2011. The Court’s decision on the Parsons presumption is potentially one of the most significant decisions involving North Carolina worker’s compensation claims in the last 30 years.
The Supreme Court agreed with the Court of Appeals that Mr. Wilkes was entitled to a presumption of compensability in regards to his continued medical treatment and affirmed that part of the decision. In addition, the Supreme Court concluded that the Commission failed to address the effects of Mr. Wilkes’ tinnitus in determining whether he had lost wage earning capacity.
Moving forward after Wilkes, we recommend that any decision regarding filing a Form 60 or a Form 63 and paying indemnity benefits beyond the applicable time period be very carefully considered. Defendants should not unreasonably deny claims, but must consider that by accepting a questionable claim, a rebuttable presumption is likely created that treatment for all other medical conditions or symptoms are related to that work accident.
We anticipate a significant potential increase in denial of questionable claims with this expansion of the Parsons presumption. Defendants will also need to be prepared to obtain independent medical evaluations quickly to evaluate whether any disputed condition is “directly related” to the compensable work injury. In addition, defendants can expect to see an increase in expedited medical motions relying on the Parsons presumption when employees seek additional medical treatment for new conditions. As the current expedited medical motion procedure provides a very short timeline with no ability for extensions, this will likely make obtaining independent medical evaluations to rebut the presumption extremely challenging for defendants.
Mr. Wilkes was working as a landscaper on April 21, 2010, when he was involved in a motor vehicle accident. On April 29, 2010, the defendants filed a Form 60 with the North Carolina Industrial Commission and described the injury as “worker involved in MVA and had multiple injuries to ribs, neck, legs and entire left side.” The defendants began paying temporary total disability and provided medical compensation for Mr. Wilkes’ injuries, but never specifically accepted his anxiety and depression as compensable conditions. Defendants subsequently disputed Mr. Wilkes’ need for medical treatment related to his work injury.
The case was eventually heard by a Deputy Commissioner who entered an opinion and award determining that Wilkes’ low back and leg pain, anxiety, depression, sleep disorder, tinnitus, headaches, and TMJ pain were causally related to the April 21, 2010 compensable injury. The Deputy Commissioner also awarded Wilkes ongoing temporary total disability benefits, concluding that he had demonstrated that it would be futile for him to seek employment because of pre-existing conditions, including his age, IQ, education level reading capacity, previous work history and physical condition resulting from his work injury.
The defendants appealed to the Full Commission, which concluded that Mr. Wilkes suffered from tinnitus as a result of the April 21, 2010 accident, but determined that the evidence regarding his alleged anxiety and depression was conflicting. The Commission ultimately concluded that, based upon the preponderance of all of the evidence, Mr. Wilkes’ alleged anxiety and depression was not caused by his April 21, 2010 work-related accident.
On appeal, the Court of Appeals vacated the Commission’s opinion and award concerning Mr. Wilkes’ request for additional medical treatment for anxiety and depression. The Court of Appeals held that the Commission erred by not applying the rebuttable Parsons presumption to Mr. Wilkes’ anxiety and depression, and instead placing the burden on him to demonstrate the cause of those conditions.
The Supreme Court affirmed the Court of Appeals, holding that the Mr. Wilkes is entitled to a rebuttable presumption that additional medical treatment is related to his compensable conditions. The Court reaffirmed that a presumption of ongoing disability only arises in limited circumstances. The Court also reaffirmed that when an employer admits “compensability”, by filing a Form 60 or a Form 63, when the employer fails to contest compensability within the 90 day time limit, no presumption of “disability” arises in those circumstances.
Nonetheless, reviewing the plain language of N.C.G.S. §97-82(b), the Supreme Court concluded that when compensability and liability are admitted, that this shall constitute an award of the Commission on the question of compensability of and the insurer’s liability for the injury for which payment was made. Accordingly, an admission of “compensability” approved under §97-82(b) entitles an employee to a presumption that any additional medical treatment is causally related to his compensable injury. In reaching this conclusion, the Court cited the language in N.C.G.S. §97-25(a) which states that medical compensation “shall be provided by the employer.”
The Supreme Court specifically rejected the defendant’s argument that applying the Parsons presumption to a Form 60 will discourage direct payment, upset the framework of the Act, and convert the Act into a general health insurance program. According to the Court, applying the rebuttable Parsons presumption merely removes the burden from the employee to prove that each medical treatment sought is to the compensable condition. The employer may rebut this presumption with evidence that the condition or treatment is not “directly related” to the work injury. The Court noted that medical issues can be complex and the extent of an employee’s injuries may be difficult to determine at the time of the accident. The Court also noted that the Act provides the Form 63 procedure which allows employers to pay benefits without prejudice while they investigate such injuries without admitting liability and requires employees to submit to medical examinations by the employer’s authorized physician.
In addition, in a footnote the Court indicated that the presumption could have been applied during the expedited medical motion procedure. In other words, it appears that the Court wants parties and the Commission to quickly determine what medical conditions are and are not related to a compensable injury.
With respect to Mr. Wilkes’ medical conditions, the Supreme Court expressed no opinion on whether the evidence was sufficient to rebut the presumption that Mr. Wilkes’ current complaints are related to his initial compensable injury. Therefore, the claim was remanded back to the Commission for further review.
There are numerous issues unresolved by the Supreme Court’s decision in Wilkes. The first is whether defendants can file a Form 60 accepting a clearly compensable claim and body part, but simultaneously file a Form 61 with respect to a disputed medical condition. In the plainest reading of the Court’s decision, the filing of a Form 60 or a Form 63, without a denial within the applicable time periods, creates the rebuttable presumption. Therefore, even if a Form 61 is filed, it may have not have an impact and the employee may still enjoy the presumption of compensability despite a clear denial of disputed body part or condition.
The Supreme Court also does not appear to place any limitations on the scope of the presumption based upon the exact injury listed in the Form 60 or Form 63. Wilkes dealt with physical injuries that allegedly caused anxiety and depression. What is potentially left unresolved is whether a defendant accepting one undisputed body part on a Form 60 is also going to have to rebut a request for medical treatment for any other body part or symptom not specifically listed on the Form 60 or Form 63.
It is also unclear how conditions that develop after the initial injury by accident will be treated, such as an employee who has a compensable right knee injury and develops back pain allegedly related to the knee injury two years later. In addition, the Court leaves open whether an employee is entitled to a presumption that a work-related injury aggravated or accelerated a pre-existing condition. The Supreme Court’s decision states that the additional medical treatment being sought by the employee must be “directly related” to the compensable injury, but it is unclear how that term will be interpreted and how the presumption interacts with prior case law.
Finally, while the Supreme Court acknowledges that the filing of a Form 60 does not create a presumption of disability, Wilkes ignores the fact that many times, if not most times, the disability determination is driven by the medical conditions in a claim. Consider an employee who has a compensable right knee injury which does not cause any physical limitations and who also has back pain allegedly caused by the right knee injury, which is totally disabling. If treatment for the back pain is found compensable, as a result of the rebuttable presumption, because the right knee injury is accepted, then the medical presumption has morphed into a disability presumption as well.
Risk Handling Hint: Employers and carriers should carefully investigate and evaluate all claims before filing a Form 60 or 63. As always, the Form 60 or 63 should specifically address exactly which body parts and injuries are being accepted. In appropriate cases, where the defendants have investigated the claim and determined that certain body parts are not related, they should file a Form 61 denying those body parts and conditions. However, employers and carriers need to realize that, following Wilkes, it is not clear that filing a Form 61 will provide protection. The employee may still be entitled to a presumption that any additional medical condition is related to the compensable injury and defendants will likely be required to litigate many of these claims and to present contrary evidence.
Written By: Kyla Block
When Plaintiffs are injured at work under circumstances which raise the question of whether the precipitating activity was “in furtherance of” versus “incidental to” the job duties assigned and the employer’s interest, the North Carolina Courts will look closely at the nature of the activity and the behavior immediately prior to the incident to determine whether the injury arose out of and in the course of employment. If the underlying facts prevent a clear determination and application of the relevant law, the Court of Appeals will remand for further clarification. In a recent decision,Weaver v. Dedmon, the Court of Appeals did just that, ultimately remanding the case to the Full Commission for clarity on whether Plaintiff was in the actual performance of a direct job duty or whether he was performing an incidental activity, and whether this incidental activity constituted a reasonable action.
In Weaver, Plaintiff was employed as a fence builder and was required to regularly operate a forklift and move fencing supplies around the outdoor storage yard. Plaintiff testified that on the date of injury, he had just finished unloading supplies with the forklift and was about to return the forklift to the warehouse when he turned the forklift too quickly and it overturned. However, a witness approximately 350 feet from Plaintiff testified he heard the loud noise of equipment “running at a high throttle” and saw Plaintiff doing “donuts” with the forklift just prior to the accident. The witness saw no work materials and “there was no indication that there was any work being done.” Plaintiff sustained a crush injury, closed head injury, multiple fractures, liver and renal lacerations, splenic injury and cardiac arrest. The Defendants denied the claim and asserted that Plaintiff had not sustained an injury by accident or specific traumatic event arising out of and during the course and scope of his employment.
Following a hearing, the deputy commissioner entered an Opinion and Award denying Plaintiff’s claim in its entirety and the Plaintiff appealed to the Full Commission.
The Full Commission affirmed the deputy commissioner’s Opinion and Award, finding the witness’ testimony credible because the witness was an unbiased, disinterested eyewitness of the events immediately preceding the accident. The Commission also found credible testimony by an accident reconstruction expert that photos of the tire impressions at the scene of the accident were consistent with the forklift having been driven in tight circles. The Commission concluded that Plaintiff was “operating the forklift at such a speed to cause it to rollover,” he was “joyriding” or “thrill seeking” when the accident occurred, and this activity bore no relationship to accomplishment of the duty for which Plaintiff was hired. The Commission further concluded that “to the extent Plaintiff may have initially performed some work-related tasks with the forklift, his decision to do donuts . . . was too remote from customary usage and reasonable practice and constituted an extraordinary deviation from his employment.”
Plaintiff appealed to the Court of Appeals.
In remanding the matter back to the Full Commission for reconsideration of whether Plaintiff’s injuries arose out of and in the course of his employment, the Court of Appeals determined the Commission’s conclusions regarding the lack of relationship between Plaintiff’s activity on the forklift to the accomplishment of his employment duties and the proposition that Plaintiff may have initially been performing some work-related tasks with the forklift were findings of fact, not conclusions of law, as these determinations were reached through logical reasoning from the evidentiary facts. The Court further concluded that the factual findings – one stating Plaintiff’s action of performing “donuts” bore no relation to his job duties and the other stating that Plaintiff may have initially performed some work-related tasks with the forklift – were inconsistent with each other and precluded the Court from determining whether the Commission’s findings supported the legal conclusion that Plaintiff’s operation of the forklift removed him from the scope of employment. Specifically, the Court found the Commission’s finding that Plaintiff “may have initially performed some work-related tasks with the forklift” undermined the Commission’s conclusion that the injury did not arise out of and in the course of employment. On remand for redetermination by the Commission, the Court directed the Commission to reexamine whether it found Plaintiff’s testimony that he was returning the forklift to the warehouse after using it for work purposes credible and what impact that finding would have the conclusion that “Plaintiff operated the forklift preceding his injury [in a manner that] was unreasonable and reckless, in essence joy riding and/or thrill seeking.” The Court specifically sought clarity on whether Plaintiff was operating the forklift in furtherance of – or incidental to – his job duties and his employer’s interest, as that would determine whether the work-related activity would be characterized as “actual performance of the direct duties of the job activities” or as “incidental activities” and would direct the Court to follow evolved precedent for each characterization.
Judge Tyson dissented and argued that since the Commission found that Plaintiff “may” have been initially engaged in a work-related task at the time of the accident, the majority’s opinion asserting that the Commission’s findings failed to support the conclusion that Plaintiff’s injuries did not arise out of and in the course of his employment “unduly parses the Commission’s findings and conclusions” and fails to apply the plain and ordinary meanings of the Commission’s words. He further argued whether Plaintiff initially performed work-related activities was inconsequential because the employee carried the burden of proving a causal connection between the employment and the injury and in this case, the Commission found that Plaintiff’s joyriding or thrill seeking ultimately broke the causal connection between Plaintiff’s employment and his injuries. Thus, the Commission’s Opinion and Award denying Plaintiff compensation was consistent with precedent, supported by competent evidence, and should have been affirmed.
Given this attention to detail at the Court of Appeals, all parties defending these types of claims need to clearly delineate arguments at the Commission level which demonstrate a succinct break between the actual performance of the direct duties of the job activities and incidental activities which can be shown to be unreasonable.
In recent years, attendant care provided under North Carolina’s Workers’ Compensation Act has gotten quite a bit of attention in the appellate courts and at the General Assembly. In particular, the Court of Appeals’ 2011 decision inShackleton v. Southern Flooring & Acoustical Company presented a challenge for employers. Reversing the Commission’s denial of an attendant care claim by the injured worker’s spouse,Shackleton adopted a “flexible case-by-case approach,” which allowed the Commission to consider a wide variety of evidence, including: “a prescription or report of a healthcare provider; the testimony or a statement of a physician, nurse, or life care planner; the testimony of the claimant or the claimant’s family member; or the very nature of the injury.”
Shackleton was seen as a departure from existing case law because attendant care claims could be proven with only the testimony of the claimant or the claimant’s family, or the nature of the injury itself. The decision also suggested that there was no time limit on when attendant care services could be requested, causing concern for significant retroactive attendant care awards. Partly in response toShackleton, the General Assembly revised N.C.G.S. § 97-2 (19) in 2011 to require that attendant care be, “prescribed by a health care provider authorized by the employer or subsequently by the Commission[.]” This revision was intended to put more parameters on when attendant care is provided, by requiring a prescription.
Recent decisions by the Court of Appeals, in Thompson v. International Paper Co. andReed v. Carolina Holdings, Wolseley Mgmt., reveal how the courts may treat attendant care going forward, but leave many questions for employers.
On February 23, 2012, Darrell Thompson suffered severe burns at work, required three major skin graft surgeries and received treatment at the UNC Burn Center. Mr. Thompson’s doctor testified following a hearing that Mr. Thompson would require some level of attendant care the rest of his life, but confirmed that he had never written a prescription for attendant care. Instead, the doctor testified that he left these decisions to the hospital social worker who wrote that Ms. Thompson would provide Mr. Thompson’s “attendant and wound care.”
Ms. Thompson was awarded attendant care services by the Deputy Commissioner, and the Full Commission affirmed, but terminated attendant care services in 2012. On January 17, 2017, inThompson v. International Paper Co., the Court of Appeals reversed the termination of attendant care, holding that a written prescription for attendant care services is not required under N.C.G.S. § 97-2(19) and a verbal prescription can suffice. The Court acknowledged the Commission cannot rely solely on lay testimony to award for attendant care, but concluded that Mr. Thompson’s social worker’s letter was a “written expression” of his physician’s verbal directive for attendant care.
Christopher Reed sustained a traumatic brain injury in 1998, which Defendants accepted as compensable. On March 18, 2011, Mr. Reed filed a hearing request seeking attendant care. Based on lay and medical testimony, the Deputy Commissioner awarded attendant care reimbursement to Mr. Reed’s mother from the date of injury to present and ongoing.
The Full Commission denied Mr. Reed’s request for attendant care before the hearing request, because he did not seek approval of attendant care services or provide defendants with notice of this request until the hearing request. Attendant care was awarded from March 18, 2011, and ongoing.
On February 7, 2017, in Reed v. Carolina Holdings, Wolseley Mgmt., the Court of Appeals affirmed, relying on hearing testimony by Mr. Reed’s mother and post-hearing deposition testimony by Mr. Reed’s doctor. The Court citedShackleton, stating the Commission can rely on, “a prescription or report of a healthcare provider; the testimony or a statement of a physician, nurse, or life care planner; the testimony of the claimant or the claimant’s family member; or the very nature of the injury[,]” when awarding attendant care.”
Thompson and Reed demonstrate the tension between the 2011 reforms to § 97-2 (19) and the Court of Appeals’ prior decision inShackleton. Thompson acknowledges that § 97-2 (19) rejects the flexible case-by-case approach announced inShackleton. However, in Reed, the Court did not discuss and it does not appear the parties argued that § 97-2 (19) changes the law. Also, both cases suggest that a written prescription is not necessary for attendant care and that the Commission may rely on lay and physician testimony to establish that ongoing attendant care is necessary.
Until the appellate courts clarify the application of § 97-2 (19), employers and insurers will continue to face uncertainty. Where attendant care issues arise, or are anticipated, employers should consult with defense counsel to proactively develop strategies to reasonably resolve these issues.
By: Elizabeth Ligon
In Holmes v. Associate Pipe Line Contractors, Inc., the Court of Appeals determined that post-offer contingencies, such as background checks and drug testing, constitute the “last act” necessary to create a contract of employment.
On October 29, 2013, Plaintiff, who was living in North Carolina, was contacted via telephone by a union representative and offered an assignment in Texas. Plaintiff traveled to Texas, where she was required to submit to a drug test and complete various forms, including an authorization for a Department of Transportation background check, before she could begin working. Two hours after taking the drug test, Plaintiff began working in Texas. She sustained two injuries on the jobsite in Texas in January 2014, and sought workers’ compensation benefits in North Carolina. Defendants denied the claims, citing lack of jurisdiction.
At hearing, witnesses for the defense testified that when workers arrive at the jobsite, they are required to take a drug test and consent to a background check. If they did not submit to either the drug test or the background check, they would not be hired. However, because it takes several days to receive the results, the worker begins work immediately after taking the drug test and signing the consent form. If the drug test or background check did not “come back clean,” the worker would be terminated and paid a per-day rate for the time worked versus the full hourly rate under the union agreement.
The Deputy Commissioner issued an Opinion and Award, dismissing Plaintiff’s claims based on lack of jurisdiction. Plaintiff appealed to the Full Commission, who upheld the Deputy Commissioner’s Opinion and Award. The Full Commission concluded that the submission to the drug test and consent to a background check outside of North Carolina were conditions precedent to Plaintiff’s hire, and were more than administrative paperwork. Consequently, the “last act” necessary to create an employment contract occurred in Texas. Because the contract of employment was not made in North Carolina, Defendant-Employer’s principal place of business was not in North Carolina, and Plaintiff’s principal place of employment was not in North Carolina, the Industrial Commission did not have subject matter jurisdiction.
Plaintiff appealed to the Court of Appeals, who agreed with the Full Commission. Plaintiff argued that the last act necessary to form her employment contract occurred in North Carolina, when she accepted the job from her home via telephone. The Court of Appeals rejected Plaintiff’s argument, noting that it was undisputed that Plaintiff’s submission to a drug test was a prerequisite to her employment. If Plaintiff had refused to submit to the drug test, she would not have been permitted to start working. Therefore, the drug test constituted the last act necessary to form a binding employment relationship. Because this act occurred in Texas rather than North Carolina, the Commission lacked jurisdiction.
RISK HANDLING HINT: Under N.C. Gen. Stat. § 97-36, jurisdiction is created (i) if the contract of employment is made in North Carolina, (ii) if the employer’s principal place of business is in North Carolina, or (iii) if the employee’s principal place of employment is in North Carolina. Holmes solidifies that post-offer requirements drug testing and background checks constitute the “last act” necessary to create an employment contract under prong (i). As part of their initial investigation of a claim, employers and their carriers should determine whether a claimant was required to meet any additional requirements after a job offer was extended, and where they took place.
By: Bruce Hamilton
On April 6, 2017, the North Carolina Workers’ Compensation Opioid Task Force held its first organizational meeting to study and recommend solutions for the problems arising from the intersection of the opioid epidemic and related issues in Worker’s Compensation claims. The Task Force has not yet issued a report or timeline for when a report is expected.
On April 24, 2017, Gov. Cooper appointed Judge John Arrowood to the North Carolina Court of Appeals to fill the vacancy created by the resignation of Judge Douglas McCullough. The appointment of Judge Arrowood took place following Gov. Cooper’s veto of a bill to reduce the size of the Court of Appeals from 15 judges to 12 judges. The legislation reduced the number of judges on the Court of Appeals by not replacing incumbent judges whose seats became vacant prior to the expiration of the judge’s term due to death, resignation, retirement, impeachment, or removal.
Gov. Cooper nominated Deputy Commissioner Philip Baddour to a six-year term as the next Commissioner of the North Carolina Industrial Commission. Commissioner Bernadine Ballance’s term ended on April 30, 2017. The Baddour nomination is subject to confirmation by the North Carolina General Assembly and, as of April 26, 2017, the General Assembly had not yet approved Deputy Commissioner Baddour’s appointment.
The North Carolina Workers’ Compensation Educational Conference is scheduled for Wednesday, October 4 through Friday, October 6, 2017. The Industrial Commission announced a Twitter account that will provide updates on breaking news and important announcements from the Commission. Twitter @IC_NC_GOV.
By: Rebecca Thornton
Last winter we examined the Court of Appeals decision in Wilkes v. City of Greenville and its seemingly a radical extension of the Parsons presumption to injuries not initially accepted as part of the claim. The decision Wilkes was appealed to the North Carolina Supreme Court and is set for oral argument in mid-February 2017. However, the show must go on, and, in its recent holding in Patillo, the Court of Appeals once again examines the Parsons presumption and its application in North Carolina workers’ compensation cases, as well as the reasonableness of a job search.
Patillo suffered a low back injury on February 16, 2011 while working as a press operator for Defendant-Employer. He was evaluated at the on-site medical clinic and was restricted to “off-standard” work, which meant that he could not perform all his job functions without assistance. Patillo remained on off-standard work until April 4, 2011. The following day he returned to on-standard work. Then, on May 13, 2011, Patillo was restricted to two weeks of sit-down work only, which was not available, so he went out of work on May 13, 2011.
Patillo later filed a Form 33 Request for Hearing. No Form 60, 61, or 63 was ever filed. The parties later entered a consent order that Patillo suffered “some level of contusion to the lower back as a result of [the] accident.” Following a hearing, the Deputy Commissioner issued an Opinion and Award finding the low back injury compensable. The decision also awarded temporary total disability benefits between March 6, 2012 and the time of the hearing, but denied Patillo’s request for prior temporary total disability benefits between May 13, 2011 and March 6, 2012.
Defendants appealed to the Full Commission. It concluded that that the parties’ consent order created a rebuttable presumption that Patillo’s current low back condition was related to his compensable accident and that Defendants failed to rebut the presumption. Even without the presumption, the Commission concluded that Patillo had proven that his at-work injury caused ongoing non-mechanical back pain and awarded him ongoing medical treatment. The Commission also concluded that Patillo failed to prove that he was disabled after March 6, 2012 because he had not shown that he made a reasonable effort to return to work or that a job search would have been futile. Both parties appealed to the Court of Appeals.
The Court affirmed the Commission’s application of the Parsons presumption and conclusion that Defendants had not rebutted the presumption that Patillo’s medical treatment was related to the at-work injury. The Court cited the Parsons and Perez cases, noting that a presumption of compensability for medical treatment applies to future symptoms allegedly related to the original injury, not just for the original injury itself. The Court rejected Defendants’ argument that no presumption applied because they had only admitted the compensability of a low back contusion. The Court further concluded that Defendants had not rebutted the presumption of compensability because they were unable to show, through the medical testimony, that Plaintiff’s current low back pain was separate and distinct from his original work injury.
The decision again highlights the burden shift in accepted claims where Defendants must rebut the presumption that an injured worker’s medical treatment is related to the compensable injury. Unlike Wilkes, this decision does not radically extend the application of the Parsons presumption to injuries that are not “the very injury” accepted as part of the claim. Instead, it highlights the importance of investigating new injuries or conditions soon after they are discovered to determine whether evidence exists to rebut the presumption, and also to establish that there is evidence that new injuries and conditions are “separate and distinct” from the original accepted injury.
The Court also examined the issue of futility and reasonableness of the job search performed by Patillo. It reversed the Commission’s decision and stated that the determination that Patillo had not conducted a reasonable job search was not supported by competent evidence. The Court acknowledged that there is no set rule for determining the reasonableness of a job search and stated that, although the determination of reasonable is discretionary, the Commission must make findings of fact to support its determination of reasonableness. Therefore, the case was remanded to the Commission for further findings.
The holding in Patillo does not constitute as drastic a shift from the application of the Parsonspresumption as the Court’s holding in Wilkes. However, both cases are an important reminder to be prepared to produce evidence that additional claimed injuries are not causally related to accepted conditions. Also, stay tuned for further developments in the application and interpretation of the Parsons presumption by North Carolina courts.
