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Risk Scenario

The Man on the Jack

An energy company drops the ball by not making the necessary accommodations for an injured employee returning from documented leave.
By: | August 18, 2015 • 10 min read
Risk Scenarios are created by Risk & Insurance editors along with leading industry partners. The hypothetical, yet realistic stories, showcase emerging risks that can result in significant losses if not properly addressed.

Disclaimer: The events depicted in this scenario are fictitious. Any similarity to any corporation or person, living or dead, is merely coincidental.

On the Muscle

When his supervisor waved to him, Early Hart took one hand off of the jackhammer trigger, plucked the earbud out of his right ear and picked up his head in acknowledgement.

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“Whatcha got?” Early shouted to his boss, the clattering, echoing din of the jackhammer coming momentarily to a halt.

“Break time!” shouted his boss. “Put that hammer down and come get out of the sun!”

“Don’t want to break. Wanna work,” Early shouted back at him, smiling.

Early wiped at his brow with a grimy backhand. Sweat was pouring down his face, the bulging muscles of his arms and his burly torso.

“Break!” the boss said as an answer, still smiling back. Early did as his boss said and set the jackhammer down to rest on the pile of broken asphalt he was creating in the middle of Green Avenue.

Early strode confidently to where his boss and a handful of other workers were already gathered under an enormous sycamore. The gate to his boss’ pickup truck was down and the guys were pulling drinks of iced tea out of an enormous orange thermos.

The son of a local alderman, Roger Hart, Early made a name for himself at a young age, as a Gloucester County New Jersey high school football star. College wasn’t for him though, and he thought himself lucky to have landed a job with KMF Energy Solutions, working on a gas line replacement crew for the utility.

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It didn’t hurt that his boss was his father’s cousin, Frank Walter. Frank eyed Early admiringly as he came forward to join his co-workers under the shade of the tree.

“You’re a strong young man, but if you want to stay strong in this heat you better hydrate!”

Early took the cup of iced tea Frank offered. He had no argument with a cold drink of tea in this heat and humidity.

“It’s all good,” he thought as he sipped his tea. Lowering his cup, he spied his SUV, with two surfboards strapped to the top of it. In two and half hours he’d be in the water.

***

When Early paddled into the surf break, the other nearby surfers gave him plenty of room.

Early had a reputation as one of the best amateur surfers on the East Coast.

Even without knowing his reputation, anyone with sense could deduce that the owner of muscles like those didn’t need to worry about objections over sharing a wave. He could clearly take care of himself or any shoreline disputes that came his way.

The swells that day were big. Some kind of a storm must have been working its way up from the Caribbean.

Early surfed one big wave, then another. He was joyous in the feeling of immeasurable strength that a young man has in taking on the ocean and feeling no fear.

That’s when it happened.

Early knew these waters well, but no one knows everything, and in this case Early’s undoing was a sand bar that had built up where he wasn’t expecting one. A big breaker drove him into it.

The wave flipped Early and he hit the sand bar hard, with his lower body extending over the edge of it and his lower back taking the brunt of the wave’s force.

It was all Early could do to stagger to the beach. He felt crippled.

“Hey! Hey Early!” one of the other surfers yelled.

Early was mobile, but after being examined by a doctor, he was placed on eight weeks of short-term disability with a severely strained lower back.

An Uneasy Feeling

Back at work, Early was under orders from the doctor to take it easy for a while. His injury was expected to fully heal, but for now a dull pain and unfamiliar physical limitations remained for the normally strong and capable man. But Early’s relative Frank Walter knew the way of the world. Frank felt he needed to protect Early and shield his condition.

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Frank gave Early lighter duty, but he didn’t formally ask for an accommodation for Early from human resources. Early was given jobs like operating the hose to keep dust down or working traffic control, but his pay rate and job classification remained the same.

Frank walked up to Early one day as Early stood morosely at the edge of the job site, holding a sign that said “stop” on one side and “slow” on the other.

“What’s the matter with you?” Frank asked Early.

“I’m bored,” Early said.

“Be happy you’ve got a job,” Frank said under his breath.

“What do you mean?” Early asked.

“Things are getting tight around here,” Frank said. “I’m hearing some rumors about layoffs.”

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One of Early’s co-workers walked by. He was the kind of person who tended not to mind his own business and he liked to start trouble.

“Same pay, lighter duty. Must be nice,” the co-worker said, eyeing Frank and Early malevolently.

“You mind your own business Johnny,” Frank said to him. “Get over there and load the concrete saw onto the truck like I told you to do a half hour ago!”

Johnny ambled off, in no big hurry.

“I’d fire that coyote tomorrow!” Frank said under his breath, for only Early to hear.

But it was Frank who lost his job, the very next day, as part of a KMF management reshuffle.

Early had been back at work only three weeks when he got a new boss, Del Miller. Miller didn’t know Early, but Early’s ginger approach to his work gave Miller a bad first impression, albeit a mistaken one.

“That guy’s just flat-out lazy,” Miller said to himself as he watched Early pick up a single two by twelve at a time instead of two or three like his co-workers did.

“Is there something the matter with you, young man?” Miller asked Early one morning, after they’d been working together for a week.

“No sir, nothing,” Early said, not anxious to be overly candid with a new supervisor he barely knew.

“Mama’s boy,” the troublemaking Johnny said under his breath to Del Miller the next Monday, as Early ducked working the concrete saw and instead picked up a hose and watered the street to keep the dust down.

With KMF’s managers under pressure to cut costs, Early was terminated by the disapproving Del Miller, five weeks after coming back from short-term disability. Del Miller wanted someone who could perform all the requirements of the job.

Lawyering Up

Roger Hart was not the type to baby his son, but when Early was terminated, Roger consulted with a friend, Avery Fischer, who was known as one of the best labor attorneys in the state of New Jersey.

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The Thursday after Early was terminated, he had a meeting with Avery Fischer in Avery’s office in Trenton.

“When you got back to work after your injury, did anyone within KMF discuss with you what you were and weren’t able to do within your job duties?” Avery asked Early.

“No sir, they didn’t,” Early said.

“Did the company offer you any kind of accommodation, say a desk job or a job driving where you wouldn’t be called on to do so much physical labor, or an official adjustment in your current job?” Avery asked Early.

“Not officially. After Frank lost his job, I was back to normal expectations on the same job, working as a laborer on the road crew.”

Roger Hart was at the meeting with Avery and Early, and it was at this point in the conversation that Avery turned to Roger with a meaningful glance.

“It looks to me, Roger, that KMF is in clear violation of the Americans with Disabilities Act Amendments Act here.”

“How so?” Roger said.

“The company initiated no dialogue with Early, made no effort to check in with him, talk to him about his back injury.”

“And?” Roger said, guessing that there was more to it.

“And they made no attempt to determine if a reasonable accommodation would allow him to continue employment. By leaving him on the road crew – in the same job with the same expectations – to get picked off by this new supervisor, they hung an injured man out to dry. That’s a clear violation,” Avery said.

Roger Hart needed to hear no more. KMF had gotten rid of his cousin, who worked for the company for 14 years, and then they’d terminated the apple of his eye, his son Early, who he knew as a hard-working young man, bent on achievement.

“So, what do we do?” Early said, turning to the two older men.

“We sue,” Roger said.

Avery nodded his head in agreement.

“We sue.”

KMF’s defense attorneys, displaying the same inadequate knowledge of the ADAAA as the company’s line managers, decided to take the case to court.

They got hammered.

Avery Fischer argued that KMF Energy Solutions failed to comply with the ADAAA in three substantial ways:

  • The company failed to maintain a dialogue, in fact didn’t dialogue at all with a worker who had a lingering disability, in Early’s case, an injury-weakened back.
  • The company made no attempt to recognize the limitations of their employee and determine whether his current job could be modified to allow him to continue to perform the essential job requirements – or if there was another job within the company he would be qualified for and would be possible within his limitations – a clear violation of the act.
  • The company terminated an employee for performance issues without first reviewing all of the facts to ensure whether the situation was truly a performance issue or if the performance issue was due to a medical condition from his recent and known eight-week short-term disability.

The judge agreed and KMF Energy Solutions was hit with a penalty judgment that ran in the low to mid six figures.

The next one to lose his job was Del Miller.

Webinar – Compliance crossroads: How are you navigating the intersection of ADA/ADAAA and workers’ comp, disability or leave?

Watch Sedgwick delve deeper into ADA/ADAA compliance with our sister publication, Human Resource Executive®.

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Risk & Insurance® partnered with Sedgwick to produce this scenario. Below are Sedgwick’s recommendations on how to prevent the losses presented in the scenario. This perspective is not an editorial opinion of Risk & Insurance®.

1. Appoint your experts: When compliance is on the line, someone in your organization needs to be well-versed in ADA/ADAAA and the interactive process. This may not be your front line managers. Appoint someone to be responsible for triggering the accommodation process and engaging appropriately when employees return from a workplace injury, a non-work injury or illness or another medical need.

2. Document, document, document: Companies need to make sure that standard procedures regarding leave or accommodation under the Family Medical Leave Act or the Americans with Disabilities Act are in place, up to date and triggering interactive process review – as well as clearly communicated to employees and supervisors. A robust information management platform is key to supporting the process and necessary documentation.

3. Alternative options: If you are able, offer a chance for those in need of accommodation to be reassigned to another job, even temporarily. Sometimes time off from work may be the best or only option; although the goal of ADA/ADAAA is to keep people at work and every effort should be made to meet an accommodation request, supervisors need to keep in mind that there may be cases where an accommodation within someone’s current position isn’t possible or advisable due to the nature of their job or the significant hardship it would place on the business.

4. Consistency: Different injured employees with debilitating conditions should be treated with consistency under the Americans with Disabilities Act, regardless of whether their need for accommodation is due to a work-related injury, a non-occupational injury or illness or for another medical need. Don’t treat employees differently based on whether they need temporary vs. permanent accommodation, based on their type of leave or based on personal feelings.

5. Medical review: Make sure you request and document medical reviews of any request for accommodation as part of the overall interactive accommodation process.

Additional Partner Resources

ADA Accommodation Services

White paper: Managing the new ADA

edge magazine: Keys to compliance

Sedgwick Connection Blog

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Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]

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The Profession

The risk manager for Boyd Gaming Corp. says curiosity keeps him engaged, and continual education will be the key to managing emerging risks.
By: | May 1, 2018 • 4 min read

R&I: What was your first job?

I was trained as an accountant, worked in public accounting and became a CPA. Being comfortable with numbers is helpful in my current role, and obviously, the language of business is financial statements, so it helps.

R&I: How did you come to work in risk management?

Working in finance in the corporate environment included the review of budgets and the analysis of business expenses. I quickly found the area of benefits and insurance — and how “accepting risk” impacted those expenses — to be fascinating. I asked a lot of questions. Be careful what you ask for — I soon found myself responsible for those insurance areas and haven’t looked back!

R&I: What is the risk management community doing right?

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I have found the risk management community to be a close-knit group, whether that’s industry professionals, risk managers with other companies or support organizations like RIMS and other regional groups. The expertise of the carriers and specialty vendors to develop new products and programs, along with the appropriate education, will continue to be of key importance to companies going forward.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

As I’m sure many in the insurance field would agree, Hurricanes Katrina and Rita in 2005 changed our world and our industry. It was a particularly intense time and certainly a baptism by fire for people like me who were relatively new to the industry. This event clearly accelerated the switch to the acceptance of more risk, which impacted mitigation strategies and programs.

Bob Berglund, vice president, benefits and insurance, Boyd Gaming Corp.

R&I: What emerging commercial risk most concerns you?

The fast-paced threat that cyber security represents today. Our company, like so many companies, is reliant upon computers, software and IT expertise in our everyday existence. This new risk has forged an even stronger relationship between risk management and our IT department as we work together to address this growing threat.

Additionally, the shooting event in Las Vegas in 2017 will have an enduring impact on firms that host large gatherings and arena-style events all over the world, and our company is no exception.

R&I: What insurance carrier do you have the highest opinion of?

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With the various types of insurance programs we employ, I have been fortunate to work with most of the large national and international carriers — all of whom employ talented people with a vast array of resources.

R&I:  How much business do you do direct versus going through a broker?

We use brokers for many of our professional coverages, such as property, casualty, D&O and cyber. We are self-insured under our health plans, with close to 25,000 members. We tend to manage those programs internally and utilize direct relationships with carriers and specialty vendors to tailor a plan that works best for team members.

R&I: Who is your mentor and why?

I have been fortunate to have worked alongside some smart and insightful people during my career. A key piece of advice, said in many different ways, has served me well. Simply stated: “Seek to understand before being understood.”

What this has meant to me is try everything you can to learn about something, new or old. After you have gained this knowledge, you can begin to access and maybe suggest changes or adjustments. Being curious has always been a personal enjoyment for me in business, and I have found people are more than willing to lend a hand, offer information and advice — you just need to ask. Building those alliances and foundations of knowledge on a subject matter makes tackling the future more exciting and fruitful.

R&I: What have you accomplished that you are proudest of?

Our benefit health plan is much more than handing out an insurance card at the beginning of the year. We encourage our team members and their families to learn about their personal health, get engaged in a variety of health and wellness programs and try to live life in the healthiest possible way. The result of that is literally hundreds of testimonials from our members every year on how they have lost weight, changed their lifestyle and gotten off medications. It is extremely rewarding and is a testament to [our] close-knit corporate culture.

R&I: What’s the best restaurant you’ve ever eaten at?

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Some will remember the volcano eruption in Iceland in spring of 2010. I was just finishing a week of meetings in London with Lloyd’s syndicates related to our property insurance placement when the airspace in England and most of northern Europe was shut down — no airplanes in or out! Flights were ultimately canceled for the following five days. Therefore, with a few other stranded visitors like myself, we experimented and tried out new restaurants every day until we could leave. It was a very interesting time!

R&I: What is the riskiest activity you ever engaged in?

I am originally from Canada, and I played ice hockey from the time I was four years old up until quite recently. Too many surgeries sadly forced my recent retirement.

R&I: What do your friends and family think you do?

That’s a funny one … I am a CPA working in the casino industry, doing insurance and risk management, so neighbors and acquaintances think I either do tax returns or they think I’m a blackjack dealer at the casino!




Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]