View From the Bench

Workers’ Comp Docket

Significant workers' comp legal decisions from around the country.
By: | November 28, 2016 • 12 min read

Benefit Limit for Undocumented Workers Unconstitutional

Martinez v. Lawhon, et al., No. M2015-00635-SC-R3-WC (Tenn. 11/21/16, unpublished)

Ruling: In an unpublished decision, the Tennessee Supreme Court held that a law limiting the maximum permanent partial disability benefits an injured undocumented worker can receive is unconstitutional.

What it means: In Tennessee, the law limiting the maximum permanent partial disability benefits an injured undocumented worker can receive is unconstitutional.

Summary: An undocumented worker was operating a lawn mower on a hillside in the course of his employment when he slipped on wet grass and fell, losing control of the mower. The mower ran over his left arm, causing severe injuries.

Because of the worker’s undocumented status, the employer did not return him to work after the injury. The worker sought workers’ compensation benefits and challenged the constitutionality of a law limiting his award to one and one-half times the medical impairment rating. The Tennessee Supreme Court held that the provision is unconstitutional.

According to the law, the permanent partial disability benefits that a worker who is not legally allowed to return to work because of federal immigration law can receive are limited to a cap of one and one-half times the medical impairments rating. The court pointed out that other workers who do not fall within this exception are entitled to a multiplier of up to six times.

The court found that the provision was preempted by federal immigration law. The legislative history of the provision showed that the legislature intended for an additional sum to be paid by employers as a penalty. The court explained that the provision was preempted by federal law because the legislature intended and attempted to establish what amounted to a state immigration policy.

The court also explained that by reducing the liability of employers of undocumented workers to one and one-half times the medical impairment rating, the law made it less costly to hire those workers and potentially created an incentive for employers to hire undocumented workers, especially in high-risk jobs that often result in workers’ compensation claims.

In this case, the court found that the worker sustained an 84 percent permanent partial impairment to the left arm as a result of his work injury.

Attorney Fees Warranted When Employer’s Actions Delayed Surgery

Bockus v. First Student Services, et al., No. S-15784, 7137 (Alaska 12/02/16)

Ruling: The Alaska Supreme Court held that a driver was entitled to attorney’s fees because the employer resisted furnishing medical care by unreasonably delaying his third surgery.

What it means: In Alaska, an employer’s acquiescence to a claim before a hearing does not prevent a finding that the employer resisted providing the benefit.

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Summary: A school bus driver injured his back while pulling open a chain-link gate. He felt a pop in his back and severe pain radiating into his legs. He had two spinal surgeries, and his surgeon recommended a third. At about the same time, the employer scheduled an independent medical examination. This delayed the surgery because the surgeon would not schedule the surgery while the IME was pending.

The driver filed a workers’ compensation claim for the third surgery, and the employer’s doctor ultimately agreed that a third surgery was appropriate. The Alaska Supreme Court held that the driver was entitled to attorney’s fees because the employer resisted furnishing medical care by unreasonably delaying the third surgery.

The driver asserted that the employer delayed his surgery because it “had ample information” about the compensability of the surgery before the IME. The employer argued that it was merely exercising a statutory right to an IME and it rescheduled the IME at the driver’s request.

The court pointed out that the employer authorized the third surgery when it was required to answer the driver’s claim. The court pointed out that an employer’s acquiescence to a claim before a hearing does not prevent a finding that the employer resisted providing the benefit.

The court explained that the IME was not directed at an opinion about the surgery itself. Instead, the adjustor listed nine treatment options and asked for an opinion about the reasonable necessity of all treatments.

The court found that this broad request was not reasonable because the driver and his surgeon, after trying conservative care, had decided that surgical treatment was the best option for addressing his condition.

The court pointed out that the employer had adequate information about the reasonable necessity of the surgery well before the surgery was authorized. The information the employer sought from the IME was not reasonably related to the narrow question of the compensability of and the need for the requested surgery.

Inability to Obtain Job Doesn’t Warrant Benefits for 100 Percent Loss

Hathorn v. ESCO Corp., No. 2015-WC-01528-COA (Miss. Ct. App. 11/15/16)

Ruling: The Mississippi Court of Appeals held that a grinder was entitled to benefits for a 50 percent industrial loss.

What it means: In Mississippi, the fact that an injured worker is unable to obtain employment is not conclusive proof that he is unemployable.

Summary: A grinder for ESCO suffered a compensable injury to his right hand while operating his grinder. He returned to work with medical restrictions, including not using a grinder and to not lift more than 50 pounds. At work, he performed various janitorial and maintenance duties and ran errands.

After he claimed that his hand swelled from driving a forklift, the grinder was terminated for insubordination when he did not provide a written work restriction stating that he could not operate a forklift. The Workers’ Compensation Commission awarded him benefits for a 50 percent industrial loss. The Mississippi Court of Appeals affirmed the commission’s decision.

The grinder claimed that because of his injury he was unable to find work and could no longer perform the substantial acts of his usual employment. However, the court found that the grinder’s post-injury employment at ESCO demonstrated that he could perform some of the substantial acts of his usual employment.

He worked for more than a year after he reached maximum medical improvement. The court also pointed out that the grinder’s post-injury employment was consistent with a number of previous jobs he had. Also, many of the grinder’s previous job duties were within his medical restrictions.

The court found that even though the grinder’s job search was not successful, this was not conclusive proof that he was unemployable. The grinder admitted that he did not seek employment in the security, maintenance, or housekeeping fields.

Assault By Student Doesn’t Fall Under Intentional Act Exception

Field, et al. v. Lafayette Parish School Board, No. 16-495 (La. Ct. App. 11/09/16)

Ruling: The Louisiana Court of Appeal held that a teacher’s suit was barred by the exclusive remedy provision of the workers’ compensation law. The teacher failed to establish that the intentional act exception applied.

What it means: In Louisiana, for the intentional act exception of the workers’ compensation law to apply, the worker must prove an employer’s intent, which is defined as consciously desiring the physical results of the conduct or knowledge that the physical results were substantially certain to follow such conduct.

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Summary: A student of a high school English teacher had a dispute with another student and attempted to leave the classroom to fight with him in the hallway. The teacher tried to keep the student inside the classroom by holding the door closed, but the student hit her repeatedly in the stomach.

The teacher was six weeks pregnant. Later, the teacher’s child was born with a congenital kidney condition. The teacher received workers’ compensation benefits but also sued the Lafayette Parish School Board, the principal of her school, and the student.

The teacher asserted that the intentional act exception of the workers’ compensation law applied. The Louisiana Court of Appeal held that the teacher’s suit was barred by the exclusive remedy provision of the workers’ compensation law.

The court concluded that the intentional act exception did not apply. For the intentional act exception to apply, the worker must prove an employer’s intent, which is defined as consciously desiring the physical results of the conduct or knowledge that the physical results were substantially certain to follow such conduct.

In this case, the court found that the teacher failed to prove the school board’s intent for the harm that occurred in her classroom. While the student had an extensive history of disciplinary issues, the school board’s knowledge of his issues and readmittance into the high school did not amount to an intentional act.

The court pointed out that no evidence showed that the student had previously attacked a teacher.

Director Who Tripped on Stairs Not Entitled to Compensation

Mojares v. RK Chevrolet, Inc., No. 1016-16-2 (Va. Ct. App. 11/22/16, unpublished)

Ruling: In an unpublished decision, the Virginia Court of Appeals held that a director’s fall on stairs did not arise out of his employment.

What it means: In Virginia, a worker who trips while walking up a staircase at work cannot recover compensation unless something about the steps presented a hazard or danger peculiar to the work site.

Summary: A finance director for a car dealership was in a hurry to deliver paperwork for a sale when he fell while walking up stairs. The director had preexisting injuries that left him permanently partially disabled. His gait was affected, he had limited use of his right hand, and he walked with a cane.

When the director fell, he was holding files and his cane in his left hand and using the railing for the stairs with his right hand. He could not explain what caused his fall and said that he tripped himself. The Virginia Court of Appeals held that he was not entitled to benefits.

The director argued that his preexisting condition combined with the configuration of the stairs increased his risk of falling. The court concluded that the director failed to establish that his injury arose out of his employment. The record established that the director simply and inexplicably fell.

The court also explained that under the idiopathic fall doctrine, if a fall results from a preexisting condition, any resulting injury is compensable only when the conditions of the workplace aggravate the worker’s injury.

Here, the director fell while simply walking up the non-defective steps. The record showed that the director’s fall was not caused by his preexisting conditions. The court found that his injury was not causally related to his employment.

Intoxication Doesn’t Block Benefits When Flat Tire May Have Caused Accident

Diaz v. National Retail Transportation, Inc., No. A-3927-14T2 (N.J. Super. Ct. App. Div. 11/09/16, unpublished)

Ruling: In an unpublished decision, the New Jersey Superior Court, Appellate Division held that a mechanic was entitled to benefits for his injury.

What it means: In New Jersey, when a worker’s intoxication is the “natural or proximate cause” of an injury, benefits will not be provided. Courts have interpreted the intoxication defense to mean that the worker’s intoxication must be the sole cause of the accident.

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Summary: A mechanic for National Retail Transportation was injured when he attempted to move a heavy metal lift that fell over on him. He said that the lift fell when it tilted to one side. The mechanic said that after the lift fell on him, he noticed that one of the tires on the lift was flat.

National conceded that a tire was deflated. The mechanic filed a claim for workers’ compensation benefits. National denied benefits and asserted the intoxication defense, arguing that the mechanic’s intoxication was the proximate cause of the accident.

The mechanic admitted that before going to work, he drank at least two eight-ounce glasses consisting of half whiskey and half ice water. National’s toxicologist opined that, based on the blood sample drawn from the mechanic after the accident, that he was intoxicated and impaired at the time of the accident.

The New Jersey Superior Court, Appellate Division held that the mechanic was entitled to benefits.

The court concluded that substantial credible evidence established that the flat tire may have caused the lift to fall, and therefore, intoxication was not established to be the sole cause of the accident.

The court found there was sufficient evidence that the flat tire may have also contributed to the accident. Without testimony eliminating the flat tire as a cause of the accident, the court found that National did not carry its burden to prove that the mechanic’s intoxication was the sole cause of the accident.

Comp Doesn’t Cover Officer’s Crossfit Injury

Maley v. Borough of Penbrook, 31 PAWCLR 191 (Pa. W.C.A.B. 2016)

Ruling: The Pennsylvania Workers’ Compensation Appeals Board reversed the workers’ compensation judge’s finding that a police officer was in the course and scope of his employment when he was injured while performing box jumps at a CrossFit gym.

What it means: In Pennsylvania, where a police officer is not required by either the employer or the SWAT team to join a CrossFit gym or perform box jumps as a part of any physical fitness test, his injuries sustained while performing this activity do not fall within the course of his employment.

Summary: The board reversed the WCJ’s finding that a police officer was in the course and scope of his employment when he was injured while performing box jumps at a CrossFit gym.

The employer had a wellness and fitness policy, which recommended that the officers stay physically fit so they can perform their duties in a safe and healthy manner. Because the employer did not have a workout room, the officer joined a CrossFit gym.

He also was a SWAT team member for the county. His participation in the SWAT team was not required by the employer. In denying benefits, the board noted that the officer’s participation in the employer’s physical fitness program was completely voluntary.

The employer did not mandate that the officer undergo any physical fitness tests, and choosing not to participate in the testing would not result in disciplinary action.

Also, although the officer’s involvement with the SWAT team required him to undergo periodic fitness testing, his participation in that program was not a mandatory part of his employment.

In addition, the officer was not required by either the employer or the SWAT team to join a CrossFit gym or perform box jumps as a part of any physical fitness test.

Christina Lumbreras is a Legal Editor for Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at [email protected]

Catastrophe Risk

Material Resiliency

New materials, methods and ideas are empowering property owners to rein in their catastrophe risks.
By: | October 12, 2017 • 11 min read

The 2017 hurricane season is one for the record books. Rebuilding efforts are underway, with builders working to make insureds whole again as soon as possible … at least until the next storm comes along.

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And therein lies the problem with recovery in disaster-prone regions. It evokes the oft-quoted definition of insanity: Doing the same thing over and over again and expecting a different result.

So what if we did it differently? What if instead of rebuilding to make structures “like new,” we rebuilt to make them better, more resilient, less prone to damage?

The reality is, we don’t really have a choice. Climate change is ushering in weather systems that are increasingly volatile. Wildfires are raging like never before. Sea-level rise is threatening our coasts, and there’s no way to dial any of it back.

Nevertheless, people will continue to build homes and businesses along the coast. Real estate developers will continue to nestle luxury homes into wooded foothills.

That means communities need to come to terms with the risk and plan for it intelligently.

Michael Brown, vice president and property manager, Golden Bear Insurance

“Natural disasters are going to happen,” said Michael Brown, vice president and property manager with Golden Bear Insurance. “But if we plan and build communities around the idea that something bad may happen someday, then that community can bounce back faster afterward.”

In any natural disaster, he added, “the property damage is extreme. But the biggest portion of the losses, both insured and uninsured, are the time element pieces. How long was the business closed? How long were homeowners unable to occupy their homes? Those are the pieces that drag on for months — years in some cases — and really drive the economic loss.”

That’s the motivation behind new materials, designs and strategies being implemented in the construction and repair of at-risk residential and commercial properties.

Powerful Flood Solutions

Newer building products move the needle significantly in terms of efficacy.

For new or restored structures in flood-prone regions, Georgia Pacific produces gypsum panels that incorporate fiberglass mats instead of paper facings and comply with the latest FEMA requirements for flood damage resistance and mold resistance. Wall boards made from magnesium oxide (MgO) don’t absorb water at all and have the added benefits of being environmentally friendly and non-flammable.

In the UK, advanced flood-resilient structures built with water-resilient concrete-block partitions are being fitted with not only MgO wallboards, but also wood-look porcelain or ceramic flooring that’s non-permeable and fire-resistant — without sacrificing aesthetics. Drains are installed in the flooring, along with sub-flooring gullies and submersible pumps that push the water back outside. Outlets and appliance motors are all situated above expected flood levels. Doors are equipped with sliding flood panels.

In the event of flooding that exceeds a depth of two feet, automatic opening window panels (flood inlets) are triggered by sensors to allow flood water to enter the property slowly, to reduce external pressure that could damage the structure.

Carl Solly, vice president and chief engineer, FM Global

Controlled inflow buys time for a homeowner to raise furniture up on blocks, or for a business owner to raise pallets of goods up to higher shelves or move equipment to a higher elevation.

Water intrusion is reduced dramatically, and even when it happens, there is little to no damage. Water is pushed into the floor drains, surfaces are allowed to dry, and then it’s back to business as usual in days rather than months — likely with no insurance claim filed.

Dramatic improvements are happening on this side of the pond as well. For entities that need permanent on-site flood solutions, barriers like flood gates and retractable flood walls are the most sophisticated they’ve ever been.

After suffering $4 billion in damage during Superstorm Sandy, New York’s Metropolitan Transit Authority invested heavily in flexible fabric flood panels that are made with Kevlar® and can be unrolled quickly and easily. Additional flood gates hinged to air grates are passively activated by the weight of incoming water entering the grates.

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The transit authority is also testing a prototype “resilient tunnel plug” — essentially a giant air bag that can be deployed quickly to seal off sections of subway tunnel. The plug is designed to withstand not only flood but also biochemical attack.

Even temporary solutions are leaps and bounds beyond the days when sandbagging was typically the best option. New as-needed barrier methods include inflatable bladders that can be placed around a building’s perimeter and filled with water to keep floodwater and flood debris at bay.

“People have always said, ‘Well, I’m in a flood plain, it’s inevitable. It’s an act of God,’ ” said Carl Solly, vice president and chief engineer, FM Global. “In the last several years, we’ve really been trying to deliver the message that you can do something about your flood risk.”

Shake, Pummel and Burn

Flood is far from the only problem benefiting from smart engineering. FM Global is working with manufacturers to develop and certify roofing material designed to better withstand the localized hailstorms that often plague southeastern and midwestern states.

Current materials rated for severe hail can withstand hailstones up to 1 ¾ inches in diameter. The new product, rated for “very severe” hail can tolerate hailstones up to 2 ½ inches. The difference sounds small, but it’s far from it.

“It’s about three times the amount of impact energy when it hits the roof [compared to a 1 ¾ hailstone],” explained Solly. “That’s a big difference.”

As for “bouncing back” after a catastrophic fire, Solly said that’s a fairly tall order. But even there, technology is helping to reduce the severity of fires so that disruption is minimal.

FM Global researchers recently pioneered the concept of SMART sprinklers — shorthand for Simultaneous Monitoring and Assessment Response Technology — which can sense a fire earlier than traditional systems and activate targeted sprinkler heads when needed and shut off once the fire is out.

“You’ll catch it with less water, so from a water usage perspective, a water damage perspective and a smoke damage perspective, we think that has an opportunity to be a big difference-maker in the fire protection industry, particular with high-challenge fires,” said Solly.

“You’ve got a better chance of stopping what normally would be a really tough fire to catch.”

In addition, added Brown, smarter sprinkler systems, much like burglar alarms, could be programmed to notify the fire department instantly, even when a structure is unoccupied.

For earthquake risk, said Brown, resilient building efforts are less about new materials than they are about more strategic ways of using traditional materials.

“Here in California we wrap homes in stucco around the wood frame to help the whole building move as a unit. Stucco is concrete so it does crack. I end up with a building that’s got some cosmetic damage … but you don’t have to rebuild the building. It does its job in terms of absorbing a lot of the ground motion before it pushes the building beyond its design tolerances.”

Using stronger, larger steel brackets where the walls meet the roof or the floor or each other, said Brown, “keeps the north wall from moving in one direction while the west wall moves a different direction.”

Those kinds of stress points can push modest earthquake damage to catastrophic levels, he said.

One earthquake innovation still in the beta phase is a project out of the U.C. Berkeley Seismological lab, using the accelerometers in smartphones as virtual seismometers. Participating phones have an app that detects certain types of ground motion. As phones pick up earthquake wave patterns, they ping the server which checks nearby smartphones to see if they sensed the same pattern, all in microseconds. If an earthquake pattern can be confirmed, an alarm will be sent to every cellphone within a logical radius.

That might only buy people an extra two to five minutes before the event, said Brown, “but if you are the operators of Bay Area Rapid Transit commuter trains, that’s enough time to slow all the trains down to five miles an hour. If you are Google, that’s enough time to park a bunch of hard drives in your server farm so that they’re better able to resist shaking and not be damaged too badly.”

Raising Standards

Cost, of course, will impact the take-up of resilient materials and tools. If it’s three times more expensive to build a home out of the resilient materials, a lot of builders aren’t going to want to because the home will be tougher to sell.

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FM Global’s Approvals division tests and certifies a variety of products aimed at mitigating disaster peril. That can help increase property owner confidence in these materials, particularly for commercial structures.

“When you’re betting millions of dollars and the future of your business — or at least the near-term future of your business — you really need to know that it’s going to work,” said Solly.

With just-in-time manufacturing, a company may have a few days’ worth of stock on hand rather than three months’ worth.

“So you can’t afford to be out of business for weeks, because your customers are going to go somewhere else for your product,” he said.

Building standards and codes can help drive adoption of resilient measures in both commercial and residential construction. But more work needs to be done to raise standards to meet the goal of resilience.

Effecting real resilience is something leaders across the spectrum should be talking about, including brokers and carriers, government and research agencies, building products manufacturers, and corporate executives.

If lives are saved in an earthquake, but a building is still damaged to the point where it needs to be torn down, said Brown “that building owner, that community, is going to have a much longer path to full recovery. We want the building codes strengthened to an immediate occupancy [goal] — we want people to be able to move right back into that building so there’s a much shorter window of disruption.

“It’s certainly better for me as the insurer,” he said, “but it’s even better for the guy that owns the building or runs his business out of it because now his employees still have a place to come to work and they can still get paid.”

Every single business able to minimize its downtime in this way helps the entire community be more resilient, he added. It creates that snowball effect in a good way. When businesses are able to stay open or reopen quickly, he said, workers don’t lose a meaningful amount of pay. Everybody’s in a better position to continue shopping and supporting the local economy.

“If you just shorten the line of people who are looking for some sort of federal aid, or state aid because they’ve had a massive financial disaster — maybe we can turn those into moderate to small financial disasters. That’s the key, I think, to communities being more resilient.”

Driving Demand

As the likelihood increases that property owners will experience a second loss or even third loss, some insurers are looking at ways to invest in resilience — a smarter long-term business plan than paying to rebuild again and again.

One new initiative is Lex Flood Ready, the product of a partnership between Lexington Insurance and The Flood Insurance Agency (TFIA). Flood Ready is a coverage enhancement for Lexington Private Market Flood clients that will not only indemnify property owners that suffer flood damage but will also provide the funds to rebuild them to a higher standard of resiliency when replacing floors and walls.

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Resilience proponents advocate a variety of approaches to encourage take-up, including tax credits, resilience grants, insurance incentives and other partnerships, as well as encouraging lenders to engage borrowers by making the flood risk assessments part of the mortgage process.

A certification scheme similar to LEED could also help drive resilience efforts. The UK is currently beta-testing a certification program called Home Quality Mark, developed by the Building Research Establishment (BRE). Properties are rated on stringent criteria that considers not just disaster resilience, but energy performance and cost, durability and environmental impact.

“Getting people from diverse perspectives thinking about it and talking about it is going to be the avenue to finding the right answers.” — Michael Brown, VP and property manager, Golden Bear Insurance

That’s something builders would be able to use to add value to their properties, offsetting the cost of building in resilience and driving consumer demand for properties built to the highest standards.

With increased resilience will come questions for insurers, said Brown. “It will open up a can of worms.”

It will create something of an arms race among insurance companies, he said. “Who’s going to be the first one to figure out what’s the right way to insure that? What’s the right price? What are the right terms and conditions?” Admittedly, it’s a good problem to have.

Effecting real resilience is something leaders across the spectrum should be talking about, including brokers and carriers, government and research agencies, building products manufacturers, and corporate executives.

“Getting people from diverse perspectives thinking about it and talking about it is going to be the avenue to finding the right answers,” said Brown.

“That kind of mentality top to bottom in the industry is going to be necessary. It’s not the first time we’ve dealt with disruptive things and we will continue doing it. It’s what keeps the game interesting.” &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]