In Diaz v. American Zurich Ins. Co., No. 05-16-01530-CV, 2018 WL 1081452 (Tex. App.—Dallas Feb. 28, 2018), the Dallas Court of Appeals held that the first certification of MMI and IR became final as to the claimant because she did not timely request a BRC and she could not rely upon the BRC request filed by the carrier to stop the 90-day clock from running. 
 
The designated doctor found that the claimant’s injury included stenosis and disc protrusions (the “Disputed Conditions”) and that the claimant was not at MMI for the Disputed Conditions. The carrier filed a BRC request to dispute the designated doctor’s determination of extent, MMI, and IR. The carrier also requested a post-DD RME. The RME doctor determined the compensable injury did not include the Disputed Conditions, and that the claimant was at MMI with a 0% IR for the carrier accepted injury.
 
The claimant never requested a BRC to dispute the first certification of MMI and IR by the RME doctor. The court found that the first certification became final under the 90 day rule. The court rejected the claimant’s argument that she was not required to file a separate BRC request on the same issues raised in the carrier’s request. The court held that Rule 141.1 requires a “disputing party” to file a request for a BRC “in the form and manner required,” and the rule does not provide that a “disputing party” may rely on a request for a BRC filed by another party.
 
The court also rejected the claimant’s argument that there was an exception to the ninety-day rule in the form of a clearly mistaken diagnosis because the RME doctor determined that her injury did not include the additional claimed conditions. The court held that the claimant was diagnosed with the disputed conditions prior to the RME exam and that the RME doctor had considered those conditions. Therefore, any error by the RME doctor in determining the compensable injury did not include the disputed conditions is not one of mistaken diagnosis. 
 

In Halferty v. Flextronics America, LLC, No. 13–16–00379–CV, 2018 WL 897979 (Tex. App.—Corpus Christi Feb. 15, 2018), the Corpus Christi Court of Appeals held that Flextronics, as the general contractor, did not “provide” workers’ compensation insurance coverage to its subcontractors for purposes of section 406.123(a) of the Act merely by requiring a subcontractor to obtain workers’ compensation insurance coverage; and therefore, it was not entitled to claim the exclusive remedy defense in response to a suit filed against it by a subcontractor’s employee.
 
Flextronics contracted with Titan Datacom, Inc. to install data cabling at a Flextronics Facility.  In the agreement, Titan agreed to provide workers’ compensation insurance coverage for the project.  Titan contracted with another company, Outsource, to assist in the data cabling.  Both Titan and Outsource had workers’ compensation coverage for their employees.
 
As bad luck will have it, an Outsource employee, Patrick Halferty, sustained a work injury when he was accidentally knocked off a ladder by a Flextronics employee.
 
Mr. Halferty obtained workers’ compensation benefits from Outsource’s insurance carrier. He also sued Flextronics for his injuries.  Flextronics filed a summary judgment motion arguing that Mr. Halferty’s suit was barred by the Act’s exclusive remedy defense because, as the general contractor, it was Mr. Halferty’s employer pursuant to section 406.123(a) of the Act.
 
The court held that to be entitled to the exclusive remedy defense, section 406.123(a) required Flextronics to do something more than “simply passing the onus of obtaining coverage to the subcontractor.”  The court suggested the “more than” might include providing for an alternate insurance plan in which Flextronics would provide coverage in the event that is subcontractors failed to obtain insurance. Or, the “more than” might include enforcement mechanisms built into its contract with subcontractors “—such as withholding payment, or deducting insurance premium costs—that would trigger in the event that the subcontractors failed to provide coverage to its employees.”

James Loughlin, Stone Loughlin & Swanson, LLP.

Effective April 1, 2018, insurance carriers must begin using the following revised plain language notices:
 
• PLN-3a (Notice of Maximum Medical Improvement and No Permanent Impairment)
• PLN-3b Notice of Maximum Medical Improvement and Permanent Impairment)
• PLN-3c (Notice of Maximum Medical Improvement and Estimated Permanent Impairment)  
 
The Division also amended the PLN-3b to allow the carrier to indicate that it disagrees with the doctor’s impairment rating, the carrier’s reasonable IR assessment, and that the payment is based on the carrier’s reasonable assessment.

A new study released March 6, 2018, compared the effectiveness of opioids to over-the-counter medications and found that opioids were “not better at improving pain that interfered with activities such as walking, work and sleep over 12 months for patients chronic back pain or hip or knee osteoarthritis pain compared to non-opioid medications.” The study can be found here:https://jamanetwork.com/journals/jama/article-abstract/2673971?redirect=true. This latest study is sure to add more fuel to the debate about the use of opioids to treat injured workers and raise more questions about the continued prescribing patterns of some doctors. 

There is a big party planned in Dallas on April 25th benefitting Kids’ Chance of Texas.  The Firm is a founding sponsor of Kids’ Chance and of the event and invites you to join the party.  Commissioner Brannon will be there, as will our first scholarship recipient, Christi Campbell.  Music, drinks, appetizers and a silent auction are planned. Tickets are only $30 per person!  If you want to attend, send an email tojstone@slsaustin.com or visit the Kids’ Chance website atwww.kidschanceoftexas.org. This is your opportunity to support this wonderful charity.  Together, we are working to ensure that as many kids as possible who have had a parent catastrophically injured or killed on the job in Texas can continue their educations after high school.
 
For more information about the BigGive fundraiser, please check out the website at:http://www.kidschanceoftexas.org/bigive/

Tom Kieselbach of CWK Law presented the 2018 Class of Fellows at the College of Workers’ Compensation Lawyers Induction dinner in Nashville, Tennessee on March 3, 2018. Fifty lawyers and judges from twenty-two states were inducted into the College.  The College was created in 2007 with assistance from the American Bar Association. Individuals are selected for their excellence in the field and ethics.

At least once a week this practitioner gets a call from an employer or adjuster asking whether New Jersey has a defense to accidents where the employee is found to be heavily intoxicated or under the influence of illegal substances.   The response is always the same: yes, there is technically a defense, but unfortunately the way the statute is written, it is almost impossible for an employer to prevail.

New Jersey is one of a few states in which the employer must prove that intoxication or the use of controlled dangerous substances is the sole cause of the injury.  It is not enough for an employer to prove that intoxication is the main cause or a substantial cause:  it must be the sole proximate cause.  If any other factor is involved, the employer loses.  In most states employers win if they can prove intoxication was a substantial or contributing cause.   How weak is the New Jersey defense? There is really only one published case in the last 50 years in which an employer has won on the intoxication defense in New Jersey!

If the employee can show that some other factor besides intoxication contributed in some way to the injury – like bad weather, a slippery floor, exhaustion from working too hard – the employer’s defense fails.  Frankly, it is almost impossible to exclude all other causes.  That point was driven home by the  New Jersey Supreme Court in Tlumac v. High Bridge Stone, 187 N.J. 567 (2006).  At the end of the opinion the Supreme Court expressed its own frustration with the regrettable language contained in the New Jersey statute.

In Tlumac the employee’s wife admitted that her husband usually drank 10 beers every weekend.  On the day of the accident, petitioner arose at 2:15 a.m. to begin his drive.  He drove 30 miles south on Route 31 with 77,000 pounds of Belgian block in his truck and then blacked out.  His tractor-trailer traveled 180 feet off the road, jumped the curb and traveled 66 feet on the shoulder, hit the guardrail and rubbed against it for 247 feet, struck a parked truck and then struck a utility pole.  The officer on the scene noticed an odor of alcohol, and petitioner admitted to drinking the night before.  An expert for the employer extrapolated that petitioner’s blood alcohol level was between .10 and .18 at the time of the accident, well above the legal limit.

The employer denied the claim based on intoxication being the sole cause of the accident.  The Judge of Compensation, Appellate Division and the Supreme Court all ruled against the employer and in favor of the petitioner on compensability because the employer could not prove the sole cause defense.  Other factors may have played a role in the accident, such as petitioner’s exhaustion from working too many hours in the days prior to the accident. He had worked over 200 hours in the prior two week period of time.  He also testified to exhaustion from repairing the roof of his home the night before the accident.   Justice Wallace, who wrote the decision, conceded that the New Jersey statute “may no longer comport with current policies at deterring the dangers of drinking and driving.  Nevertheless, any change in that interpretation must come from the Legislature.”

Twelve years after the Tlumac decision, nothing has been done by the Legislature to address the situation that Justice Coleman addressed, namely deterring the dangers of drinking and driving.  As hard as it is for employers to win on an intoxication defense, it is even harder for employers to win when illegal drugs are found in the employee’s system because it is scientifically impossible for an employer to pinpoint exactly when the illegal substances were used.  Many drugs, like marijuana, remain in the system for days, if not weeks.

One must wonder what the social policy was that the Legislature was trying to promote many decades ago when the sole cause language was written into law.  A cynic might conclude that the purpose was to sanction the practice of employees coming to work somewhat inebriated.  The truth is that intoxicated employees not only risk injury to themselves but may also imperil the lives of others.  Yet as of 2018 heavily intoxicated employees who are injured at work or those under the influence of illegal substances remain eligible for workers’ compensation, even if the use of alcohol or drugs was the major cause of the accident.  The reason is that the major cause is not the same as the sole cause.

A change in the law to “substantial cause” instead of “sole cause” would benefit all New Jersey residents and would send the correct message that employees must keep alcohol and illegal substances out of the workplace.   The present statute was written at a time when the two martini lunch was perhaps considered socially appropriate.  But those days should be long gone.

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

The concept of reconstructing wages for permanency awards pertains to part-time workers with serious injuries.  For example, consider an employee who works 20 hours per week earning $10 per hour.  The employee has a serious injury that prevents the employee from earning the same amount of money or prevents the employee from working full-time in the future.  The wage is $200 per week giving rise to a permanency rate of $140 per week.  Assume that the award is 50% permanent partial disability payable over 300 weeks.  Unreconstructed the award would amount to $42,000.  (300 times $140).   If the Judge were to reconstruct the wage to $400 per week (40 hours times $10 per week in a customary work week), the rate would be $280 per week with the award being $84,000. (300 weeks times $280).  That reconstructed award to a 40-hour work week would be double the unreconstructed award.

As a reminder, the New Jersey rate chart that all practitioners have at their desks cannot be used for low wage employees.  The front of the rate chart is for high wage earners (those subject to maximum rates due to high wages).  If one were to pay based on a 2017 rate chart, the award would be 300 weeks or $179,400.  That would be an overpayment of $137,400!

Remember also that the minimum for temporary disability benefits is much higher than the minimum for permanency benefits ($35). In 2017 the minimum rate was $239 for temporary disability benefits but the minimum for permanent partial disability benefits was $35 per week.  That minimum rate has been $35 per week for many decades.

So when should a judge reconstruct an employee’s wages?  The rule comes from Katsoris v. South Jersey Pub. Co., 131 N.J. 535 (1993).  The Supreme Court said, “The critical inquiry is whether petitioner has demonstrated that her injuries, while disabling her from engaging in part-time employment, have disabled or will disable her with respect to her earning capacity in contemporary or future part-time employment.”

Let’s consider a few scenarios:

1. The part-time employee is able to return to his or her full-time job but can no longer engage in the part-time work due to the disabling injury. Reconstruct?  No, according to the Supreme Court in Katsoris.  If the employee can return to her prior full-time job with no wage loss in that full-time job, the employee has not satisfied the test because the employee cannot show material impairment in full-time earning capacity.
2. The part-time employee was earning $800 per week in her full-time job, which requires physical skills, but now cannot engage in physical work. Her employer transfers her to a lower paying non-physical job paying $400 per week due to the work injury.  Reconstruct the award?  Yes, because the employee has proven a material impairment in full-time earning capacity.
3. The part-time employee decides to spend more time with her growing family and cuts back hours from 20 per week to 15 per week. Reconstruct the award?  No, because the employee’s decision to reduce hours is not related to the work injury but is rather a personal decision.  But suppose the employee could only work 10 hours per week part-time because the disabling injury prevented her from working her normal 20 hours?  Then the Judge would properly order reconstruction because there is proof of a contemporary loss of wage earning capacity.
   
   
4. The part-time employee lost her full-time job earning $1,000 per week while out one full year recovering from the serious work injury suffered on the part-time job. The employee was skilled in package handling and now cannot get any job at all other than a full-time minimum wage job.  Reconstruct the part-time wage? Yes, because the work injury clearly has had a material impact on the employee’s full-time earning capacity.  She cannot get a similar full-time job paying wages she had earned before.

What happened to Ms. Katsoris?  She had a part-time job delivering newspapers, which was the work that caused her serious injury.  She was no longer able to do that part-time physical job on account of the work injury.  However, she was able to return to her full-time secretarial job.  The Appellate Division stated that the wage should be reconstructed, but the Supreme Court reversed and said it should not be reconstructed because petitioner did not prove an impairment of full-time earning capacity since she was able to resume her full-time secretarial job.  So the focus must always be on whether there is a material impact on contemporary or future earning capacity.

Here’s the last point to remember about wage reconstruction.  One does not always reconstruct to 40 hours per week. That is most common but it could be more or less hours, depending on what is a normal work week.  The Supreme Court makes clear in the Katsoris case that the judge should determine the customary number of hours and the customary number of days constituting an ordinary work week before reconstructing.  So if the normal work week is 50 hours per week, then the multiplier should be 50 instead of 40.

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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.