Larson’s Spotlight: Top 10 Cases for 2011 That You Should Know About

Larson’s Spotlight: Top 10 Cases for 2011 That You Should Know About

It’s time to look back on the past year’s top cases to help us identify possible national trends. While many of these cases are state decisions, there are far reaching implications to be found in each of them. Here’s our selection for the top 10 workers’ comp cases that you should know about:

1. KY: Franchisor May, Under Appropriate Circumstances, Be Considered "Contractor" and Liable for Workers' Comp Claims Filed by Employees of Uninsured Franchisees

Nothing in Kentucky's "contractor-under" statute [see KRS 342.610(2)(b)] prohibits a franchisor from being considered a general contractor and, therefore, liable for workers compensation liability to the employees of uninsured contractors under it, held the Supreme Court of Kentucky.  Reversing a decision by the state's Court of Appeals, which had earlier indicated that because the relevant statute did not mention franchisors they could not be deemed to be contractors, the high court held that under the facts of the case, as correctly found by an administrative law judge, the franchisor was not a contractor.  Quoting Larson's Workers' Compensation Law, § 70.06, the court reasoned that the franchisor-which franchised "Subway" sandwich shops-did not control the day-to-day activities of the franchisee, nor had it contracted out a "regular or recurrent part of its business" to the franchisee in an attempt to avoid the expense of workers' compensation benefits.  The court noted that the ALJ (and the Board) found that the franchisor was in the business of franchising, not selling sandwiches.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 Ky. LEXIS 166. Then click on the red button Search for Free. Note: If you haven't registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 70.06.

2. US: Circuit Courts of Appeals Hold "Byrd Amendments" Related to Black Lung Act Contained in "ObamaCare" Legislation Are Constitutional

The Third, Fourth, Sixth, and Seventh Circuit Courts of Appeals have all held that the "Byrd amendments" in the Patient Protection and Affordable Care Act, which reverse a 1982 amendment to the Black Lung Benefits Act ("the Act) that required survivors of a deceased coal industry worker to show a causal connection between the death and the deceased's pneumoconiosis-even if the deceased was drawing disability benefits under the Act at the time of his death-are constitutional. From 1982 until the PPACA amendment was enacted on March 23, 2010, a survivor, usually the miner's spouse, had to prove that pneumoconiosis caused the miner's death to be entitled to benefits, even if the miner was receiving benefits when he died.  As stated by the 3rd Circuit, the PPACA amendment automatically continues benefits to a miner's eligible survivors if the miner was entitled to benefits prior to death. The court rejected the employer's contention that the amendment was unconstitutional under the due process and takings clauses of the Fifth Amendment.

FREE VERSION: Access the Third Circuit case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 U.S. App. LEXIS 21631. Then click on the red button Search for Free. Note: If you haven't registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured Third Circuit case here. See generally Larson's Workers' Compensation Law, § 54.02.

3. PA: Refusal to Respond to Answer Question as to Immigration Status Is Insufficient to Support Suspension of Benefits

A Pennsylvania appellate court affirmed a decision of the state's Workers' Compensation Appeal Board that in turn had reversed a finding by a workers' compensation judge that suspended claimant's benefits because he was an undocumented alien ineligible to work within the United States.  The only evidence at the hearing related to claimant's immigration status was his refusal, on Fifth Amendment self-incrimination grounds, to answer a question proferred to him as to whether he was a naturalized citizen.  The appellate court agreed that the judge was justified in drawing an adverse inference from the claimant's refusal to answer, but the judge erred in relying solely on that adverse inference in finding that the claimant was an undocumented alien.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 Pa. Commw. LEXIS 527. Then click on the red button Search for Free. Note: If you haven't registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 66.03.

4. MT: Rehabilitation Benefits May Not Be Denied to Those Beyond Retirement Age

In a divided decision, the Supreme Court of Montana held that there was no rational basis to support the categorical elimination of rehabilitation benefits for claimants who are eligible for social security benefits as required by § 39-71-710, MCA and that accordingly, the statute violates the Equal Protection Clause of the Montana. § 39-71-710, MCA, deems "retired" any disabled worker eligible for social security retirement benefits. The statute eliminates permanent  partial disability benefits, permanent total disability benefits, and rehabilitation benefits for those disabled workers deemed "retired" by operation of the statute. It should be noted that injured workers had challenged the constitutionality of the provision twice in the past seven years.  In Reesor v. Montana St. Fund, 2004 MT 370, 325 Mont. 1, 103 P.3d 1019, the court held the statute violated equal protection as to claimants who had been denied permanent partial disability benefits based solely on their eligibility for social security benefits.  In Satterlee v. Lumberman's Mut. Cas. Co., 2009 MT 368, 353 Mont. 265, 222 P.3d 566, in contrast, the court held that the categorical elimination of permanent total disability benefits passed constitutional review, concluding that the age-based elimination of such benefits was rationally related to the legitimate governmental interest of providing wage-loss benefits that bear a reasonable relationship to actual wages lost.  The majority indicated the instant issue was similar to Reesor, the court indicated that social security benefits would not provide the injured worker with resources to receive rehabilitation benefits that could return him to work.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 Mont. LEXIS 202. Then click on the red button Search for Free. Note: If you haven’t registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, §§ 95.03, 157.03.

5. NJ: Court Affirms Death Benefits Award for Pulmonary Embolism Caused by Unusual Level of Inactivity

In Renner v. AT&T, 2011 N.J. Super. Unpub. LEXIS 1668 (lexis.com users) (free version) (June 27, 2011), a New Jersey intermediate appellate court addressed a number of important issues that arise from today's prevalent use of home-based workers. The underlying facts and court decision serve as a cautionary tale for both employers and home-based employees alike. 

Renner had been a salaried manager for AT&T for some 25 years at the time of her death. Although she had a "nine-to-five" job, she often worked at home all hours of the day and night to meet various AT&T deadlines. For example, on the evening before her death, Renner emailed a coworker at 12:26 a.m. When her son awakened at 7:00 a.m., Renner was at her desk in her home office. At 9:00 a.m., she called a coworker to say she was not feeling well, but would soon complete the project. She finished it at home, sent an email to a coworker at 10:30 a.m., and an hour later called 9-1-1 because she couldn't breathe. She was pronounced dead when she arrived at the hospital, having succumbed to a pulmonary embolism.

A workers' compensation judge awarded death benefits to Renner's surviving spouse in the face of New Jersey's enhanced causation standard governing cardiovascular injury or death [N.J.S.A. 34:15-7.2]. That standard, like similar provisions in other state Acts, generally requires the claimant to show that such an injury or death was produced by work effort or strain involving an event or happening "in excess of the wear and tear of the claimant's daily living."

The appellate court agreed with the compensation judge; Renner's work inactivity was greater than her non-work inactivity and her work inactivity caused her embolism in a material way. The court noted the conflict in medical evidence—the husband's medical expert concluded that Renner's effort of sitting at her home office desk for long periods of time contributed to a material degree in causing her death while the employer's expert opined that her embolism was more likely caused by a combination of Renner's risk factors (obesity, lack of exercise, use of birth control pills)—and observed further that the employee led a sedentary life in and out of work. Still, credible evidence supported the judge's finding that Renner’s work inactivity was greater than her non-work-inactivity.

6. LA: No Penalties Owed by Employer Where Delay in Payment Was Caused by Centers for Medicare & Medicaid Services

A Louisiana appellate Court held that penalties and attorney's fees could not be awarded to a worker where the employer did not timely fund the worker's Medicare Set-Aside account because it was awaiting approval from the Centers for Medicare & Medicaid Services.  The court concluded that penalties for nonpayment within thirty days were not owed because the employer's nonpayment was the result of conditions over which it had no control [see LSA-R.S. 23:1201G].

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 La. App. LEXIS 755. Then click on the red button Search for Free. Note: If you haven't registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 157.03.

7. WA: Federal "Economic Realities Test" Should Be Used to Determine Independent Contractor Status

An appellate court in Washington state has determined that the "Economic Realties Test" used by many federal courts in Fair Labor Standards Act cases is the appropriate standard for determining whether a worker is an employee or an independent contract.  While the primary issue before the court related to the state's Minimum Wage Act and not its workers' compensation law, the case would likely be followed for disputes involving injuries within the work place as well.  The economic realities test used by a majority of the federal circuits has six factors.  They are (1) the permanence of the working relationship between the parties; (2) the degree of skill the work entails; (3) the extent of the worker's investment in equipment or materials; (4) the worker's opportunity for profit or loss; (5) the degree of the alleged employer's control over the worker; and (6) whether the service rendered by the worker is an integral part of the alleged employer's business.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2010 Wash. App. LEXIS 2805. Then click on the red button Search for Free. Note: If you haven't registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 60.02.

8. OH: Injured Worker's Termination for Refusing to Take Drug Test Is Sustained

An Ohio appellate court affirmed a decision by a trial court that granted summary judgment to a former employer in a discrimination action filed against the firm by a former employee.  The employee had sustained a work-related injury and refused to take a post-accident drug test as requested by the employer.  The court indicated that the collective bargaining agreement in effect between the company and the union representing the injured worker clearly indicated that workers sustaining injuries on the job would be subject to drug testing.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2010 Ohio App. LEXIS 5355. Then click on the red button Search for Free. Note: If you haven’t registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 36.01.

9. KY: Settlement Agreement Not Final Where Reference Was Made to Medicare Set-Aside Allocation, But No Allocation Made

The Supreme Court of Kentucky determined that correspondence between the claimant's attorney and an insurance adjuster did not show the existence of a settlement agreement between the parties where the same correspondence indicated that the claim was to be settled for a lumps sum amount and that there was to be an allocation for a Medicare Set-Aside Account, but no such allocation was made.  The court reasoned that the allocation was an essential part of the settlement between the parties.

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 Ky. LEXIS 8. Then click on the red button Search for Free. Note: If you haven’t registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 157.03.

10. WI: Former Employee's Defamation Suit is Not Barred by Exclusive Remedy Provisions of Workers' Compensation Act

Reaffirming that a tort claim of defamation is generally barred by the exclusive remedy provisions of the Wisconsin Workers' Compensation Act, a state appellate court nevertheless reversed a trial court's grant of summary judgment favoring plaintiff's former supervisor and plaintiff's former employer because plaintiff was no longer an employee when the alleged defamatory statements were made.  

FREE VERSION: Access the case on lexisONE free case law. Click on tab for Free Case Law. Click on the radio button for Search by Citation. Enter this citation: 2011 Wisc. App. LEXIS 203. Then click on the red button Search for Free. Note: If you haven’t registered for free at lexisONE, you will be prompted to do so in order to access the free case law.

FULLY FEATURED VERSION: Lexis.com subscribers can read the fully featured case here. See generally Larson's Workers' Compensation Law, § 104.04.

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Source: Larson’s Workers’ Compensation Law, the nation’s leading authority on workers’ compensation law

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