Recently in Compensability Category

December 3, 2014


At his blog Working Immigrants, Peter Rousmaniere has been tracking various public policy, health and work issues related to the underground economy of undocumented workers since 2006. His blog is a go-to source for research, think tank studies, major reportage and more, with a heavy focus on workers' comp. His topical expertise is good reason for you to follow him as this issue evolves and a good starting point is his recent analysis of the impact of the Executive Order on workers' compensation.

"The Order will force the workers' compensation field to address issues that have been lying in plain sight for some time. After all, one-fifth of work injuries are likely sustained by a foreign-born workers, 10% by undocumented workers, whether or not they are reported.
Will the administration's policy cause a jump in claims? Will it close down grey market labor abuses or open up a Pandora's box? Will it make it easier to enforce work safety standards or sow confusion?"

His analysis addresses the states that will see the greatest effect:

"According to the Pew Hispanic Center, undocumented workers form the highest share of workforces in Nevada (10%), California (9.7%), Texas (9%) and New Jersey (8.6%). California has the largest number of people in the labor force who are unauthorized immigrants (1.85 million), followed by Texas (1.1 million), Florida (600,000) and New York (450,000.)." well as the industry segments that will be most affected:

Major sectors with undocumented worker employment are farming, construction, hospitality, and institutional (building and grounds maintenance). About four out of every 10 farm workers are undocumented, hence the expectation, of which we will hear more, that providing work rights to these workers will cause food prices (especially fresh produce) to increase. However, farming's size is dwarfed by the combined size of these other sectors, in which an average 12% of workers are illegal.
Take construction. A fifth to one quarter of lost-time compensable injuries sustained by all undocumented workers are sustained in construction. The typical image of the illegal construction worker is the low skilled laborer. About a fifth of them are estimated to be unauthorized. But a fair number of painters and other skilled workers are also illegal.
Take hospitality, which includes lodging and restaurants. About 20%-25% of room cleaners and cooks are undocumented workers.
For every 10 lost-time compensable injuries sustained by undocumented workers, about five of them take occur in either construction or hospitality. Maybe only one takes place in farming.

He also discusses the potential impact on claims and on employers and insurers.

Here are other related recent blog posts from Working Immigrants:

Arguments pro and con re legality of Executive Actions

Pew Hispanic Center's estimates for the Executive Action

Some specifics about the Obama Administration's "Executive Actions"

How Obama devised his Executive Order

Reagan and Bush Sr. used executive orders for immigrants

Chronology of recent news about Executive Orders to come

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June 16, 2014


This morning, Work Comp Central's Mike Whiteley published a well-researched 2,500+ word article focusing on the plight of undocumented immigrant workers who get hurt on the job. His article, Immigration Reform Expected to Impact Comp Systems, highlights the attempt of the National Employment Law Project to push for passage of immigration reform legislation adopted by the U. S. Senate last year. The legislation would make it much easier for undocumented workers to collect workers comp benefits following injury on the job. It is unfortunate that, given recent political machinations (see Eric Cantor, John Boehner, et al), the Senate's legislation has as much chance of being passed anytime soon as a thrown strawberry has of putting a hole in a battleship.

As of 2013, twenty-eight U. S. state Supreme Courts have ruled that undocumented immigrants are entitled to workers comp benefits. Only one, Wyoming, has ruled otherwise.

We've been writing about this since 2004 - ten years. In 2005 we wrote:

It's one of our nation's dirty little secrets: immigrant workers are doing some of the nation's most dangerous jobs, are being injured and dying disproportionately in those jobs, and denied benefits when injuries and deaths occur. In a political climate where the rhetoric and emotions are high and seemingly getting higher by the day, a "blame the victim" mentality is pervasive.

Unfortunately, the only thing that seems to have changed in ten years are those court rulings. But just because a worker is entitled to benefits doesn't mean the worker is going to get them. And that, I think, is the primary thrust of Mr. Whiteley's article.

In addition to the quite understandable fear of undocumented workers that if they report an injury they'll likely face aggressive retaliation, there is the little problem of a social security number (SSN), which, by definition, undocumented workers don't have. At least, not legal ones. In any event, an SSN seems to be required on the First Report of Injury (FROI). And that's where the trouble begins, because as soon as an injured undocumented worker gives a fraudulently obtained SSN, ICE, Immigration and Custom Enforcement, comes calling.

I say, "seems to be required," because, although the FROI does have a block for the SSN, more and more states are allowing workers to choose to have a random number assigned to them, rather than the SSN. Trouble is, many workers don't know this. It will take time for this to catch on.

Meanwhile, as Mr. Whiteley reports, many workers get caught in the Catch 22 of the "seemingly required" SSN. Moreover, it is not unusual for ethically compromised employers to do everything in their power to prevent benefits being awarded to undocumented workers they have hired. I call these employers American Predators, because they hire workers they know to be in the country illegally and then kick them smartly to the curb when they get hurt on the job. This is probably why experts think that only a small percentage of undocumented worker injuries ever get reported into the workers comp system.

There's an interesting twist to this story. In addition to Mike Whiteley's article, Peter Rousmaniere, working independently, published his own column in Work Comp Central this morning on the same subject. Peter has long advocated for better treatment of undocumented workers, even going so far as to create a blog in 2006 on the subject - Working Immigrants.

Immigration reform seems to be a bridge too far right now. I fear that undocumented workers will continue to be workers compensation's bastard stepchildren. And that is shameful.

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April 18, 2014


This morning, ABC's Good Morning America shone its media arclight on Cathy Caswell as she spun the great big wheel on The Price is Right, not once, but twice. But while doing so Ms. Caswell was drawing $3000 per month in workers comp indemnity payments, according to ABC. And she was collecting those payments because of a shoulder injury, which prevented her from standing, running, reaching or grasping, as reported by ABC's eagle-eyed Cecilia Vega. Vega "reported" that Caswell was one of "the countless people accused of faking an injury" to the tune of "hundreds of millions of dollars."

The report then cut to some fraud words of wisdom from private eye, "master of disguise" (not my words; they're Vega's), Bob Keane who fancies himself cut from the James Bond cloth. Keane claimed that if you're committing fraud the only way to avoid being caught by him is "by completely staying in your house for three to five years," because if you venture outside he's going to "get you."

By using phrases like "countless people" and "hundreds of millions of dollars" ABC implies that Ms. Caswell is merely the tip of a very big iceberg. Frankly, I think Ms. Vega skipped Philosophy 101 - Aristotelian Logic. You know, the part about faulty inductive arguments going from the particular to the general? But I digress.

We all know that there are people who commit workers comp fraud. In fact, some of them are workers who fake injuries or malinger trying to milk the system. But the fraud committed by workers is dwarfed by that of many others in the system.

Consider Devon Lynn Kile and her husband Michael Petronella. In 2010, while Ms. Kile sought to appear on the Bravo TV series "The Real Housewives of Orange County," the couple gained a different kind of notoriety when federal authorities, after raided their three roofing businesses as part of a two year probe, charged them with 31 felony counts involving tens of millions of dollars of underreported workers comp premiums. Petronella went to jail for 10 years, and Kile was sentenced to 10 years probation and ordered to make $2.8 million in restitution.

There are many dimensions to fraud in the workers comp system. While many people think of fraud primarily as a problem involving employees, in dollar terms most fraud is committed by other players in the system. There are opportunities for wrong-doing in virtually every financial transaction within a system that generates multiple billions of dollars every year.

Just to be clear, fraud can be committed by, yes, employees, but also by employers (see Devon Kile), attorneys, medical providers, claim adjusters, insurance agents and even investment firms (see the "Coingate" scandal in Ohio).

Despite the many opportunities for fraud in the comp system, outright fraud is relatively rare. The vast majority of transactions within the comp system, involving all of the above players, are carried out with integrity and good faith. Nonetheless, vigilance is always necessary to ensure that comp dollars are spent prudently and wisely.

ABC has scheduled an expanded report on Ms. Caswell, et al, this evening on its World News Tonight program. It should make for some interesting, if infuriating, entertainment, faulty logic and all.

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March 27, 2014


We lost two firefighters in Boston, yesterday.

A 9-alarm fire on Beacon Street in Boston's Back Bay, aided by 45 to 50 mile per hour winds off the Charles River, took the lives of Lt. Edward J. Walsh and Firefighter Michael R. Kennedy. Walsh, 43, was married with three children; Kennedy, 33, was a Marine Corps veteran. They were trapped in the basement of the four story apartment building when a window blew out, the winds rushed in and part of the building exploded.

Deputy Chief Joseph Finn said, "In 30 years, I've never seen a fire travel that fast."

Once again, we are reminded that firefighting is a lot like combat, a lot of waiting for something to happen, and then the world falls in.

This, from today's Boston Globe, should give one a sense of the emotional trauma of the event:

After the seventh alarm sounded, all firefighters were ordered from the building through a haze of screams and sirens. But when word came that some firefighters were missing, some vowed to go back in.

"No companies should be going in anywhere; stay away from the building," firefighters were instructed in the mayday call.

"We are aware of the potential we see in front of us; we're going back inside the building," came the reply.

But the firefighters were told, "Stay out of the building."

It took five hours to recover Walsh's body. As he was carried out on a stretcher, all the firefighters formed an Honor Guard line. "Everyone saluted him, and Eddie was taken for his last ride," said Steve MacDonald, a Fire Department spokesperson. If that doesn't stir emotions inside you, then you have something other than blood coursing through your veins.

Reminiscent of the 1972 Hotel Vendome fire just a couple of blocks away that killed nine firefighters, and the 1999 Worcester Cold Storage Warehouse fire that took the lives of six, yesterday's inferno sledgehammers us with the understanding that firefighting is a deadly business.

Seeing the soot-covered, teary faces of the men and women who watched Lt. Walsh take his "last ride" made me think of the other end of the pole, the sometimes messy business of workers comp.

In most states, injured workers are given two-thirds of their average weekly salary (60% in Massachusetts), tax free, while they're recovering and unable to return to work. Police and firefighters, on the other hand, public sector employees, receive 100% of their average weekly salaries, also tax free. In essence, it's a promotion.

This different treatment can sometimes anger taxpayers, usually when abuse occurs. And abuse does occur, not often, but when it does it can make headlines. In Massachusetts, we vividly remember the case of Albert Arroyo, a 20-year veteran of the Fire Department, who, after being deemed "totally and permanently disabled," which allowed him to receive 100% of his salary, tax free, made the Boston Globe front page when he finished eighth in the 2008 Pro Natural American Bodybuilding Championship, with a picture to prove it.

Although Arroyo was acquitted of fraud charges in 2011 by a federal jury, the whole thing left a bit of a stink. US Attorney Carmen Ortiz, Boston Mayor Tom Menino and just about everyone else in authority complained loudly and in print that justice had not been done.

We all want our tax dollars spent well, but every once in a while, like yesterday, we come up against two truths that won't go away: First, protecting the citizenry can be a tragic and deadly business; and second, with the exception of soldiers, I don't know of any other occupations where people give their lives in the line of duty to protect others. Do you?

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July 29, 2013


John Pike may be the most (in)famous campus cop in America. He was video taped on November 18, 2011, at the University of California, Davis, spraying seated demonstrators with pepper spray. His demeanor was remarkably casual, as if he were spraying bushes for an infestation of bugs. He is now the subject of a meme that has spread across the internet, with images of Pike spraying Christina, in the famous painting by Andrew Wyeth, among other things. While we live in a culture where many are famous for being famous (the Kardashians come to mind), Pike is famous for one moment of his policing career.

An internal investigation by the university recommended that Pike be demoted. New police chief Michael Carmichael - the original chief had resigned - rejected that recommendation, deciding, in July of 2012, to fire Pike. There were a number of problems with Pike's behaviour: he used an unapproved pepper spray that was three times stronger than the university's preferred brand and he violated university protocol by spraying people in the face at close range.

Enter Workers Comp
Pike has filed a stress claim under the California workers comp statute. The state used to be famous for its lenient criteria for stress claims: only 10 percent of the stress had to be work related for a claim to be compensable. (How could work not comprise at least 10 percent of what is wrong in one's life?) Over time, California tightened up the compensability guidelines, which now total six (as outlined by the Kenton Koszdin Law Office):

1.The employment must be six months or more. Check
2.The employee must have a psychiatric condition that is listed in DSM IV. Probably a check.
3.The employee must prove that the actual events of employment are the predominant cause of the psychiatric condition (51% or more). Definitely a check.
4.A psychiatric condition that is substantially caused (35%--45%) by good faith, non discriminatory personnel action(s) is not compensable as a work-related injury. Examples of good faith personnel actions are criticism of the employee's work or attendance, change in work assignments, and decision about raises or promotion. The employer has the burden of proof on this issue. DNA.
5.A psychiatric injury that is caused by the litigation process is not compensable. Examples of psychiatric injury caused by the litigation process are an employees reaction to the denial of their claim, dealing with an abusive claims adjuster, or having their benefits terminated.DNA
6.A stress claim or mental--mental psychiatric injury claim filed after termination or notice of termination is not compensable unless the employer know of the injury or medical records of treatment for the psychiatric dated prior to the termination exist. He filed on June 10, presumably before the notice of termination.

A Mental-Mental Claim
Pike must prove compensability of the notoriously difficult "mental-mental" claim. In many states, there must be a physical injury that precedes the mental disability. In this case, the physical injury was limited to the protesters; the university settled their claims for $1 million. In the immediate aftermath of the incident, Pike in his new-found infamy has been subject to harassment, threats and humiliation. He is the principal subject of a meme that has spread throughout the internet. Stressful? Certainly. Compensable? Possibly, but by no means a certainty.

Pike's former employer will try to show that he violated policy in spraying the students, including the use of an unapproved spray. Pike will undoubtedly try to show the ambiguity of the university's policies, perhaps a lack of training specific to the circumstances he faced.

In the meantime, Pike has lost a job that paid in excess of $100,000 per year. He has achieved indelible fame for a single, ill-advised work-day decision. He is without a doubt suffering from work-related stress - stress of his own making - but the compensability of that stress is another matter altogether. We await the results of the August conference with great interest.

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July 23, 2013


Back in 2009, we blogged an expose from the New York Times concerning the abuse of independent medical exams (IMEs) in New York. The article quoted 79 year old Dr. Hershel Samuels, who performed as many as 50 exams in a day. He filled out a checklist and let others write the reports. Did he read these reports? "I don't," he said. "That's the problem. If I read them all, I'd have them coming out of my ears and I'd never have time to talk to my wife. They want speed and volume. That's the name of the game."

Muckraking journalism apparently did not solve New York's IME problem. Which brings us to orthopedist Michael Katz, who makes a pretty good living performing, among other things, about 1,000 IMEs a year for the state of New York. [Details can be found at the invaluable Workcompcentral (subscription required).] After examining an injured worker, Manuel Bermejo, Dr. Katz wrote up his findings. In testimony, he declared that he spent 10 to 20 minutes with Bermejo. Unfortunately for Dr. Katz, Bermejo secretly recorded the session, which lasted just four seconds shy of 2 minutes.

Tantrum in the Court
When presented evidence of the IME's duration, Queens Supreme Court Judge Duane Hart went ballistic. "How do I stop carriers from putting people like Dr. Katz on the stand and causing the state to spend thousands and thousands of dollars trying a case and putting a lying witness on the stand?" Judge Hart referred the transcripts of the proceedings to a Queens administrative law judge for potential perjury action against Dr. Katz.

The judge's rage is understandable: IMEs are a vital activity in workers comp: in theory, IMEs offer a fresh, objective look at a worker's injuries to determine what, if anything, is wrong, the extent of the disability and the role work played in it. In an ideal world, the IME is dispassionate, with no vested interest in the ultimate determination of compensability.

Good Faith, Bad Faith, No Faith
Dr. Katz claims he has been set up by plaintiff attorneys, who believe he acts primarily to further the interests of insurance carriers. (Here is a link to a plaintiff attorney's blog featured Dr. Katz and other alleged abusers of IMEs.) On the other hand, there are surely IME doctors who tend to find in favor of injured workers and are thus favored by plaintiff attorneys, .

The world of medicine is supposed to be driven by objective medical evidence, but doctors are hardly robots, evidence is in the eye of the beholder and what the doctor sees might well be influenced by political views, personal history and, yes, even financial considerations.

It is interesting to note that the Bermejo claim began in the workers comp system, where the benefits are limited to lost wages and medical costs. Because the injury involved a fall from heights, the claim also fell under New York's unique - and understandably unreplicated - Scaffold Law. But the claim now involved literally millions of dollars: Bermejo was suing the hospital where he was treated for malpractice. It is this last suit that brought Dr. Katz into Judge Hart's courtroom. The judge was hoping for an objective analysis of the claim in order to determine whether the hospital had really screwed up. Alas, he ended up with no faith whatsoever in the quickie IME performed in the proverbial New York minute.

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May 7, 2013


In the Insider's decade of exploring workers comp, we have encountered many unusual instances of compensability, legitimate claim denials and outright fraud. But rarely have we found cases where a claims administrator, in this case, a TPA, simply refuses to pay for medically necessary treatment. The saga of the late Charles Romano reminds us that the great bargain of workers comp is not just between employers and their workers; it includes the good faith effort of claims adjusters to carry out the letter - and spirit - of the law.

Charles Romano worked as a stocker for Ralph's Grocery Company, a California-based operation that is part of the Kroger chain. It is worth noting from the outset that Kroger is self-insured for comp, with Sedgwick serving as the TPA. As a stocker, Romano presumably did a lot of lifting and reaching. He suffered a work related injury involving his shoulder and back in August of 2003.

A Solution Worse than the Problem
After conservative treatment failed to resolve the problem, he underwent surgery in December 2003. What had seemed like a relatively simple solution to a shoulder problem quickly descended into a grave, life-threatening situation: Romano contracted a MRSA infection following the surgery, which led directly to total paralysis. He suffered renal failure and several heart attacks, which were related to the MRSA infection. After enduring inadequate medical treatment directly related to the TPA's denial of treatment, Romano died in May 2008.

Nearly three years after the initial surgery, a workers comp administrative law judge (WCJ) ordered that the TPA pay for all the medical expenses related to the infection. Without consulting with medical professionals, the TPA unilaterally refused all payments - totalling, by this time, hundreds of thousands of dollars. The TPA appealed the adverse ruling.

In February 2012, a workers comp administrative law judge imposed penalties for delay of treatment in eleven specific instances, finding that the TPA "failed in its statutory duty to provide medical care, egregious behavior which increased the suffering of a horrifically ill individual." He imposed the maximum $10,000 fine for each denial of treatment.

Unappealing Appeal
The TPA appealed the penalties for delayed treatment. In what surely qualifies as a new definition of chutzpah, the TPA contended that penalties were not appropriate, among other reasons, because the claimant had died. Well, duh, the routine denial of treatment throughout the course of the illness was a significant factor in the death. Romano simply did not receive medically necessary treatments to address his formidable medical conditions.
NOTE: The penalties, even when maxed out at $10,000 per incident, is dwarfed by the suffering inflicted upon Romano.

The Workers Comp Appeals Board upheld the penalties [For a link to a PDF of the lengthy ruling, Google "Charles Romano Trust vs. Kroger Company]:

The WCJ's Report makes it clear that he imposed the harshest penalties possible under section 5814 because of defendant's extensive history of delay in the provision of medical treatment; the effects of those delays on a paralyzed, catastrophically ill employee; the lengths of the various delays; and defendant's repeated failure to act when the delays were brought to its attention.

Lest the ruling be considered in any respect ambiguous, the court went on to say: "We have rarely encountered a case in which a defendant has exhibited such blithe disregard for its legal and ethical obligation to provide medical care to a critically injured worker."

Risk Transfer, Risk Retention
It is tempting to conclude that the TPA's actions were related to their customer's risk assumption - otherwise known as self insurance. It is one thing to purchase insurance (risk transfer) and have the insurance company assume liability for a catastrophic loss. It is quite another for a self-insured company to absorb a loss of this magnitude on its own. (Presumably Kroger had some form of stop loss in place.) Despite the multiple findings of compensability, despite the judicial determination that the horrendous MRSA infection was indeed work related, the TPA persisted in denying treatments and rejecting payments, long after Romano's untimely death.

As Mark Twain famously noted, "denial is not just a river in Egypt." It's also a poor strategy for managing claims. In his last years, the unfortunate Charles Romano certainly had to confront health issues beyond anyone's worst nightmare; denial for him was not an option. For reasons that remain unclear, when it came to paying for Romano's extensive and expensive care, the TPA chose a path of full catastrophe denial .

In the findings of the court, this denial was in itself an unmitigated disaster for the acutely vulnerable Romano, accelerating his precipitous decline and death. In the interests of saving their client some serious bucks, the TPA dug in its heels and refused to accept the compensability of a claim that had been adjudicated as compensable. In doing so, they violated the spirit and letter of the workers comp contract and earned themselves, in this particular instance at least, a place on the Insider's Management Wall of Shame.

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April 8, 2013


Ben Ciccone Inc. is a construction company that confronts formidable risks every working day. They are involved in excavation, site development, bridge construction and, if that isn't risky enough for you, blasting and demolition. Most underwriters would give them a quick pass. So it is ironic that they are dealing with a permanent total disability claim involving a tiny, barely visible tick.

Worrell Bailey was doing some work in the woods back in July 2008 when he was bitten by a deer tick. He contracted Lyme Disease. When he began to suffer from upper body muscle weakness, he quit his job. He filed for workers comp benefits, which were granted. He underwent several courses of antibiotics, but he did not get better.

By June of 2009 his condition had worsened to the point where a judge deemed him permanently and totally disabled. Ben Cicconne appealed, alleging that there was no definitive link between Bailey's progressive deterioration and Lyme disease. The carrier presented the opinions of several neurologists, who could not state "with certainty" that Bailey's Lyme disease was the cause of his motor neuron disease. In other words, Lyme disease might be the cause of Bailey's disability and then again, it might not.

Dueling Doctors
Bailey's doctors were convinced of a causal relationship. His treating physician stated that by March 2009, Bailey suffered from significant muscle atrophy that rendered him totally disabled, which the doctor attributed to Lyme disease. Samuel Koszer, a board-certified neurologist, testified that Bailey's progressive muscle weakness and consequent total disability were causally related to Lyme disease. Finally, Bailey's psychiatrist - treating him for anxiety and stress relating to his diagnosis - testified that the lyme disease had prompted an autoimmune reaction that resembled amyotrophic lateral sclerosis (ALS). The psychiatrist went on to criticize the comp carrier for denying benefits, which interrupted the course of treatments and may even have made the situation worse. These strong, unambiguous opinions were, in the language of claims adjusting, not very helpful to the defense.

The award of permanent total benefits was upheld by the Appellate Division of the Supreme Court of New York, Third Department. Thus Ben Ciccone Inc, a high risk operation by any definition, finds itself responsible for a very expensive claim involving the kind of risk we all face when we go for a walk in the woods. Luckily for Ciccone, they appeared to carry conventional insurance, so the impact of the claim on their costs through experience rating has already run its course. For the carrier and its underwriters, however, this little tick will go on ticking for a long, long time.

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March 26, 2013


Imagine identical injuries to two workers: one is a junior college graduate, the other lacks a high school diploma;one can read and compute fairly well, the other reads at the 8th grade level and performs math at the 6th grade level. The injury involves failed back syndrome, with the injured worker experiencing fairly constant pain and the inability to perform sustained physical work.

In the world of workers comp, the first worker is deemed "employable" and entitled to temporary total benefits, followed (in some states) with a lump sum settlement for permanent loss of function. The second worker, lacking the education and skills to transfer to another job, is awarded permanent total disability benefits. In the two claims involving identical injuries, a marginal education pays.

For many years, Missouri resident Todd Grauberger worked for Atlas Van Lines, moving furniture and household goods. He performed heavy lifting routinely, avoiding physically demanding work only when driving from pick up point A to delivery point B. Ironically, his injury did not involve heavy lifting: in December 2001, he bent over to put padding on a nightstand - something virtually anyone could do - and felt an immediate pain in his back. His herniated disc required surgery. Even after some minor improvements, he continued to suffer from substantial pain and numbness in his legs. He was diagnosed with a phrase that terrifies any injured worker - and any claims adjuster: "failed back syndrome."

Grauberger filed for permanent total disability benefits. His employer countered with a vocational rehabilitation assessment that concluded - without directly interviewing Grauberger - that he could perform light factory work or perhaps drive a car or truck. But the claimant's doctor countered that with a failed back and almost no transferable (non-physical) skills, Grauberger was unemployable for any position that he might be qualified to hold. In other words, his only employable asset was the labor of his body and his body was irreparably broken. In a unanimous decision, the Court of Appeals in Missouri sided with Grauberger and upheld the award of permanent total benefits.

Hiring Conundrum
Employers do not give much thought to transferable skills when they hire new employees. They simply hire people qualified to do the work. Indeed, for jobs requiring sheer physical strength, it is often cheaper to hire the lowest skilled available workers. But workers comp, long the great equalizer, takes a post-injury look at employability. Once maximum medical improvement has been reached, the issue for workers comp is simple: the worker is either employable or not. If employable, benefits come to an end. If there are no transferable skills and no reasonable prospect of employment, the benefits may continue for the lifetime of the worker.

Grauberger will never again have to worry about finding gainful employment. Because he can offer nothing of value to the labor market, and because of his persistent, debilitating pain, he will be supported by workers comp indefinitely. It's an odd calculus, seemingly rewarding the absence of marketable skills beyond the strength in one's body. In this Missouri case, limited skills and limited education secure a future well beyond the reach of a failed back and a failing body.

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March 18, 2013


Back in November we blogged the story of John Pearson, a diabetic whose tight workboots - provided by his Arkansas employer - caused a blister that led directly to diabetic neuropathy. The injury was deemed compensable under workers comp. Today we examine a similar blister saga involving Earl Sterling, a machinist for Eaton Corporation in Mississippi. Like Pearson, Sterling was diabetic, but his is a story with a grim outcome. When it comes to compensability, the devil is definitely in the details.

Once again, the story begins innocently with new boots. Sterling began wearing new steel-toed boots - required by his employer - in June 2008. His feet started throbbing immediately; within a week, a blister had developed. He took a week off, telling his supervisor that he had twisted his ankle: he did not report the blister problem. After the blister popped, Sterling sought treatment from his family doctor. Within three weeks of first putting on the boots, Sterling had developed a high fever and was delirious. During his hospitalization, he developed a staph infection, resulting in the amputation of his leg below the knee. By the end of the year, Sterling had reached maximum medical improvement and had been cleared for seated work.

Work Related?
In July 2008 Sterling filed for workers comp benefits, claiming the blister was the result of wearing the boots. But in the course of his testimony, numerous contradictions and inconsistencies emerged. His initial report only involved a swelling of his feet - nothing about a blister. Hospital records indicate that his diabetes was out of control for at least 90 days prior to hospital admittance. In his testimony, he was unclear about the exact nature of the blister: he stated it was on top of his fourth and fifth toes, but medical records indicated it was between the toes, where a friction blister is less likely to occur.

Given the inconsistencies, the administrative law judge denied the claim. The denial was upheld at the appeals level.

It turns out that Sterling's family physician may have misdiagnosed - or at least mistreated - the diabetes: while two years prior to the injury, the doctor had given Sterling medications for regulating blood sugar, he mistakenly believed that Sterling's current blood sugar levels were within normal ranges. They were not. Three physicians testified that the blister was a result of the swollen feet and Sterling's uncontrolled diabetic condition and was independent of the wearing of steel-toed boots.

"Arising From and In the Course and Scope of Employment"
Thus we have two cases involving diabetes: one in which the co-morbidity leads to a work-related and compensable infection (Pearson), and one where the co-morbidity itself - and not the work-required boots - leads to the infection that ultimately requires an amputation (Sterling). Pearson is able to return to productive employment, supported every step of the way by the robust benefits of the workers comp system. Sterling finds himself without a job and without benefits, literally, without a leg to stand on.

In this tale of two blisters, one has a reasonably happy ending, the other does not. In the annals of compensability, eligibility for comp benefits is - in this particular case, at least - subject to the highly rigorous and presumably objective scrutiny of medical science. Sterling ultimately loses his case because his narrative is full of holes and his devastating condition apparently did not arise from and in the course of his work as a machinist.

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February 25, 2013


We have long noted how the generous benefit structure in California encourages professional athletes to file claims long after their careers are over. These athletes need not play for teams based in California: just playing a few games in the state over the course of their careers opens the door for generous lump sum payouts and, more important, lifetime medical benefits. There is indeed "gold in them thar hills."

Marc Lifsher of the Los Angeles Times does a great job summarizing the impact of California comp law on professional athletes. Since the 1980s, $747 million has been paid out to 4,500 players. That is apparently just what's been paid - the $3/4 billion may not reflect what's been reserved for future medical payments.

California's statute is uniquely generous. It allows anyone injured while working in California to file a claim in the state. Even if the worker has been paid under another state's comp system, the door remains open. Professional athletes may settle out claims for a few hundred thousand dollars, but they may also secure lifetime medical benefits: given the concussed brains and frequent musculoskeletal injuries that are a routine part of professional athletics, the lifetime medical bills may be enormous. Finally, California has a worker-friendly definition of cumulative trauma, so a professional athlete need not prove a specific body part was injured during a game in that state.

Athletic Attorneys
A number of the lawyers specializing in these claims are former athletes. Mel Owens, a former Los Angeles Rams line backer, represents a number of out-of-state athletes filing claims. "California is a last resort for a lot of these guys because they've already been cut off in the other states," he says.

Lifsher describes the situation of journeyman tight end Ernie Conwell, who played for two out-of-state teams, including the New Orleans Saints. During his 11 year career, he underwent 18 surgeries, including 11 knee operations. He filed for comp benefits in Louisiana and received $181,000 to cover career-ending knee surgery in 2006. He also received $195,000 in injury-related benefits as part of the players's collective bargaining agreement. But the claim in Lousiana only covered his knee injury. So he filed a claim in California to deal with ongoing health problems that affect his arms, legs, muscles, bones and head. A California judge awarded him $161,000 plus future medical benefits. The payer in this case, the New Orleans Saints, has appealed.

Wrong Solution to a Real Problem
There is little question that retired players face formidable physical and mental challenges resulting directly from their athletic careers. But the question on the table is whether California is an appropriate forum for delivering extended benefits for professional athletes. Part of the rationale for continuing this gratuitously generous program is the fact that athletes pay state taxes on their incomes for contests in California. But given the fact that income taxes have nothing whatsoever to do with comp, this is a specious argument. The taxes paid do not support California's workers comp system.

Ultimately, the solution to the problem of long-term injuries to professional athletes must be removed from California and relocated to where it belongs: in the labor agreements between professional sport teams and their athletes. The first step in this process requires an act by the California legislature to shut off the spigot, so that out-of-state athletes are no longer allowed to file comp cases in the Golden State. Immediately following this, the players will have to put the issue of life-long benefits for retired players on the bargaining table. This may seem obvious to those of us on the outside, but there is a reason why it may not happen: collective bargaining tends to focus on the needs (and greeds?) of today's players. Once out of the game, players - other than those joining a broadcast network - simply disappear.

As is so often the case, it's all about the money: money the owners want to preserve as profits; money the current players want in their own pockets. While management and labor are undoubtedly sympathetic to the former players, the latter are out of the limelight, struggling day by day to function with compromised bodies and brains. They paid the price. Someone should step up and negotiate a reasonable settlement. It's time for this particular form of California scheming to come to an end.

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February 20, 2013


The severe injuries to a utility lineman in Tennessee delineate the fine line where "no fault" ends and "willful intent" begins. In January 2009, Troy Mitchell and his crew were replacing a forty-foot power pole with a new pole forty-five feet in height. Mitchell was in a bucket lift near the top of the new pole preparing to attach a lightning arrestor when a copper ground wire that he held in his bare hands came into contact with a transformer on the older, charged pole some five feet below. Mitchell received an electrical shock of approximately 7,200 volts. He suffered severe burns and injuries to both hands. Clearly, Mitchell was in the course and scope of employment, but he had removed the safety gloves that would have prevented the injury. So is this a case of no fault coverage or willful disregard of safety rules? Are Mitchell's injuries compensable?

There is no doubt about the severity of the injuries. Mitchell underwent eight surgeries--five on the left hand and three on the right. Procedures included cleaning the wounds, cutting away dead tissue, and removing healthy skin from Mitchell's forearms and upper arm to suture into the hands. Following these surgeries, he underwent physical and occupational therapy for ten-months in an effort to reduce the swelling in his hands and increase strength and flexibility. He was also treated for burn injuries to his side. Just over one year after the accident, Mitchell was able to return to work in the same position he held at the time of the accident.

Before considering the compensability issues, let's take a moment to applaud Mitchell for his gritty recovery and his fierce determination to get back to work. You could hardly ask for a more motivated worker.

An Initial Determination of Compensability
A trial court found the injuries to be compensable. They awarded Mitchell a vocational disability rating of 39% permanent partial disability to the body as a whole--one and one-half times the 26% medical impairment rating to the body as a whole. The court noted that Mitchell is "apparently a tough guy. He's back at work. He and the doctor worked together to make sure there were no restrictions. This is a profound injury. He has deformity on both of the hands. It's quite visible."

In addition to an award of $117,312.00 for permanent partial disability, the trial court granted $23,462.40 in attorney's fees and $1,669.20 in discretionary costs. (As much as we would like to explore the concept of "permanent partial disability" ratings for people who are able to perform their original jobs, we must set that aside for another day.)

The Appeal
Mitchell's employer appealed the compensability determination. In Tennessee - as in most states - there is a four-pronged test for willful intent. No one questioned that the first three tests had been met: (1) at the time of the injury the employer had in effect a policy requiring the employee's use of a particular safety appliance; (2) the employer carried out strict, continuous and bona fide enforcement of the policy; (3) the employee had actual knowledge of the policy, including a knowledge of the danger involved in its violation, through training provided by the employer.

The crux of the matter arises in the fourth test: (4) the employee willfully and intentionally failed or refused to follow the established policy requiring use of the safety appliance. In other words, the sole issue was whether Mitchell's removal of his gloves while in the performance of his duties was a willful disregard of safety policy.

Mitchell testified that he had worn his protective gloves when lifted in the bucket and when he covered the "hot" lines on the lower pole with rubber blankets and hosing. Having done that, he believed that he was in a "safe zone" and "clear" of the danger five feet below. He then took off his gloves to hammer a metal staple, which was to secure a lightning arrestor into the crossarm of the new, taller pole. Mitchell explained that it was easier to hammer without the gloves and, further, that he "didn't want to puncture a hole" in the gloves. After removing the gloves, he remembered being struck by a "ball of fire." He later realized later that the copper ground wire he was handling at the time must have come into contact with the transformer on the lower pole. He further testified that because he had removed his gloves under similar circumstances on previous occasions, he did not believe that he was exposing himself to danger.

On cross-examination, Mitchell acknowledged that the employer's policy was that "any time from cradle to cradle, which is when the bucket closes, you have to wear your rubber gloves if you're around anything hot․" He admitted that when he was "around" the hot wires, the rule required him to wear his gloves for safety reasons. He further understood that the employer's policy required leather gloves as an additional covering to guard against puncturing the rubber gloves. He agreed that his gloves were in perfect condition and that he should have kept them on as he attached the staple. Mitchell conceded that his failure to do so violated the safety rules. When asked whether he could hammer the staples with the gloves on, he responded, "Yes, but it's hard."

The cost of replacement gloves was not an issue: the company's safety coordinator confirmed the gloves were provided by the employer and were immediately replaced when punctured or worn out. As a result, it appears that Mitchell was just trying to save his employer a few bucks by not ruining the gloves!

The Supreme Court of Tennessee determined that Mitchell had indeed willfully disregarded company safety policy and thus was not eligible for benefits under workers compensation.

A Compelling Dissent
Justice Holder dissented from the majority opinion. She noted that Mitchell believed he was in a "safe zone" and was not in danger of electrocution when he removed his rubber gloves. Holder quotes the trial court: "it is plausible that [Mr. Mitchell] believed the pole he was working on was not hot." Holder goes on to note that although Mitchell's conduct in this case may rise to the level of negligence or recklessness, the removal of his gloves when he assumed he was in a safe zone should not be deemed willful misconduct.

Mitchell, an experienced lineman, made a judgment that he had protected himself from potential harm by covering the lower power lines with insulated blankets. He removed the gloves to more easily complete the installation process. He made a mistake, he was certainly at fault, but the action, in the opinion of Justice Holder, did not rise to the level of willful misconduct.

This case falls within the perpetual gray zone in which most disputes on compensability are argued. While the majority was technically correct in their determination, and while the law does not discriminate between worthy and unworthy employees, it is difficult not to side with Justice Holder in her dissent: Mitchell is in so many respects an exemplary worker. If the rules of comp could be made to bend toward justice, perhaps they would bend in the direction of this stoic and stalwart man. Unfortunately, that's not the way this system works.

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February 7, 2013


The Insider is very much looking forward to the Workers Compensation Research Institute (WCRI) annual conference, taking place on February 27-28 in the virtual epicenter of wonkiness, Cambridge MA. There is always much food for thought in these annual gatherings of insurance execs, state officials, policy makers, attorneys, medical specialists, employers and safety/loss control practitioners.

This year's agenda has zeroed in on the fundamental medicine-related conundrums facing workers comp systems across the country. All of us in workers comp long for insights into the following:
- Unnecessary medical care and its impact on treatment guidelines. (Back surgery, anyone?)
- Medical price regulation: what are the essential elements of an effective fee schedule? (Beware of the state where the doctors love comp...did someone mention "Connecticut"?)
- The Opioid epidemic: treatment protocols involving the generous and prolonged distribution of opioids are destroying lives across the country. Why are so many doctors so clueless about the proper use of pain killers? Whatever happened to "do no harm"?

WCRI's head honcho, Dr. Richard Victor, will host a discussion on health care policy involving (the presumably liberal) Howard Dean and (the assuredly conservative) Greg Judd. The dialogue might not equal the fireworks of July 4th on the Esplanade, but it might come close. The Insider will be listening closely for any indications of that rarest of phenomena: a common ground.

From Gorilla to ?
Last year, Dr. Victor concluded the conference with a discussion of the "gorilla in the room": the enormous and perhaps insoluble problem of structural unemployment among the 20 million people who lost jobs in the recent recession. For many of these people, especially those in their 50s and 60s, there is little prospect of returning to jobs with anywhere near the same rate of pay as before. Many will find themselves lost in the new economy, cobbling together part-time employment without benefits, while struggling to hold onto housing where mortgages exceed the value of the home. Tough times and, so far, not much in the way of effective solutions.

This year Dr. Victor will have to find some other animal analogy to glean lessons from history: Giraffe in the closet? Rhino in the den? He tells us that the lesson might have something to do with the first century Ephesians, toward whom St. Paul addressed some rather famous snail mail. While some might find such a teaser a bit obscure and full of religious overtones, the Insider looks forward to the story. Indeed, we look forward to this year's entire conference with great anticipation. There are few things better for policy wonks - our people! - than listening to the latest research from WCRI. Diligent note-taking will be in order.

If you count yourself among those with wonkish tendencies and you haven't signed up yet, you'd best jump on it immediately. If you have any questions about the conference, contact Andrew Kenneally at WCRI: 617-661-9274.

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January 30, 2013


When Cassandra warned the Trojans about a peculiar looking horse, she was ignored. In a somewhat similar vein, the Insider has predicted potentially dire consequences of an aging workforce: unable to retire, some older workers labor to the breaking point and then might hope to parlay workers comp into the retirement plan of last resort. So far it has not turned out that way. But a new study by Sage Journals confirms some of our concerns about risks among older workers and possibly even explains why fatally injured older workers might not show up on comp radar.

The Sage researchers set out to examine the relationship between fatal falls and age. They focused on the construction industry, which comprises only 8 percent of the American workforce, but generates 50 percent of all fatal falls. The frequency of falls among younger workers (here defined as under 55) was higher, but older workers who fell were more likely to die. (Kudos to Sage for defining older workers as 55+ - as opposed to the fairly meaningless federal standard of 40+.) The greatest risks for fatal falls occurred, not surprisingly, among roofers, iron workers and power line installers. Among roofers, older workers had a fall rate of 60.5 fatalities per 100,000 workers, compared to 23.2 fatalities among younger workers. Older workers were more likely to fall from ladders. In addition, their fatal falls could occur at substantially lower heights than the fatal falls of younger workers.

Where's Comp?
As we continue to zero in on the problem, the workers comp dimension comes into focus. Fatal falls among older workers were more likely to occur in residential settings - worksites less likely to be overseen by OSHA or state authorities. And fatal falls were more likely to occur among small contractors, many of whom were sole proprietors. The study points out that nearly 40 percent of construction workers 55+ are self employed.

Therein may lie one of the clues to the mystery as to why workers comp costs among older workers have not risen at the rate we once anticipated. Among fatalities, a substantial portion of the workers were independent contractors and thus did not carry workers comp coverage; many states preclude coverage for sole proprietors. Even in states where independent contractors are allowed to enroll in comp, most did not bother, as the cost, often based upon the state's average industrial wage, is well beyond the means of a part-time, self-employed craftsman.

Case in point: In Massachusetts, a relatively low cost state for comp, the rate for roofers is $26.10 per $100 of payroll; the state average industrial wage is $42,700. A sole proprietor roofer would have to pay over $11,000 to secure the protection of a comp policy, even if his annual billings were less than the average industrial wage.

The Sage study points to a number of factors in the severity of falls among older workers. Over time, we all succumb to the biomechanics of aging: slower reaction times, decreased joint mobility, reduced elasticity of tissues and loss of strength. Based upon my own experience, mix in a little forgetfulness, an occasional lack of coordination, and you have a potentially toxic mix, especially in the context of heights and ladders.

Unbroken Falls
The aging workforce is not about to go away. The Sage researchers point out that older workers - again, 55+ - totalled 17 million in 1998, reached 27.9 million in 2008 and are projected to reach 40 million by 2018. The median age in construction has gone from 34 in 1985 to 41+ in 2009; in the same period, workers 45 to 64 went from 25 percent to 34 percent of the workforce.

Given the absence of strong safety oversight in residential construction, the inevitable aging of the workers who perform residential work and the common use of ladders, we can expect the trend of fatalities among older construction workers to continue. The impact on workers comp is another matter altogether. It appears that many of the aging craftsmen working on our homes are independent contractors. When they fall, there is little or no safety net between them and the cold, hard ground.

Thanks to Julie Ferguson for the heads up on this research.

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January 14, 2013


We have often discussed the disconnect between the roughly 100 year old workers comp system and the realities of today's workforce. The old system was not designed to handle older - and we do mean older - workers. Today's case in point is Von Brock, a 77 year old greeter for Walmart in Mississippi. In July 2008 Brock was moving a lawn mower for a customer when the handle fell off, causing him to fall and break his leg. After surgery, one leg was shorter than the other. Brock was assigned a 20 percent disability rating and never returned to work.

Given his permanent total disability, Brock was awarded benefits of $163.67 per week for 450 weeks. He requested and was granted a lump sum settlement which totalled about $75,000, minus what had already been paid, for a revised total of $53,000. Using actuarial tables for life expectancy, the workers comp commission further reduced the lump sum to $32,000 - a discount of 42 percent, compared to the usual 4 percent discount for younger workers. Brock sued, stating that he had already exceeded average life expectancy for white males and was in good health. He alleged that the use of actuarial charts was discriminatory.

The Mississippi court of appeals rejected Brock's claim, citing Mississippi Code Annotated section 71-3-37(10):

Whenever the [C]ommission determines that it is for the best interests of a person entitled to compensation, the liability of the employer for compensation, or any part thereof as determined by the [C]ommission, may be discharged by the payment of a lump sum equal to the present value of future compensation payments commuted, computed at four percent (4%) true discount compounded annually. The probability of the death of the injured employee or other person entitled to compensation shall be determined in accordance with validated actuarial tables or factors as the [C]ommission finds equitable and consistent with the purposes of the Workers'Compensation Law.[emphasis added in appeals court decision]

The appeals court noted that the language of the law is unambiguous: the commission "shall apply validated actuarial tables..." Hence, despite Brock's apparent good health and his already beating the prevailing odds on mortality, the lump sum was discounted substantially because of his age.

New Realities of the Working World

The Mississippi statute, like those of other states, does not contemplate the dilemma of a 79 year old disabled worker. Nor do these various statutes take into account the precarious state of the rapidly aging American workforce, where post-employment prospects are exceedingly dim. Retirement is hardly an option for people who lack the substantial resources necessary for retirement. Von Brock continued working because he needed the money; once disabled, he needed workers comp to fill in the gap. Unfortunately, the "mortal coil" of age finally caught up with him: his working days are over.

Even if Brock had prevailed, the nest egg represented by the maximum lump sum settlement would only have covered his expenses for a few years; as it is, he now walks away with a substantially lower amount. While his former employer Walmart continues to offer discounts to bring in the customers, workers comp offers a discount that substantially reduces his ability to survive. Mr. Brock is in the vanguard of a multitude of aging workers in a dire situation. We wish them all the best of luck.

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December 26, 2012


As the New Year looms, the 100 year old workers compensation system continues its awkward foray into the 21st century, it encounters problems beyond its original design: the widespread availability of opioids, increasing sophistication in medical interventions, and an aging workforce. Today we examine a formerly inconceivable conundrum: can an 80 year old man be expected to return to work after an injury?

Kenneth Brunner graduated high school in 1949 and worked steadily all his life: From 1951 through 1993 he ran the family dairy farm with help from his wife, an accountant. Brunner raised crops; used a tractor, plow and other farm machines, kept track of feed and each animal's output. He took milk samples from each cow and sent them for analysis; after receiving reports, he adjusted feed for each animal to maximize output. He supervised two to three individuals on the farm.

From 1954 through 1984 he supplemented his farm income by driving a school bus - work which, in the view of the Ohio workers comp commission, required the ability to work independently and use judgment.

From 1968 through 2000 Brunner also was employed as an insurance adjuster. He estimated crop loss for an insurance company, a job that required using scales, taking samples and writing reports. In 1990, at age 58, he was certified for insurance sales.

In January 2011, at age 77, he was working in a maintenance job, when he tripped on a drain pipe and fell face first onto pavement. His injuries were severe:bilateral frontal bone fracture; fracture lateral wall right maxilla; fracture bilateral paranasal sinuses; closed fracture bilateral nasal bone; open wound of forehead; abrasion face; closed fracture C2 vertebra.

He received workers comp benefits. A couple of years into his recovery, he filed for permanent total benefits (PTD). Brunner was 80 years out and had had enough of working.

Brunner's treating doctor concluded that he would never work again:

This claimant has an injury that is permanent and for which there is no curative therapy. This claimant has progressively suffered loss of function and has had to endure progressively more pain. The exam above shows that there is so little functional capacity and that the claimant is so affected by his condition and its required care, that there is no capacity for sustained remunerative employment and that there is no reasonable employer that would ever hire the claimant expecting any work capacity.

Based on the examination above, review of documents, and based on sound medical reasoning I find that the allowed physical conditions, independently and by themselves, render the claimant permanently and totally disabled and unfit for all sustained remunerative employment.

Once a Worker, Always a Worker?
The Ohio workers comp commission reviewed Brunner's claim for PTD benefits. They took into account his age, as well as his resume in determining that he was still capable of working. While most of his living involved physical labor, throughout his working life Brunner had displayed skills that at least theoretically were transferable to sedentary work. As a result, they rejected Brunner's request for PTD benefits. The commission did not address the likelihood of anyone offering Brunner a sedentary job.

An appeals court upheld the denial of the claim, finding that the commission did not abuse its discretion: (1) in weighing Brunner's age in assessing the non-medical factors; and (2) in determining that Brunner has some transferable skills.

It appears that Brunner's longevity worked against him. He labored well into his 70s and displayed unusual fortitude in recovery from serious injuries. Because the premise of PTD payments is protection for disabled workers who are available for work but no longer able to do it, Brunner finds himself ineligible for benefits. In a supreme irony, his ability to work as an older worker precluded the conclusion that he was unable - even at 80 - to continue working.

Brunner's dilemma is by no means unique. As the workforce ages, as more and more workers continue labor late into their seventies and even 80s, a paradox emerges: the point where one is too old to work recedes into the haze of the future, leaving injured older workers in a gray zone where their permanent injuries may or may not be compensable and where their (theoretical) ability to work mitigates against their being paid not to work.

In the months and years ahead we will see more and more litigation involving the claims of "older" workers with ages far beyond what was contemplated in the original workers comp system. State by state, the system will have to respond, becoming the focal point of economic, social and even psychological forces that are far larger than workers, comp stakeholders and state policy makers combined. This is an evolving narrative of surpassing interest. Stay tuned.

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November 16, 2012


John Pearson was diagnosed in his mid-20s with diabetes and was insulin dependent. About fifteen years after the diagnosis, he was working for an Arkansas temporary placement agency, Worksource, which sent him to a steel fabricator. His temporary employer gave him a pair of steel toe boots and assigned him the task of covering warm steel bundles with blankets. The job required a lot of rapid walking across a large field, as the bundles emerged from the plant at odd intervals. In the course of the day he experienced discomfort in his left foot and at the end of the day he found a blister on his left great toe. The next day he requested a wider pair of boots, but none were available. The employer suggested he buy them, but he could not afford to do so before being paid - and payday was still a couple weeks away.

Two weeks later Pearson was diagnosed with "diabetic neuropathy and cellulitis." Worksource sent him to another doctor, who diagnosed a diabetic ulcer and cellulitis and placed him on light duty, restricting his standing and walking. (The court is silent on how long Pearson continued to work at the steel fabricator.) Ultimately, surgery was performed on the toe, which fortunately did not require amputation, and Pearson was able to begin working again, albeit with (temporary) restrictions. Pearson took a job in a Waffle House, where he was able to resume full time work. In the meantime, he was faced with lost wages and formidable medical bills.

Proving Compensability
Pearson filed a workers comp claim, which at first was accepted and then denied on appeal to the Arkansas Workers Compensation Commission. The denial was based upon an interpretation of state law:

(4)(A) "Compensable injury" means: (i) An accidental injury causing internal or external physical harm to the body or accidental injury to prosthetic appliances, including eyeglasses, contact lenses, or hearing aids, arising out of and in the course of employment and which requires medical services or results in disability or death. An injury is "accidental" only if it is caused by a specific incident and is identifiable by time and place of occurrence; (ii) An injury causing internal or external physical harm to the body and arising out of and in the course of employment if it is not caused by a specific incident or is not identifiable by time and place of occurrence, if the injury is: (a) Caused by rapid repetitive motion. [Arkansas Code Annotated section 11-9-102(4)(A) (Supp. 2011)]

The Arkansas Court of Appeals agreed with the commission that the injury did not meet first criteria: there was no specific incident identifiable by time and place. However, the Court found that the injury was caused by "rapid repetitive motion," applying a two-pronged test that is stunning in its obviousness: did injury involve "repetition" and did it involve "rapidity"?

The "repetitive" part involved walking itself: Pearson walked up and down the field in tight boots, watching for the steel bundles as they emerged from the plant. The rapid part involved his walking briskly to protect the bundles as they appeared. He walked from bundle to bundle, as fast as he could, performing the job as instructed. In doing so, the boots rubbed his toe continuously over the course of the day, resulting in a blister. For most people, a blister is no big deal. For a diabetic, it could lead directly to amputation.

Lessons for management?
It is difficult to draw conclusions from this unusual case. Because Pearson was a temporary employee, the steel company had no awareness of his diabetes and no reason to be aware of it: he was able to perform the work as assigned. Theoretically, they could have done better on Pearson's request for wider boots, but they had no reason to anticipate a serious problem beyond a bit of discomfort. Pearson himself was probably unaware of the risks involved in wearing the tight boots. He obviously was feeling pressure to earn money and probably thought the discomfort, while painful, was not a serious matter.

Perhaps the most important aspect of this case is Pearson himself: despite a life-altering health problem, he is strongly motivated to work. In the few months described in the court narrative, he tries hard to do what he's supposed to do and he keeps working as best he can. Given comfortable footwear, Pearson will do just fine.

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October 22, 2012


Jimmy Walters worked for the Florida Department of Corrections. In December 2009, he came down with a cold, but continued to work for a week. He suffered from chills and nausea on his days off and then experienced chest pain. He went to a hospital, where he was treated for "heart symptoms" and subsequently diagnosed with myopericarditis and cardiomyopathy. He was hospitalized for several days. He filed a workers comp claim, under the Sec 112.18, the "firefighter's presumption" which creates a rebuttable presumption of occupational causation for disabling heart disease.

For most workers, there would be no conceivable issue of compensability for flu-caused heart problems, but most workers do not work in the public safety arena and most workers are not protected by presumption laws. The facts of the case were not in dispute: there was a direct causal relationship between Walters's stomach flu and subsequent heart problems. His initial claim was denied by the state of Florida and by a judge on appeal, who ruled that Walters had not proven that his viral gastroenteritis was an occupational disease or that the exposure was traceable to the workplace.

The District Court of Appeal overturned the ruling and awarded benefits for the treatment of heart disease. The judges noted that the presumption statute shifts the burden of proof from the claimant to the employer: "The state had the burden to prove he did not get the virus at work, and failed to carry its burden." Some burden! The chain of causality is stark and rather crude: for public safety employees, any heart ailment caused by illness is compensable, unless the employer can trace the exposure to specific, non-work conditions. Where the cause/exposure is unknown - as in most cases - there can be no outcome other than the awarding of benefits.

By facilitating benefits to firefighters and police who may develop cancers or heart desease related to employment, law makers acknowledge the unique exposures for the people who protect us.[Back in 2008, my colleague Julie Ferguson provided the background for presumption laws.] But the generous language of these statutes may open the door to compensability far wider than any prudent legislature would intend.

The Politics of Presumption
In practice, presumption laws may create as many problems as they solve. For stressed taxpayers who ultimately foot the bills, cases of questionable compensability can be shocking: the firefighter with lung cancer who smokes two packs a day, the obese cop with heart disease, and now, the corrections officer with a flu-caused heart problem. Are these truly work related? For most people, the answer would be "no way." For the public safety employees covered by presumption laws, compensability is a given. Their safety net is woven of much finer cloth than that which protects most people in the working world.

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October 9, 2012


The alarming crisis precipitated by contaminated steroids has implications for the workers comp system. In Framingham, MA, two towns over from where I write, the New England Compounding Center has been shut down, but not before it shipped over 17,000 vials of methylprednisolone acetate, each potentially contaminated by fungal meningitis. Across 23 states, eight people have died and over 100 others have been sickened. As Denise Gray writes in the New York Times, the incubation period appears to be between a few days and a month; the last doses of the tainted medications were administered on September 17, so there are literally thousands of people at risk for a potentially fatal illness.

Because the steroid is used for the treatment of back pain, this crisis intersects with the workers comp system. Lower back injuries are among the most prevalent in workers comp; across the country, injured workers are receiving all forms of treatment, ranging from physical therapy to surgery to injections. An unknown portion of those sickened by the tainted drugs will have been treated for work-related injuries. These unlucky few will require lengthy and costly treatment, along with extensive hospitalization. They will be eligible for long-term indemnity payments, including support for any qualified dependents. These claims will total hundreds of thousands of dollars. Should an injured worker suffer a stroke - one of the many side effects of the disease - the claim is likely to become a permanent total disability.
[NOTE to comp attorneys: New England Compounding is out of business. The prospects for subrogation are remote.]

Exposure: Limited But Deadly
The good news, if indeed there is any, is that the source of the contamination is highly specific: it involves only drugs shipped by New England Compounding. Thus any injured workers receiving lumbar injections over the past few months can know for sure whether they are at risk. But that - and the fact that most people exposed to the drug will not become ill - is the extent of the good news.

Anyone exposed to the fungus is advised to seek medical help immediately if they experience any of the following symptoms: severe headache, fever, stiff neck, dizziness, weakness, sensitivity to light or loss of balance. For those who have received tainted injections, just reading that list would probably give rise to real or imagined symptoms.

Early treatment is essential and might save a patient's life. The untreated fungus can cause strokes. So logic might indicate that everyone exposed should receive preventive treatment. Unfortunately, the life-saving treatment itself carries risk: antifungal drugs must be administered for months and they can have serious side effects, including kidney damage. Thus those anxiously awaiting the first signs of illness can only watch the days tick by until they are beyond the incubation period. (Even if they do not become ill, individuals exposed to the risk might be tempted to pursue claims for PTSD, given the magnitude of the stress they are experiencing.)

Manufacture Versus Assembly
The Wall Street Journal points out that a 2002 Supreme Court ruling placed limits on any federal role in the oversight of drug compounding:

[The FDA] has been stymied by, among other factors, a 2002 Supreme Court decision. In the majority opinion, written by Justice Sandra Day O'Connor, the court struck down as unconstitutional the portion of a 1997 law setting out how the FDA would decide which compounding pharmacies it would regulate

The compounding - as opposed to manufacturing - of drugs is considered a pharmaceutical procedure, so the only oversight comes from the states. And given limited resources, states are not in a position to do the job thoroughly or consistently. As Representative Ed Markey (D-MA) put it, "compounding pharmacies currently fall into a regulatory black hole."

Most of the people receiving the tainted medication will soon be able to resume their normal lives. For the relatively small number who become ill, or even die, the promise of relief from back pain has been transformed by a scandalously unregulated industry into a broken promise of life-altering proportions. For those wondering what role, if any, government should play in free markets, this surely is an example of a place where government belongs.

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October 3, 2012


When risk managers scan the virtually infinite horizon of risk, they often overlook the single greatest exposure in the working world: driving cars and trucks on the roads of America. Today we approach the issue through the back door, wherein an individual killed in an accident was deemed not be in the course and scope of employment. It might be the backdoor, but it still leads to the same conclusion.

Linda Gadbois was a cook for the California prison system. She suffered a work-related injury and was sent to a doctor. When this doctor proved unsatisfactory, she was allowed to choose another medical provider from a list. After completing her appointment in May of 2008, she headed back to work. She was involved in an accident: Gadbois was killed; the other driver, Kenneth Fields, was seriously injured. Under the theory that Gadbois was "in the course and scope" of employment, Fields sued Gadbois and the state of California, her employer. No need to ask why: the state's pockets were significantly deeper than those of the late Gadbois.

Going to Work
Field's case rested on the interpretation of the "coming and going" rule: was Gadbois, leaving a medical facility after work-related treatment, inside or outside of employment? The court noted that she had requested the second treatment on her own. Her employer did not require her to drive to the appointment, nor was she required to drive as part of her employment. As a prison cook, the essential job functions were limited to her cooking: how she got to work was not her employer's concern.

As a result, the fifth district appeals court concluded that the state was not liable for any injuries Gadbois caused while on her way to work. Field's suit against the state was dismissed; the status of his suit against Gadbois is not known, though presumably he collected up to the limits of her personal auto insurance policy.

It is worth noting that Gadbois's death was not compensable under workers comp. Gadbois was paid for the day of her death in accordance with a death benefit policy that covers all workers who die on a regular work day, whether at work, on the way to work, or on paid vacation or leave. Gadbois received her full salary for the day of the accident, but received nothing from workers' comp. Had she received death benefits under comp, Fields would have had a stronger case.

Drivers: Good, Bad and Indifferent
While the specific circumstances proved Gadbois to be the exception, many people do drive in the course and scope of employment: obvious examples would be tradesmen, salespeople on the road and people whose customers are visited in their homes. But the circle of drivers must be expanded to include any and all employees who run errands or perform any aspect of their jobs in company cars or in personal vehicles.

Some employees do this company-related driving on a regular basis; others only sporadically. But any employee driving "in the course and scope" of employment is a representative of the employer. Whether consciously or not, the employer has endorsed the driving skills of employees whose work involves driving. Even if the employee is in a personal vehicle, the employer has, in effect, entrusted them with the keys. This "entrustment" may well comprise the riskiest part of the working day.

Basic Management
How should employers manage this risk? It's really quite simple. Any and all employees who drive - or who might possibly drive - while working should be required to submit annual copies of their driving records. If there is a cost in obtaining the records, the employee should be reimbursed. The employer should review the records carefully and place restrictions on any employees with marginal or poor driving records. Indeed, the employer may well find that some employees who drive while working do not hold valid licenses. If these unlicensed drivers have accidents while working, the employer is on the hook for anything that happens.

In addition, employees should be required to report any moving violations, on or off the job. A speeding violation on the weekend might not preclude an employee from driving during work, but a formal warning would be appropriate.

Finally, prudent employers should have written policies on limiting the use of cell phones while driving and, needless to add, prohibiting texting. These policies should be enforced, with appropriate documentation and disciplinary action for any violations.

The risks of driving permeate our lives. When we drive in the course of work, the risks are shared by employee and employer alike, even if the latter is oblivious to the exposure. For the savvy manager, a well organized approach to the risks of driving goes a long way toward containing the ever-present perils of the open road.

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October 1, 2012


Over eight years ago, my colleague Julie Ferguson blogged on the issue of workplace heart attacks: compensable or not? (Workers Comp Insider just passed its ninth birthday, but we've been too busy to celebrate.) Heart attacks present a unique challenge to the courts overseeing workers comp. The general standard requires that something unusually stressful happened at work in the moments leading up to the incident; if people are doing their usual work in the usual manner, the heart attack does not arise "out of" employment. If, on the other hand, the demands of work are unusually stressful and beyond the ordinary, the incident might well be compensable.

Today's case raises the isse of whether anything that happens on Super Bowl Sunday can be ordinary. Colleen Robert's husband (no first name given in the court documents) normally worked as a receiver for Waldbaum's Supermarkets in New York. While the 2010 superbowl did not involve any New York teams - the contest featured the Indianapolis Colts versus the New Orleans Saints - Super Bowl Sundays are always busy for super markets. Roberts was asked to manage the store during the unusually busy day. At one point, he engaged in a verbal altercation with a customer (which in itself may not be unusual for those working in New York). Later that same day, while still at work, Roberts suffered a myocardial infarction and died.

The case was first deemed compensable, then denied by an administrative law judge, and then finally adjudicated by the Appelate Division of the New York Supreme Court. The judges noted that any death at work is presumed to be work related, but they also looked for a causal connection between the fatal attack and the work being performed. The autopsy revealed that Roberts suffered from extensive cardiovascular disease and thus was a good candidate for a myocardial infarction. In arguing against compensability, the defense pointed to the lapse of time between the verbal altercation with a customer and the attack itself. However, the judges noted that the entire day was full of stress and excitement for Roberts, who was not performing his usual job in the usual manner. They determined that the fatal heart attack was compensable.

Best Practices
In a similar case involving a supermarket in Massachusetts, a 70 year-old man with a pacemaker collapsed and died on his break. Because he had a known heart condition, and because of his age, the market assumed the fatality was not work related and failed to report it to their insurer. Months later, the widow filed for comp benefits. Due to the absence of timely interviews with co-workers and supervisors, and due to the "death at work" presumption, the case was deemed compensable.

The lesson for employers is both simple and straight-forward: report any and all incidents of heart problems immediately. Regardless of the state jurisdiction, the courts are likely to apply the same standards as in New York. And if a heart attack occurs on Super Bowl Sunday, defense may have a tough time proving it was just another working day.

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September 25, 2012


One of the most compelling issues in the compensability of workers comp claims is determining the moment when coverage begins. For most workers, coverage begins at the worksite, often in the employer's parking lot. Under the "coming and going" (or "to and fro") rule, the commute to and from work is generally not covered. There are exceptions, of course, and these exceptions become the focus of litigation when an injury occurs during a commute. When a serious injury or, in today's case, a fatality occurs, there is a lot at stake in the interpretation of this deceptively simple rule.

Juan de los Santos worked for Ram Production Services, a Texas company that services gas and oil leases. De los Santos was assigned to work on a gas lease located on a large piece of fenced ranchland. The employer furnished de los Santos with a company-owned truck and paid for work-related fuel expenses. The truck was not for personal use. De los Santos spent a significant part of his workday traveling to wells and job sites within a designated area known as the Buck Hamilton Ranch. De los Santos entered the ranch through the only entrance, a gate where he was signed in by a guard. De los Santos traveled to the exact same location each day to begin his work, which started at 6:00 a.m. He was a salaried employee, who was not paid extra for his travel.

One Fateful Day
In June of 2005, de los Santos was driving to work, on a public highway, when he was involved in an accident that resulted in his death. He was survived by his wife, Noela, and his daughter, Kimberly Ann. [Note that the litigation around the compensability of his death remained unresolved more than seven years later.] Noela filed for workers comp benefits, which were denied, then granted, and then finally resolved in the Texas Fourth Court of Appeals.

Mrs. de los Santos tried to develop a narrative of the accident that met the standard for a compensable claim: she noted that her husband was traveling in a company truck furnished as part of his employment contract, and that her husband's travel originated in the employer's business because he was taking a route to a remote job location, was on a "special mission" at the time of the accident, and was transporting tools and equipment to the worksite.

Deconstructed Narrative
The appeals court dismantled her narrative one piece at a time:
- Being in a company vehicle does not mean you are necessarily "in the course and scope" of employment;
- Yes, he was driving to a remote location, but that was his regular assignment, unchanging from week to week;
- Even though he was meeting a contractor at the jobsite, this did not mean he was on a "special mission" as he was headed to his usual workplace at the usual time;
- And the fact that he was carrying tools and equipment did not change the nature of the commute. [NOTE: had he been injured moving the equipment into the truck, he would have had a compensable claim.]

The court noted that "there is no bright line rule for determining if employee travel originates in the employer's business; each situation is dependent on the facts." And the facts, as the court interpreted them, did not favor the widow's claim. They reversed the trial court's ruling by rendering a "take-nothing" judgment. Take nothing, indeed.

Thus, after seven years, the case grinds to its conclusion. Mrs. de los Santos and her daughter are on their own.

Letter of the Law
The court was correct in its determination that de los Santos was on his ordinary commute to his regular workplace. While we all have moments when we might like to engage in social engineering - the widow and her daughter certainly could use a helping hand - the rules are the rules and the law is the law. Workers comp offers a formidable package of benefits to workers across America. The wage benefits are generous and the medical benefits superior to any conventional health plan. But the barrier to coverage is substantial: the injury - in this case, fatality - must arise "in the course and scope" of employment. In his drive seven years ago on that lonely and presumably quiet back road to his remote job site, de los Santos was commuting to work. He never made it to the Buck Hamilton Ranch. Now, years later, his widow must deal with the consequences of his not quite reaching the gate, where his compensable workday would have begun.

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September 21, 2012


Back in 2009 we blogged the fate of strippers at the ironically named King Arthur lounge in Chelsea MA. The club treated the women as independent contractors, but the court found that they were employees and ordered the lounge to pay back wages to the strippers. (I wonder if they were able to collect.) Today we examine a similar situation with a dramatically different outcome: the saga of LeAndra Lewis, a free-lance stripper in the Carolinas.

The 19 year old Lewis worked a network of strip clubs in North and South Carolina. She traveled from one club to another, bringing her own (skimpy) costumes and working on her own schedule. She would approach a given club, uninvited and unannounced, and ask for access to the stage. She would pay an enrollment fee (about $70) and then dance as she wished to dance, collecting tips from the customers. If a given customer really liked her work, he might "make it rain" with dollar bills. At the end of the evening, she would pay a portion of her tips to the club owner. Lewis grossed an estimated $82,000 a year, but no one knows for sure, as she did not bother filing a tax form.

In June of 2008 she found herself working in L.B. Dynasty, DBA Boom Boom Room Studio 54 - you have to love the Studio 54 tag, adding a touch of New York glamour - and some white powder? - to an otherwise marginal venue. A fight broke out while Lewis was in the club. A random bullet hit her in the stomach, causing severe internal injuries. She filed for workers comp benefits; the club did not carry insurance (surely no surprise), so the claim reverted to the South Carolina Uninsured Fund. Her claim was denied on the basis that she was an independent contractor, not an employee of the club.

The Usual Criteria in an Unusual Setting
In its ruling on Lewis's claim, the South Carolina Appeals Court upheld the denial. They used the typical four pronged analysis for independent contractors to determine her work status:

1. The right or exercise of control: Lewis was free to come and go and free to dance as she chose; there were rules of behavior, but these did not constitute an employment relationship;
2. Furnishing of equipment: the court observed that the provision of a stage, a pole and music were practical matters, as a traveling stripper would not be able to bring these to each venue;
3. Method payment: the club did not actually pay Lewis anything, as she herself paid a fee to dance and a portion of her earnings to the club.
[NOTE: As we noted above, Lewis paid no taxes on her earnings, and it goes without saying the club paid no benefits on her behalf.]
4. The right to fire: the court determined that the right to throw Lewis out for violation of club rules did not make her an employee.

Judge Short dissented from the majority opinion, noting instances in other states where strippers were determined to be employees - he did not site the King Arthur Lounge case. But sad as Lewis's story is, and tragic as the results for her have been, the court probably got this one right. Lewis worked as an itinerant stripper, with no real base of operations. She walked into clubs, offered her services, and was given a stage on which to perform. She moved on when she felt like it. Had she been a regular at the Boom Boom Room, she could have made a stronger case. But this 19 year old woman was very much on her own. The money was good while it lasted, but she now finds herself unable to have children and, due her scars, unable to perform her chosen work. Like all truly independent contractors, Lewis was on her own that fateful day in 2008 and she must live with the consequences for the rest of her life.

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September 18, 2012


Five years ago we blogged Missouri's tough-on-workers reforms that made it more difficult to collect benefits in the "show me" state. Among the provisions in the new law was a 20 to 50 percent reduction in indemnity for workers who are injured while wilfully ignoring the employer's safety program.

Which brings us to Dennis Carver, a roofer who worked for Delta Innovative Services in Kansas City. Carver was carrying a 100-pound roll of composite weather barrier up a ladder - no easy task! - when he injured his back, resulting in a permanent total disability. The problem was that Delta had a safety policy that required three point contact with a ladder at all times: it would be physically impossible to carry a 100 pound roll and maintain three point contact. Because he violated the policy, Carver's indemnity was cut in half, from $743 per week to $371.

Carver admitted that he went to work with the intent of violating the policy. He knew that instead of having the usual crew of 11 men on the job, the crew that day would total two people: himself as foreman and one other crew member working in a separate area. He knew full well that he was on his own. He also knew that company policy required that he use a hand pulley or power equipment - or request the assistance of a coworker - to lift materials to the top of a ladder.

Delta argued that Carver caused his own injury by failing to follow its "three-point" safety rule. Slam dunk for the employer? Here is the statute:

[w]here the injury is caused by the failure of the employee to use safety devices where provided by the employer, or from the employee's failure to obey any reasonable rule adopted by the employer for the safety of employees, the compensation and death benefit provided for herein shall be reduced at least twenty-five but not more than fifty percent; provided, that it is shown that the employee had actual knowledge of the rule so adopted by the employer; and provided, further, that the employer had, prior to the injury, made a reasonable effort to cause his or her employees to use the safety device or devices and to obey or follow the rule so adopted for the safety of the employees.§ 287.120.5

"The burden of establishing any affirmative defense is on the employer․ In asserting any claim or defense based on a factual proposition, the party asserting such claim or defense must establish that such proposition is more likely to be true than not true." § 287.808.

The Checklist
Thus the statute presents a checklist for reducing indemnity payments:

1. that the employer adopted a reasonable rule for the safety of employees; CHECK

2. that the injury was caused by the failure of the employee to obey the safety rule; CHECK

3. that the employee had actual knowledge of the rule; CHECK and

4. that prior to the injury the employer had made a reasonable effort to cause his or her employees to obey the safety rule. NOT SO FAST!

Theory and Practice
While Delta's owner, Danny Boyle, testified that "[n]ormally our guys are trained ․ [that] the only thing that should be carried on a ladder is the person himself," he then testified that employees routinely violated that rule:

Q. Does that mean nobody ever carries anything?

A. Not at all. Guys tend to do things wrong all the time.[emphasis added]

Q. And that's what--

A. I'm just being truthful.

Q. Sure. It happens. It's faster to carry it up sometimes?

A. Yes.

Q. Because you're trying to finish a job and get something done, you may carry something up a ladder as opposed to using the beam?

A. Yes.

Q. Or the pulley?

A. Yes.

Even though Boyle was aware of multiple instances in which employees had failed to follow the three-point rule, he was unable to provide any testimony concerning discipline imposed on noncompliant employees. In other words, the policy was not enforced. And because it was not enforced, Delta must own the consequences of employees failing to follow it.

The Court of Appeals remanded this case back the workers comp commission, for a closer examination of whether there were grounds for reducing the indemnity payments. In all likelihood, Carver will collect the full indemnity.

Roofers at Risk
Boyle's testimony that "guys tend to do things wrong all the time" reminds me of a telling moment in a training session some years ago. I was explaining the implications of implementing a drug testing program and the owner of a small roofing company responded: "I could never do that. Half my guys would fail." [Need I add that, following the seminar, I alerted the underwriter to flag that account for non-renewal?]

Would it surprise you to learn that roofing is one of the most expensive job classes in workers comp? The rates can run as high as $50.00 per $100 of payroll and even higher. It is difficult, demanding work. In some respects, there is no such thing as a good day for a roofer: it's either too hot, too cold, or too windy. The exposures are relentless and the work itself, especially on the commercial side with hot tar involved, can be noxious.

Owners of roofing companies like Danny Boyle are faced with a daily conundrum: do I enforce the rules and slow down the work? Do I discipline employees for violations or let the work flow, hazards be damned? In the course of normal employment, it's tempting to ignore the finer points of safety. But that puts workers at risk for serious injuries - and owners at risk for footing substantial bills.

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September 14, 2012


Whether in a local coffee shop or a Dunkin Donuts (but never a Starbucks?), the coffee break is an iconic moment in the routine of a police officer and thus appropriate fodder for our Friday blog.

Carolyn McDermed, a lieutenant in the Eugene, Oregon, police department, left her desk in the station and walked across the street to purchase coffee. She planned to drink it at her desk. Unfortunately, she was struck by a car and suffered multiple injuries. Her claim for workers comp revolved around one central issue: was she on a personal errand or "in the course and scope" of employment? Was she on a break or on call?

An administrative law judge ruled that McDermed was indeed working; the ruling was upheld recently by the Oregon Court of Appeals.

McDermed worked in the Office of Professional Standards; she managed her own time and took breaks when she felt like it. But unlike most of us, who can leave our work behind when we head out for coffee, McDermed was still prepared to do her job. She carried her cell phone and might be required to return to her office on a moment's notice. Indeed, her coffee breaks were not without incident: one time she witnessed an auto accident and administered first aid; another time she escorted a woman fearful of a stalker to the latter's office; and when a vehicle caught fire near her office, she applied a fire extinguisher and exerted crowd control. As a well-known, 17 year veteran of the force, she found herself frequently answering questions out in public about community law enforcement concerns. No wonder she would take the coffee back to her desk, where she could at least enjoy it in relative quiet.

Public safety officers are a bit like comic book heroes: they are expected to respond to public need at a moment's notice. Thus, even though there were no safety issues on the day of the accident, McDermed was prepared to respond had something arisen. She was on duty and on call. Her work environment was not limited to her desk in the police station, where most of her duties were performed.

In the Course of Employment
The appeals court clarified the concept of "in the course of" employment:

An injury occurs 'in the course of' employment if it takes place within the period of employment, at a place where a worker reasonably may be expected to be, and while the worker reasonably is fulfilling the duties of the employment or is doing something reasonably incidental to it."

It is possible to extend the implications of this ruling to the point where public safety officers are on call 24/7. When the police encounter a circumstance requiring intervention or assistance, they are obligated to respond. They might be home in bed, or shopping at a mall with the family, or just moseying across the street for a cup of coffee, but they must be ready for anything and thus they are, potentially at least, at work. Compensability would revolve around what they were doing at the time of the injury and why they were doing it. In McDermed's case, her taking a break did not sever her availability for service.

So the next time you see some cops taking a coffee break (that shouldn't take very long), rather than ask whether they could find something better to do, remind yourself that they are on call and at work, unlike most of us, whose coffee breaks really are a break from our daily routines.

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September 10, 2012


We have been tracking the compelling issue of compensability in drug overdoses within the workers comp system. We have blogged drug-induced fatalities that are compensable (Tennessee) and non-compensable (Ohio and Connecticut). Given the prevalence - make that rampant over-use - of opioids in the workers comp system, prescription drug abuse is an issue with profound implications for injured workers, their employers and the insurers writing workers comp policies across the country.

Which brings us to the saga of Bruce Ferguson-Stewart. He was injured on May 25, 2004 while working for AltairStrickland, an industrial contracting firm in Texas. A bolt weighing several pounds fell from above, striking Ferguson-Stewart and injuring his shoulder and neck. The MRI showed "minor disc bulges" at three levels on his cervical vertebrae. His treating physician diagnosed him with a left shoulder contusion and prescribed hydrocodone as part of the treatment plan. The doctor also recommended surgery to repair the shoulder.

Denial and its Consequences
For reasons that are not clear from the trial documents, the claim was denied by Commerce & Industry Insurance, the employer's carrier. The carrier lost the initial appeal and then lost again. The insurer then sought judicial review of the Division-level finding of compensability.

Meanwhile, with his shoulder untreated and in extreme pain, Stewart continued to take his prescribed Hydrocodone, known locally as an "East Texas cocktail." At every level of appeal, the compensability of the claim was upheld, but the surgery was delayed - with apparently disastrous results. (The delaying tactics may have been related to Stewart's alleged history of abusing prescription drugs.)

On October 3, 2004, while his worker's compensation claim was still being contested, Ferguson-Stewart died from an overdose of hydrocodone. His blood contained a hydrocodone level of 0.38 mg/L, which is consistent with acute severe toxicity. The blood also contained carisoprodol, a prescription muscle relaxant, and marihuana.

Trial by Jury
Ferguson-Stewart's widow filed for death benefits under workers comp, but the case was denied. The widow appealed.

At trial, Ferguson-Stewart presented two theories as to how and why Stewart might have unintentionally or unknowingly ingested a lethal dose of hydrocodone. First, in what CIIC describes as the "accidental overdose" theory, Ferguson-Stewart alleged that the overdose must have been accidental because her husband did not intentionally or knowingly commit suicide.

Tommy J. Brown, a forensic pathologist who performed an autopsy on Stewart, concluded that the cause of death was hydrocodone toxicity and that the manner of death was "accidental." Brown's testimony is right out of central casting:

Well, I--I see it a lot. I do autopsies on people with chronic pain a lot and this--like before I see them, start out with their drugs and then they increase the drugs, and then to try the [sic] alleviate the pain more, and pretty soon they're taking more than prescribed, and pretty soon they will overdose theirselves [sic] or they will overdose theirselves [sic], some people do. And then they die and it's usually in a low lethal range [like that observed in Stewart]. So I consider that an accidental death because they were overdosing due to the chronic pain.

With its pathos and illuminating detail, the widow's testimony reads like a monologue from a Faulkner novel:

The day before or the day of--that he died. They say he actually died
early in the morning; so, I guess the day before. He was really disoriented. He was not acting normal or the way he had been acting since he was hurt. He wasn't acting normal at all. His speech was slurred. He was stumbling and falling all over things. I remember--I think I remember one time he actually falling [sic] out of a chair and--in the yard
because he was trying to get up and he tripped over a root and he fell on
the shoulder he had injured. And that made it even that much more
painful for him. He was--he was very--he was crying about it. He really
had hurt himself.
. . . .
He was--in the last couple of days before he died, he was getting really
bad about forgetting that he had already taken his medicine and taking it
again; and you know, sometimes I would have to tell him, "Hey, you
already took it. You can't take it again." And usually he would agree with me; but there were times when he would say, "No. No. No. I didn't take it. I'm sure I didn't take it. I'm still hurting too bad, and I don't remember taking it." So, he'd take it again.
But especially the day of [his death], he was entirely too confused. He
wasn't--like I said, he wasn't himself at all.

The jury charge instructed that "[a] claimant's death does not
result from medical treatment instituted to relieve the effects of his compensable injury if the death results solely from a claimant intentionally or knowingly failing to comply with his doctor's instructions[emphasis added]." The jury concluded that Ferguson-Stewart's death was unintentional, resulting from the treatment for his compensable injury. The widow was granted death benefits.

Intention, Confusion and Compensability
Under Texas law, compensability hinges on Ferguson-Stewart's intent: was the death an intentional suicide or was it an accident? He had no intention of killing himself, so the death was compensable. In a somewhat similar Connecticut case (see above), the overdose was the result of the deliberate (and illegal) act of using a needle to ingest drugs. That case was denied.

Behind every death due to prescription drugs lies a story worth telling. Powerful and effective pain killers are transformed into instruments of death. When it comes to the compensability of these cases, disorientation and confusion are not limited to injured workers experiencing pain. The medical and workers comp systems struggle with the ambiguous legacy of medications: while opioids offer immediate, short-term relief from pain, the relief is followed all-too-often by a downward spiral of addiction and dependency.

I truly wish the testimony of Ferguson-Stewart's widow could be played in the examination room of any doctor about to write a script for an "East Texas cocktail." The doctor just might consider a more benign and less toxic alternative.

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August 24, 2012


What better blog fodder for a Friday than a waiter at TGI Friday's choking on a quesadilla? Michael Bernard was sampling new menu items at his restaurant in Virginia when he literally bit off more than he could chew: he tried to eat a piece of quesadilla that was too big for his esophagus. It caught in his throat. In the process of trying to remove it, he perforated his esophagus and his lung collapsed.

Bernard filed for workers comp. While it is clear that his injury occurred "in the course and scope of employment," the question was whether it arose "out of employment." Virginia's standards for compensability are more stringent than those in many other states. The Court of Appeals upheld a lower court's denial of the claim. The judges focused on the quesadilla itself: was there anything unusual about it that might cause a swallowing problem? Bernard testified that there was not. As the majority wrote, "Bernard's quesadilla was neither a hazard nor a danger - it was simply a quesadilla."

Risks Unique to the Workplace
The judges noted that under Virginia law, injuries must stem from risks unique to the workplace. For example, an employee who trips while walking on stairs cannot collect workers comp unless there was something unusual about the steps or related conditions in the workplace. (In most other states, a fall on the stairs at work is compensable, even if the stairs were free of hazards.)

Bernard's lawyer argued that the injury arose "out of employment" because quesadilla testing was a job requirement which furthered the interests of the employer. If a customer asked "would you recommend the quesadillas?" a waiter - presumably not Bernard - could testify to their relative deliciousness. The judges determined that swallowing food was a hazard confronting Bernard every day of his life; there was nothing extraordinary or unique in swallowing an ordinary quesadilla.

Essential Job Functions
In a dissenting opinion, Justice Frank points out that quesadilla testing was an essential requirement of the job:

Browning Bridges, claimant's supervisor, testified the food tasting activity was to familiarize staff with the taste of new foods so they could explain those tastes to guests. Part of a host/server's employment responsibilities is to "sell the food." While attendance at the food tasting activities is mandatory, no employee is required to eat anything they do not want to eat. However, all host/servers are evaluated on the effectiveness of their recommendations to guests, and failure to make such recommendations can result in counseling by management. Employer even employs "secret shoppers" to assess staff members' performance, including recommendations of menu items.

Alas, had Bernard known the consequences of the simple taste test, he could have passed on the quesadilla. When asked by a customer if he would recommend it, he could have simply said: "Absolutely. They're great!" But he did what he was asked to do and paid a terrible price.

The moral of the story comes from our mothers: slow down, eat small bites, and chew your food carefully. Most of us, in the course of our hectic lives, are prone to ignore this sage advice.

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July 11, 2012


Barton Rodr was a computer programmer for Yzer Inc, DBA Funnel Design Group in Oklahoma. When the yard crew taking care of Yzer's property quit, the company asked for volunteers and Rodr stepped forward. He and his son mowed the lawn and manicured the yard on successive Saturdays, in preparation for the festivities at Automobile Alley, the historic district of downtown Oklahoma City. Barton, a salaried employee, was not paid for the work; his son received $40.

On July 18, 2009, Rodr was putting away the lawn mower when he suffered a heart attack. He was 36 at the time. A workers comp judge awarded him benefits, determining that the injury occurred in the course and scope of employment. A three-judge panel affirmed, but the OK Court of Civil Appeals reversed, opining that Rodr's lawn work bore no relation to his primary job as a programmer.

The OK Supreme Court has ruled in favor of Rodr. Despite his performing volunteer work out of class and on the weekend, he was still an employee of Yzer, as the yard work met the primary test of employment: it furthered the interests of his employer.

In its defense, the company pointed out that the heart attack was caused by a pre-existing conditon: Rodr was overweight, a smoker, with a family history of heart problems. From the perspective of (very distant) consultants, we are tempted to ask: why did the company allow this employee to volunteer? Despite his relatively young age, he worked at a sedentary job and displayed risk factors that precluded his doing physical work. Speaking as a weekend mower, I can certify that the task is strenuous and noisy (less so for my neighbor who sits calmly on his riding mower, listening to music through noise-canceling headphones).

Volunteer vs. Employee
The court has ruled that an employee who volunteers is not a "volunteer." OK law defines a volunteer as "any other person providing or performing voluntary service who receives no wages for the services other than meals, ...therapy...or reimbursement for incidental expenses." An employee is not "any other person."

This is no small matter, for Rodr or for Yzer's workers comp insurer. The unfortunate Rodr is permanently and totally disabled. He is unlikely to work again. He is currently surviving on a mechanical heart and will need a transplant soon. Given Rodr's age and medical expenses of significant magnitude, this claim is likely to reach seven figures.

The lesson for employers is clear: saving a few bucks on physically demanding jobs is not worth the risk. An overweight smoker with a family history of heart problems does not belong within ten feet of a lawnmower. When your lawn crew quits, just go find another one.

Thanks to WorkCompCentral (subscription required) for the heads up on this case.

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June 25, 2012


Kelly Taylor worked as an accountant for Community Health Partners (CHP) in Montana. On her way out for lunch in May 2009, she slipped on the stairs and landed on her tailbone. Her primary caregiver, Rebecca Hintze, worked for the same employer and provided medical advice soon after the injury. The claim was accepted by the Montana State Fund. Taylor suffered from pain off and on over the following months, using up her sick leave in a random succession of 1-3 day episodes. She did not seek comp indemnity for these incidents as she mistakenly thought comp required 4 consecutive lost days.

Over a year later, in September of 2010, Taylor was sitting on a couch at home. She put her foot on her coffee table and bent over to paint her toenails. When she finished, she tried to stand up, but immediately had difficulty, experiencing extreme pain in her back and down the front of her leg. In the following weeks, she experienced this sharp pain two more times, once after stubbing her toe on a rug at CHP and again when she was scooping out cat litter. (For all the severity of the injury, this case is sublimely prosaic in terms of risk.)

Because of the long gap between indemnity payments, and because an IME found that the herniated disc following the pedicure was a new injury and not a recurrence of the old one, the claim was denied. Taylor appealed, and the case came before the estimable Judge John Jeremiah Shea, whom we have encountered a couple of times in the past: in the notorious "pot smoking with bears" incident, and in another complicated claim involving a non-compensable back injury.

Dispensing Dispassionate Justice
Judge Shea appears to be a relentless seeker of fact and a dispassionate purveyor of justice. While he praises both the IME doctor (for reasonably concluding that the pedicure incident involved a new injury) and the claims adjuster (for reasonably denying benefits), he over-ruled the denial and reinstated the benefits. He found continuity in the documented self-treatment and in the somewhat informal, ongoing treatment provided by Rebecca Hintze. While the IME doctor had stronger credentials and a longer track record, Hintze had "substantially more opportunities to observe and talk with Taylor about her injury in both formal appointments and in informal workplace conversations."

He concluded that the pedicure injury was an aggravation of the back injury suffered over a year prior. At the same time, he denied an award for attorney's fees to Taylor, as he found that in denying the claim, the adjuster had acted reasonably.

All of which might appear to be much ado about not much, but in the intricate and ever-evolving world of comp, this case embodies a core value of the system: the relentless effort to determine whether any given injury occurred "in the course and scope of employment." Judge Shea, connecting the dots as methodically as a detective, concludes that the pedicure injury was an extension of the original fall. While the ruling itself can be questioned, Judge Shea's method and discipline are beyond reproach .

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June 15, 2012


Wallace Weatherholt, AKA Captain Wally, was leading a family on an air-boat tour of the Everglades. To liven things up, the 63 year old captain apparently dangled some food over the side of the boat. An alligator obligingly leapt out of the water to consume the (illegal) snack and took off Wally's hand in the process. To the gator, the hand was part of the snack - and who could argue with that? Unfortunately for the gator, authorities killed it to retrieve the hand, although doctors were unable to reattach it.

We will not try to determine which creature acted with greater stupidity, although it's clear that the gator did only what gators have done for millions of years, while Wally did what thinking humans are not supposed to do. (Feeding gators is illegal - a misdemeanor - for somewhat obvious reasons.)

Wilful Intent?
The issue here is compensability: Captain Wally was clearly injured "in the course and scope of employment" - but is this a compensable injury? Did Captain Wally cross the line to "wilful intent" and thus disqualify himself from workers comp benefits (which, by the way, will be substantial, given the severity of the injury and the permanent loss of a hand)?

This might sound like "wilful intent" but it may well prove compensable. The issues for review include:
- Did Captain Wally's employer have a written policy against feeding alligators?
- Was the enforcement documented? Were their punitive consequences for the act?
- Has Captain Wally's unsafe practice been observed in the past and if so, what was done about it?

If Captain Wally's employer turned a blind eye to this practice, which, parenthetically, was good for business, the employer and the insurer will own the injury. Unless the prohibition is an explicit condition of employment, in all likelihood the employer will be on the hook for the loss. As for Captain Wally, he, too, will be on a hook of a different sort: he will have a permanent reminder of his ill-advised and illegal feeding of a primitive creature who was minding his own business until an attractive snack caught his impassive eye. I do feel for Captain Wally, but hands down, my greater sympathies are with the gator.

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June 11, 2012


The immortal Mae West once said that "too much of a good thing can be wonderful." When it comes to pain relievers, however, too much of a good thing can kill you. Which brings us to the sad saga of Anthony Sapko, who died of an accidental prescription drug overdose in August of 2006. Sapko worked as a policeman for 21 years in New Haven, CT, and went on in the mid-1990s to become a state corrections officer. Beginning in 1999, he was treated for depression. He suffered four work-related injuries while working in corrections, the last being a back problem from which he never returned to work.

Sapko was treated with a cornucopia of medications: oxycodone, Zanaflex, Kadian, Celebrex, Roxicodone, Avinza, Lidoderm patches and Duragesic. When his depression deepened in 2006, his psychiatrist prescribed Seroquel. Two weeks later, Sapko was dead. The autopsy revealed a level of oxycodone 20 times normal, and of Seroquel at 5 times normal. The combination of the two over-consumed drugs proved both toxic and fatal.

Suicidal Intent Vs. Accident
Sapko's widow filed for workers compensation death benefits. The claim was denied at the Commission level and again at the Appeals Court level. Sapko's widow argued that the death was directly related to his workplace injuries, but the court found a disconnect: this was not a suicide (where such a link might be established), but an accidental overdose.

In a December 2011 blog, we made note of two similar cases: a compensable case in Tennessee and a denied case in Ohio. Fatal overdoses, in other words, may or may not be compensable, depending upon the specific circumstances and state-based precedents. But the over-arching issues are clear: the abuse of prescription narcotics has reached epidemic proportions in workers comp; some individuals are unable to properly self-manage the use of these medications; and doctors are all-too-too willing to prescribe very powerful drugs to alleviate pain.

Workers compensation is endlessly fascinating because it inevitably brings together pain (from workplace injury) and pain suppression (far too often, opioids). In Sapko's foreshortened life, the combination of medications was toxic. In workers comp as a whole, the mixture of pain and drugs is proving to be a formidable problem.

No Will, No Way?
One of the interesting sidebars in this case is the concept of wilful misconduct: when an injured worker abuses prescription medication, is this a "serious and wilful" action that precludes compensability? Or is the pain so consuming and the drugs so powerfully addicting, that the concept of "wilful" disappears in a drug-induced haze? There are no simple answers. There is undoubtedly some link between Sapko's depression, the work he performed and the injuries he suffered. But in the world of comp these links must be explicit and, unlike life itself, unambiguous. It would require a novelist to reveal the connections. Unfortunately for Sapko's widow and children, the commissioners and judges in charge are simply not in a position to craft that kind of narrative.

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May 15, 2012


For those who seek risk conundrums, workers comp is fertile ground. From a micro perspective, the unfortunate Ronald Westerman, a paramedic for a California ambulance company, embodies many of the elements that result in sleepless nights for claims adjusters and actuaries: Westerman had an inordinately long commute (2.5 hours each way!), a sitting job with periodic lifting (inert patients and medical equipment), along with the comorbidities of hypertension, obesity and diabetes. In two years of ambulance work, Westerman gained 70 pounds, thereby compounding the co-morbidity issues.

In March 2009 Westerman returned home from a 36 hour shift and suffered a stroke. His doctor determined that the stroke was work related and that Westerman was permanently and totally disabled. He was 50 years old. While there was some dispute over the cause of the stroke, an independent medical evaluator surmised that it was caused by a blood clot moving through a hole in Westerman's heart to his brain, otherwise known as in-situ thrombosis in his lower extremities - a direct result of too much sitting. (We blogged a compensable fatality from too much sitting here.)

At the appeals level, compensability centered on the performance of a shunt study - an invasive test - that would have determined whether the blood clot caused the stroke. Westerman was willing to undergo the test, but his wife refused to authorize it, due to his fragile health. If there was no hole near the heart, the entire theory of compensability would be disproven; the stroke would not have been work related.

Had the defense attempted to force the test issue, it would have given rise to yet another conundrum: was refusing an invasive test the equivalent of "unreasonable refusal to submit to medical treatment"? Indeed, does a diagnostic test, by itself, meet the definition of "treatment"? Fortunately for Westerman, the defense requested - but did not attempt to require - the shunt test.

Managing Comorbidities
Our esteemed colleague Joe Paduda, who blogs over at Managed Care Matters, provides the macro perspective, one which is unlikely to aid in the sleep patterns for actuaries. He reports on the impact of comorbidities on cost from the recent NCCI conference:

The work done by NCCI was enlightening. 4% of all claims (MO and LT) between 2000 - 09 had treatments, paid for by workers comp, for comorbidities, with hypertension the most common. These claims cost twice as much as those without comorbidities [emphasis added].

It is beyond doubt that comorbidities make work-related injuries more expensive. But what, if anything, can claims managers do about this? In the Westerman case, there is not much to be done, as the stroke resulted in a permanent total disability. But in other cases where there is a path to recovery and even return to work, adjusters should flag these claims for early, intensive intervention, including psychological counseling and support for weight loss and other life style adjustments. To be sure, this would increase the upfront costs, but these steps just might go a long way toward mitigating the ultimate cost of the claims.

As is so often the case in workers comp, it's "pay me now" and "pay me later." To which I can only say to my claims adjuster and actuary friends, "sweet dreams!"

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February 27, 2012


Earlier this month, Julie Ferguson blogged the hazards of unsafe trenches. Today we examine the consequences of unsafe trenching for Oscar Avalos, a laborer for a Texas-based company involved in the installation of sewer pipes. The good news for Oscar is that a jury awarded him $4.5 million for the general contractor's negligence in supervising his jobsite; a court of appeals has upheld the award. The bad news, of course, is that Avalos will never work again.

Nowak Construction, a Kansas-based company, was hired by the city of El Paso, Texas, to install new sewer lines. James Heiman, Nowak's onsite superintendent, was neither an engineer nor safety expert. In their plans submitted to the city, Nowak proposed using trench boxes for safety, a proven means of preventing trench collapse. Unfortunately, when they hired Rocking Q as a subcontractor, they did not require that Rocking Q adhere to the trench box procedure. Instead, they deferred to Rocking Q's decision to use "sheet piling" - a form of bracing in which steel plates are driven into the ground with a backhoe and then secured with chains. This alternative plan was never submitted to the city for approval.

Thus we have a jobsite where digging and maintaining trenches are a constant activity, where the original safety plan has been scrapped, and where an alternative plan is in effect. Rocking Q did not use any cross-bracing to support the street plates. Rocking Q's owner testified that no one from Nowak told him that this was unsafe or asked him to use cross-bracing. Further, an engineer representing the City visited the work site daily and never criticized the trench safety system (in itself fodder for another blog posting).

Water-soaked Trenches
On the evening of September 13, 2006, 1.15 inches of rain fell within a two-hour period. At about 7:30 the next morning, site super Heiman went to the area where the Rocking Q crew was working. He then went to work about 150-feet away, within sight of the Rocking Q crew.

Here comes the astonishing part: Heiman testified that he returned to the area at around 12:30 or 1 p.m. and saw that the street plates were not anchored in any way - they had neither chains nor cross-bracing. Heiman did not mention to anyone that he thought the site was unsafe. Just two hours later, the dirt behind a street plate collapsed, causing the plate to fall on Avalos while he was working in a trench. The unanchored plates, intended as safety barriers, were transformed by unstable earth into moving objects with catastrophic impact. Avalos was totally disabled in the accident.

Initially, Avalos's injuries were covered by workers comp. But he also sued the GC Nowak for negligence. In the course of the testimony, Novak's lack of safety oversight was exposed:

Heiman testified that the street plates were tied back with a chain. Heiman had never before worked on a job in which street plates were used for trench safety. He had some initial concerns about [the subcontractor's] system because no structural supports were used for the street plates. According to Heiman, [the sub] told him "that's the way they do it in Texas." Heiman called Mr. Nowak to report his concerns, but he also told Mr. Nowak that [the sub]'s system seemed to be working. Mr. Nowak spoke with [the sub], who assured him that the plates were being hammered into the ground properly and that a chain was being used to anchor the plates. Mr. Nowak then approved the use of street plates for trench safety.

By giving a verbal OK to the revised trench safety plan, and by not seeking El Paso's approval for the change, Nowak assumed liability for the consequences. When the trench failed, Nowak became the responsible third party for Avalos to sue.

The Eyes of a Stranger
One of the intriguing aspects of this case is the way everyone overlooked an obvious hazard, including the city's own site inspector. Trenches were routinely secured by plates driven into the ground. There were no cross braces - indeed, no requisite trench boxes - in view. Based upon the testimony, it appears that chains to secure the plates were not used consistently.

Because we are consultants, LynchRyan always has the benefit of seeing job sites for the first time. We view the work being performed with the eyes of a stranger, because we are, literally, strangers. As part of our approach to safety, we encourage companies to look at the work being done as if they had never seen it before. Routine fosters indifference. I once toured a large warehouse with the company safety director. We came across an employee awkwardly pulling a bulky box from a shelf above his head; a rolling ladder stood a few feet away. What I saw was a very unsafe practice which could easily have been mitigated by using the ladder; what the safety director saw was his buddy, Ralph. He waved to Ralph and we moved on.

Everyone knows that trenches are dangerous. As OSHA frequently notes, "an unprotected trench is an open grave." Yet even in companies whose only work involves trenches, the hazards persist. Despite OSHA's videos, PowerPoints, brochures, and posters highlighting trench hazards - along with well-publicized fines for failure to comply - bad safety practices in trenching persist. In losing this liability case, Nowak has probably learned a painful lesson. But I shudder to think that big time lawsuits are the only effective way to motivate management to take trench risks seriously.

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February 13, 2012


A couple of years ago we blogged the performance incentive program at Smurfit-Stone Container Corporation in California. The performance numbers were stellar, but not necessarily because the work was performed safely. Instead, the company conspired with local medical providers to secure limited treatment outside of the workers comp system. Two supervisors pled no contest in conspiring to deny comp benefits to injured workers.

With the recent conviction of chiropractor Robert Schreiner, we see into the black box of the conspiracy. Workers complaining of work-related problems were referred to doctors like Schreiner - giving rise, alas, to a new and ominous definition of provider network. In one instance a worker complained about a neck and shoulder injury. Schreiner denied that the problem was work related, saying that it was caused by carrying a back pack as a child. He provided a handful of treatments and then encouraged the worker to file the claim under his health plan to continue treatments. When the worker persisted and filed a comp claim, he was fired.

Schreiner is headed to jail to serve a mostly symbolic sentence of 30 days, to be followed by three years of probation. Perhaps he can provide some adjustments to his fellow inmates. Confined spaces sure can mess up the spine.

Faking Safety
Smurfit-Stone was bought out last year by RockTenn. You can still read about the company in Wikipedia. Here is the (unattributed) description of the company's safety program:

Smurfit-Stone has been an industry leader in safety performance since 2001 [NOTE: the conspiracy to under-report claims began in 1999!]. In 2007, Smurfit-Stone's U.S. operations had an OSHA recordable case rate of 1.05, the best in company and industry history. This represents an 84 percent improvement in the company's recordable case rate since the implementation of Smurfit-Stone's SAFE process in 1995.The SAFE process, which stands for Smurfit-Stone Accident-Free Environment, promotes five core beliefs: 1.All injuries are preventable 2.Safety is everyone's responsibility 3.Working safely is a condition of employment 4.Training employees to work safely is essential 5.Safety is good business

As litigation has proven, Smurfit-Stone's low OSHA case rate has less to do with safety than with a conspiracy to under-report claims. Perhaps the SAFE program stood for something else: Screw All Forsaken Employees. Aggressive safety goals are a good business practice; circumventing the workers comp system is not just a bad practice, it's illegal. Just ask Robert Schreiber.

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February 7, 2012


I watched the Superbowl with a group of friends on a 60" High Definition TV, sipping a few beers and compulsively downing munchies. My team lost (but to my mind, second place in a league of 32 teams is not all that bad - kind of a silver medal). I find the organized mayhem of football fascinating, as if J. S. Bach were being performed by a deranged, full contact orchestra. A number of years ago, my then 4 year old daughter Julia called the game "all fall down." She was right in more ways than she knew.

We have been following two tracks in the saga of the NFL: the workers comp claims filed by former players in California (where benefits are easier to secure) and the lawsuits alleging that the league knowingly hid the effects of repeated concussions, resulting in dementia and other serious medical issues among retired players. While there are numerous lawsuits filed across the country, there is a movement to consolidate several of them into one big federal case, under Senior Judge Anita Brody in Philadelphia.

The stories of diminished mental capacity that have emerged over the last few years are disturbing - easily reaching the threshold where all of us who view the sport must question our complicity. For decades, the football mentality has been to keep the best players on the field, regardless of (future) consequences.

Touchdown Tony Dorsett
One of the parties to the lawsuits is the former Dallas Cowboy running back, Tony Dorsett. He was a smooth, electric runner on the field, but the mask of his helmet and pads only served to make invisible his considerable pain and suffering:

Dorsett's had surgery on both his knees, and problems with his left arm and right wrist. He says then-Cowboys coach Tom Landry once told him he could play despite a broken bone in his back. Not even the flak jacket Dorsett says he wore beneath his jersey could bring relief, the injury so painful that "tears would just start flowing out of my eyes, profusely and uncontrollably" during practices. "They would see me and just point to the training room. 'Go to the training room, get some ice and heat and come on back out here,'" Dorsett says.

That, indeed, was (and to some extent, still is) the coaching mantra: "Suck it up and get back out there!"

Presumption versus Denial
For many years, the NFL denied any relationship between the violence on the field and the subsequent mental traumas of former players. Much like the company doctors who once denied that smoking caused cancer, the league's doctors insisted that there was no demonstrable relationship between multiple concussions and dementia.

The systematic denial has ended, but the implications for hundreds of retired players are still not clear. I envision that they will eventually reach a settlement, where the league accepts responsibility for virtually any and all mental incapacity in its retirees. Much like the cancer and heart attack presumptions granted to public sector firefighters and police, the league would presume that mental disabilities among retirees are work related, with the burden of proof on a given owner to show that they are not.

While any such settlement will involved the commitment of millions of dollars, the league is so wildly popular, only a small percentage of gross income will be required.

Appetite for Sport
In the meantime, we face half a year without football. Come fall, there will be a Thursday night game every week, along with the full Sunday menu. To be sure, the players don't like the short week of preparation that Thursday games entail; they will lack the usual full week to recover from the bumps and bruises of the prior Sunday game. Oh, well, the public's appetite for America's Game is nearly insatiable. The players will just have to suck it up and get back out there...

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February 6, 2012


ABC news has picked up a story out of Arkansas: Zack Clement suffered a hernia while moving a refrigerator for his employer, Johnson's Warehouse Showroom. He underwent multiple surgeries, but the pain lingered, so he filed for a continuation of benefits. Among the pieces of evidence at his trial were party photos posted on his Facebook page, which show Clement drinking (and little else). When his claim for reinstatement was denied, Clement appealed, citing the unfairness of the Facebook evidence.

ABC wrote as follows:

In an opinion, written by Judge David M. Glover, the Arkansas Court of Appeals states: "We find no abuse of discretion in the allowance of photographs. Clement contended that he was in excruciating pain, but these pictures show him drinking and partying."

"Certainly these pictures could have a bearing on a Clement's credibility, albeit a negative effect that Clement might not wish to be demonstrated to the ALJ or the Commission, " Glover continues. "We hold that there was not an abuse of discretion in allowing the photographs."

Justice in the Details
At first glance, the judge's comments might be cause for alarm. An injured worker suffering from chronic pain might well be capable of having a few drinks with friends. (One can only hope that the alcohol does not interfere with any prescribed -or unprescribed - pain medications.) If the photos were the primary evidence of Clement's condition and the basis for denying the claim, Clement would have good reason to object. However, this is not the case.

In the course of his carefully reasoned findings, Judge Glover reviews in detail the medical history of Clement's claim. Even after multiple surgeries and several changes in treating doctors, Clement complained of ongoing pain. Extensive medical testing revealed no abnormalities and no evidence for the pain itself. He has been released to full duty. It is this detailed history and the lack of medical evidence that lead Glover to conclude that any further treatment would fall outside of the workers comp system. The Facebook photos are by no means the foundation of his findings. Nonetheless, he decides that the photos are a legitimate piece of the case file and admissable as evidence.

In my limited experience, Facebook seems to be a platform for superficial news and, for the most part, images of the good times. It is difficult to imagine that Clement would have used this public forum to post pictures of himself suffering excrutiating pain. If he had chosen to do so, this might have provided evidence in his favor. However, his friends would likely have chided him for being such a downer and even then, the court might have dismissed the images as theatrical exaggeration.

Facebook may now be the preferred means of presenting our personal narratives, but it is unlikely to help us make our case in a court of law.

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December 20, 2011


Raymond Letellier co-founded a steel fabrication company in New Hampshire called Steelelements. The company suffered a major fire in March of 2007. They rebuilt, although the cost of the rebuilding, managed by Letellier's partner, exceeded the budget. In October 2009 the company went out of business. Throughout the long, downward spiral, Letellier suffered from stress, hypertension and depression. Soon after the company's failure, he filed for personal and business bankruptcy. At the same time, he applied for workers comp benefits.

Letellier's claim was initially denied, then accepted for the medical costs only, and then denied again. Eventually the claim reached the New Hampshire Supreme Court, where a deeply divided court (3 to 2) ruled against Letellier. The court reasoned that the failure of the company was akin to a personnel action: workers comp does not cover such employer actions as discipline, termination and lay off. In closing the business, Letellier subjected himself - and everyone else - to a lay off. - a non-compensable personnel action.

Work-Related Stress?
Two dissenting judges pointed out that the majority focused almost exclusively on the ultimate failure of the company, the lay off itself. But the extraordinary and relentless stressors in Letellier's life began with the fire and continued throughout the struggle to keep the over-leveraged company in business. This is not the stress of a single event, but the cumulation of stress over months and years. The dissenters noted that Letellier's commute to the factory was 100 miles, so he often slept in his office, where ever-pending doom haunted his every waking moment and his troubled dreams. They opined that his multiple health issues were predominantly caused by work.

Letellier, once the proud owner of a successful business, finds himself in the same situation as laid off workers across America. He is on his own and out of luck.

We will set aside for the moment what may be Letellier's biggest mistake: instead of trying to make things that people can actually use, he should have pursued a career in finance, where he could have sold worthless mortgages, watched his company flounder, and then be rescued by tax-payer bailout, all the while preserving a superbly inflated salary. That's an All-American story of a different sort, albeit fodder for another day.

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December 12, 2011


Today we examine two court cases that trouble the dreams of claims adjusters: workers with severe injuries whose use of pain medication leads to their deaths. In one case, the accidental overdose is deemed compensable; in the other, the claim is denied. The devil, of course, is in the details.

Compensable Death In Tennessee
In November 2008, Charles Kilburn was severely injured in an auto accident while in the course and scope of employment. Fractures to his back and neck resulted in permanent total disability. Following surgeries, he still experienced severe pain. A pain specialist prescribed oxycodone. Fourteen months after the accident, Kilburn died of an accidental overdose. His widow filed for death benefits.

Kilburn's employer believed that the death was the result of negligence, which would break the chain of causality with the original injury. Kilburn had ignored his doctor's cautions to limit his intake of oxycontin to a specific maximum dose. The Supreme Court of Tennessee determined that the severe pain experienced by Kilburn might result in diminished faculties, which in turn might lead to taking more medicine than was prescribed. In their view, the chain of causality remained intact at Kilburn's death and thus his widow was entitled to benefits.

Denial in Ohio
In Parker v Honda of America, the initial circumstances are similar, but the apparent "diminished faculties" lead to a very different result. John Parker suffered a severe back injury at work in 1988. He was prescribed OxyContin in March 1999. He eventually became addicted to the drug, along with cocaine, percocet and heroin. In March of 2006 he was found dead, a syringe in his arm, a spoon with a lethal dose of melted OxyContin at his side. In this case, the Ohio Court of Appeals found that his melting and injecting the drug, combined with his documented abuse of street drugs, broke the chain of causation linking the death to the workplace injury.

The court rejected his widow's argument that the drug abuse was the result of a "severe disturbance of mind" and thus unintentional. It's worth noting that if Parker had deliberately overdosed as an explicit act of suicide, the death may have been deemed compensable. But because the overdose was an acccident, workers comp benefits were denied.

The Big (and Not-So-Pretty) Picture
Pain is a constant factor in work-related injuries. The control of pain is a complex and widely misunderstood aspect of claims management. Because we live in a culture that relies heavily on powerful medications to control pain, and because the prescribing of these powerful drugs is neither well managed nor well monitored, we will see more and more cases of drug overdoses wending their way through the workers comp system. Some cases will be compensable, others will not. One thing is certain: the challenges of managing these situations will continue to haunt key players in the comp system: the doctors who prescribe the drugs, the adjusters who authorize bill payment, the families who suffer the consequences of loved ones in severe discomfort, and above all, the injured workers, whose every waking moment is compromised and consumed by a pain that just won't go away.

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November 28, 2011


Geoffrey Hampton worked as a laborer for Intech Contracting LLC. Hampton, an insulin dependent diabetic, was working with a crew on September 9, 2009, repairing a bridge in Muhlenberg KY. Hampton suddenly uttered a profanity and walked to the edge of the bridge. He climbed over a 4 foot barrier and fell 60 feet, suffering permanent injuries.

Hampton has no memory of the incident. His co-workers testified that he had been complaining about not feeling well; that he had taken a snack of sweets to adjust his blood sugar; and that the fall did not appear to be an act of suicide.

Hampton was certainly "in the course and scope" of employment, but the question for the courts was whether his injuries arose "out of" employment. The Appeals Court found that his idiopathic condition - diabetes - was the likely cause of his actions and that his extensive injuries did not arise "out of" employment. As a result, Hampton was unable to collect workers comp.

It's important to note that Hampton's employer took specific steps on that fateful evening to remove Hampton from harm's way:
- When he requested time for a break to adjust his blood sugar, they immediately consented.
[NOTE: Hampton had inadvertently left his insulin at the hotel room.]
- When Hampton complained about not feeling well toward the end of the shift, he was told to sit in the truck. He left the truck and walked toward the bridge rail on his own.

Not All Risk is Work-Related
The court noted that Hampton's diabetes was not under control, which certainly raises the issue as to whether it was safe for him to perform this kind of work; if the employer had awareness of the medical condition, they should have required a note from Hampton's doctor that it was safe for him to perform the essential job duties.

The court implies that there were circumstances where an injury might have been compensable: for example, if Hampton had been working near the edge of the bridge and had experienced a black out due to hypoglycemia, he would likely have been eligible for comp benefits. However, if it could be proven that the black out was the result of his own negligence in attending to his illness, perhaps the claim would still have been denied.

But Hampton was sitting in a truck, safe and secure, with no unusual risks or exposures. He was clearly out of harm's way. There is no way of knowing why he did what he did, but it is clear that work had nothing to do with it. When he went over the rail of the Muhlenberg bridge, he gave no thought to the workers comp safety net that usually covers his every working moment. The findings of the court are both harsh and fair. For Geoffrey Hampton, the fateful date of 9/09/09 will resonate every moment of his diminished life.

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October 24, 2011


When the category 5 hurricane hit Joplin, Missouri on May 22 this year, Mark Lindquist was perched on a mattress which covered his clients, three mentally disabled adults. Lindquist, a social worker for Community Support Services, was following the tornado protocol in a town where basements are virtually non-existent. Unfortunately, the protocol proved utterly ineffective in the wake of 200 mile per hour winds. Lindquist was plucked from his perch and hurled a block away. He was impaled on debris, with every rib broken, his shoulder destroyed and most of his teeth knocked out. He was put into a coma for about two months, nearly dying from Zyomycosis, a rare fungal infection that killed 5 other victims. And to top things off, his three clients perished in the storm.

Lindquist's survival is well beyond the expectations of his doctors. His right arm remains in a sling, but he has use of the hand. An eye that was temporarily blinded has full sight. He moves slowly and has short-term memory loss, but is able to speak clearly.

A Hole in the Safety Net?
Lindquist assumed that workers comp insurance would cover his medical costs (a whopping $2.5 million), pay for his 12 daily meds and provide indemnity for his lost wages. (As a low wage worker, Linquist could not afford health insurance.) His assumption of coverage has proved naive. He certainly was "in the course and scope of employment." However, under Missouri law, Acts of God are only covered by workers comp if work exposes the individual to unusual risk. If, on the other hand, there was no greater risk for Lindquist than that facing the general public at the time of the tornado, the injury is not compensable. Lindquist was working - heroically - but the work itself did not cause the injuries. His claim has been denied.

End of story? Not quite. Certainly a case can and will be made that by lying on top of a mattress, in that particular location, Lindquist was more exposed to harm than the general public. He will be able to show that had he not been working, he might have been able to drive his van out of harm's way. Given the high profile of his claim, he is likely to prevail at some point in the process.

It's worth noting that of 132 comp claims filed in the tornado's aftermath, only 8 have been denied. It may have been an Act of God, but somewhere along the line there will be an act of mercy to help a courageous worker rebuild his shattered life from the ground up.

Thanks to Mark Walls and his Workers Comp Analysis Group for the heads up on this story.

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September 19, 2011


We know that there are individuals with extreme sensitivity to chemicals. What we don't know, in many cases, is whether exposure to chemicals in the workplace produces a compensable incident under workers comp. As with work-related illnesses (e.g., cancer possibly caused by workplace carcinogens), it can be difficult to prove that the workplace exposure is the predominant cause of the disability.

For a little over a year in mid-1990s, Deborah Chriestenson worked for Russell Stover Candies in Iola, Kansas. She had been diagnosed with multiple chemical sensitivity in 1986. She worked as a plant nurse, safety coordinator, and workers compensation benefits coordinator. Her office was located across the hall from a laundry facility. Chriestensen contends that she could smell bleach on a regular basis in her office. She claimed to have suffered respiratory symptoms as well as increasing headaches as a result of this exposure.

Chriestenson also claims she was occasionally exposed to methyl bromide fumes emanating from a room where nuts were fumigated. In addition, she claims that she was exposed to fumes from pesticides, truck exhaust, paint, and anhydrous ammonia at various times during her employment at Russell Stover. [As for the future eating of chocolate nut clusters from Russell Stover or any other manufacturer, I leave it to the reader to perform his/her own risk analysis...]

Soon after her termination from the company, Chriestenson filed a workers comp claim. She received temporary total disability benefits. Her claim wended its way slowly through the Kansas system, until 2006, 11 years after she left the company, a split panel of comp judges awarded her permanent total disability (PTD) benefits.

There were two key elements supporting of Chriestenson's claim: her own testimony and that of an expert witness, Dr. Grace Ziem, who specializes in chemical sensitivity. (Dr. Ziem's website is full of red flags for toxic exposures.) Dr. Ziem's testimony was key: without her connecting Chriestensen's problems directly to the workplace, there would be no comp claim.

Evidence-Based Medicine
The Kansas Court of Appeals has reversed the decision to award Chriestenson PTD benefits. While they recognize Dr. Ziem's skills as a medical provider, they question her credentials to connect Chriestenson's problems to the workplace. For one thing, Chriestenson is a lifelong smoker; Dr. Ziem casually dismisses any connection between smoking and Chriestenson's respitory problems. In addition, Dr. Ziem did not bother to examine the medical records pertaining to treatment of Chriestenson in the days and months immediately following her filing of a comp claim. Finally, the Kansas court calls into question Dr. Ziem's methods, citing court rulings in two other cases where her testimony was rejected outright.

In Georgia:
Our research has revealed that several courts across the United States have also had difficulty with causation opinions expressed by Dr. Ziem in chemical sensitivity cases. In Mason v. Home Depot U.S.A., Inc., 283 Ga. 271, 658 S.E.2d 603 (2008), Dr. Ziem was not permitted to testify on causation in an civil lawsuit against a manufacturer and seller of a floor covering product. The Georgia Supreme Court upheld a trial court's determination that "Dr. Ziem's methods [are] based only on her own experience and opinions, without any support in published scientific journals or any reliable techniques for discerning the behaviors and effects of the chemicals contained" in the floor covering product. 283 Ga. at 279.

In Tennessee:
Likewise, in Wynacht v. Beckman Instruments, Inc., 113 F.Supp.2d 1205 (E.D. Tenn. 2000), the United States District Court for the Eastern District of Tennessee did not allow Dr. Ziem to offer an opinion on causation in a product liability case arising out of alleged exposure to chemicals in the workplace. Although the court found her qualified to diagnose medical conditions and treat patients, it found that "[t]he ability to diagnose medical conditions is not remotely the same . . . as the ability to deduce, delineate, and describe, in a scientifically reliable manner, the causes of those medical conditions."

Given her prior history, the lack of compelling evidence in the workplace exposure and her ongoing smoking, Chriestenson is unable to prove a definitive connection between workplace exposures and her current inability to work. It is a sad case, for sure, and it is entirely possible that work contributed in some degree to her current dilemma. But the burden of proof in this type of claim is difficult, often impossible, to achieve. For all her expertise in treating chemical sensitivity, Dr. Ziem has fallen short in her effort to establish herself as a credible expert witness - at least in Georgia, Tennessee and Kansas.

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August 30, 2011


We first encountered Montana workers comp judge James Jeremiah Shea last year, when he ruled that Brock Hopkins, a pot-smoking handyman, was eligible for workers comp after being mauled by a bear at Great Bear Adventures. In his ruling, Judge Shea managed to invoke the movie, Harold and Kumar Go to White Castle, to wit:

"It is not as if this attack occurred when Hopkins inexplicably wandered into the grizzly pen while searching for the nearest White Castle. Hopkins was attacked while performing a job Kilpatrick had paid him to do - feeding grizzly bears."

In a more recent case, Judge Shea was confronted with the claim of Bruce Martin, a carpenter seeking treatment for what he insisted was a work-related back problem. While there is no reason to believe that Martin was partaking of Brock Hopkins's favorite recreational drug, he did manage to present a narrative that consistently conflicted with the perceptions of virtually everyone else involved: his employer, Jesse Chase, co-worker Barry Hollander, and claims adjuster Michele Fairclough.

Martin claimed he injured his back while stripping the plastic protective barrier off of metal siding - a relatively light-duty task. But in walking off the job that morning, he stated to his boss that his sciatica was acting up and that it was not work related. Only after going to an Urgent Care clinic did he claim that the injury happened at work. Why? We can assume that he wanted his employer to pick up the tab through workers comp.

My Aching Back
Martin's history of back problems began in the early 1990s, following a motor vehicle accident. He treated sporadically with Dr. Aumann, a chiropractor. Dr. Aumann, sympathetic to his long-term patient, thought that "on a more- probable-than-not" basis that Martin's injury was the result of the work accident he described. Unfortunately for Martin, no one else bought his story, even as the story itself changed over time.

Judge Shea wrote:

Dr. Aumann identified objective medical findings to support Martin's claim of lumbar spine problems. However, Martin has not established that this injury occurred because of a specific event on a single day or during a single shift. I did not find Martin's testimony credible. Neither Hollander, who was working alongside Martin, nor Martin's employer Chase could corroborate Martin's account of injuring his back on June 29, 2010...

It is not altogether impossible to feel a little sympathy for Martin: he has a real back problem. He is experiencing legitimate pain. He has difficulty performing physical work and is not trained to do anything else. He desperately needs income. Martin is like a lot of other American workers in these troubled times, living day-to-day on the edge of disaster. While we can understand why he would try to stretch the facts to fit the workers comp mold, we acknowledge that he was wrong to do it. As Judge Shea concluded, Martin was not injured as the result of an industrial accident. Given that definitive ruling, Martin, bad back and all, is simply on his own.

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August 1, 2011


David Little worked for B & L Ford in Ashland, Pennsylvania. He suffered a shoulder injury in October 2005. He worked light duty up until January 19, 2006, when the employer received a letter from his attorney stating he was unable to perform any manual labor. The employer advised Little to secure a note from his doctor regarding his ability - or inability - to work. His doctor gave Little a letter stating he was unable to work, but before Little had the opportunity to present the letter to B & L Ford, they sent Little a letter of their own, terminating him.

Little spent a weekend brooding over the termination. He called his wife home from her job on Monday. She found Little at the kitchen table, holding the termination letter. He stood up and then collapsed from a heart attack. Emergency workers had to pry the letter from his hand. Little died later that day at a hospital.

Was this a work-related fatality? Little's widow filed two workers comp claims, one for Temporary total benefits up until the death, and one for death/survivor benefits.

Small Victory, Big Loss
A workers comp judge awarded temporary total disability benefits up to the date of Little's death; once Little became "unavailable" for work (i.e., dead), the benefits ceased. On the issue of a work-related fatality, the judge found - and the Commonwealth Court of PA upheld - that the death was not work related, as it neither occurred "in the course and scope of employment" nor did Little's activities on that fatal day "further the interests" of the employer.

There is no question that the loss of his job was a significant, perhaps predominant, factor in Little's death. However, personnel actions (discipline, demotions and terminations) are generally excluded from workers comp coverage. The sequence of events that began with his attorney's letter culminated first in the loss of the job and then in a fatal heart attack.

Given that Little had filed a workers comp claim and the employer apparently fired him because of his injury, the widow might be able to sue for wrongful termination. But the courts have made it clear that aside from a modest indemnity payment for lost time, workers comp will provide the widow no solace and no support for the work-related loss of her husband.

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July 18, 2011


Gary Veeder had the kind of job TV viewers love: for 31 years he was a scientist in the New York State Police Forensic Investigation Center. He specialized in trace evidence, examining fibers, arson residue, footwear impressions, glass, hair and other evidence gathered in criminal investigations. His findings carried significant weight in criminal trials. People went to jail based upon his evidence. Alas, a state investigation found significant problems in 29 percent of Veeder's 322 cases. That's a lot of problems - and a lot of jail time - for people who may or may not have committed crimes.

As the investigation into his work unfolded, Veeder first retired and then committed suicide by hanging himself in his garage. Given that the stress leading to the suicide was predominantly caused by work, his widow filed for workers comp benefits. The claim was denied, on the basis that the stress was the result of personnel actions, which are excluded from comp eligibility.

The case wended its way to the Appelate Division of the NY Supreme Court, where the decision to deny benefits was reversed and the case sent back to the workers comp board for reconsideration.

Nothing Personnel
The reversal was based upon a simple, rather stark conclusion: at the time of Veeder's suicide, no personnel actions had been implemented. The state was investigating the situation; they had uncovered problems in Veeder's work, but they were on a narrowly defined "fact finding" mission. No action had been taken against Veeder: he was not suspended or demoted or disciplined in any manner. Thus the stress was purely the result of the investigation, not of any personnel action.

In other words, had the employer simply announced to Veeder that the investigation was the initial phase of a disciplinary process, he would probably not have been eligible for workers comp. The only facts that count: he was under enormous work-related stress (of his own making) and he killed himself as a direct result of the work-related situation. And because comp is no fault, it appears that Veeder's widow will be eligible for burial and indemnity benefits.

Is this fair? Is this just? Maybe yes, maybe no, but these questions themselves are not relevant in the determination of compensability. The claim may still be denied, but some other basis of denial must be found.

Hard Time
Veeder did his job poorly, but he was never held accountable by his superiors. A case can be made that Veeder's widow is an innocent party, that she is entitled to benefits for her husband's "work-related" death - despite the fact that virtually all of the stress was of Veeder's own doing. Meanwhile, quite a few people convicted on corrupted evidence are serving hard time. Some were probably guilty, others completely innocent. But in cases where the lynchpin of conviction was Veeder's incompetent work, all deserve to go free. This is unlikely to happen. Is this fair? Is this just? Nothing "maybe" about it. Justice - to this point, at least - has certainly not been served.

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July 5, 2011


Work can be a killer when workers are asked to do too much: intense labor in the heat of summer, the stress of heavy repetitive lifting, moving too quickly among common workplace hazards. But can work kill us from doing too little? Can work-required inactivity lead to a compensable claim?

For twenty five years, Cathleen Renner worked as a manager for AT&T. With a heavy workload, she often brought work home and labored at her computer late into the night. In September 2007, facing a tight deadline, she appeared to pull an all-nighter; she sent an email to a colleague around midnight and was seen at her desk at 7 in the morning, at which time she complained about a pain in her leg. She labored on through the morning. Around 11 am, she had trouble breathing. By the time she reached the hospital, she was dead from a pulmonary embolism (which began with that pain in her leg).

The New Jersey workers compensation had to determined if work was the predominant cause of the death.

Risks in Doing Nothing
Back in May of 2006, we blogged the dangers of inactivity. If people sit still for a long time - for example, during air travel - they are at risk for deep vein thrombosis. It appears that Cathleen's prolonged and unrelieved sitting at her computer caused just such an incident. According to a medical expert, she experienced an "unorganized" blood clot which developed while she was sitting (as opposed to an organized clot, which takes much longer to form). Despite her other risk factors - obesity and the use of birth control pills - the court determined that her death was work related.

The defense argued that Cathleen lived a relatively sedentary life - that her sitting at the computer was no different than her sitting at other times. But her husband countered with the observation that they had school-aged children. Cathleen was always running around, taking the kids to school and appointments, cooking meals, cleaning the house and doing the myriad tasks that virtually all mothers must perform. That's a pretty compelling argument and it convinced the judges: the Superior Court determined that the prolonged sitting while performing work-related tasks caused her death.

Get Out of that Chair!
Savvy employers will note the risks of prolonged sitting and encourage - require! - employees to get up at least once an hour to move around and stretch. (Policies should cover workers in their home offices, too.) Moving around not only prevents blood clots, it also prevents injuries to the spine. Humans are not meant to sit in one place indefinitely. We are built to move and move we must.

With that being stated, I'm going to stand up and stretch a bit. Unless you are reading this on a treadmill, I recommend that you do the same.

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June 21, 2011


A restaurant manager taking out the trash in Virginia, a tree trimmer in Ohio and an Alabama school coach sitting inside at a desk are all workers who inadvertently joined a unique club this year: lightning strike survivors. In any given year, the odds of being struck by lightning are about one in a million, but the lifetime odds (over 80 years) are 1 in 10,000. About 90% of all lightning strike victims survive. About 25% of the survivors suffer major medical after effects.

This week is Lightning Strike Awareness Week - and the National Weather Service wants to remind you to be safe. Public awareness campaigns appear to be working because lightning-related fatalities have been trending down in recent years. While there are 55 fatal lightning strikes in an average year, in 2010 there were 29 fatalities, which occurred in 19 states in 2010; in 2009, there were 34 fatalities; in 2008, there were 28 fatalities.

There have been 5 lightning-related fatalities in 2011, one each in LA, MO, MT, NC, PA. Three deaths occurred during agricultural work, one was related to tornado search-and-rescue, and one occurred during golf. While lightning strikes can occur in any month, they spike in the summer months.

When it comes to geographical risks, not all locations are equal - some states are riskier than others. Florida has often been called the "lightning capital of the world," and although NASA scientists have clarified that Rwanda actually holds this dubious title, Florida still holds the North American title. Rounding out to the top five states for lightning-related fatalities, we have Colorado, Texas, Georgia, and North Carolina.

Are lightning strikes compensable under workers comp?
The answer to that question is a clear and resounding "maybe." As with so many issues in workers comp, the devil is in the details: state law, where and when the injury occurred, and the nature of the work involved all are factors that come into play. Injuries related to lightning and other weather-related events fall under the murky area of "acts of God" or "neutral risks," which are generally not considered to be the responsibility or liability of the employer. However, if a worker is exposed to heightened risk due to the nature of their work responsibilities, an injury related to a lightning strike could be compensable.

Often, the burden is on the employee to establish a causal link between their injury and their work or to prove that their job exposed them to increased or heightened risk. Recently, however, the North Carolina Court of Appeals upheld benefits for a framer who suffered injuries related to a lightning strike that occurred while he was at work. The court established that he did not have to provide expert testimony to establish increased risk. "The court concluded that the description of the physical characteristics of the jobsite supported a finding that the framer was at an increased risk of a lightning strike."

Employers certainly can't insulate their workers from "acts of God" but there are steps that employers can take to mitigate risk. It's a good idea to review weather-related hazards with your employees seasonally to raise their awareness about safety best practices both on the job and off. And it is important to take particular care with workers who have outdoor responsibilities or work that might put them at heightened risk. Here are some tools & resources:

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May 31, 2011


The brinksmanship continues in Illinois. A moderately effective reform bill passed the senate but has been defeated in the house by Republicans, who seek stronger ways to limit compensability. As a result, the Dems are moving forward with the Doomsday option: a bill to abolish workers comp and send each and every claim into the court system. Wow, that's one way to make everyone miserable, above all, injured workers looking for a reliable safety net.

Among other things, the defeated reform bill would have reduced the medical fee schedule by 30 percent, thereby saving (theoretically) $500m to $700m per year. The reduction sounds harsh, but in practice, fee schedules are fluid. For top specialists, the fees are almost always negotiated upward; for run-of-the-mill practitioners - or the Dr. Feelgoods with their pockets full of pills - they can take it or leave it. Lowered fee schedules provide payers with leverage to find the best available doctors - not necessarily a bad thing.

Who Blinks?
At the moment, legislators are playing a classic game of chicken: if we can't reach agreement on reforms, we'll blow the whole thing up. Given that Democrats are behind the Doomsday option, I doubt they will allow things to reach that point, as it would be a disaster for workers. But they are running out of time.

The potential good news for Illinois employers (and there isn't much when it comes to comp) is that even the modest changes in the reform bill will begin to reduce the cost of workers comp, currently the third highest in the nation. The bad news is that further reforms will be needed, most of all, perhaps, involving the de-politicizing of comp in a hyper-political state. My advice to the legislators is simple: take it incrementally. Pass the reform bill pretty much as is and revisit the issue in the next session. In this precarious situation, half a loaf is better than none.

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May 25, 2011


Henry C. Becker Custom Building Limited was doing some construction work in Newburyport MA. They hired the Great Green Barrier Company to do some waterproofing. They apparently did not ask for a certificate of insurance; Great Green Barrier did not carry workers comp for their employees. There was an explosion on the jobsite. Timothy Wentworth, an employee of Great Green Barrier, was killed; his son, Ezekiel, was severely injured. As the employees of an uninsured subcontractor, the Wentworths collected workers comp through Becker's insurance company, which paid out substantial lump sum settlements to each.

Then the Wentworths sued Becker as a third party. Becker objected: comp, after all, is an exclusive remedy. Once the Wentworths collected comp benefits, they should be precluded from any other remedies. Becker sought and won a summary judgment dismissing the lawsuit.

The case wended its way to the MA Supreme Judicial Court, where the justices determined that the summary judgment was improper: the exclusive remedy provision of the comp statute applies only to employees. The Wentworths were not employees of Becker, but of Great Green Barrier. Becker, in other words, was a third party and thus, despite the payment of comp benefits, was not immune from lawsuit.

Compounded Liabilties
Becker is going to pay and pay again: first, under their workers comp policy, the payroll for Great Green Barrier employees will have been added to the Becker payroll in the premium audit; that's the chump change. Then, the substantial losses for the Wentworths - each likely exceeding the state rating point limit of $175,000 - will be added to the experience modification calculation for Becker over a three year period. That's serious bucks (but nowhere near the financial hit taken by Becker's comp carrier).

Then, given this ruling, the Becker company is vulnerable to a lawsuit, which is likely to result in additional payments to the Wentworth family. The MA Supreme Court has made it crystal clear: general contractors are liable for the comp costs of uninsured subs, but the acceptance of comp benefits does not preclude a third party lawsuit.

The lesson for GCs should be clear: proper risk transfer must be a fundamental part of the operation. Make sure subcontractors carry workers comp: require that any and all subs produce a certificate of insurance, with the GC named as an additional insured. Track the expiration dates on the certificates and do not allow subs on the job site unless they have shown that comp (and liability) policies are in place.

Henry C. Becker Custom Building has learned about risk transfer the hard way, an expensive lesson indeed. May a word to the wise be sufficient.

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May 17, 2011


Illinois is struggling mightily with its bloated workers comp system. Currently ranked 3rd highest for overall cost in the Oregon study, the governor and legislature are under intense pressure from the business community to lower the cost of comp insurance. Aiming its powerful bulldozers at the state capital, the Caterpiller Company has threatened to move their business somewhere else if reforms are not implemented immediately. In exploring all options, the legislature has gone so far as to think the unthinkable: abolishing workers comp.

In looking for ways to save money, Illinois does what all states do: first, identify the cost drivers and then try to change the statute to bring down costs. Among the hot issues on the table are the medical fee schedule (too generous), employee choice of doctor (too flexible), duration of benefits (too long), causation (too vague). Ah, behind every cost driver is a vested interest (perhaps literally vested, with many of the lobbyists wearing three piece suits). The common denominator among all states struggling with high comp costs is the omni-present stakeholder, who is deeply committed to the status quo.

Governor Quinn would like to see a number of reforms, including the capping of carpal tunnel benefits, denying claims where employee intoxication is a significant factor, attacking fraud (see our blog on Illinois's dubious arbitration services), capping wage differential benefits at age 67 or five years after an injury, and implementing utilization review for physical therapy, chiropractic and occupational therapy services.

Going Nuclear
The Illinois legislature is so frustrated with the slow progress and with stakeholder resistance to change, they are now threatening to blow up the entire system. Interesting to note, this pressure is coming from the Democrats. John Bradley (D-Marion) has filed House 1032, a bill to repeal the workers comp act and send all workplace-injury issues into the court system. Should this happen, Illinois will find itself in the world prior to 1912, when injured workers had to sue their employers and could collect benefits only if their injuries were caused by someone other than themselves. They would collect no benefits while awaiting adjudication of their claims. They would be out of work and out of luck.

In all likelihood, repeal of workers comp is not a serious option in Illinois; it's a political strategy for getting the attention of inertia-bound legislators. But the prospect of abolition does raise an interesting issue. Workers comp came to America 100 years ago. By the end of the World War II, every state had implemented the program.

What if there were no workers comp programs today? What if each state were starting from the beginning and tackling the issue of protection for injured workers? I find it hard to imagine that state legislatures would be willing to implement a program, totally funded by employers, that provides indemnity for lost wages and 100 percent medical benefits for injured workers. Why so generous? Why so inclusive? It's too expensive. It will create disincentives for working. The cost will drive employers out of business or out of state.

With today's acrimonious, ideology-driven debates, workers comp would be a hard sell. That's too bad, for despite its problems and inequities, despite the wide variations in benefits and costs from state to state, comp is a compelling example of effective social engineering. In Illinois, cooler heads will likely avoid the meltdown option. To be sure, Illinois comp is a mess, but the alternative - a workplace without workers comp - would be far worse.

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April 19, 2011


Last September we blogged the sorry saga of Illinois trooper Matt Mitchell. He was heading toward an accident scene, siren blazing, texting his girlfriend and weaving in and out of traffic at a mind-boggling 126 miles per hour. (There was no urgency, as other troopers were already at the scene.) He crossed the median and slammed into a car coming the other way, killing teenage sisters Kelli and Jessica Uhl. Three days after pleading guilty to criminal charges, he filed for workers comp benefits. We expected that he would be able to collect; after all, comp is no fault and Mitchell was certainly in the "course and scope of employment."

We guessed wrong. An arbitrator found him ineligible, saying he neglected his duties as a trooper by taking "unjustifiable" risks. He was ineligible, in effect, because he knowingly and willfully put himself and others at risk. Mitchell is appealing the arbitrator's decision.

Carved in Stone
In an effort to make sure that the ugly circumstances of this incident are not repeated, the Illinois senate recently passed a bill (S 1147) denying any workers comp claim for injuries or death incurred while committing a crime, with crime defined as "a forcible felony, aggravated driving under the influence, or reckless homicide that resulted in the death or injury of another."

It's not unusual for a legislature to fashion ad hoc solutions to very specific situations. Prior to Matt Mitchell, there would have been little if any support for this particular bill. But once the possibility arose that Mitchell might actually be able to collect comp, the legislature was motivated to change the statute. Usually judges and arbitrators act with some discretion. In these egregious circumstances, the legislature wants to make its intent crystal clear.

The bill requires a conviction; on the other hand, acquittal or dismissal of the charges will not create a presumption that the claim is compensable.

As for Mitchell, the former trooper has left the state and now resides in New Jersey. Perhaps his dreams are troubled by images from that fateful day, when the dreams of two young sisters were obliterated by his negligence. He probably still experiences difficulty with his damaged legs, but one thing now appears fairly certain: there will be no indemnity checks in the mail to ease the pain of his work-related but non-compensable injuries.

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April 11, 2011


We have long puzzled over a peculiar and cruel stipulation in Virginia's workers comp statute that denies coverage to workers with brain injuries, where the injury had no witnesses and the injured could not testify on their own behalf. We first encountered the issue with a trucker named Arthur Pierce, who was found unconscious beside his truck with multiple skull fractures, a sinus facture and head trauma. Had Pierce been found dead at the scene, the injury would have been compensable. But because survived the accident only to die later at a hospital, the system invoked the rule that the claimant must provide direct testimony.

In their denial of benefits, the workers comp commission wrote:

The circumstances surrounding the claimant's injury and death are tragic, and we are certainly sympathetic to the loss his family members have experienced. We are also mindful of the difficulties in obtaining and introducing sufficient evidence to support those claims...It would be purely speculative to infer that the only rationale (for the accident) was a workplace risk.

Purely speculative?. Sure, he might have been knocked off the truck by space aliens (which, to my mind, would still be compensable as he clearly was in the course and scope of employment).

Ever-So-Gradual Justice
We are pleased to report that the Virginia legislature - through a unanimous vote in both house and senate - has corrected the statute, which Governor Bob McDonnell has signed into law. Title 65 of the Code of Virginia now reads:

In any claim for compensation where the employee is physically or mentally unable to testify as confirmed by competent medical evidence and where there is unrebutted prima facie evidence that indicates the injury was work-related, it should be presumed in the absence of a preponderance of evidence to the contrary that the injury was work related.

It's too late for Claire Pierce, Arthur's widow, to benefit from a law that she diligently lobbied for. And while the Virginia legislature would never thumb its nose at the comp board, it would have been nice to call Title 65 the "Arthur Pierce Provision." This grotesque loophole has finally been closed. Unwitnessed brain injuries may now be compensable. It appears to be a no-brainer, but it took the brains of Virginia a rather long time to reach this just conclusion.

Thanks to Workcompcentral(subscription required) for the heads up on this item.

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April 1, 2011


We last encountered Brock Hopkins back in June of 2010, when he had secured workers comp benefits for severe injuries incurred while feeding bears. He was a bit stoned at the time. Russell Kilpatrick, owner of Great Bear Adventures in Montana, contended that Hopkins was a volunteer. Judge Jeremiah Shea found in Hopkins's favor. Now the Supreme Court of Montana has weighed in, finding that Judge Shea got it right.

There were three major issues in determining compensability: whether Hopkins was an employee; whether he was in the course and scope of employment when attacked; and whether his marijuana use precluded payment of benefits.

Hopkins frequently worked in the park, performing minor repairs and, yes, feeding the bears.The pay was informal, but Kilpatrick would slip him some money now and then. This "exchange of money for favors" is, well, employment. Thus, Hopkins was an employee, working under the admittedly informal and ad hoc supervision of the laid-back Kilpatrick.

While it is not clear that Kilpatrick wanted the bears fed on the fateful day, he did not tell Hopkins not to feed them. And as Judge Shea deadpanned in his ruling: "...presumably, customers are unwilling to pay cash to see dead and emaciated bears." Hopkins, in other words, was working when he mixed up the feed, set down his marijuana pipe on a fence post and entered the enclosure.

Finally, the judge opined that smoking marijuana while working among bears was "ill-advised to say the least and mind-bogglingly stupid to say the most," being high was not a factor in the attack. Red, the attacking bear, was an "equal opportunity mauler" and likely would have gone after anyone, stoned or sober.

So Brock Hopkins, a loser by most accounts, wins in the courts. He collects indemnity for his (considerable) troubles and has all his extensive medical bills paid through the Montana uninsured fund. Kilpatrick's legal woes continue, as he did not carry workers comp insurance for the employees he didn't think he had. So much for clear thinking in the good mountain air of Montana.

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March 11, 2011


Our thoughts and prayers are with the people in Asia who are suffering through a disaster of unprecedented scale. The digital age allows us to watch the apocalyptic images: entire neighborhoods being swept to sea; burning houses borne upon the dark tide of water and debris; hundreds of vehicles swept along as if they were rudderless boats; the boats themselves powerless against the sheer force of the waters. We engineer our buildings, our infrastructure, our vehicles, our very lives on the assumption that the odds are always with us, that destructive forces of this magnitude are very unlikely to rise up from the depths of the ocean. And yet, on occasion, arise they do.

It will take months to sort out the damages. Indeed, the damage has not even run its brutal and indifferent course. But we cannot allow this horrific moment to pass without at least a glance at the implications for the subject of this blog, the insurance industry. Insurance is all about risk and risk transfer. Individuals and most businesses are too small to absorb the risk of loss that surrounds us. We purchase insurance as a hedge against disaster: loss of life, property, assets, physical ability, etc. The law of large numbers works in favor of the insurer: sell enough policies, expand your markets far and wide, and the risk of loss is spread out over an immense area. A catastrophe in one place is absorbed by the absence of losses elsewhere.

In the scale of what is happening in Japan, there is no elsewhere. No actuarial calculation can take into account the implications of losses on this scale. And even if the actuaries could come up with a number, the cost of the insurance would preclude anyone from buying it.

Here's one relatively minor insurance issue emerging from the rubble in Japan: the quake hit at 2:30 in the afternoon. Many of the people being swept away by the surging waters were working. Their deaths will be compensable under whatever form of workers comp exists in Japan.

Our modern lifestyles do not recognize risk and disruption on this scale. We somehow think ourselves immune from disaster. It brings to mind a poem by Percy Bysshe Shelley about another powerful and confident civilization that could not foresee an end to its dominion:


I met a traveler from an antique land
Who said: Two vast and trunkless legs of stone
Stand in the desert. Near them, on the sand,
Half sunk, a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them, and the heart that fed;
And on the pedestal these words appear:
"My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!"
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare
The lone and level sands stretch far away.

A century of horrific wars and occasional natural disasters have taught us that our arrogance and presumed mastery of the world are illusions. The lesson is clear: Ozymandias and his ilk (Muammar Gaddafi comes to mind) rule with arrogance and contempt. By contrast, our actions must be as full of generosity and compassion as possible. The risks that lurk in our lives may be beyond calculation, but what truly matters is our ability to embrace the time given to us and help those whose lives have been devastated by chance.

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January 31, 2011


John T. Dibble is an arbitrator in Illinois. He was very active in the cases for carpal tunnel syndrome filed by 230 guards at the Menard Correctional Center. The guards alleged that their injuries were due primarily to the constant turning of keys in antiquated and rather sticky locks. No diddler, Mr. Dibble approved over half of the repetitive trauma cases filed by the guards, who collected nearly $10 million in a three year period. The repetitive filings for repetitive motion have caught the eye of Illinois Governor Pat Quinn, who has appointed a lawyer to investigate. NOTE to lawyer: WD 40 can do wonders for sticky locks.

It turns out that Mr. Dibble's sympathies run deep. In fact, he has some shared experience with the prison guards who come before him. On November 12, 2009, Mr. Dibble fell on the steps at a hearing office in Herrin. He filed a claim for "post-traumatic carpal tunnel" [whatever that may be], claiming injuries to "both knees, both hands, both elbows and (his) left little finger." That would be the finger he holds up in the air when partaking of his post-hearing tea, I suppose.

Mr. Dibble settled his case for $48,790. The payment included a 17.5% loss of function for each hand and a 7.5% loss of function in his little finger. The check was cut based upon a form signed by three parties: the office of the attorney general, a Central Management Services official and Dibble himself. Mysteriously, the award was not listed in the comp commisioner's online data base. The actual case file has disappeared - and I'm guessing that the medical records have disappeared as well. It would be fascinating to read the doctor's report that resulted in Mr. Dibble's rather generous loss of function awards.

The job of arbitrator in Illinois is hazardous, indeed. Seven of the state's 32 arbitrators either filed for or received a workers comp payment, including three for repetitive trauma. You know what happens: you listen, day in and day out, to the prison guards's tales of woe, and eventually your fingers start to tingle and your wrist aches a bit. It's the price you pay - and perhaps the reward you reap - for lending a sympathetic ear.

Kudos to reporters George Pawlaczyk and Beth Hundsdorfer of the Belleview News Democrat for their coverage of this story.

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January 25, 2011


Two years ago we blogged the sad story of Arthur Pierce, a commercial driver in Virginia who suffered a traumatic brain injury and eventually died from a fall on the job. Pierce's death was deemed non-compensable due to a cruel and rather peculiar glitch in the Virginia comp statute. Under the law, if a worker suffers a brain injury that is not witnessed by others, and the worker is unable to provide details on the injury (Pierce was found in a coma from which he never emerged), the incident is not compensable. There is no room for judicial discretion: no testimony, no benefits.

We also blogged a more recent incident, where Dan Casey, a cable installer, fell off a roof. Again, there were no witnesses and again, in the days and weeks following the incident, Casey had no memory of what happened. Fortunately for him and his family, he eventually was able to remember some of the details. With some reluctance, the insurer settled the case.

The problem, obviously, lies in the Virginia comp statute. Rather than allow the comp system the normal latitude in determining compensability, the law rigidly lays out a harsh standard: if there are no witnesses, the employee must provide the narrative. In the absence of a narrative, there can be no compensability. In the above rare but compelling circumstances, seriously injured workers were unable to provide details on exactly what happened.

The Fix is In?
There is finally some movement toward amending the faulty statute. Here is the language of a bill which recently made its way out of committee, onto the floor of the Virginia House:

Workers' compensation; presumption that injury arises out of employment. Creates a presumption that a workplace injury results from an accident arising out of employment for purposes of the Workers' Compensation Act if the employee is found dead or to have incurred a brain injury resulting from external mechanical force that impairs the employee's brain function to such an extent that the employee is incapable of recalling the relevant circumstances of the accident. A judicially created presumption currently exists when an employee is found dead as the result of an accident at his place of work and there is no evidence offered to show what caused the death or to show that he was not engaged in his employer's business at the time.

Note that the brain injury must be the result of "external mechanical force" - no aneuryisms need apply. This revision would crack open the door to compensability just enough for a grievously injured Arthur Pierce or Dan Casey to slip through.

Pierce's widow has been lobbying the legislature to address this gaping hole in coverage for Virginia workers. She has nothing to gain, as the changes will not be retroactive. But it would be comforting to think that workers who suffer severe brain injuries on the job in the Old Dominion State will have recourse to the protections that are virtually universal for all workers. That would be a sanity clause, indeed.

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January 11, 2011


A deranged man with a high-powered handgun in Tucson, Arizona, has killed six people and wounded many others. We will never really understand what drives an individual to plan and execute this kind of action, just as we cannot fathom why a man (or woman) would in the name of religion strap explosives to their bodies and kill themselves and as many innocent victims as possible. Belief systems are powerful motivators; demented beliefs can bring about appalling results. In these trying times, as the poet Yeats put it, "everywhere the ceremony of innocence is drowned."

Today we limit our meditation to the role of workers compensation in this incidence of mayhem. Congresswoman Gabrielle Giffords (D-AZ) was holding an informal "Congress on the Corner" gathering outside an ironically named Safeway Supermarket, when Jared Loughner walked up behind her and shot her in the head at point blank range. Somehow, she has survived to this point. One of her aides, Gabe Zimmerman, was killed. For what it's worth, both are covered by workers comp, as they were "in the course and scope of employment." A number of Giffords's volunteers were also injured: their medical bills will likely be covered by comp, but they probably will not receive any indemnity benefits. Innocent bystanders are on their own: whether employed or not, their jobs did not bring them to that fateful location.

Federal Judge John Roll, who was killed, is a special case. The justice department will try to prove that his attendance at the event was an official act: that rather than just casually dropping by to see his friend, Rep. Giffords, he was "in the course and scope of employment" when he left his nearby office to attend the meeting. Why? It is surely not workers comp that concerns the feds; they want to include the murder of Judge Roll in the federal charges against Loughner and can only do so if the judge was technically on the job at the time he was assassinated. (Ironically, the judge had received death threats due to recent rulings.)

The Politics of Mayhem
Some have drawn a direct link between Loughner's actions and the inflammatory rhetoric of recent political campaigns. When politicians talk of "second amendment solutions" to ideological differences, they are referencing guns. By placing a cross-hair image over an opponent's photo, they raise the specter of assassination. Based upon the limited evidence of Loughner's web postings, his actions are likely the result of internal demons. His links to the real world were tenuous at best. He may have thought his actions were political, but like his brethren the suicide bombers, any intended political message is subsumed and ultimately obliterated by sheer madness.

This is by no means the first time that humanity has been confronted with such images of meaningless depravity. Yeats published "The Second Coming" in 1920, just a couple of years after the end of the first world war - the "war to end all wars."

Things fall apart; the center cannot hold;

Mere anarchy is loosed upon the world.

There was much anarchy then, much anarchy to follow in the dark days of the second world war and, alas, much anarchy in our time.

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January 4, 2011


For nearly 15 years, beginning in 1990, Bradley Clark was a baggage handler for United Airlines. He started at age 33, and by the time he was unable to perform the work, he was nearly 50. Ten years in, he began experiencing pain in his thumb joints. In 2004 he banged his hand against a cart and was diagnosed with bilateral carpal tunnel, for which he had surgery. Unfortunately, the surgery did not stop the pain. (NOTE to claims adjusters: This is yet another example of unnecessary surgery, based upon the wrong diagnosis.)

With pain continuing after the surgery, Clark sought treatment from a hand specialist. He treated with Dr. Charles T. Woolley, who performed surgical fusions on both thumbs. Coverage of this surgery was denied, as a succession of five physicians concluded that Clark's problem was osteoarthritis, which is hereditary and unrelated to work. The opinions included an IME performed by two doctors, who concurred with the other doctors that the condition was not work related.

Slam dunk for the employer, right?

Making the Case
In his choice of a hand surgeon, Bradley Clark stumbled upon a stubborn and determined physician, one more than willing to disagree with his colleagues. Dr. Woolley diagnosed bilateral trapeziometacarpal joint arthritis and insisted that it was work related. Among his impressively detailed findings:
- Clark was too young to develop osteoarthritis, as he was only 43 years old when the pain first developed.
- He found no genetic pre-disposition to developing osteoarthritis, as none of the other joints in Clark's hands, such as his fingers, revealed osteoarthritis. There was no osteoarthritis in any other part of his body.
- Osteoarthritis in the thumbs is typically seen in women, in particular post-menopausal women. Clark rather obviously did not fall within this category.
- Clark performed significant lifting for 16 years, which required repetitive pinching of his thumbs. This kind of grabbing/pinching activity places significant loading on the thumbs and ultimately leads to a wear and tear of the thumb joints. Wear and tear over time led to instability of his joints causing the osteoarthritis. His TMC or thumb joints became unstable over time because of the repetitive grabbing/pinching use. Over time with continued use, his cartilage in his thumbs wore off due to the repetitive friction from the pinching/grabbing.
- Contusions/strains, such as the work injury he sustained in November 2004, also contributed to the osteoarthritis, because they cause damage to the cartilage which leads to instability of the ligament. Jamming one's thumb also contributes to the development of osteoarthritis because it damages the ligament causing instability and then osteoarthritis.
- The thumb basal joint (where the thumb meets the wrist) is exposed to very high stresses with grabbing activities and the forces felt at the tip of the thumb are multiplied twelve times in their effect on the thumb base, thus predisposing this joint to wear and tear. Clark's work activities as a ramp serviceman are the exact kind of activities to cause wear and tear to the thumb joint because of the grabbing involved; this wear and tear led directly to the osteoarthritis in his thumbs.

Deep Knowledge
While there were five doctors lined up against him, Woolley was the only hand specialist among them. The duelling docs bolstered their differing cases through articles in medical journals. The Oregon Court of Appeals was faced with a choice: side with the majority or side with the expert.

Ultimately, Dr. Woolley's opinion prevailed. His compelling testimony, combined with his intimate knowledge of hands, won the day. So let's have a little hand for Dr. Woolley, who could have taken the easy way out and deferred to his colleagues, but instead fought the good fight for a hard-working man who could no longer do his job.

(For the record, we duly note that Clark retired from his job long before the onerous baggage fees went into effect, at which time many of us lost a bit of sympathy for these harried and ultimately blameless workers.)

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December 14, 2010


Up until recently, Peter Orszag was the director of the White House Office of Management and Budget. As he leaves this job for a presumably more lucrative position with Citibank (no comment), he offers a final op ed piece in the New York Times on the subject of disability: specifically, the sharp rise in applications for SSDI benefits that has accompanied the collapse of the economy. Discouraged job seekers, many with obsolete or atrophied skills, try to qualify for a program that will take them out of the job market forever.

Currently, about 750,000 people apply for disability benefits every quarter, a rate 50 percent higher than that of four years ago. Orszag fears the consequences of burgeoning disability rolls: it's not only expensive, it's counter-productive. Once on disability, people rarely return to the workforce, even when jobs become plentiful. They "qualify" for benefits by proving themselves incapable of productive employment.

The fundamental question for SSDI is similar to the one faced by workers comp practitioners: once an individual qualifies for permanent benefits - usually a long, drawn out process - is there any way to encourage a return to work? Or is eligibility for disability, by definition, a self-fulfilling acknowledgement that employment is no longer a possibility?

The Digital Divide
Orszag speculates that the problem may lie in the rigid determination of disability: once disabled, always disabled. There is no middle ground where an individual's limitations might be re-assessed periodically, where incentives for taking a job might encourage less dependence upon disability payments.

Orszag believes that we need some kind of interim program, less absolute in its determination of disability and less of a drag on public resources. He recommends privately funded, interim disability protection for non-work related disabilty (which would run parallel to the benefits already available through workers comp). The new program would last up to two years, during which both the employer and the worker would have strong incentives to return the disabled worker to productive employment. For workers who remain disabled at the end of the two years, application for SSDI would probably be in order. Under this model, the digital switch is made analog, with options and incentives all along the way. The cost? He estimates a relatively modest $250 per worker per year, assuming, of course, that all workers are included in the program.

Disability is indeed a conundrum: it requires people to prove that they are incapable of productive employment. The stage for this determination is strewn with detritus: the perverse incentive to prove one's lack of ability; the ever-changing economy, which casually discards workers with obsolete skills without a hint of compassion; the notion that disability is a permanent state, which, once entered, precludes the possibility of growth and change.

All too often, disability intersects with the law of unintended consequences. By seeking to protect those who cannot protect themselves, we place people in the awkward position of proving their inability to function in the working world. There is very little incentive to do otherwise. We set disability up as a locked room, with no exit. We need to think of disabiility as a bridge, arcing out of the darkness toward new possibilities. While most who are disabled may never be able to cross this bridge, those who can must be given every opportunity to make the journey.

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October 25, 2010


Tasha Dakota Burns lived with Tony Anguiano for four years. After his divorce from his first wife became final, Tony - on several occasions - asked Tasha to marry him. Tasha did not take him seriously, because his proposals only came when he had had a bit too much to drink.Tony gave Tasha an engagement ring for Christmas in 2005. Tasha acknowledged that neither she nor Tony referred to the rings as wedding rings, but it was her intention to marry Tony.

Tasha had one child by Tony, with a second on the way. Then on August 22, 2007, Tony was killed in a work-related accident, thrown from a scaffolding 40 feet in the air. The status of Tasha's relationship to Tony suddenly became paramount. She filed for death benefits under the Kansas comp statute.

At her initial hearing for benefits, Tasha testified that she believed she and Tony were married sometime in 2005 because "he gave me a ring and I gave him a ring and he wasn't going nowhere and I wasn't going to go nowhere." After the two exchanged rings, she said that Tony repeatedly stated, "I'm going to marry this girl or this is my baby and I'm going to marry her." However, Tasha admitted that Tony never stated that the two were actually married.

It is painful and perhaps futile to parse the language of a couple that "ain't going nowhere", but parsing is what the judges in these cases must do. Under Kansas law, to establish a common-law marriage, a plaintiff must prove (1) capacity of the parties to marry; (2) a present marriage agreement between the parties; and (3) a holding out to the public as husband and wife.

"Although the marriage agreement need not be in any particular form, it is essential there be a present mutual consent to the marriage between the parties" [emphasis added].

Ah, there's the rub: a "present mutual consent." We can probably assume that, had Tony been around to answer the question, he would have affirmed his marriage to Tasha. But Tony, alas, is gone and Tasha is left holding the proverbial (empty) bag. The Court of Appeals upheld the workers comp court in its ruling that there was no proof of marriage.

What's in a Name?
In building a case to reject Tasha's claim, the Court pointed to the fact that she continued to use her maiden name. While she claimed that it is uncontroverted that she "holds out to the public her married name, present intent to be married...and a wedding ring on her finger," Tasha testified that she introduces herself to others as "Tasha Burns," her driver's license lists her as "Tasha Burns," she signed her 2005, 2006, and 2007 tax returns as "Tasha Burns," and she never used the name "Tasha Anguiano" in any official capacity.

To which I say to the court, so what? Lot's of women keep their original names after marriage, so a similar standard should be applied to common law marriages.

Tasha took the risk of living with Tony and having his kids, without the protection of formalizing their relationship. Surely, it seemed unimportant at the time, especially as the marriage proposals came only when Tony was a bit looped. But as this tale illustrates, we never know how much time is given to us. The fates can be cruel; the days that seem to stretch far into the future can end abruptly. And the consequences of not explicitly establishing the exact nature of a relationship may haunt us for the rest of our lives.

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October 19, 2010


When a laborer is unable to perform physical work, the options are limited, not only for the worker, but for the workers comp system as well. Meet Pennsylvania's Sam Muzzicato. He came to America from his native Italy in 1969. He had only four years of schooling in Italy. He immediately went to work in America and continued working until January 2007, when he injured his back while employed as a laborer for Strow's Plumbing and Heating Company.

Strow's insurer hired a vocational expert to determine Sam's earning power. The expert came up with five possible jobs in the immediate labor market:
- Cashier at a Jiffy Lube
- Teller at a local casino
- Dispatcher for a trucking company
- A customer sales rep
- Front desk clerk in a hotel

Do you see a common denominator in all of these jobs? Some degree of computer literacy is needed. The Administrative Law Judge dismissed the first four jobs as not within Sam's capabilities, but for unknown reasons determined that he could perform the desk clerk position. With this theoretical job available, the ALJ approved a reduction in Sam's weekly indemnity benefit.

Here is the theory in PA law behind the wage reduction:

"[A]n employer may seek modification of a claimant's benefits by either offering the claimant a specific job that it has available that he is capable of performing or establishing earning power through expert opinion evidence."

Sam appealed to the Commonwealth Court, where the judges determined that the inclusion of the single job by the ALJ was capricious, and that Sam was incapable of performing any of the jobs recommended by the voc expert. Sam, in other words, has few, if any, transferable skills. When his body broke down, he had nothing to bring to the marketplace. As a result, his full indemnity will continue.

Broken Bodies
Sam's story is by no means unique. Many of the immigrants who came to this country to find work had limited education in their native lands. Once here, they were too busy or too indifferent to pursue educational goals. They gained a foothold through hard work, perhaps shifting educational goals onto their children. Now as they enter the waning years of employment, their bodies break down. Where once they recovered quickly from workplace injuries, now the pain lingers, eroding their capacity to work. And once out of work, there is literally no place to go.

What lies ahead for the Sam Muzzicatos of the world? While it sounds odd to say it, Sam is lucky that he was injured at work. His back problems will be treated through the comp system for the foreseeable future. He will collect roughly 2/3 of his average weekly wage, tax free, at least until his eligibility for temporary total benefits runs out. After that, he will probably qualify for some form of permanent partial award. Sam, in other words, will transition rather smoothly into retirement through the generosity of the workers comp system.

Strow's Plumbing and Heating will foot the bill through the experience rating process for three years. After that, the insurer will be on the hook for whatever is owed to Sam. Is this fair? Does it make sense? Is Sam being rewarded for his failure over the years to improve his skills through education? Ironically, if Sam did have transferable skills, his benefits would have been reduced, despite the fact that he might not be able to find work in this troubled economy. Would that have been fair? Indeed, in the world of workers comp, as judges parse the letter of the law and and employers struggle to pay the bills and injured workers battle to survive, is fairness even an issue under consideration?

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October 12, 2010


There is no doubt that Ronald Babin, an electrician in Louisiana, was injured at work. He was in the bucket of a truck, working on a transformer, when the bucket mechanism malfunctioned, crushing the bucket into the transformer for several minutes. Babin huddled in the bottom of the bucket until co-workers were able to gain control of the mechanism. He hurt his back.

This sounds like a straight-forward workers comp case, but Babin ran into a complication. This was not the first time he had hurt his back.He had four prior back injuries involving two herniated discs. At one point he was out of work for nearly two years with back problems.

When he applied for the job with Ernest Breux Electric, he filled out several pre-employment questionnaires. One asked if he had any "current or prior back injuries" (this question could well be illegal, but that's an issue for another day). He answered "no." On another form, he admitted to having a "back strain" - but again, did not mention serious disc problems.

Thus, Babin misrepresented his medical history. His employer relied upon that misrepresentation in hiring him. And his subsequent injury was directly related to the condition he failed to disclose. Bottom line for Babin: his claim was denied.

Rock and a Hard Place
One can sympathize with Babin. He probably felt that full disclosure would have resulted in his not getting the job. It is possible, of course, that Breux Electric would have taken the information into consideration and hired him anyway. With clear documentation on the prior injuries, Breux would likely have had access to Louisiana's second injury fund:
- The applicant had a permanent partial disability
- The employer would have hired him with knowledge of that disability
- The new injury merged with the old injury to produce a claim for the second injury fund

By hiding the truth, Babin essentially was working without a safety net. This might not have mattered if the injury had not aggravated the pre-existing condition. But as soon as his aching back became involved, Babin lost access to the protections of the comp system.

Abolish Second Injury Funds?
Speaking of second injury funds, our colleague Peter Rousmaniere has recommended that they all be abolished. He makes a compelling case. The money in second injury funds is derived from fees paid by all insureds. However, the primary beneficiaries of these funds has not been the employers, who took the risk in hiring disabled workers, but the insurance companies, who generally pocket the payments from the funds. They are not obligated to recalculate experience modifications and return premium dollars to the insureds. Some are diligent about doing this, others are not.

Second Injury funds may not be the most effective means of encouraging employers to hire partially disabled workers. And it's clear from this particular story that these workers should not try to lie their way into a job. In the best of all possible worlds, disabled workers would not be penalized for their candor in disclosing disabilities and employers would not be penalized for the additional risk of hiring them. But in case you have not noticed, this is hardly the best of all possible worlds.

Special thanks to Work Comp Central (subscription required) for their heads up on this and many other interesting cases.

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September 21, 2010


Matt Mitchell was an Illinois state trooper. On November 23, 2007, he was bombing along Interstate 64 at 126 miles per hour, on his way to an accident scene. He was chatting with his girlfriend and sending text messages. The road was somewhat clogged with holiday travelers. His speeding was not necessary, as help had already arrived at the accident scene. The distracted trooper crossed over the median and hit a car head on. Two sisters, Kelli and Jessica Uhl, were killed instantly. Two other occupants of the car were injured. Trooper Mitchell suffered severe leg injuries.

Speeding for no reason. Texting and talking unrelated to his job. Reckless. Negligent. And, it appears, compensable.

Mitchell pleaded guilty to reckless homicide and reckless driving and was sentenced to 30 months probation. He resigned his position with the state police. He has filed a claim for workers comp benefits, which is likely to be awarded because Mitchell was in the course and scope of employment. In the stipulation during a civil suit filed by the parents of the Uhl sisters, the Illinois attorney general agreed that, despite the criminal negligence, Mitchell was acting in his capacity as a state trooper when the accident occurred. Yes, the speeding was gratuitous, the texting irresponsible, the girl friend chats unrelated to work. But Mitchell was heading to the scene of an accident. He was a jerk and a menace, but he was working.

On the Hook
Illinois taxpayers face an interesting double jeopardy. They are on the hook for the deaths of the Uhl sisters. And they will soon be on the hook for Mitchell's loss of function payments and possibly for permanent total benefits.

It's worth noting that just three days after pleading guilty to the criminal charges, Mitchell testified in a claims hearing that he was not responsible for the crash.

If Mitchell had not been heading for an accident scene, if he was speeding simply because he wore a uniform that allowed him to get away with it, perhaps his claim would be denied under the concept of "wilful intent." We are reminded once again of comp's cornerstone principle of "no fault." There's plenty of fault in this sorry saga, but it does not - alas, it cannot - matter one bit.

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September 20, 2010


Last year the Insider blogged the unfortunate fate of Arthur Pierce, who died in a work-related accident, but whose claim was denied due to a glitch in the Virginia comp statute. Fearing a rash of bogus claims by workers faking severe brain injuries, the lawmakers allow insurers to deny any unwitnessed incident where the injured worker cannot testify to what happened. If Pierce had died instantly, his claim would have been accepted. By surviving for months without being able to talk, he never collected a dime.

Dan Casey, a columnist for the Roanoke Times, brings us the saga of Mike Gentry, who fell off a roof while installing a satellite dish. He survived, but suffered brain damage and severe physical trauma. While paying the claim at first (Gentry was in a coma and rehab for weeks), the insurer finally got to talk to him. Here is Mike and his wife Andrea's summary of the exchange with the claims adjuster:

"She asked me,'Ever jumped off a roof before? Ever thought of killing yourself?'"

"I said, 'No, and no.'"

And then she said, "Do you remember what happened?"

"And he said no," Andrea interjected. "Because he didn't. And she said, 'OK, that's all I need.'"

Thus, in accordance with the peculiar and patently unfair Virginia law, the claim was denied. Ironically, just 12 days before Gentry fell off the roof, an attempt to change the Virginia statute, instigated by Arthur Pierce's widow, was defeated in committee. The revision would have allowed brain injured workers the same presumption of compensability as workers killed on the job. In the words of insurance lobbyist and attorney Charles Midkiff, any changes in the current law would be "an invitation to fraud."

It was only through the kindness of strangers that Gentry and his family were able to survive the months without any insurance benefits. Then a minor miracle occurred: Gentry's memory of the incident came back. Not all at once, but gradually. First, he remembered that the battery on his power drill died. A few more memories filtered in. Finally, about a month after the initial recall, he remembered everything. He was climbing down to get a replacement battery from his truck, when the ladder slid and he fell.

(Over)Due Process
Armed with this new information, Gentry filed for benefits. The carrier, defended by - who woulda guessed? - attorney Midkiff, managed to delay the hearing for months (from December 2009 until April 2010). Finally, three hours before the rescheduled hearing, the carrier caved and accepted the claim.

Mike Gentry will never work again. He has double vision, his speech is slurred and he is frequently exhausted. He has severe seizures and difficulty thinking. He takes 10 medications daily. But he and his family are finally protected by the workers comp safety net - no thanks to a carrier following the letter of the law, and no thanks to the legislators who think workers are going to fake brain injuries in order to qualify for benefits.

In the words of the immortal Frank Zappa: "The United States is a nation of laws: badly written and randomly enforced." Not true of most laws, but certainly applicable to this bizarre and completely unnecessary provision of Virginia's comp statute.

NOTE: The Insider is quoted in course of Casey's fine article.

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August 31, 2010


Today we examine an interesting case where the ADA runs up against OSHA's general duty clause, where the individual's right to "reasonable accommodation" collides with the need to ensure the safety of the general public.

In 1999 Oscar Brownfield became a policemen in Yakima, Washington. By all accounts, he was a good cop. In 2000 he suffered a head injury in a non-work-related car accident. He returned to work about 6 months later. In 2005 the troubles began: he (wrongfully) accused a co-worker of malfeasance. He was short-tempered, storming out of a disciplinary hearing with a superior. He described moments of intense anxiety when he was not sure he could control himself. And he made alarming comments about how meaningless life had become.

Fearful of Brownfield's mental state, his employer sent him for a Fitness for Duty Exam (FFDE). He was diagnosed with a mood disorder and disabled from work due to his "emotional volatility, poor judgment and irritibility." The disability was considered permanent.

Then Brownfield had another auto accident. His treating physician, Dr. Gondo, released him for work: that is, he wrote that Brownfield could carry out the "physical requirements" of the job. When pressed on the issue of Brownfield's mental state, Dr. Gondo did not back down, but he did not respond either. He simply remained silent. As a result, the Yakima police department sent Brownfield for a second FFDE, with the same result as the first. Brownfield was terminated from his job.

Claiming an ADA disability (he does appear eligible), Brownfield sued for a violation of the ADA, violation of his first amendment rights of free speech (his apparently groundless accusations against a fellow cop) and violation of the FMLA (which limits the ability of employers to require multiple FFDEs). Brownfield's case was dismissed on summary judgment by the district court, a decision subsequently upheld by the 9th circuit court of appeals.

A Tool in the Toolbox
Employers often balk at requiring Fitness for Duty exams. They fear a violation of the employee's rights. This case clearly indicates that those rights can and should be tempered by a clear-headed vision of business necessity. If the employee's mental or physical condition undermines his ability to perform essential job functions safely, a fitness for duty exam is not only allowable, it is necessary. To be sure, the exam comes with a high standard: the need must be work related and it must derive from business necessity. But where these standards are met, employers must act. If the employer takes the path of least resistance and does nothing, they could easily be charged with negligent retention when and if something bad happens.

Management continuously walks a fine line between employee rights and the obligation to operate a safe workplace. Yakima took a chance in terminating Brownfield's employment, but it appears that they did what had to be done and they did it legally. Brownfield was unable to perform his job safely. His mental state comprised a risk to himself and to the public he was oath-bound to protect. It is never easy confronting an unruly, agitated and volatile employee, but it must be done - and done in a timely manner.

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August 10, 2010


Yesterday was a day of remembrance for the victims of last week's horrifying shootings at Hartford Distributors in Connecticut - our hearts go out to the family, friends, and coworkers of the deceased. Their lives will be forever changed and imprinted by this terrible event.

In chilling testimony minutes before death by his own hand, we hear the shooter in the deadly rampage calmly relaying his motive to a police dispatcher: "This place right here is a racist place...They're treating me bad over here. And treat all other black employees bad over here, too. So I took it to my own hands and handled the problem. I wish I could have got more of the people."

Omar Thornton's murderous acts left eight coworkers dead and two grievously wounded. The horrifying massacre brought to mind another racially-motivated workplace-based mass murder, the 2003 shooting at a Lockheed Martin plant in Meridian, Miss., which left 6 dead and 8 wounded. Unlike last week's shooting for which there were few if any advance clues or hints, the killer in Meridian had left a trail of violent threats and behaviors. Many who knew or had worked with Doug Williams feared and even predicted that his threats would culminate in some terrible event.

Whether racism was a trigger in the Connecticut case or not seems a moot point. Even if it were true that racism occurred, as alleged by the family of the shooter, that would not justify such a heinous and wildly disproportionate reaction. Company and union officials deny the allegations of racism and say that no such grievances had been filed or were on record. Yet Thornton's call and the allegations will likely play a factor as lawyers for the victims seek damages. If victims seek any redress beyond workers compensation, they will face a high hurdle. When litigation is successful at piercing the exclusive remedy shield, it often involves employer misconduct that is highly egregious.

In 2005 and again in 2008, courts barred tort claims for Lockheed victims and upheld workers compensation as the exclusive remedy. Plaintiffs felt they had a strong case and sued Lockheed on the basis of having been deprived of civil rights. They cited a 2004 EEOC report, which stated: "(Lockheed) was aware of the severity and extent of the racially charged and hostile environment created by Mr. Williams, which included threats to kill African-American employees," the determination by the EEOC's Jackson office said. "(Lockheed's) reaction to those threats against African-American employees was inadequate and permitted the racially charged atmosphere to grow in intensity, culminating in the shooting of 14 individuals."

We noted then and note again now that, while often an imperfect and unsatisfying system, workers comp generally holds up as the exclusive remedy in such cases.

Can employers inoculate against such events?
While most workplace risk can be managed and risk mitigation strategies can be adopted to eliminate or minimize hazards, when it comes to the human heart and mind, preventive strategies can be less certain. There are certainly best practices that can be put in place, predictive profiles and warning indicators that can be consulted, and good hiring and supervisory practices that can be enacted.

Connecticut attorney Daniel Schwartz has been following this event and others on his blog. He recalled another terrible CT event on the 10 year anniversary of the 1998 Lottery headquarters shooting, which claimed the lives of four supervisors. Schwatz has revisited the topic of workplace violence on more than one occasion, offering best practice tips and resources for employer vigilance. In light of the recent tragedy, he asks if there are any lessons to be learned from evil. He concludes:

"Despite all the guidance and advice that can be given, the awful truth is that there really is no way to prevent tragedies like this from ever occurring. An employer can do everything "right" and yet still a rampage ensues by someone committed to carrying out a terrible crime.

That's not to say that employers should ignore the issue; they shouldn't. But we also should be careful not to draw conclusions from an incident like this too.

Indeed, as we look for answers from this tragedy, perhaps its best to acknowledge that we can never truly understand what brings people to commit evil and that despite whatever efforts we might make, something like this will sadly happen again."

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July 12, 2010


Today we examine one of the great conundrums in workers comp claims: the old injury that may or may not be defined as a new injury.

In 2006 David Poulton worked for Martec Industries in Rochester, New York, as a laborer. Poulton had a bad back, having already filed workers comp claims in 1998 and 2000. When he visited his treating physician in June 2006, he had the same old complaint: his back hurt, as it had virtually every day since his first injury in 1998. He told his doctor that he re-injured his back at work the prior day while lifting materials. At this appointment, a discouraged Poulton told his doctor he wanted to quit working.

In consideration of Poulton's long-established problem, apparently compounded by the prior day's incident, the doctor disabled him from work. He cited "old injuries and his continued decline." He characterized the situation as involving "episodic increases in pain" that had troubled Poulton for several years. The doctor, in fact, had been encouraging Poulton to stop working prior to this particular visit.

An independent medical exam determined that Poulton suffered from degenerative disc disease and that his disability was caused primarily by preexisting problems.

So is this a new injury, as reported by Poulton, or simply the recurrence of an old one?

Who Pays?
An administrative law judge found in Poulton's favor, determining that the lifting incident at Martec aggravated the pre-existing condition. However, this ruling was reversed by the appelate division of the NY supreme court, which found no evidence of a new injury and remanded the case for further consideration.

Poulton may yet succeed in re-establishing his workers comp claim, but it will draw upon the resources of the carrier for his prior employer, not the carrier for Martec. As is usually the case in workers comp, the narrative is driven by the evidence. In this case, the history of pain and suffering is so unrelenting and consistent, the "new injury" theory goes up in smoke. With his working days apparently at an end, Poulton probably does not care who pays for his troubles. He has suffered for a long time.The remaining question, of course, is who pays and how much.

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June 16, 2010


Workers comp is 100 years old this year and by way of Roberto Ceniceros' informative blog Comp Time, we learn that there is a Workers' Compensation Centennial Commission (WCCC), which was formed to celebrate the anniversary of the first constitutional workers' compensation law in the United States. The WCCC was organized by a bi-partisan coalition of Wisconsin-based labor and government leaders, which is reaching out to other states to commemorate the anniversary of the landmark legislation. It's pretty appropriate that this initiative is kicking off in Wisconsin because that was the state where the first state workers' compensation law was signed on May 3, 1911.

The WCCC site has collected some really interesting resources, including a photo gallery and various historical documents. And one of the centerpieces of the collection is a terrific 10-minute video that was created by students from Nimitz High in Houston Texas for the 2008 National History Day.

Great job on the film - thanks, Nimitz High students!

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June 8, 2010


We are following the consequences of the gulf oil disaster with increasing despair. Images of oil soaked birds, dead fish, and the serene Gulf waters transformed from the customary beautiful blue-green to an appalling brown. Our thoughts also turn to the men and women laboring under very challenging conditions to contain the impact of this man-made disaster.

NIOSH has issued the following summary of the exposures facing the recovery workers:

Chemical exposures may include benzene and other volatile organic compounds, oil mist, polycyclic aromatic hydrocarbons, and diesel fumes. Physical hazards may include ergonomic hazards, excessive noise levels, sun exposure and heat stress. Injuries may occur due to slips, trips, and falls on slippery or uneven walking and working surfaces. Other safety hazards are associated with the use of tools, equipment, machinery, and vehicles. Biological hazards include possible exposure to biting or venomous insects or other animals. Psychological hazards may include witnessing traumatic injuries or death, inability to help affected wildlife, and fatigue.

You can read the CDC's 96 page opus on managing the exposures to emergency workers here. (I can't help but wonder if this particular web-available document is symbolically collecting dust on the shelf, like so many other well-intentioned but rather long-winded safety manuals - the ones risk managers point to with pride during a tour of an industrial plant.

"We're Hiring!"
BP has hired about 22,000 workers to help with the clean up. I wonder how carefully they screened the new hires. Any rapid ramp up is full of risk; the hazards of hiring on this scale for jobs full of open-ended risk is simply beyond calculation. How many of the 22,000 workers will end up with work-related illnesses and injuries? How would you project the future impact on BP's workers comp costs? (Perhaps BP is calling the new hires "independent contractors." Some may well be; most are not.)

Under regulatory scrutiny, BP has provided some form of rudimentory training and the necessary personal protective equipment (PPE) for the new workers. But how well is the work supervised? With temperatures routinely in the high 80s and the heat index over 100 degrees, how long can people function in the requisite protective suits, steel-toed boots, gloves, hard hats and safety glasses? What is the impact of raw crude on bare skin and laboring lungs?

Looming Epidemic?
There have already been reports of illnesses among these workers. Law firms have put out the word that at least one of the dispersants used in the clean up may harm workers:

OSHA representatives, Obama administration officials and others have expressed concerns that the oil dispersant chemical Corexit may be the source of the illnesses reported on May 26 by cleanup workers. In May, the EPA urged BP to stop using Corexit because of its toxicity. Corexit is manufactured by Nalco, whose board of directors has strong ties to the oil industry, including sharing at least one board member with BP.

We all feel a sense of urgency on an unprecedented scale as the pristine Gulf waters are sullied by millions of gallons of oil. A huge workforce has been mobilized to help with the clean up. Looming on the distant horizon is the cost of cleaning up the damage to those who are currently engaged in the clean up. It's something we give only passing thought to today. But the time will come when those costs are as conspicuous and nearly as disturbing as the image of an oil-soaked pelican trying to spread its soiled wings, trying and failing to launch itself into the brilliant blue skies of its Gulf home.

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June 3, 2010


As a service for Insider readers who do not follow the Flathead Beacon, we bring you the western Montana saga of Brock Hopkins, who either was or was not an employee of Great Bear Adventures when he had a great bear adventure of his own, much to his detriment. Hopkins, 23 at the time, appears to have been an occasional worker at the seasonal attraction. On November 2, 2007, he showed up at the park, took a few hits on his marijuana pipe (not prescribed by a doctor) and checked in with the park owner, Russell Kilpatrick, who was on the phone at the time.

Kilpatrick wanted Hopkins to repair a gate. After completing the task, Hopkins went to ask Kilpatrick if there was anything else that needed doing, but Kilpatrick was asleep (hibernating?). So Hopkins, after carefully placing his marijuana pipe on a storage shed outside the bear pen, mixed up some feed and entered the pen. He was attacked by a bear and sustained severe injuries to his legs. He barely managed to crawl out of the pen.

Contract of Hire
In subsequent court proceedings, Kilpatrick argued that Hopkins was a volunteer at the park. While he denies asking Hopkins to feed the bears, he admits that he did ask him to adjust the gate. And, yes, he did slip him $300 shortly after he was released from the hospital.

Judge James Jeremiah Shea, of the Montana Workers' Compensation Court, disagreed with Kilpatrick. In his written decision, Judge Shea managed to reference the (marijuana stoked) comedy, "Harold & Kumar Go to White Castle:"

"It is not as if this attack occurred when Hopkins inexplicably wandered into the grizzly pen while searching for the nearest White Castle. Hopkins was attacked while performing a job Kilpatrick had paid him to do - feeding grizzly bears."

Kilpatrick denies asking Hopkins to feed bears, who may or may not have needed feeding. And one might be inclined to raise the issue of the marijuana impeding Hopkins's judgment. Judge Shea took these factors into account and concluded that there was contradictory testimony on the issue of feeding the bears and most important, even though Hopkins smoked marijuana on the job, his being stoned was not a significant contributory factor in the injury. (If Hopkins could fix a gate while stoned, he could presumably feed the bears.)

Management's Burden
Kilpatrick is appealing the ruling. He has a high mountain to climb if he wants to prove that Hopkins was not an employee. I'm not sure he is helping his cause when he indignantly stated the following:

"I became very very angry because I then knew what had happened. In my opinion Brock could not resist one last time of harassing the bears with his habit of blowing smoke in their faces for God only knows what reason and in direct defiance of my telling him NOT to disturb them!!!"

Alas, Kilpatrick is learning a tough lesson in management: you are responsible for the (stupid) actions of people who perform work-related tasks for you, whether or not you formally hired them - and in this case, whether or not you specifically asked them to perform a given task. (If a supervisor is napping, employees are pretty much on their own.)

The fact that Hopkins was prone to blowing smoke at the bears and Kilpatrick still allowed him on the property weakens his case considerably. (As Hopkins left his pipe on the shed prior to entering the pen, it is unlikely that he provoked the bear in this particular manner on that fateful day.)

Meanwhile, the youthful Hopkins has knee problems and possibly permanent muscle damage. He may want to find himself a medical practitioner to write him a script for marijuana, which is available legally in Montana. Blowing smoke can ease the pain, as long as you don't direct it into the face of a sleepy or hungry bear.

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May 25, 2010


The Insider scans the world of risk in a risky world. We try to zero in on hazards that might be overlooked in the rush of daily commerce. In that spirit we bring you the distasteful but necessary tale from the New York Times involving bus drivers in New York City, a number of whom have suffered prolonged disability due to the unsanitary habits of riders.

Unhappy riders may express their displeasure in any number of ways, including the unfortunate choice of spitting on the bus driver. I am sure we all sympathize with these uniformed public servants who are simply doing their jobs. You cannot please everyone all the time, especially in the Big Apple.

It's what happens after these incidents that is really puzzling. One third of all the assaults that prompted a bus operator to take paid leave in 2009 involved spitting, 51 in all. The MTA defines these "spat upon" incidents as assaults. The 51 drivers who went on paid leave after a spitting incident took, on average, 64 days off work -- the equivalent of three months with pay. One driver spent 191 days on paid leave.

Before we jump to conclusions like irate citizens running after a bus, let's listen to John Samuelson, president of the transit union:

"Being spat upon -- having a passenger spit in your face, spit in your mouth, spit in your eye -- is a physically and psychologically traumatic experience. If transit workers are assaulted, they are going to take off whatever amount of time they are going to take off to recuperate." [Emphasis added.]

Mr. Samuelson has given us one of the most compelling definitions of disability I have ever encountered: workers are going to "take off whatever amount of time they are going to take off to recuperate." It's not a matter of medically (or psychologically) necessary time away from work, but the amount of time the worker deems necessary. Who needs a doctor when the drivers are empowered to determine the extent of their own disabilities?

Tough Times, Not-So-Tough Drivers
The MTA is facing a budget shortfall of $400 million. It's tempting to conclude that tightening up a bit on eligibility for "Post Traumatic Spitting Syndrome" (PTSS - you first read about it here!) might help reduce that deficit. Heck, it might even make the riding public a bit more sympathetic to bus operators.

Nancy Shevell, the chairwoman of the transit authority's bus committee, questions whether three months' off is a bit excessive.

"You have to wonder if you can go home and shower off, take a nap, take off the rest of the day and maybe the next day," she said. "When it gets strung out for months, you start to wonder."

As we peruse the annals disability - mostly real and painful, occasionally trumped up - we do indeed begin to wonder who is in control in New York, just who is driving - in this case, not driving - the bus.

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May 20, 2010


We've recently been challenging ourselves with OSHA recordable quizzes posted by the smart folks at the Advanced Safety and Health News Blog. We found them interesting enough that over the next few weeks, we will pose the scenarios / questions and you can test your knowledge. Click the headlines to go to the respective blog post and learn the answers.

OSHA Recordkeeping Quiz #10: injured on smoke break
Scenario: An employee reports to work. A few hours later, the employee goes outside for a "smoke break." The employee slips on the ice and injures his back.
Question: Since the employee was not performing a task related to the employee's work, the company has deemed this incident non-work related and therefore not recordable - right or wrong?

OSHA Recordkeeping Quiz #11: injury during seizure
Scenario: You have a 48 year old male employee who reports to work on Wednesday morning and two hours into his work shift he experiences some sort of seizure and falls to the floor. During this event when the employee falls he strikes his head on a work table and receives a laceration on his head that requires six stitches. Further investigation determines the employee has epilepsy and a history of epileptic seizures. The doctor verifies that what this employee experienced was indeed an epileptic seizure. So you determined the event was due to a preexisting non-work related medical condition.
Question: Since the employee struck his head while at work performing work, does the geographical presumption make this event an OSHA recordable?

Recordkeeping Quiz 12: company sponsored meal

Scenario: To celebrate a safety milestone of achieving one million hours worked without an injury, your employer provides a lunch complete with fried chicken, barbequed ribs, hamburgers, and all the trimmings. A few hours later many employees start to exhibit signs of food poisoning. Seventy two of your employees get food poisoning so bad that they must miss the next day of work. Further investigation reveals they received the food poisoning from the potato salad provided by the caterer your company hired for the event.
Question: Do all seventy two of these cases go on your OSHA 300 log as recordable with at least one day away from work (DART case)?

OSHA Recordkeeping Quiz 13: counting time away from work
Scenario: An employee sustained a work-related ankle injury (sprain) and received medical treatment. The employee immediately returned to work with restrictions. The employee's doctor has requested that the employee return for periodic office visits so that he can observe the patient's improvement. The employee's doctor states that on the days the employee has an appointment, the employee is "unable to work that date."
Question: Are the days used by the employee to visit the doctor for follow-up to be considered days away from work?

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May 11, 2010


We've recently been challenging ourselves with OSHA recordable quizzes posted by the smart folks at the Advanced Safety and Health News Blog. We found them interesting enough that over the next few weeks, we will pose the scenarios / questions and you can test your knowledge. Click the headlines to go to the respective blog post and learn the answers.

Recordkeeping Quiz #6: counting days
Scenario: One of your employees injured his foot at work on a Thursday. Your physician said he could not work and scheduled a follow-up appointment on the following Tuesday. The physician would then determine if your employee could return to work or would need to be away longer. The employee was not scheduled to work on Saturday or Sunday, but was scheduled to be at work on Monday.
Question: Since your employee was not scheduled to work on the weekend, do you need to record this time as part of the days away from work?

Recordkeeping Quiz #7: are flu illnesses recordable?
Scenario: Your business is in the middle of flu season and many employees are calling in sick. Two of the employees are claiming that they have been diagnosed by their doctors with the H1N1 flu. They say they contracted the flu at work from a co-worker who was also diagnosed with the H1N1. The two employees want you to record their illnesses because they say they got the flu at work.
Question: Are you required to record these flu related illnesses?

OSHA Recordkeeping Quiz #8: maximum recordable days
Scenario: One of your employees suffered a very serious broken leg due to an accident at work. She had surgery and is in rehabilitation. Her physician cannot give a definite date or even an estimate of when she will be able to return to work. She may be out of work for many months, but is expected to fully recover and be able to work in her job again.
Question: Is there a maximum number of days that should be recorded on the OSHA 300 Log for cases such as this one?

OSHA Recordkeeping Quiz #9: posting the entire 300 Log
Scenario: You are the Safety Manager for your company and are responsible for completing the OSHA 300 Log. It is time for you to have your new Plant Manager sign the "Summary of Work-Related Injuries and Illnesses" Form 300-A so you can post it as required by the standard. You spent quite a bit of time explaining to him how the whole OSHA recordkeeping process works, and he demonstrated quite an interest in what you were doing and the types of injuries your plant was experiencing.
As you are leaving his office, he makes the following statement to you: "When it comes to safety, we have no secrets around here. I think it would be a great idea if you post the entire 300 Log along with the Summary so people see just exactly what type of injuries we are having."
Question: How should you respond to his statement?

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May 4, 2010


We've recently been challenging ourselves with OSHA recordable quizzes posted by the smart folks at the Advanced Safety and Health News Blog. We found them interesting enough that over the next week or so, we will pose the scenarios / questions and you can test your knowledge. Click the headlines to go to the respective blog post and learn the answers.

OSHA Recordkeeping Quiz #1: horseplay
Scenario: Two of your supervisors completed their work for the day and had entered the change trailer to change clothes and proceed home. There was some bantering back and forth concerning how to beat the traffic at shift's end. The discussion escalated into a physical confrontation where one supervisor allegedly pulled a knife and struck the other in the right bicep, causing a laceration that required sutures to close.
Question: Is the injury the one employee received an OSHA recordable or not?

OSHA Recordkeeping Quiz #2: go-cart racing
Scenario: An employee is injured while participating in go-cart racing, which occurred during an off-site company sponsored team-building event. Employees were required to attend the off-site meeting and lunch, but were then free to choose among the following options: (1) participating in the team-building event; (2) returning to the office to finish the work day; or (3) taking a ½-day vacation.
Questions: Is an injury incurred during the go-cart racing considered to be work-related? Is the answer any different if an employee elects to stay for the go-cart racing but is not required to participate and is injured while watching the racing?

OSHA Recordkeeping Quiz #3: personal tasks
Scenario: An employee knits a sweater for her daughter during the lunch break. She lacerates her hand and needed sutures. She is engaged in a personal task.
Question: Are lunch breaks or other breaks considered "assigned working hours?" Is the case recordable?

Recordkeeping Quiz #4: injuries in company parking lots
Scenario 1: Employee A drives to work, parks her car in the company parking lot and is walking across the lot when she is struck by a car driven by employee B, who is commuting to work. Both employees are seriously injured in the accident.
Scenario 2: Employee C commutes from home to work and parks his personally-owned vehicles in the company controlled parking lot. The employee opened the driver side door and started to exit his car when he caught his right foot on the raised door threshold. The employee subsequently fell onto the parking lot surface and sustained a right knee cap injury that required medical treatment.
Question: Is either case work-related?

OSHA Recordkeeping Quiz #5: damage to dentures
Scenario: One of your employees was hit in the mouth by an object while he was performing his normal work duties. However, his dental bridge was damaged. He has not wanted any medical or dental treatment.
Question 1: Would damage to a denture in the presence of no other discernible injury be considered a recordable injury requiring entry on the OSHA 300 log even when medical treatment is not administered?
Question 2: In the context of repair to a denture, what type of activity would be considered medical treatment?
Question 3: Would simple repair to a denture meet the threshold for the definition of medical treatment?

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May 3, 2010


Christina Gamble worked at the family friendly Red Robin restaurant in Quakertown PA. She claimed to have fallen and hurt her back. She quit on the spot and went to work for Target, where she worked for two weeks. She filed a workers comp claim for the restaurant injury, which slowly wended its way through the Pennsylvania system until she was awarded benefits nearly a year after the initial injury. Gamble said she was unable to work because standing and changing positions was difficult. She collected over $20,000 in indemnity.

An anonymous tip sent investigators to C.R. Fanny's Gentleman's Club and Sports Bar in Easton, where Gamble worked out the kinks in her back by removing her clothing and writhing around a pole. C.R. Fanny's (read the name aloud for full effect) is noted for its not-exactly highbrow entertainment such as applesauce and Jello wrestling, along with a "frozen thong contest" that is beyond the descriptive powers of this particular blog.

Gamble has been indicted for two counts of insurance fraud and theft by deception. She told investigators that she became an exotic dancer because she and her husband were under enormous financial pressures.

As is so often the case, a number of questions arise:

  • Why was the injury deemed compensable in the first place?

  • With Gamble quitting her job at the restaurant, did anyone at Red Robin or the insurance company pay any attention to this claim?

  • Did Gamble's doctor attempt to test her physical mobility in any way - for example, using the unorthodox "sliding down the back of a chair" test?

  • Lastly, can Gamble find the proverbial Philadelphia lawyer to take her case, arguing, for example, that pole writhing might indeed be appropriate treatment for a gimpy back and that frozen thongs were an ingenious method of applying ice in the general vicinity of the injured body part?
  • Ms. Gamble should have followed immortal Will Rogers's advice on gambling: "Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it." (I wonder what Will would have thought about AIG...)

    NOTE: Thanks to Pennsylvania reader Rick G. for the heads up on this story.

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    April 19, 2010


    We recently blogged California's open door policy on comp claims for professional athletes based in other states. Most of the claims involve orthopedic injuries. Today we examine a claim for coverage of brain injuries - specifically, dementia. This one might blow California's doors right off the hinges.

    Ralph Wenzel toiled in the trenches for the Pittsburgh Steelers and the San Diego Chargers from 1966 to 1973. After retiring from the NFL, Wenzel coached for a number of years. In his mid-50s, he began suffering from dementia-like symptoms. Now, at age 67, he is institutionalized with full-blown dementia. He is no longer able to communicate.

    Wenzel's wife, Dr. Eleanor Perfetto, has filed a claim under the California workers comp system, contending that the dementia was the result of Wenzel's football career. (At 6'2" and 250 pounds, he was somewhat undersized for a lineman.)

    "Absolutely, this was work-related for Ralph," Dr. Perfetto said. Given that the NFL has toughened its stance on post-concussion activity for active players, the medical evidence is certainly leaning in what now appears to be a rather obvious direction: constantly banging your head in the course of work leads to mental impairment, up to and including dementia.

    There is a lot of money at stake. California law requires that the employer or insurer pay not only all current and future medical costs associated with the injury, but also all the incurred costs. Wenzel's institutionalization, going back to 2006, runs about $100,000 a year. If deemed compensable as workers comp, his claim will run into the millions.

    88 Hike?
    Dr. Perfetto is not without resources in caring for her husband. He is eligible for beneifts under the NFL's 88 Plan, which reimburses up to $88,000 per year in medical costs for former players with dementia. [There does seem to be a presumption of work-relatedness for dementia in the very creation of such a fund.] The 88 Plan, plus Dr. Perfetto's health plan through her employer, pretty much cover the costs of Wenzel's care. Dr. Perfetto, however, wants to open doors for families who do not qualify for the 88 plan, which is limited to players with at least 4 years in the league.

    [A question for no one in particular: If dementia is determined to be a work-related condition, could the health insurer invoke the "exclusive remedy" provisions of workers comp and refuse to pay for treatment?]

    There are a number of parties very interested in the outcome of this case: not just the self-insured team owners and insurance companies, who are confronted with huge (and retroactive) liabilities, but the federal government itself, which would welcome an opportunity to shift the formidable costs of caring for patients with dementia out of the social security system and into the private sector.

    If Dr. Perfetto succeeds, it will be interesting to see who becomes the first payer: 88 Plan or workers comp. As is usually the case, there will be winners and losers. For poor Ralph Wenzel, however, winning and losing - once the paramount goal of his existence - no longer matters at all. It's probably impossible to say what does matter to this once handsome warrior, who has paid a dreadful price for the all-too-brief glory of his seven years in professional football.

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    April 14, 2010


    Alan Schwarz of the New York Times has written a fascinating series on workers comp in California: specifically, a cottage industry that has sprung up securing comp benefits for retired National Football League (NFL) players. The interesting part is that the claims are not limited to players from teams based in California. In its effort to protect transient workers (e.g., truckers, flight attendants), California offers recourse to anyone who temporarily passes through the state. Thus, professional athletes on any teams that compete in California can file for benefits, even if years have past and even if it was just a single game. Needless to add, the carriers for these out-of-state teams are trying to get the California system ruled off-side.

    There are currently about 700 former NFL players pursuing benefits. Most of the injuries are orthopedic - bad backs, shoulders, knees, ankles. (We will deal with a claim for dementia in a future blog.) Two points should be made about these orthopedic injuries: many are cumulative in nature, so there need not be an acute injury specific to the sporting event in California; and virtually anyone who played professional football is likely to have one or more injuries directly related to the game.

    Attorneys Take the Field
    Behind every loophole lurks an attorney. In this situation, two former NFL players, now attorneys, are leading the charge: Ron Mix, a lineman for the San Diego Chargers in the 1960s, and Mel Owens, a linebacker for the Los Angeles Rams in the 1980s. Mix and Owens help former players from teams across the country to file claims in California. There is some question, however, about the quality of help that they offer.

    Once deemed eligible for benefits under California law, players could opt to receive lifetime medical benefits for any medical expenses related to their football years. Think about it. That might include shoulder and back surgeries, hip and knee replacements, not to mention treatment for dementia related to on-field concussions.

    Would it surprise you to learn that over 90 percent of the players entering the California comp system decline the lifetime medical coverage and instead, settle for a lump sum payment? Most players have accepted an extra $60,000 to $100,000 to settle their claim for future medical coverage. That amount would pay for one, maybe two surgeries.

    Why settle out the medicals? Settling avoids the necessity of a trial (in these instances, not by jury but by administrative law judge). It puts a significant amount of money in the players's pockets sooner rather than later. And, of course, it puts money in the pockets of the attorneys, which lifetime medical benefits do not.

    Faulty Judgment?
    Judge Norman Delaterre, who sits in Santa Ana, notes that judges must consider whether proposed settlements are fair. "These players are represented by experienced, competent attorneys - the players themselves, they're adults. Presumably they've discussed the ramifications of the various types of settlements with their attorneys and they've come to a decision to accept the lump sum. Even though the judge in the back of his mind is thinking, you know, if it were me, maybe I wouldn't do this."

    Hey, it's all just a game, right? The players took their chances on the field. Now they roll the dice in the corridors of comp system. If they end up doing what's in the best interests of their attorneys, what harm is there in that? They get some cash, the attorney gets a nice fee, the insurer gets a settled claim with no future exposure. One door opens, another one closes. When and if the future medical issues arise or the dementia sets in, well, someone else will be on the hook for that.

    There are a lot of people unhappy with California's wide open door, above all, team owners and insurance carriers outside of California. They are going to do their best to shut the Golden State's door - the only such door, we should add, that is available to the walking wounded veterans of the NFL wars. We will keep readers posted on any developments.

    But enough with the old folks who can no longer play and whose names we barely remember. The NFL draft is just weeks away. Hope springs eternal for every team, even the Detroit Lions. I can't wait to see what happens.

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    April 12, 2010


    In our first blog of the Upper Big Branch mine disaster that took 29 lives last week, we made no attempt to point fingers. It was a time for mourning, for acknowledging the sacrifices of the brave men whose jobs never see the light of day. Well, now that the final death toll has been rendered - there were no survivors - it's time for some accountability. Let's begin at the top.

    The CEO for Massey Energy is Don Blankenship. He is a man of humble and hard-scrabble beginnings, raised by a single mother. He worked as a union miner (an irony that will soon become evident) and attended Marshall University, where he received a degree in accounting. He worked for Massey Energy in the accounting department. where his fiscal skills and his penchant for cost controls helped him rise in the ranks, culminating in his becoming CEO in 2000. He is a vehement foe of organized labor, along with government regulations and the "the hoax and ponzi scheme" of global warming. (His business is coal, so his disbelief in global warming runs as deep as his mines.) Blankenship constantly battles regulators over safety infractions, including adequate ventilation of the mines (which at this point appears to be a major factor in last week's exlosion).

    While famous for his focus on production, Blankenship does give lip service to safety. In a July 2008 depostion defending Massey Energy's safety record, he appears to talk the talk:

    "As an accountant, I know that safety is an important cost control. So even if I were so calloused, which I am not, as to believe that safety should be sacrificed for production, I would understand that it doesn't make any sense because the accidents and so forth cause you to have more costs."

    But somehow, in the dust and drive of production goals and profits, safety falls by the wayside. Blankenship does not walk the walk - or, as we are talking mines, he does not crawl the crawl.

    Management Styles
    There are clues to his management style in his personal life (a rather critical summary of which appeared in Business Week). His maid quit, saying the working conditions were intolerable. Ever the bean counter, the politically connected Blankenship successfully fought her application for unemployment benefits. The case wended its way to the West Virginia Supreme Court, where the maid prevailed. Two of the court's justices said that "the unrefuted evidence" before the state unemployment agency showed that Blankenship "physically grabbed" the maid, threw food after she brought back the wrong fast-food order, and tore a tie rack and coat hanger out of a closet after she forgot to leave the hanger out for his coat.

    "This shocking conduct" showed that she was, in effect, fired because she felt compelled to quit, the justices said. They said the conduct was "reminiscent of slavery and is an affront to common decency."

    The same, alas, could be said of Blankenship's management of Massey Energy.

    Humble No More
    Don Blankenship earned about $11 million in 2008. Not bad for a man of humble beginnings. As for the survivors of the miners killed last week, they must turn to the West Virginia workers comp system, which will provide indemnity for widows and dependents. (It appears that Massey Energy is self insured for comp - a penny-pinching decision that is about to haunt Blankenship, big time.)

    The company is also vulnerable under West Virginia law for civil suits: comp's "exclusive remedy" provision can be transcended if you can prove "deliberate intent." I would say that repeated stalling, appealing, stonewalling and dismissal of documented safety violations is likely to reach the "deliberate" standard.

    You may remember the song "Sixteen Tons" - made famous by Tennesse Ernie Ford:

    You load sixteen tons, what do you get?
    Another day older and deeper in debt.
    Saint Peter, don't you call me, 'cause I can't go;
    I owe my soul to the company store.

    Surely the miners had souls to put in hock. That may be more than can be said for the man who currently runs the company store.

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    March 22, 2010


    Last August we blogged the case of Adam Childers, a morbidly obese pizza maker in Indiana who suffered a back injury. Childers's weight was in itself a substantial obstacle to his getting better, so the court ordered the comp carrier to pay for gastric by-pass surgery. Now we find a similar case in New York, where the state supreme court requires the state fund to pay for by-pass surgery.

    Salvatore Laezzo, an employee of the state Turnpike Authority, slipped and fell at work back in 2002. He suffered injuries to his head, neck, back and knees. While we might assume that Laezzo had some weight issues at the time of the injury, in the subsequent years of relative inactivity his weight increased dramatically. There was substantial evidence that Laezzo's weight gain was caused by his work injury. In effect, the New York court has set a somewhat narrower standard for compensability than the court in Indiana: had Laezzo been morbidly obese prior to the injury, the court might have ruled for the carrier.

    Seeds of Compensability
    New York has some interesting and rather expansive notions of compensability in workers comp. The current ruling cites a precedent involving Stephen Spyhalsky, a construction worker [Spyhalsky v. Cross Construction N.Y.S.2d 212). The court ordered the comp carrier to pay for artificial insemination of Spyhalsky's wife, after back surgery compromised the route taken by his sperm. This unusual definition of compensability leads directly to another intriguing issue: had Spyhalsky been permanently disabled, would the comp carrier be required to pay dependency benefits for the resulting child? In all likelihood, yes.
    NOTE: We blogged a somewhat similar situation in Arkansas, where the wife of a deceased claimant was artificially inseminated with his frozen sperm. After a rather complex deliberation, the court rejected her claim for additional dependency benefits.)

    When in Doubt, Leave Them Out?
    While the logic for including gastric by-pass surgery under workers comp is certainly understandable, there is a strong potential for unintended consequences: obese job applicants, who already face myriad problems in finding employment, may encounter even more discrimination. These well-publicized court rulings place the burden of gastric by-pass surgery directly on comp insurers and employers. The latter may shy away from hiring qualified obese applicants. After all, the obese are at greater risk for injury and, once injured, their weight becomes a substantial obstacle to returning to productive employment.

    It would be nice to think that the pending expansion of healthcare benefits to nearly all Americans might make this cost-shifting problem go away. Alas, the game of "pin the tail on the payer" has only just begun.

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    March 15, 2010


    Depression is by no means a rare occurrence in the workplace, but depressions that lead to compensable claims under workers comp are very rare, indeed. The burden of proof on the claimant is substantial, generally requiring a conclusive demonstration that work is the "predominant cause" of the depression. Given all that goes on in our lives, this can be a very tough standard to meet.

    Janina Guz was a factory worker until 2002, when she sustained a work-related injury and filed for workers' comp benefits. She had bilateral carpal tunnel syndrome, later amended to include a neck injury and an aggravation of a preexisting back condition. In 2007, she amended her claim to add a major depressive disorder. Her case reached the Appelate Division of New York's Supreme Court.

    Shrink One, Shrink Two
    The case revolved around the testimony of two psychiatrists, one hired by the insurer and one by the claimant. The two shrinks approached Guz's complaint with very different perspectives, which naturally influenced their conclusions.

    Dr. Areyeh Klahr conducted independent medical examinations in 2006 and 2007. In 2006 he found Guz to be exhibiting some symptoms of depression, but in his opinion this depression did not prevent her from working. One year later, he concluded that Guz no longer suffered from an ongoing psychiatric condition and had reached maximum medical improvement. Klahr cast a sceptical eye on Guz: he found significant inconsistencies in her responses and concluded that her complaints did not correlate with his objective findings. Klahr ultimately concluded not only that Guz did not suffer a work-related psychiatric disability, but that she was not really depressed.

    A claims adjuster would call this IME a "home run."

    The evidence in support of Guz came from her own psychiatrist, Alina Marek, who treated Guz on five occasions beginning in January 2008 - which the court noted was more than five years after her injury. Marek diagnosed Guz as having a major depressive disorder that was causally related to the work accident. However, she she acknowledged that she had no information about the circumstances or nature of Guz's work-related injury. She was also unaware that Guz had been involved in two prior motor vehicle accidents which involved injuries to her neck and hands. Marek had to concede that such prior injuries would be important in diagnosing Guz and determining the cause of her depression. Marek further conceded that she had no information regarding Guz's daily activities or her personal life history, including the fact that she was divorced. When pressed to specify the basis for her opinion that Guz's depression was related to her workplace accident, Marek admitted that she relied entirely upon Guz's subjective account. The Board found Marek's testimony on the issue of causally related psychiatric disability to be "entirely lacking in credibility."

    Objective, Subjective
    It's interesting to note the radically different frames of reference used by the two psychiatrists. An independent doctor with no ongoing relationship to Guz, Dr. Klahr zeroed in on the inconsistencies in Guz's complaints. Using the "objective" standards of his profession - not always as objective as they appear - he concluded that Guz was fabricating her complaint in order to preserve her comp benefits.

    In distinct contrast, Malek took Guz at her word. Guz said she was depressed and she said that the depression was related to her work. Malek did not feel the need to probe any deeper.

    In the world of comp, medical opinions quickly turn into dollars: if a condition is work related, all the medical bills are paid and the claimant receives indemnity. If it's not work related, no such payments are made. While it's tempting to make a judgment about the relative quality of the two psychiatric evaluations, that might not be entirely fair. From a workers comp point of view, the court had ample reason to conclude that Guz's situation did not rise to the level of compensability. From a purely medical perspective - regardless of whether work caused the problem - Guz is in pain and in trouble. Given the court's decision, she will find no further solace in workers comp.

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    March 9, 2010


    Henri Cyr was a part-time mechanic for McDermott's, a Vermont company that transports milk from dairies to processing plants. A co-worker offered Cyr a bottle of Mountain Dew. As he was not thirsty at the time, he put the bottle in the workplace fridge. About a week later the fridge was cleaned out, so Cyr took the bottle home.

    Some time later, Cyr came home after a workday, drank a couple of beers and then, feeling thirsty, he opened the bottle of Mountain Dew and took a deep swallow. Alas, the bottle contained toxic cleaning fluid. Cyr felt a severe burning sensation in his mouth, throat and stomach. He was rushed to the hospital, where blood work and urinalysis revealed that his blood alcohol level was .16, well above the legal limit for driving.

    So here is the question for workers comp aficionados: is Cyr's (severe) injury compensable under workers comp?

    The initial claim was denied by the Vermont Department of Labor because Cyr was intoxicated and intoxication is an "absolute bar" to benefits - even though, we might add, the intoxication did not in any way contribute to the injury.

    Now the Vermont Supreme Court has ruled that Cyr may indeed have a compensable claim. They have remanded the case back for consideration as to whether the injury arose out of "the course and scope of employment." The majority wrote:

    Here, we find that claimant's injury arose out of his employment when he accepted the bottle containing the caustic chemicals. That act put the mechanism of injury in motion. This is not to suggest that his injury was inevitable once he received the bottle or that no superseding, intervening factor--such as intoxication--could have prevented his injury or altered its mechanism. However, no one suggests he was intoxicated at that time. ...His injury would not have occurred had not his employment created the dangerous condition.

    In his dissent, Justice Reiber returns to the language of the statute that precludes compensability for any injury "caused by or during intoxication [emphasis added]" He believes that compromising this absolute language in the statute runs contrary to legislative intent.

    Whether he was technically drunk or sober, poor Henri Cyr was the victim of horrifying circumstances when he took a swig from the bottle mislabled "Mountain Dew." He would have been better off if he had resorted to the beverage transported by his employer, wholesome milk.

    The lingering mystery in this sad tale is how the toxic chemicals got into the Mountain Dew bottle: who did it and why? Such questions may be beyond the technical issue of compensability, but surely they are the questions most in need of answers.

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    February 23, 2010


    In December we blogged the horrendous case of Carla Nash, a lovely woman who was mauled by a chimpanzee owned by Sandra Herold, a friend. The 200 pound chimp literally ripped her face apart. Nash, who lacks health insurance, has been hospitalized for over a year at the Cleveland Clinic. The attack destroyed her vision and rendered her face unrecognizable (and unviewable). Doctors have determined that she is not ready for a facial transplant. She has sued Herold for $50 million. Her medical bills will easily run to 7 figures; who will pay has yet to be determined.In our prior blog, we noted that Herold was trying to limit the exposure to her workers comp policy.

    A little lost in Nash's tragedy is the fate of Frank Chiafari, the Stamford, Connecticut police officer who came to Nash's aid. The raging, blood-covered chimp approached Chiafari's cruiser, tore off the mirror, ripped open the door and tried to attack the policeman. Chiafari shot and killed the chimp.

    In the weeks and months following the incident, Chiafari suffered from post-traumatic stress disorder (PTSD); he experienced anxiety, flashbacks, mood swings and nightmares. He underwent counseling. (It's not clear how much time, if any, he was away from work.) Chiafari's workers comp claim was denied: under Connecticut law, public safety officers are eligible for PTSD benefits only when they shoot people - not animals.

    Compensating for the Uncompensated
    The good news is that Stamford has been covering Chiafari's medical bills, although they did require him to switch to a therapist of the city's choosing. The even better news is that Chiafari has literally been working his way through this work-related nightmare. He is still on the job.

    There is movement in the Connecticut legislature to amend the workers comp statute so that public safety officers are covered for PTSD resulting from the use of deadly force involving animals. As is so often the case, the law will be adjusted long after the incident that exposed the gap in coverage. Fortunately for officer Chiafari, the city, despite the comp denial, recognized the legitimacy of his claim and paid for the needed counseling. They did the right thing for an officer who did the right thing. Nothing will erase the horrible images from that fateful day last February. But life for Chiafari can go on in all its ordinary splendor - more than we can say, alas, for the ill-fated Carla Nash.

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    January 20, 2010


    We recently blogged a "to and fro" case involving a meandering motorcycle ride back to work from a conference. The cycle crashed and the employee filed for workers comp. The court in Wyoming determined that the accident took place during a deviation from the direct route home and thus was not compensable. Some readers commented that the employee was following his supervisor's lead, so the injury should have been compensable. "To and fro" often raises issues in the gray zone. Here's another gray area: coffee breaks.

    Jesse Cooper, master plumber and foreman, needed to consult with someone at the union hall in Winslow Township, New Jersey. His contact was teaching a class, so Jesse decided to take a coffee break. He preferred the coffee at a deli some five miles down the road. On his way to a good cuppa, he was involved in a serious accident, breaking his arm and both legs.

    Personal Comfort or Personal Errand?
    Cooper's employer, Bernickel Enterprises, argued that the coffee break was a personal errand. Workers comp judge Bradley Henson determined that a coffee break was part of the working day and that Cooper was under the "coming and going" rule while on his way to a somewhat distant cup of joe*. He found the injuries to be compensable.

    Henson describes Winslow Township as a "rural area", so the options for coffee are somewhat limited. In his summary of the case, New Jersey comp guru John Geaney notes that there were other coffee options closer than the deli; the judge, however, "accepted as credible that petitioner knew the deli had good coffee."

    This ruling certainly stretches the parameters of the "personal comfort" doctrine to its outer limits. One wonders when that hypothetical line between work and personal might actually be crossed: if I have a sudden craving for a Caramel Brulee Latte (not likely, mind you) and the nearest Starbuck's is 15 miles out of the way, am I still "working" when I head in that direction?

    The Driving Hazard
    These two cases share one important characteristic: both involve accidents while driving, statistically the most dangerous part of the working day. As risk managers contemplate enhancements to safety programs, they would do well to put safe driving near the top of the list.

    * Why do they call it a "cup of Joe"? Check this link for a possible if not entirely plausible answer involving a former Secretary of the Navy.

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    January 12, 2010


    Richard Selest worked for the state of Wyoming Department of Transportation. He was asked to attend a training session 100 miles away from his office. Given the nice June weather, Richard, his supervisor and a co-worker decided to ride their motorcycles. (This surely would not have been an option in January!) On the way back to the home office, they discussed taking a scenic route, but no final decision was made. When they arrived at the intersection for the scenic road, the supervisor, riding in front, turned off. Richard and the co-worker followed. In the course of the ride, Richard lost control of his motorcycle and suffered serious injuries. Compensable under comp?

    Richard's claim was initially denied on the theory that the scenic route - 50 miles longer - was a deviation from the road back to the office and thus not compensable. Richard countered that his supervisor approved the deviation and that he was not on any specific "personal errand." He merely was going back to his office, albeit in a meandering fashion.

    The case, like the scenic road, wended up to the Wyoming Supreme Court, where Richard once again lost. The court found that the choice of a scenic road was purely personal and a clear deviation from the "course and scope" of employment. Even though Richard had no specific goal in taking the longer road, and even though he was in fact heading back to the office, the deviation in route was substantial, thus taking him outside of comp's protective umbrella.

    One justice dissented, but I think the majority acted appropriately. Despite the fact that Richard was paid for the entire trip (which took one hour longer than the direct road) and despite the fact that he followed his supervisor's lead, the deviation had nothing whatsoever to do with work. As all good claims adjusters know, this is a matter of reading a map: the presumptive route to the office is a (relatively) straight line. Richard and his co-workers were seduced by the curvy call of nature, for which poor Richard has had to pay a very steep price.

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    December 22, 2009


    You probably never heard of Gilby, North Dakota, population 226. Edith Johnson, 56, worked as a teller in the town's bank, which, somewhat surprisingly, has been robbed three times. Edith was in the bank during two of the robberies. The last one was especially traumatic: she was handcuffed and placed face down on the floor with a sawed off shotgun pressed against her head. After this incident, she became too afraid to return to her job. Diagnosed with post-traumatic stress syndrome, she filed for workers comp. The claim was denied. North Dakota, like many other states, will pay a "mental" claim only if it is precipitated by a physical injury.

    Edith has an attorney and is appealing the denial of her claim. Given the way the law is written, she is unlikely to prevail.

    The irony, of course, is that with just a bit of coaching at the time of the incident, it would have been easy for Edith to collect comp. All she would have had to do is complain about a pain in her wrist and shoulder, caused by the handcuffs and the awkward position on the floor. Even without objective medical evidence, these physical complaints would have opened the door to her claim of post-traumatic stress.

    Coming from a small town and working as a bank teller, Edith is undoubtedly the soul of rectitude. She is not about to tell a lie. Unfortunately, she is up against the letter of the law, which, in North Dakota, is very clear. Workers Safety and Insurance director Bryan Klipfel explains the denial: "A post-traumatic stress disorder that is directly related to a physical workplace injury may be compensable if it can be shown that it was primarily caused by the physical work injury, as opposed to all other contributing causes."

    Letter and Spirit
    Edith's dilemma reminds me of the scene in the immortal Marx Brothers movie, "A Night at the Opera." Groucho (Otis. B. Driftwood) and Chico (Fiorello) are discussing the proposed language of a contract. Every time Chico objects, Groucho tears the page from the contract.

    Fiorello: Hey, wait, wait. What does this say here, this thing here?

    Driftwood: Oh, that? Oh, that's the usual clause that's in every contract. That just says, uh, it says, uh, if any of the parties participating in this contract are shown not to be in their right mind, the entire agreement is automatically nullified.

    Fiorello: Well, I don't know...

    Driftwood: It's all right. That's, that's in every contract. That's, that's what they call a sanity clause.

    Fiorello: Ha-ha-ha-ha-ha! You can't fool me. There ain't no Sanity Clause!

    With that impeccable logic, the Insider wishes the beleagured Edith and the citizens of Gilby all the best and we bid our readers a splendid holiday. Every week we try to invoke the "sanity clause" in risk management and workers comp. It's not always easy. We sincerely hope that Santa - whether or not he exists - rewards you for all the good that you have done this year.

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    December 15, 2009


    In a recent decision that shouldn't be too surprising to those who follow workers' comp compensability issues, the Massachusetts Supreme Court recently upheld a decision by the Department of Industrial Accidents to grant workers compensation benefits to Karen Sikorksi, a Peabody teacher injured while chaperoning high school kids on a 2004 ski trip. The City of Peabody had contested the award on the basis that she was a volunteer engaged in a recreational activity.

    We've seen many of these cases and the decision often hinges on the voluntary nature of the activity. In this case, the city of Peabody probably thought they were well within the law in denying benefits. According to Insurance Journal, the Massachusetts legislature added a little twist to the workers' comp statue in 1985, when it excluded "... any injury resulting from an employee's purely voluntary participation in any recreational activity, including but not limited to athletic events, parties, and picnics, even though the employer pays some or all of the cost thereof."

    Note the adjective "purely."

    When is a volunteer really not a volunteer? Usually, when an employer encourages the employees to participate in said activity. (Everybody who has ever been an employee is likely familiar with the concept of so-called voluntary recreational activities - non-participation can be a career-limiting option.) According to reports, the Peabody school administration has historically expected teachers to become involved with the school's extracurricular activities and, in this particular case, the school principal and the ski club adviser solicited teachers to serve as chaperones. In Sikorski's case, the Supreme Court justices unanimously found that she was "acting in the course of her employment" and not in a recreational activity as described in the law. The court found that her responsibilities as chaperone were "...essentially the same ones teachers must exercise while working in the school building during school hours." Chaperones were expected to supervise students both in the lodge and on the slopes.

    Another common criteria that courts use is in determining whether an activity is "voluntary" is how beneficial it is to the employer and whether it furthers the employer's interests. In this case, the court found that it did: "...the ski club's trips benefited the city by furthering the school's educational mission."

    Of course, nothing is ever simple with workers' comp - there are 50 different flavors, so every state law may have its own particular nooks and crannies related to these issues. Andrew G. Simpson has an excellent article on 'Forced Fun' and related workers' compensation problems, in which he discusses variations in state laws.

    Other posts related to the issue of "mandatory fun":

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    December 9, 2009


    Imagine you work as a commercial driver for a long-established trucking firm that self-insures for workers comp. You are injured on the job. You seek benefits under the comp statute. The TPA handling the claim refers you to a company doctor. The doctor determines that the injury is not work related. The adjuster for the TPA denies the claim. End of story?

    Not quite. What if you shared your story with five other employees, all of whom filed comp claims, all of whom saw the same doctor (a family practitioner), with the same result: claim denied by the same adjuster at the TPA? A coincidence or a conspiracy?

    Five employees of Cassens Transport in Michigan concluded that there was a conspiracy to deny their claims. They filed suit in federal court, alleging a violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). A district court dismissed their claims, finding that their individual claims did not constitute a "pattern" of activity and that invocation of the RICO statute would violate the McCarren-Ferguson Act by interfering with state regulation of insurance.

    The U.S. Court of Appeals for the 6th Circuit reviewed the case and overturned the district court's ruling. Now the U.S. Supreme Court, by declining to get involved, has upheld the Appeals Court. The Appeals ruling is a fascinating document which explores the nature and definition of racketeering, the relationship of workers comp benefits to insurance and the roles of state and federal governments. It's required reading for attorneys and highly recommended for all others.

    Criminal Acts?
    The district court has been ordered to reconsider the allegations. The five Cassens drivers allege that Cassens, their self-insured employer, Tina Litwiller, a claims adjuster for the TPA Crawford and Co., and Dr. Saul Margules conspired to deny their comp claims. (While you might expect Dr. Margules to be board certified in occupational medicine, he appears to be a family practitioner.) The Appeals Court does not address the substance of the allegations: it simply rules that denial of the workers comp claims might involve a violation of the RICO statute and thus is appropriate fodder for the federal courts.

    Some folks are alarmed that the feds are getting involved in what is usually a state issue. That might be a problem, but let's not lose sight of the delicious prospect before us. During the course of the new hearings, plaintiff attorneys will seek access to some fascinating communication records: between Cassen and Crawford, detailing the status of individual claims; Ms. Litwiller's claim notes; and communications between Crawford and Dr. Margules, who had so much difficulty finding a connection between a given injury and work. As much as I enjoyed the Appeals Court's discussion, I am really looking forward to the nitty-gritty details of the proceedings in the district court. (You don't suppose that some of the written and electronic communications have disappeared, do you?)

    At heart, this is a very serious matter. The five employees allege that they have been unlawfully denied the protection of Michigan's workers comp law through a conspiracy of company, TPA and doctor. If the allegations are proven, if the accused violated the RICO statute, they will face the consequences of a criminal conspiracy. In the Insider's burgeoning annals of fraud - employee, employer, attorney, doctor, agent, insurer - this case will surely offer one of the more compelling narratives.

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    December 8, 2009


    Usually employers try to prove that someone is not an employee, in order to avoid the workers comp liability. (Think "independent contractor.") Today we examine a truly horrific case where the employer is desperate to establish compensability under workers comp, so that a grieviously injured employee can only collect comp benefits. By using the "exclusive remedy" provision of comp, the employer wants to avoid liability for pain and suffering. Some pain, some suffering!

    Sandra Herold runs a towing company out of her house in Stamford, Connecticut. The company had a mascot - a 200 pound chimpanzee named Travis, who lived with Herold. I do mean lived with her: according to reports, they shared wine at candle lit dinners and shared a bed as well (no further comment possible).

    Charla Nash occasionally worked for Herold, in an unspecified capacity. In February 2009, Herold called Nash and asked her to come by, as she was having trouble controlling Travis. As soon as Nash arrived, Travis attacked her, ripping off her face (literally). She lost her eyes, nose and mouth in the horrendous attack. (While images of her ravaged face are available on the internet, I do not recommend viewing them.) Police eventually were able to shoot the chimp.

    Nash somehow survived the attack and is suing Herold for $50 million; a second suit against the state of Connecticut seeks an even larger amount, alleging negligence in allowing Herold to keep the animal in her home. (It is worth noting that no criminal charges have been brought against Herold.)

    Exclusive Remedy?
    Herold's first line of defense is establishing workers comp as the "exclusive remedy." She claims that Nash is an employee and thus is prohibited from suing her "employer." While it may be premature to judge this particular strategy, it seems highly unlikely that Herold will prevail. Even if she can show that Nash was on the payroll, it is clear that Nash was not working on the day of the attack; Herold had called her and asked her to come over to help with Travis. And even if it can be proven that Nash occasionally helped out with Travis, it is unlikely that her job description included the duties of an animal trainer (for which she is not qualified).

    In the unlikely scenario that this case is limited to workers comp, the claim will run in the multiple millions: comp will have to pay for Nash's humongous medical bills - including a face transplant - and support her astronomical living expenses. This is a permanent total injury, so the indemnity portion may also be substantial. (If I were Herold's comp carrier, I would aggressively deny this claim as not being work related.)

    Herold is banking on a judicial process that finds having your face ripped off by a 200 pound beast is simply part of the job, part of the "assumption of risk" we all accept simply by showing up for work. (If that were the case, how many of us would be willing to report to work?) Herold's house-of-cards defense will collapse with the most humble of gestures: Nash revealing her destroyed face to a jury.

    Exclusive remedy is an important concept, one well worth preserving, but in this situation, it has no place. Herold must be held accountable for the actions of her late companion, Travis - anything less would be a travesty.

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    December 3, 2009


    William Wehnke, 51, claims to have spotted a wild turkey in his field in rural Annsville, New York (population 3,000). He took aim and fired at the turkey and managed to hit Matthew Brady, a workers comp investigator, who happened to be crouching in the field, dressed in camouflage. Brady was apparently performing surveillance on Wehnke, who is collecting workers comp benefits for an unspecified injury. Whatever his disability, Wehnke is obviously capable of operating a shotgun.

    Local authorities are not buying Wehnke's story about the turkey. He's been arraigned on a three-count grand jury indictment that includes felony second-degree assault and unlawful manner of taking. He is even charged with using inappropriate ammunition for hunting turkeys. Wehnke is in a lot of trouble for his little turkey shoot.

    Investigator Brady was hit in the side, back and legs. He underwent surgery and presumably filed his own workers comp claim for what is surely a work-related - if highly unusual - disability.

    Images - Lasting and Otherwise
    I could not help but think of the other Mathew (sic) Brady, the 19th century photographer whose iconic images of the Civil War still resonate with us. As pathetic as investigator Brady's situation is, his earlier namesake fared even worse. After the Civil War, Mathew Brady found that war-weary Americans had little interest in purchasing photographs of the bloody conflict. Having risked his fortune on his Civil War enterprise, Brady lost the gamble and fell into bankruptcy. His negatives were neglected until 1875, when Congress purchased the entire archive for $25,000, which might sound like a lot, but was not even enough to cover Brady's debts. He died in 1896, penniless and unappreciated. In his final years, Brady said, "No one will ever know what I went through to secure those negatives. The world can never appreciate it. It changed the whole course of my life."

    The world may ultimately take little note of the suffering of the other Matthew Brady, wounded as he crouched in that desolate Annsville field. His life, too, has been significantly changed. But he at least will benefit from the wonders of modern medicine and the cushion of weekly indemnity, until he once again pursues his craft as a comp investigator. But the next time he is asked to don camouflage, he just might want to take a pass.

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    November 24, 2009


    The state of Ohio has attained considerable notoriety for its workers comp program. Unfortunately, the fame derives from a scandal, dubbed Coingate, in which high level officials were implicated in the diversion and theft of comp funds. There are a number of political operatives spending this Thanksgiving in jail. Now we read of a state senator who has proposed legislation to explicitly exclude undocumented workers from the Ohio comp system. It appears that one bad turn in Ohio deserves another.

    We all recognize the ambiguous state of undocumented workers in the American workforce. But virtually all states - with the exception of sparsely populated Wyoming - have provided comp coverage to illegal workers once they are injured. It's a matter of common sense and fundamental decency: we may question how these workers came here, but once hired and in the workforce, they must be afforded the same protections given to other workers. Otherwise, we create a second-class workforce subject to exploitation and substandard working conditions - not exactly the American way.

    Turkey of a Bill
    Enter one Bill Seitz, a state senator who graduated summa cum laude from the University of Cincinnati and from the University of Cincinnati School of Law, where he was Law Review and Order of the Coif. I have no idea what "Order of the Coif" is, but you can see Bill having a reasonably good hair day here.

    Seitz says he was shocked to learn that the Ohio Bureau of Workers Comp does not require injured workers to document their status before receiving benefits. (Why is he shocked? No state has any such requirement.)

    According the AP:

    Seitz's bill would place the burden of proof on the injured worker to demonstrate he or she is a legal worker by showing documentation such as a birth certificate or a visa. It would establish immunity from civil lawsuits for businesses in cases in which their workers' claims are denied by the bureau because the worker is illegal, except in cases in which the business knew the worker was illegal or if it intentionally hurt the worker.

    I particulary like the immunity from civil suits. This bill would not just eliminate the "exclusive remedy" of comp - it would strip away any remedy for injured, undocumented workers. It's an invitation to employers to actively recruit illegal workers: they won't be held responsible for hiring them, they won't have any responsibility for workplace injuries that occur and they can avoid other forms of liability, provided, of course, that they did not "intentionally hurt" the worker. Seitz has stacked the deck against an already vulnerable population.

    David Leopold, a Cleveland attorney and president-elect of the American Immigration Lawyers Association, thinks Seitz is engaged in a publicity stunt. "It seems to me to be a waste of time to even be talking about this. Beyond being cruel, it's senseless because it's not going to address the problem. If he has no statistics to back this up, he hasn't shown a problem exists."

    As all of us gather for this most generous of our holidays, let's give thanks for our many blessings. Let's say a prayer for all of the families - native born, immigrant, legal and undocumented - struggling to make ends meet in this most difficult of times. And let's hope that the good people of Ohio focus on fixing the real problems in their comp system, not the imaginary ones that trouble the waking hours of the well-dressed, well-coifed Mr. Seitz.

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    November 6, 2009


    Ginger Wilson works as a librarian in Montgomery County, Virginia. One day she arrived at work, got out of her car and headed for the library entrance. Then she remembered that she had a hair appointment at noon, so she returned to the car and opened the door to fetch a bottle of shampoo. A gust of wind caught the door, which slammed against her. She fell, breaking her wrist.

    Compensable under workers comp? Not likely, as the return to the car was a definitive deviation from her work routine - she had already exited the car and was headed toward the library. The fetching of shampoo was a personal errand, having nothing to do with work.

    Ah, but this is Montgomery County, home of the $32 million comp problem. Ginger was awarded $5,500 in comp benefits, covering her medical costs and six weeks of lost time.

    Associate County Attorney Susan Chagrin (who immediately earns a place on my All Name team for attorneys) has sued Ginger for repayment, asserting that the injury had nothing to do with employment. I'm with Chagrin, but to our mutual chagrin, the county is unlikely to prevail. There is nothing fraudulant in Ginger's filing a claim. She apparently was completely candid about the circumstances of the injury. The claim was accepted by the adjuster. Getting money back on this one is likely to be as difficult as the proverbial putting toothpaste back into the tube.

    I have a few random questions for Montgomery County and for Ginger:
    1. Why does a librarian with a broken wrist have to miss 6 weeks of work? Library work is about as light duty as it gets.
    2. If Ginger returned to her car for the specific purpose of fetching the shampoo, why is she still in "the course and scope of employment"?
    3. According to her testimony, Ginger planned to "eat my lunch while I was getting my hair done." Excuse me and with all due respect, that is a truly revolting example of multi-tasking.
    4. Finally - admittedly a bit off point - why does Ginger have to provide her own shampoo for a hair appointment?

    As is so often the case, the best opportunity for controlling the outcome of questionable claims is at the beginning. If compensability is in doubt, adjusters should take aggressive action at the outset. Given the particulars of Ginger's situation (at least as this article presents them), there was enough evidence to deny the claim when it was first filed. Once accepted as compensable, however, it's unlikely that the decision could be reversed. Ms. Chagrin, in all likelihood, will remain, well, chagrinned.

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    October 5, 2009


    Fernando Martinez worked for the D. H. Smith Company, as did his two sons. The company provided Martinez and his sons a Ford F350 flatbed to drive to and from work. Because Martinez did not have a driver's license, only the sons were to operate the vehicle. In June 2007, Martinez and his sons were on their way to a construction site, with the elder Martinez behind the wheel. Martinez rear-ended another vehicle on the freeway, injuring himself and his son. At first, Fernando and his son lied to the investigating officer from the Califomia Highway Patrol about who was driving the company truck. However, marks on their bodies from their seatbelts showed that Fernando was driving and his son was a passenger at the time of the collision. They eventually fessed up to the fact that Fernando was driving.

    Both filed workers comp claims. There is no doubt that the son's injuries are compensable. But what about Fernando?

    At first, Fernando's claim was denied. Here is an excerpt from the initial ruling:

    After consideration of all of the evidence, testimony at trial and in deposition, and the demeanor of witnesses, it was found that applicant's conduct in driving the company truck to work without a driver's license, against the express orders of the employer, was a cause of the injury, and takes the activity in which the injury occurred outside the course of employment. The conduct of driving the company truck on public highways against the express order of the company was more than the manner of performing duties. It was different duties than he was employed for. It appears that applicant did drive the truck before his sons were licensed, contrary to the testimony of defendants. However, on the evidence it is clear that he was not allowed to drive after they were licensed, and he and his sons were well aware of that...Applicant's conduct in this case posed an increased hazard to his own safety and life, to that of his son and members of the public, and greatly increased the risk of liability to the employer for damage to property and injury.

    Sounds reasonable, but remember, this is California. The review board overturned this decision. They found the injuries to Fernando were compensable, as he was in the course and scope of employment and furthering the interests of the employer, even though he was disregarding the employer's instructions pertaining to his driving.

    Golden State Precedents
    The review board cited some fascinating cases to support their contention that the injuries were compensable:

    Benefits not barred for injury incurred following a high-speed chase through heavy traffic after employee had run a red light [Williams v. Workmen's Comp. Appeals Bd. (1974)];
    Bus driver who sustained injury as a result of nearly hitting an oncoming vehicle while recklessly driving his bus not barred from recovering workers' compensation benefits for the injury [Westbrooks v. Workers' Comp. Appeals Bd. (1988)]

    With precedents like these, it would be hard to come up with a case where employee misconduct resulting in an injury was not compensable. In California at least, virtually anything you do at work is compensable.

    The review board goes on to say:

    In this case, it does not matter that applicant may not have been authorized by defendant to drive the truck because his travel to the job site in the truck was authorized by the employer and was of benefit to the employer.
    A distinction must be made between an unauthorized departure from the course of employment and the performance of a duty in an unauthorized manner. Injury occurring during the course of the former conduct is not compensable. The latter conduct ... does not take the employee outside the course of his employment.

    It is apparently not a concern to the review board that the "unauthorized manner" in this particular case involves an illegal activity (driving without a license).

    The End of "To and Fro"?
    Finally, California has interpreted the "coming and going" rule in the most generous manner. In most states, commuting "to and fro" is generally not compensable, even when the employee is operating a company vehicle. The workday usually begins at the worksite. Not in California: "When the employer provides the means of transportation, the course of employment begins when the employee begins to travel."
    NOTE to CA employers: you may want to bag it on the company cars.

    Workers comp costs in California are the highest in the country, despite the fact that employee benefits are relatively stingy. The high costs derive from many factors, one of which is revealed in this particular case. There are embedded in case law deeply rooted concepts that tilt the interpretation of compensability in the direction of injured employees. In many states, defense could certainly raise the issue of whether Fernando's insistence on driving the truck without a license crossed the line into "serious and wilful misconduct." You know, the concept of personal responsibility. That might be a reasonable argument in some states, but it doesn't hold any water in California.

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    September 25, 2009


    In September, the New York State Workers' Compensation Board released a 59-page report on World Trade Center Cases in the New York Workers' Compensation System (PDF), along with a reminder that the clock is ticking for rescue and clean-up workers to register service. The registration deadline is September 11, 2010. Registering puts a stake in the ground to preserve the right to benefits should they be needed at a future time.

    The data is a significant historical record and analysis of the largest single workers compensation event in insurance history. Report findings are limited to claims covered under the New York State Workers' Compensation Law so do not include police, fire, or sanitation workers, federal employees, out-of-state employees, and people who were not working.

    For a sample of the report, here is an executive summary of the 9-11 Workers Comp report taken from a press release issued with the study:

    Among All Cases The Board has 13,676 workers' compensation cases resulting from the World Trade Center disaster. This study focuses on the 11,627 cases where there is comprehensive claim data. More than half the cases were for victims of the attacks, and about 40 percent were for rescue, recovery and clean-up workers. In 5,220 cases, the Board received an initial filing but no medical evidence supporting the claim, or the worker did not pursue the claim (by filing information or attending a hearing). The Board is actively contacting those workers, to determine why they did not pursue their claims. Carriers disputed 40 percent of World Trade Center cases, more than twice the rate of other claims. Three-quarters of all cases were filed before 2004. Only 4 percent of cases have open issues.

    Death Cases
    There are 2,064 death claims; 2,058 were for people killed in the attacks. The Board has just three death cases for rescue, recovery and clean-up workers. There were three other fatalities, as well. Fifty-two domestic partners of victims received a death benefit, under special provisions of a 2002 law.

    Rescue, Recovery and Clean-up Cases
    In 4,670 claims, rescue, recovery and clean-up workers received benefits. Nearly 90 percent of these cases are for respiratory system diseases. The Board has received 39,151 WTC-12 forms since 2006. On a WTC-12, the filer states he or she performed rescue, recovery and clean-up efforts for the World Trade Center, in an area south of Canal St.; at Fresh Kills Landfill; on the barges, the piers, and at the morgues. While not a claim, it preserves the right to future benefits, should one ever need them. Gov. Paterson signed legislation last year extending the deadline to Sept. 11, 2010, for World Trade Center workers and volunteers to file a WTC-12. Since beginning a national publicity campaign in June 2008, the rate of filings has increased more than tenfold.

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    August 20, 2009


    Earlier this week, my colleague Julie Ferguson blogged an intriguing case in Indiana, where Adam Childers, an obese pizza baker, suffered a back injury when he was hit by a swinging freezer door. He was unable to get better due to his obesity. As a result, the Indiana court ordered the employer to pay for weight reduction surgery, to be followed by back surgery, all the while providing temporary total disability benefits to Childers. A relatively large claim becomes a very large claim due to the prospect of sequential surgeries. This case raises some fascinating issues concerning the cost of getting better. Boy, does it ever!

    There is no need to repeat the succinct summary of the case provided in Julie's blog. For those interested in the details, here is the actual opinion of the court.

    This case raises two compelling issues: First, the degree to which employers become responsible for non-work related factors in recovery; and second, the looming specter of widespread discrimination against people whose pre-existing conditions make virtually any injury substantially more difficult to manage.

    Taking People as They Are
    Employers cannot set a high bar for "health and wellness" and then exclude everyone who falls below it. Any health standards must be grounded in business necessity. As we have seen in recent blogs, employers might be in a position to reject applicants who smoke (depending upon the state), but they generally cannot arbitrarily turn away people with co-morbidities that may impact recovery times: diabetes, heart conditions, asthma, etc.

    In the Indiana case, at the time of the injury Childers weighed 340 pounds and smoked 30 cigarettes a day. In its opinion, the court did not consider him "disabled" as defined in the ADA: his weight did not "substantially impact" one or more major life activities. Thus, despite his weight, he did not fall into a protected class.

    Once injured, however, Childers's weight became a major obstacle to his recovery. Indeed, any obese person suffering from back, hip, knee, leg or ankle injuries would find recovery extremely difficult, as their spine and limbs are routinely stressed by the sheer weight of the body. Under Indiana law, the pre-existing condition of obesity combines with the work-related injury to produce a single injury. With the pre-existing condition absorbed into the workers comp claim, the employer is responsible for any and all treatments required to bring the worker to maximum medical improvement.

    There is a definite logic to the Indiana court's position. The problem is not in its protection of Childers, but in the implications for all Indiana employers as they are confronted with hiring decisions.

    When in Doubt, Leave Them Out?
    With the Childers's decision, employers in Indiana have been put on notice that at least one conspicuous part of the labor pool - obese people - bring the risk of substantially higher costs following injuries in the workplace. As employers make day to day hiring decisions, they may well have the image of higher costs of injuries associated with obesity in the back of their minds. Given two applicants, one obese, one within normal weight ranges, employers may be tempted to ignore other important hiring factors such as motivation and experience and reject the obese applicant.

    Thus the unfortunate consequence of providing extensive benefits to Childers is that it may have the proverbial "chilling effect" on the job prospects for others with similar weight problems. The obese already suffer from the daily judgment of a thousand eyes: their weight problems are impossible to hide. Now they may have to overcome the additional burden of fearful Indiana employers, who exclude them from employment in the vague hope of keeping the costs of comp under control.

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    August 18, 2009


    Yesterday, my colleague blogged about employers that refuse to hire smokers and cited another employer who would like to extend that ban to obese applicants. Health-related matters and their associated costs are challenging for employers and we expect they will continue to be played out in the courts. In fact, yesterday, Roberto Ceniceros blogged about a surprise ruling by the Indiana Court of Appeals about weight loss surgery related to a workers comp claim ... or at least the ruling was a surprise to us. In Boston's Gourmet Pizza v. Adam Childers, the court determined that the employer must pay for weight-reduction surgery for Childers as a precursor to treating the work-related back injury. The employer must provide temporary total disability benefits while the employee prepares for, and recovers from, the weight-loss surgery. The subsequent treatment path for the back injury is unclear, various treatments have been under consideration but the employer's weight was deemed a barrier to any success.

    In 2007, the then 25-year-old Adam Childers sustained a back injury after being struck in the back by a freezer door while serving as a cook for his employer. At the time, he weighed 340 pounds and smoked about a pack and a half of cigarettes a day. Because of his weight, his physician advised against any nuerosurgery, but Childers' back pain persisted and other treatments did not provide relief. Over the course of this treatment, his weight increased to 380 pounds. His physician suggested lap band or gastric bypass surgery to get his weight down, both to relieve his symptoms and to improve his suitability for potential surgical treatments, such as spinal fusion.

    Understandably, the employer balked at footing the bill for weight loss surgery. While the employer assumed responsibility in providing treatment for Childer's work-related injury, they contested the idea that they should have any responsibility for providing secondary medical treatment for a preexisting condition. However, in Indiana, a preexisting condition is not a bar to benefits, a matter that the courts have taken up in several prior cases. Ceniceros sums up it ups this way: But the court agreed with a Worker's Compensation Board finding that the worker's pre-existing medical and health condition combined with the accident to create a single injury for which he is entitled to work comp benefits.

    We've posted many times about the high-cost of obesity and diabetes in the workplace, and how comorbidities can add to the cost of workers comp injuries. We've also blogged about employers' increasingly aggressive efforts to target so-called lifestyle issues that impact health. Decisions like this might heighten employers' resolve to control obesity - but in that regard, they may find themselves between a rock and a hard place.

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    August 3, 2009


    There is an ongoing debate concerning the compensability of injuries that occur during company sponsored recreation. As Dr. Suess might say, "These things are fun and fun is good," except when your employer makes you do it. There is a fine line between employees participating because they want to, as opposed to feeling that they have to.

    Clark Kauffman has a nice summary of the compensability issues in the Des Moines Register. He sites the case of Robert Powell, an employee of the Cedar Rapids Gazette, who injured his back bowling at a "Family Fun Fest" sponsored by his employer. His injury was compensable - to the tune of $100,000 - because the employer urged participation: "Don't make us cancel this event from lack of interest/attendance."

    Iowa has some interesting case law regarding compensability:
    Hunting: way back in 1933 Claire Fintzel was trying to close a deal while pheasant hunting with a business associate. He was shot in the leg. He received $15 a week for 100 weeks (a paltry sum, to be sure, but this was back in the depression).

    Boating: In 1941 Roy Linderman, a salesman for Cowie Furs, won a company-sponsored contest for highest sales. His prize? A fishing trip, during which, alas, he drowned. His death was deemed compensable.

    Basketball: In 1982 Professor Charles Campolo of Briar Cliff College was partcipating in a faculty-student basketball game. At age 40, Campolo had a known heart condition. He died in the game's final seconds. Because the school derived a benefit from his participation, the death was compensable.

    State by State
    Kauffman takes a brief look of the compensability issue from state to state. It usually boils down to this: is the event truly voluntary? Does the employer derive a direct business benefit from the activity? To some degree the burden of proof is on the employer to demonstrate that there is no pressure on employees to participate - that participation is not the only true measure of "team spirit."

    The state of Tennessee recently revised their comp statute, to provide clarification on the compensability issue. The statute is brief but comprehensive:

    Public Chapter 407 (SB1909/HB1500) excludes from workers' compensation injuries that occur during recreational activities that are not required by the employer, and do not directly benefit the employer. Workers' compensation injuries that are covered under workers' compensation include those that occur where participation: 1) was expressly or impliedly (sic) required by the employer; or 2) produced a direct benefit to the employer beyond improvement in employee health and morale; or 3) was during work hours and was part of the employee's work duties; or 4) occurred due to unsafe conditions the employer had knowledge of and failed to curtail or cure the unsafe condition.

    This statutory language summarizes the issues without tying the hands of judges unnecessarily. It's a good model for legislators contemplating changes. Beyond that, it's good policy guidance for employers who want to encourage team building and fun, without creating inadvertant comp exposures.

    NOTE: Our collegue Julie Ferguson has related blogs here and here.

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    July 20, 2009


    College athletics is big business. While athletes are not paid for their efforts (well, some are), they can reap substantial benefits while pursuing glory on the playing fields of their Alma Maters. But athletes, like workers, are prone to injuries. And once injured, they may find themselves liable for the cost of medical treatment. There is no workers comp for injured athletes, but perhaps there ought to be.

    Kristina Peterson writes in the New York Times that athletes are often stuck with the medical bills for sport injuries. Students may have coverage through their parents's insurance policies, but these often exclude varsity sports, limit out-of-state treatment or do not cover much of the bill. Schools may offer supplemental plans, but these vary greatly. Athletes who play for major Division I schools often benefit from robust coverage. Big Ten athletes rarely have to pay for medical treatment. The NCAA offers catastrophic insurance for all athletes, but coverage begins at $90,000. An athlete would run through an awful lot of treatment to reach that level of medical billing.

    Even in the Big Ten, where insurance coverage is robust, stuff happens. Jason Whitehead played football at The Ohio State University. He was badly injured during a practice and was airlifted to a hospital.

    "The next day, when I woke up, the doctor came in and informed me that surgery went well, but this was a career-ending injury...It took a while to sink in."

    Whitehead lost his scholorship one year after the injury. He also ended up with $1,800 in medical bills not covered by his father's insurance or by the school's. The school valued Jason as an athlete; as an ordinary student, well, he ended up pretty much on his own.

    Rowing to Oblivion
    As in workers comp, medical coverage for student athletes is complicated by factors that may or may not be directly related to the injury. Erin Knauer went out for the crew team as a freshman walk-on at Colgate University. She had a cold when she took a five kilometer workout test on rowing machines. On pace for the fastest time, she suddenly felt a shooting pain beginning in her back and reaching her toes.

    She eventually was diagnosed with postviral myositis, a muscular inflammation that causes weakness and pain. Colgate officials determined that this was an illness, not an injury, so financial responsibility fell to Knauer. She tapped out her student health policy at $25,000, leaving her $55,000 in debt. She is currently working two jobs and paying down the bills at the rate of $250 a month.

    There is little doubt that Knauer's illness was exacerbated, if not caused, by the strenuous workout. If this had been a work-related situation, comp would likely have picked up the entire tab (plus indemnity). But as a student athlete, Knauer has no guarantee of coverage. She wanted to row for the glory of Colgate. She ended up in serious pain and serious debt. Glorious it was not.

    College athletics often involve a fundamental trade off: in return for playing sports, athletes benefit from a low-cost or virtually free education. That might be a pretty good deal, except when the sport results in a life-changing injury. As David Dranove, a professor at Northwestern's Kellogg School of Management, puts it: "It makes no more sense to tell the athletes, "You go buy your own health insurance," than it does to say, "You go buy your own plane tickets and uniform.'"

    The rationale for mandatory insurance for athletes is similar to the rationale for workers comp. The schools benefit from the labors of their athletes. The least they can do is pay for any and all medical treatment required to make these athletes whole.

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    July 16, 2009


    Roberto Ceniceros blogs about the New York appeals court ruling in Frank P. Torre v. Logic Technology, which awarded workers comp benefits to an employee for an injury sustained in the gym. Usually, injuries sustained in extracurricular activities aren't covered by workers comp, but there are exceptions, such as when injuries occur during "mandatory attendance" events or while an employee is on business travel (see our past posts: Mandatory fun: when recreational activities are compensable and When play becomes work, or the case of the traveling employee).

    On first glance, a case like this might seem open and shut. The employee was on his own time at the gym - the injury did not appear to arise out of and in the course of employment. But on closer examination, the court apparently determined that gym participation was furthering the employer's interest for the networking potential. (Is gym the new golf?) When it is determined that an employer has derived significant business benefit from an activity - such as interacting with clients and prospects - then an activity may be compensable.

    The courts also noted that the employer encouraged and sponsored this activity. In this case, the sponsorship entailed reimbursement for membership fees. One has to wonder what kind of chilling effect a ruling like this could have on wellness programs. Employers frequently incent employees by paying for or supplementing gym membership, exercise programs, and weight loss or smoking cessation programs. Some companies offer financial incentives for participating in wellness programs or disincentives such as increased cost for insurance for not participating.

    This type of endorsement and sponsorship can be tricky when it comes to workers comp. In days gone by, sponsorship generally referred to softball or bowling teams and employers could take some steps top mitigate risks. But as employers become more aggressive about wellness programs in an effort to control health care costs and these wellness programs become more ingrained in the corporate culture, does the compensability exposure increase? Some of the variables that have come into play in determining compensability are the location and time of the activity - is the gym on the employer's premises? Does the activity take place during work hours? Another factor is how strongly the company encourages participation and whether participation is purely voluntary. If a corporate culture is such that it so strongly endorses an activity, the issue of whether participation is truly voluntary could be up for debate.

    Comorbidities like obesity and diabetes have been shown to have an impact on claim frequency and severity so it would appear that wellness programs would have a positive net effect on workers comp costs. But good intentions can often have bad outcomes. Take the concept of programs that heighten worker awareness about safety and incent workers for best practices - that may sound great on the surface, but The New York Times recently reported on safety incentive programs that ran headlong into the law of unintended consequences.

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    July 8, 2009


    Serious workplace injuries often turn spouses into caregivers. So the question becomes, are their services compensable under workers comp? As is so often the case, it depends upon where you live.

    The Supreme Court of Arizona recently decided a case in the spouse's favor (Sabino Carbajal v.Industrial Commission of Arizona). In 1999, Sabino, working for Phelps Dodge, suffered a serious injury, resulting in cognitive problems and partial paralysis on his right side. He required full-time supervision and intermittent attendant assistance. The carrier paid for nursing aides during daylight hours. At all other times, Sabino's wife took charge of his care: this included giving him his medication in the morning; specially preparing his food; cleaning him when he was returned from day care soiled; and moving him between his wheelchair and his bed, the toilet, or his recliner.

    In their deliberations, the Arizona Supremes examined practices in two other states. They looked first at Virginia, where the courts have denied reimbursement to spouses for home health care services (Warren Trucking v. Chandler, 277 S.E.2d 488). In Warren, the claimant's wife helped him bathe, shave, and put on braces, and she prepared his meals, drove the car, and maintained the household. When the claimant lost consciousness, his wife revived him.

    The Virginia court concluded that under the statute, to qualify as compensable "medical attention," the spouse's care must, among other requirements, be "performed under the direction and control of a physician" and be "the type [of care] usually rendered only by trained attendants and beyond the scope of normal household duties." The court rejected the spouse's claim because the care rendered by the wife was not prescribed by a doctor and was not "of the type usually rendered only by trained attendants." I suppose that when the wife revived her husband, she was just acting as a good samaritan.

    NOTE: Workers in Virginia may well wonder whom the comp statute is designed to protect. We recently blogged an absurd provision of the law which precludes payment to brain injured employees who have the misfortune of surviving catastrophic injuries. Virginia seems to go out of its way to construct "rigid frameworks" that preclude compensation for the families of seriously injured workers.

    Empathy in Action
    Arizona justices also looked at case law in Vermont, where a similar set of circumstances led to a very different conclusion. In Close v. Superior Excavating Co. (693 A.2d 729), the claimant received a severe head injury and required 24-hour supervision. The claimant's wife cared for him at home, including "administer[ing] and monitor[ing] his medications[,] . . . alter[ing] the doses [of medication,] . . . log[ging] . . . her husband's behavior[, and] monitoring her husband's seizure activity and responding appropriately."

    In concluding that the wife's services were compensable, the Vermont court rejected the "rigid framework" of Warren, noting that "it "would . . . conflict with [its] longstanding practice of construing the workers' compensation statute liberally."

    The Arizona court restated the aim of workers comp: rather than pushing the notion of spousal duty deep into the area of custodial care, the court "places the burden of injury and death upon industry." The Arizona court overturned rulings at the commission and Appeals court levels. They found that Mrs. Carbajal routinely performed work that others were paid to perform and that these duties were necessitated by workplace injury. Therefore, she is entitled to reimbursement. It will be interesting to see how the comp commission comes up with a dollar value for her services: will she be reimbursed for "time on task" or is she "on call" and working whenever other paid help is not available?

    When workers suffer catastrophic injuries, their families suffer loss beyond measure. The quality of life changes for everyone, not just the injured worker. If the question is "to pay or not to pay" for the onerous burdens placed on spouses, the answer, in Arizona and Vermont at least, is to pay.

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    June 22, 2009


    The Defense Base Act (DBA) was enacted in 1941, to cover the injuries to civilian employees - primarily a few hundred engineers - during the second world war. The act might have worked then, but it certainly is not working now, nearly 70 years later. As we have blogged in the past, the DBA is a boondoggle, generating huge profits for a small number of insurance carriers and routinely devastating both the civilian workers wounded or killed in war zones and their families. There are over 10,000 claims filed each year: the medical only claims are usually paid; the indemnity claims are dissected, inspected, detected, and ultimately, rejected. A handful of insurers (AIG, CNA among others) are making big bucks at the expense of the wounded and the dead.
    NOTE: As bad as the situation is for U.S. citizens wounded and killed in Iraq, it is far worse for foreign nationals.

    The Domestic Policy Subcommittee of the House Oversight and Government Reform Committee held a hearing last week on the DBA. The title of the hearing betrays an (understandable) prejudice: "After Injury, the Battle Begins: Evaluating Workers' Compensation for Civilian Contractors in War Zones." The hearing focused on the handling of workers' compensation insurance for federal contractors working overseas, specifically on the inordinate delays in compensation running parallel to the enormous profits for insurers. Among those testifying were Deputy Labor Secretary Seth Harris; Timothy Newman, Kevin Smith and John Woodson, former civilian contractors in Iraq; Kristian Moor, president of AIU Holdings, Inc., a division of AIG; George Fay, executive vice president for Worldwide P&C Claims, CNA Financial; and Gary Pitts of Pitts and Mills Attorneys at-Law.

    Kristian Moore defended AIG's decisions and motives, pointing the finger at a lack of Labor Department oversight and a system overtaxed with cases. "We are doing everything we can do," suggested Charles Schader, senior vice president and chief claims officer for AIU Holdings. Yeah, everything you can do to make money.

    At the conclusion of the hearing, Dennis Kucinich (D-Ohio) warned AIG executives that he plans to demand copies of internal memos and documents that will link claims denials to the company's profits. Most of us do not get terribly excited by the prospect of reading claim files, but these will undoubtedly provide some compelling reading. While I doubt that the subcommittee will find a direct, written link between denials and profits, the rationale for the individual claim denials - in the face of compelling evidence of compensability - should prove riveting. Was it incompetence or was it greed? Something cruel, heartless and cynical took place in the back rooms of carriers with responsibility for civilian claims. If you like Edgar Alan Poe, you'll love the claims files of AIG and CNA.

    Risky Job, Risky Work
    Seth Harris, the new deputy secretary at the U.S. Department of Labor, is in charge of this mess for the government. He's been on the job for 3½ weeks. Congratulations on the new job, Seth! (You might want to keep your resume circulating.) Seth has been working less than a month, but he has already figured out that the system is in need of fundamental change.

    The work of insurers usually involves risk transfer. Under the perverse incentives of the DBA, the risk is absorbed by taxpayers, the pain falls on civilian workers and their families, and the profits - running from 37 to 50 percent of premiums - are pocketed by the carriers. Risk without transfer. It's amazing that AIG can generate this level of profit in one division and still only trade at $1.40 a share. I guess that they have been looking for risk in all the wrong places.

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    June 2, 2009


    Here's a question that comes up frequently in our employer seminars: can you terminate an employee who is on workers comp? In general, it's not a good idea. In many states there is a presumption that the termination is in retaliation for filing the comp claim. Nonetheless, the complete answer to the question is yes, you can, but you must do it very carefully.

    The invaluable Risk and Insurance Magazine describes a case in Texas that illustrates this point nicely (Williams v AT & T, U.S.District Court, Southern Texas). Williams, a telecommunications tech, alleged that he sprained his leg stepping down from a ladder. He was a bit confused about the exact date, offering more than one in his descriptions of the incident. His claim was denied. One month later, he violated an important company policy and was suspended and then terminated. Even though his comp claim was denied, he alleged that he was terminated in retaliation for filing the claim. He sued AT & T for violating the Texas comp act.

    Keep in mind, the employer must be able to demonstrate that the termination had nothing to do with the (denied) claim. In this situation, the burden of proof is definitely on the employer. AT & T presented evidence that Williams had a history of poor performance and excessive disciplinary actions for more than a year prior to the alleged injury. In other words, two key criteria of proof were met: the disciplinary problems preceeded the workers comp incident and they were thoroughly documented.

    The court granted summary judgment to the employer. While falling under the protected class of employees who have filed comp claims, Williams could not establish that his termination was related to the comp claim. There were plenty of other reasons for the employer's actions.

    I often hear employers complain that they had been planning to terminate a marginal employee, but then the employee got hurt. In most cases, there is inadequate documentation of poor performance prior to the injury. These employers are stuck: any attempt to document performance issues after the injury will be viewed sceptically by the court. The termination will trigger retaliation claims.

    Here is a quick tip to avoid this situation: fire marginal employees before they get hurt. Once employees are injured on the job, an employer's options narrow significantly. Given that marginal employees are more likely to be injured - that's part of what makes them marginal - prompt action to end their employment is an essential "best practice."

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    May 26, 2009


    Our blog last week linking skin cancer to workers comp has already generated a few comments. "Workers comp attorney" raises some interesting questions:

    (1) How much weight do you give to the person's leisure activities and/or length of employment? It seems these would certainly be factors in assessing whether the employment is the predominate cause.
    When assessing the work-relatedness of skin cancer, claims adjusters will look carefully at non work exposures: hobbies such as hiking, fishing, boating, outdoor sports, surfing, swimming or simply tanning. Balanced against these exposures will be the work setting: outdoors all the time (eg, roofing, migrant farm work, paving) or just incidentally (framing carpentry).

    While the case law is still rather limited, there are examples of compensable skin cancers involving a limousine chauffeur (!) in New York and an architect in Texas. [NOTE: a sun screen manufacturer, unsurprisingly, is keeping close track of case law developments!] It is safe to assume that the burden of proof remains on the employee to show that the cancer is work related, but this burden is now supported by substantial medical evidence. Indeed, the existence of government funded education on the risk - here is a CDC link - would tend to support claims of compensability.

    As far as length of employment goes, it usually does not matter. As in the case of repetitive motion injuries, the most recent employer is usually on the hook for coverage, even if the employee has only been working for a few weeks.

    (2) What steps could employers take to prevent work-related skin cancer other than the mentioned provision of sun screen and policies to enforce dress code?
    Employers should just stick with the basics: provide - and enforce the use of - sun screens; require head gear. In the vast majority of exposed workers, this is not happening. There is research showing an increase in skin cancers among Latinos. I wonder if this is related to the negative cultural images associated with protective gear. [NOTE: my teenage daughters hate my wide-brimmed sun hat. It's just not cool!] [I wear it anyway.]

    (3) What about research indicating that some, if not all, sunscreen products are carcinogenic?
    While there is some evidence that tanning booths may be associated with cancer, I am not aware of any medical evidence to support a connection between sunscreens and cancer. In any event, the risk of not using a sunscreen far exceeds the risk of using one.

    4) What balance should be sought between skin cancer and heat-related illnesses (if any "balance") as far as prevention is concerned?

    Skin and heat protection are not mutually exclusive. People have been covering up in desert cultures for centuries by wearing light colored, loose clothing and head gear. (I hardly need add that American workers would vehemently reject any protective measures that made them resemble middle-eastern sheiks!)

    Proactive, Reactive, Inactive?
    Another reader wonders how many companies have actually implemented the recommended preventive measures. That's a great question. Judging by limited observation of workers in the sun, smaller employers have done little if anything to prevent risk. Any time I see a worker in the hot sun, shirtless and hatless, I assume that the cancer issue is simply being ignored.

    What, if anything, will mobilize employers to take action to limit sun exposures? It usually comes down to money. Employers who operate in states that view skin cancer as potentially work related will eventually find it cheaper to provide (inexpensive) sunscreens and hats to their workers in the great outdoors. If state courts reject these claims, the workers will bear the burden.

    Let's hope that employers take action before the courts force the issue. We have a known risk and we have proven remedies. Reason says that employers, at a minimum, will immediately share this information with exposed workers. But then again, how often is the voice of reason heard in the American workplace?

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    May 21, 2009


    With the full heat of summer bearing down on us, the Insider has deputized its readership to become informal safety inspectors: the next time you leave the office, observe any people who are working outdoors. Your checklist should include the fundamental safety drill: fall protection for height exposures; personal protective equipment such as hard hats, work boots and goggles; secure scaffolds and ladders; proper use of machinery (lawnmowers, clippers, circular saws, etc.); proper lifting and efficient material handling.

    Here is a safety issue that you are likely to observe in the breach: protection from skin cancer. Exposure to the direct rays of the sun, especially at midday, is a significant safety hazard. Alas, when most people labor in the full sun, they usually take action against the heat, at the expense of protecting themselves from the sun's rays.

    Cancer prevention dictates the wearing of long-sleeved shirts, a hat with neck flaps, sunscreen for exposed skin and sunblock for the nose and lips. When was the last time you saw a landscaper, carpenter or roofer dressed appropriately? When the heat rises, the shirts tend to come off. Bandanas and "do-rags" - considered cool in working circles - keep sweat out of the eyes, but they do little to protect the skin from the sun's rays. Hats with flaps? Dude, you must be kidding. Goggles and hardhats? They are the first to go when the heat rises.

    As for the advice to "avoid exposure between the hours of 10 am and 2 pm," that is simply not going to happen. There is work to be done and those are prime hours for doing it. Siestas might be culturally acceptable in the tropics, but in our productivity-driven culture, siestas are not an option.

    The Compensability Conundrum
    As we have pointed out in prior blogs, the connection between work and occupational disease is often difficult to prove. With the exception of public safety employees, most workers face formidable odds in collecting comp for occupational diseases. There often are factors that mitigate against the acceptance of a claim: family history, smoking, fair skin, etc. Workers must be able to prove that workplace exposures are the "predominant cause" of the cancer. Sure, a laborer is under the sun at work; but he or she might also have significant exposure during leisure time, going to the beach, fishing, or just working in the garden.

    It's always interesting to see how state legislatures translate emerging hazards into proposed legislation: lawmakers tend to react in a limited, ad hoc manner. See for example this proposed bill in the New York legislature:

    This bill would provide,with respect to active lifeguards employed, for more than 3 consecutive months in a calendar year, by certain local agencies and the Department of Parks and Recreation, that the term "injury" includes skin cancer that develops or manifests itself during the period of the lifeguard's employment. This bill would further create a rebuttable presumption that the above injury arises out of and in the course of the lifeguard's employment if it develops or manifests during the period of the employment.

    Note that the symptoms must develop during employment: this in itself may prove problemmatic, as many cancers occur some time after the direct exposure. Beyond that, the bill establishes a compensability presumption for one very limited class of workers, lifeguards. It does not address the myriad workers who face similar hazards on a daily basis (even if their work uniforms involve more than just a bathing suit).

    Despite the fact that many workers will develop skin cancers which are likely to be work related, the number of compensable incidents will remain modest. The comp deck remains stacked against workers in the general area of illness.

    Compensability and safety are two separate issues. We may not be able to do much about expanding coverage for work-related cancers, but we can take aggressive action to prevent them. It all comes down - as it does so often - to management: do you tolerate your workers's ad hoc efforts to combat the heat, or do you enforce "best practices" in cancer prevention. Do you make sunscreens and head protection readily available on the jobsite, or do you allow your workers the "individual freedom" to do as they please?

    We all know how most managers respond. They take the path of least resistance. The risk of an accident is one thing, the seemingly remote risk of illness is quite another. It will take many more tragic cases of work-related cancers before a true prevention mobilization takes place. For workers struggling under today's galring sun, we can only hope that a word to the wise is sufficient.

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    May 19, 2009


    Roberto Ceniceros of Business Insurance has been tracking the potential impact that a Chrysler bankruptcy and sale could have on state workers comp systems. In a story last week, he reports that Michigan Attorney General Mike Cox has taken legal action to protect the state. Cox stated that Michigan's Self-Insurers' Security Fund could face insolvency as a result of Chrysler's bankruptcy and sale.

    Now, Ohio state officials are raising concerns about how the Chrysler sale could affect Ohio's workers comp system. This week, Ohio's Attorney General Richard Cordray has filed a "limited objection" to the pending sale. "While Chrysler's bankruptcy filings show the automaker is committed to fulfilling its workers comp obligations, the filings do not hold a new owner to the same conditions, the attorney general said." According to a news report in Columbus Business First, there are about 5,000 Chrysler workers in the state.

    It is likely that this issue is on the radar screen for other stat attorneys general, too. Ceniceros states that, "As of Dec. 31, Chrysler had 38,257 U.S. employees. It purchases workers comp insurance in some states while self-insuring in others, according to various state regulator databases."

    And beyond Chrysler, there is the matter of whether General Motors is another likely candidate for bankruptcy - many expect this to be the case - see key dates in GM run-up to bankruptcy deadline. GM is a much larger company so problems could be multiplied, a matter that we discussed in our December posting about Maryland officials monitoring GM solvency related to workers comp.

    For more on the way bankruptcy works for both insured and self-insured entities, see our postings of Robert Auerbach's three-part series on bankruptcy and workers compensation, part 2, part 3.

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    April 27, 2009


    It's only Monday morning and many of us are just refocusing after a weekend of gardening, football drafts, NBA playoffs, baseball (Ellsbury steals home!), so we are probably not quite ready to think about the unthinkable: a potential swine flu pandemic, originating in Mexico and already active in several major American cities.

    Here is the official government announcement (which appears to circumvent potential panic by burying the bad news in gov-speak):

    As a consequence of confirmed cases of Swine Influenza A (swH1N1) in California, Texas, Kansas, and New York, on this date and after consultation with public health officials as necessary, I, Charles E. Johnson, Acting Secretary of the U.S. Department of Health and Human Services, pursuant to the authority vested in me under section 319 of the Public Health Service Act, 42 U.S.C. § 247d, do hereby determine that a public health emergency exists nationwide involving Swine Influenza A that affects or has significant potential to affect national security.
    [Where, oh where, do they learn to write like that?]

    As is our custom, we focus on the implications for workers comp. Back in 2005 we blogged the ramifications of smallpox exposure from the comp perspective. The smallpox exposure - a result of the terrorism scare - proved to be a false alarm. The swine flu, unfortunately, appears to be all too real.

    The Comp Dimension
    It's not difficult to isolate the kinds of activities that might expose an individual to the Swine flu. Many of these exposures are prevalent in the world of work:
    : travel
    : frequenting congested areas (travel terminals, public transportation, classrooms, etc.)
    : touching anything handled by strangers
    : eating out
    : meeting business colleagues from around the country and around the world

    In order for the flu to be a compensable event under comp, certain requirements must be met:
    : the individual must be "in the course and scope of employment" when exposed to the virus
    : the exposure must arise out of work (as opposed to being a totally random event)
    : work itself must put the individual in harm's way

    An individual commuting to work via public transportation might have high risk exposure, but flu caught on a subway or bus would not normally be covered by comp. But if the exposure stems from company-provided transportation (for example, a van), the subsequent illness might well be compensable.

    If one worker in a closed environment brings the flu to work, co-workers who succomb to the virus can make a good case that the illness is work related. The initiator, however, would not have a compensable claim, unless he/she could demonstrate a definitive work-related exposure.

    Health workers are on the front lines of any pandemic. Even though it might be impossible to prove that they actually caught the virus at work, any and all cases of Swine Flu are likely be compensable.

    If you fly on an airplane on company business and the person next to you is sneezing and coughing, your exposure is work-related and the subsequent illness is likely to be compensable. If you are flying to visit Aunt Martha, you are on your own.

    The comp system is not well equipt to deal with illness. It's usually very difficult, if not impossible, to determine exactly when an individual actually caught the virus. With state laws varying in their assumptions of compensability, with a multitude of insurance carriers and third party administrators making compensability determinations, we will see a crazy quilt of decisions regarding the compensability of swine flu.

    There is a lot of money at stake in these compensability decisions. For mild cases, the issue is moot. It's the more severe cases - prolonged illness and even death - that raise the greatest concerns. While thus far the fatalities have been limited to residents of Mexico, if the feared pandemic occurs, there will be prolonged illness and even fatalities in the states. Then the crucial decisions regarding compensability will directly impact the future cost of workers comp insurance.

    What is to be Done?
    So how should employers handle flu exposures? For a start, educate employees on prevention. The above government website has some helpful hints - and they are actually written in plain English; unfortunately, they are only written in English.

    Any employee showing up at work with flu symptoms should be sent home immediately. And if any employee appears to come down with the flu while "in the course and scope" of employment, employers should report the illness to the insurer/TPA, so that a proper compensability determination can be made. As in all things comp, it is usually a mistake for the employer to make assumptions about compensability. When in doubt, report the illness and let the experts determine what to do.

    As the world lurches from one crisis (economic) to another (pandemic), it is all too clear that we have fulfilled the Chinese (?) curse: "May you live in interesting times." We do, indeed.

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    April 21, 2009


    AIG has been in the news mostly for its ingenious method of losing money: insuring the riskiest possible financial transactions and tanking after these risks go bad. But give the biggest insurance company in the world some credit. They still know how to make money the old fashioned way: collecting premiums and denying claims. To be sure, this strategy is not easy to do in the states, where public scrutiny is never more than a phone call away. But it works rather effectively in Iraq.

    T. Christian Miller from Propublica and Doug Smith from the LA Times have described in great detail how AIG transformed Iraq into a business opportunity with an enormous upside. AIG is the predominant workers comp carrier in the war-torn country, insuring civilian workers. When these workers are injured - and the injuries can be devastating - AIG has routinely denied their claims for basic medical care, artificial limbs and desparately needed counseling for post-traumatic stress syndrome. More than 1,400 civilian workers have died and 31,000 have been wounded or injured in the two war zones.

    Insurers have collected more than $1.5 billion in premiums paid by U.S. taxpayers and have earned nearly $600 million in profit, according to congressional investigators. That's nearly 40 percent profit after expenses - an unheard of loss ratio in the states.

    Collect and Deny
    The AIG strategy is deceptively simple: first, charge exorbitant fees for premiums, roughly 100 percent of a worker's pay. (Don't feel sorry for the companies paying these premiums; they are fully reimbursed by taxpayers.) Then, accept all the small claims and fight almost any claim involving lost time (more than four days of disability). Delay, delay, delay. Never make a payment until ordered to do so by a court.

    The denial rate on serious claims is pretty astonishing: about 44 percent. How could you argue that any injury - let alone a serious one - is not work-related, as civilian employees are in Iraq for one purpose, supporting the war effort? In addition, fully half the claims for PTSD are denied. All this in the context of a war where catastrophic injuries are all too common and legitimate PTSD is as prevalent as cuts in a glass factory. How many state-side workers have watched co-workers blown to pieces by roadside bombs? Do you think that such incidents might qualify as PTSD?

    AIG used the argument of extremely high-risk working conditions to boost the premiums. Then they turned around and used the strategy of denial to boost profits. Who says capitalism is dead?

    I suppose you could argue that this reporting is just piling on poor AIG.The behemoth just cannot catch a PR break. Oh, well, dear reader, don't waste too much energy feeling sorry for AIG. After all, you are paying for AIG big time: in the bailout that exceeds $200 billion; in the war-based premiums that generate profits nearing 40 percent; and in all likelihood, in the social costs of caring for devastated civilian employees, who have so much difficulty accessing the comp benefits to which they are entitled.

    AIG may not know diddly about the risk in risky financial vehicles, but they certainly know how to make money in conventional comp insurance. Of course, it helps that the injured workers are so invisible, like obscure figures in a desert sand storm, struggling blindly to find some kind of shelter in a harsh and unsympathetic world.

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    April 14, 2009


    The Sunday Times had an article about tough times in Palm Beach, where the super-wealthy reside. They like to shop at Trillion, a store that kind of indicates, by the name, that if you have to ask how much something costs you don't belong in the store. The last time Bernie Madoff was in Trillion, he fell hard for a $2,000 pair of worsted spun cashmere pants, which Trillion didn't have in his size. So Trillion ordered the pants from Italy. They arrived, alas, after Madoff had been busted. I don't think he'll be needing the pants where he currently resides. His new outfits - undoubtedly lacking that fine cashmere "hand" - are provided free of charge by the state of New York.

    But this is not a posting about Bernie. The subject is one Victor Leon, a 26 year old illegal immigrant who fell off a roof three years ago. He was paralyzed and now lives in constant pain. He's run up about half a million in medical expenses at St. Mary's Medical Center, with the prospect of further surgery to come. You might expect that workers comp will reimburse St. Mary's, but that is unlikely to happen. The hospital, like Leon, is on its own.

    What about Comp?
    In most states, despite his illegal status, Leon would be covered by workers comp, up to but probably not including the voc rehab he clearly needs. Coverage is apparently not a given in the Sunshine state. A post-injury urinalysis run at the hospital found traces of cocaine and marijuana in Leon's blood. His employer, Altec, believes that the failed drug test, combined with Leon's undocumented status, are grounds for denying his claim. Leon's lawyer, supported by a toxicologist, asserts that the test does not prove that Leon was impaired at the time of the incident. Leon admits to taking "about four puffs" the night before, but he had a good night's sleep (alas, the last of his life) and was fully alert the next morning at work.

    OK. If comp does not apply, Leon can sue his employer, right? Well he tried, but failed there, too. A civil court judge ruled that Altec owed Leon nothing, because they carried workers comp for their employees...Which takes up back to Leon's comp claim, which was, of course, denied. Leon is caught up in a rather ferocious version of Catch 22.

    Leon's life is ruined, not because of greed or malice (sit still, Bernie!). He lied in order to get work. He performed his job to the best of his ability. He was seriously injured through an unfortunate miscommunication with a co-worker. While he has benefitted from good medical care, he is penniless and now homeless. He would return to Mexico, but if he does, all hope of winning his legal case would be lost.

    So there you have it: A tale of two broken lives in America. One man dreams of the $2,000 pants he almost got to wear and the other dreams of being able to pull on a pair of cheap jeans. There are probably some compelling lessons to be drawn from these parallel stories. I'll leave it to our readers to figure out exactly what those lessons might be.

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    March 18, 2009


    Marcellus, a character in Shakespeare's Hamlet, muses that there is "something rotten in the state of Denmark." To the contrary, there is a spirit of generosity in Denmark that is increasingly rare in this troubled world. We are dealing here with the issue of compensability of cancers that may or may not be work related. As we have discussed in previous blogs, in the states, unless cancer-suffering workers are firefighters, they are unlikely to receive comp benefits for any forms of cancer. Most doctors are reluctant to establish a definitive link between workplace exposures and cancers, even when there is compelling evidence of a connection.

    Denmark has a different take on the matter.

    Thirty-seven women in Denmark have won the right to compensation after claiming that their breast cancer was linked to their long-term (20 plus years) of night shift work. (We have blogged the possible link between shift work and cancer here.) The state-run disability agency received 75 applications for compensation in 2008. They awarded benefits in 37 cases, as they could find no other significant factors that might explain the development of breast cancer.

    Denmark might even take this one step further: they are considering whether to establish the presumption that breast cancer is an occupational illness. In other words, just as many firefighters with cancer in America are presumed to have a work-related condition, women workers with breast cancer in Denmark may benefit from a similar presumption. (It's safe to say that no such presumptions are likely to take root in our comp system.)

    Denmark is in the vanguard of worker-friendly governments. Here is just a sampling:

    Some of the latest collective bargaining decisions have been an increase of the annual holiday from five to six weeks at some workplaces, an increased proportion of the wages set aside for pensions and increased access to further education. In the new agreements in 2007, many industries introduced three weeks' paternity leave on full pay. Woman already have four weeks' pregnancy leave and 20 weeks' maternity leave.

    I know that some of our readers will chastise the Danes for operating a welfare state. Certainly, the Danish tax structure reflects the costs of providing robust benefits for all workers. But Denmark has a total population of only 5.5 million - one metropolitan area in the states. The scale of their social engineering is tiny by American standards.

    In these days of market turmoil, where scoundrels cash out huge bonuses and ordinary workers struggle to support their families, we might take a few moments to question the efficiency and fairness of unbridled markets. In times like these, a case can be made for a strong government presence, and, perhaps, for generosity itself. As Hamlet reminds us, "there is nothing either good or bad, but thinking makes it so." Given the state of the economy, we have a lot of thinking to do.

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    March 4, 2009


    Back in December we blogged the sad story of Taneka Talley, who was stabbed to death while working as a clerk for Dollar Tree. Her assailant, Tommy Joe Thompson, singled her out simply and solely because she was black. At first, Dollar Tree denied the claim, under the theory that Talley's race - not her employment - was the cause of the attack. After public outcry, Dollar Tree's insurer decided to pay death benefits to Talley's 11 year old son.

    This case generated a lot of comment from Insider readers, who were divided on the whether the incident should have been compensable under workers comp. Now a California assemblywoman, Mariko Yamada (D-Davis), has filed a bill to address the ambiguities of this case. AB 1093 would forbid the denial of a comp claim where the motivation for the injury or death was related to an "immutable" personal characteristic - such as race, age or gender.

    Here is the proposed language to amend Section 3600 of Labor Code:

    (c) No workers’ compensation claim shall be denied solely because the motivation behind what caused the employee’s injury or death was related to an immutable personal characteristic of that employee.

    "By introducing 'Taneka's Law,' I hope that no other family in California will ever have to endure the unspeakable pain that the Talley family experienced," Yamada stated.

    Chain of Ambiguities
    The proposed language raises an interesting issue: what exactly is an "immutable" personal characteristic? Would this include mental disabilities (such as "intermittant rage disorder") or would such diagnoses be considered mutable? In terms of physical disabilities, where is the line between "permanent" (immutable) and "temporary" (mutable). Does anyone at maximum medical improvement (MMI) by definition have an "immutable" charateristic?

    This bill is designed to close a loop hole in workers comp coverage. Should it become law, it will be interesting to track the inevitable loop holes that the new statutory language (inadvertantly) creates.

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    February 24, 2009


    Audeen Jacobs was a teacher in the Clark County (Kentucky) school system. She retired in June 2003, but was hired back on a 100 day contract in the fall of that same year. In addition to her teaching responsibilities, she volunteered to sponsor the high school's Beta Club, an honor society that requires students to maintain a specific grade point average.

    On December 6, 2003, she accompanied the students to a Beta convention in Louisville. She was paid while attending the conference and had secured permission from the high school principal to attend. In other words, Jacobs was clearly "in the course and scope of employment" when she fell from a set of bleachers and severely injured her left shoulder.

    The Clark County school board denied the claim, lost at the initial and appeal levels, and lost for the last time at the Kentucky Supreme Court. The board argued that participation in the Beta club was not required and, like other extracurricular activities, the club was of "intangible benefit" to students.

    The judges did not buy this specious argument. They pointed out that Beta club activities were directly connected to educational goals and that participating students had access to scholarships only available to Beta members. Jacobs was off-site, but directly involved in school-related activities.

    History Lessons
    Audeen Jacobs gave a lot to the kids in Beta. Maybe it's time for the kids to give something back. The Insider would like to propose an extracurricular project: a presentation to the school board on the history, purpose and importance of workers compensation. The kids might even ask Audeen Jacobs to attend, to share her experience of being injured and unable to work, the pain and shock of the initial fall, the subsequent operations, the medications, the indemnity payments that helped her pay her bills.

    While the kids have the attention of a board that is clueless about comp, they might want to take the opportunity to provide an historical lesson in irony and ambiguity. Their high school is named for a revolutionary war hero. Here, courtesy of Wikipedia, is a little background on Mr. Clark:

    George Rogers Clark (November 19, 1752 – February 13, 1818) was a soldier from Virginia and the highest ranking American military officer on the northwestern frontier during the American Revolutionary War. He served as leader of the Kentucky militia throughout much of the war, Clark is best-known for his celebrated capture of Kaskaskia (1778) and Vincennes (1779), which greatly weakened British influence in the Northwest Territory. Because the British ceded the entire Northwest Territory to the United States in the 1783 Treaty of Paris, Clark has often been hailed as the "Conqueror of the Old Northwest."
    Clark's military achievements all came before his 30th birthday. Afterwards, he was disgraced and accused of being drunken on duty and therefore left Kentucky to live on the Indiana frontier. Never fully reimbursed by Virginia for his wartime expenditures, he spent the final decades of his life evading creditors, living in increasing poverty and obscurity, and often struggling with alcoholism. He was also involved in two failed conspiracies to open the Spanish controlled Mississippi River to American traffic. After suffering a stroke and losing his leg, he was aided in his final years by family members, including his younger brother William, one of the leaders of the Lewis and Clark Expedition. Clark died of a third stroke on February 13, 1818.

    The name of George Rogers Clark graces the facade of the county high school. I wonder how many school board members - let alone kids in the school - appreciate the rich history behind that simple name.

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    February 23, 2009


    Perry Kennon, a thug with a long record, experienced a craving for a Big Mac, so he accompanied a lady friend to a McDonald's in Little Rock, Arkansas. ["I'm lovin' it!"] His lady said something he disapproved of, so he smacked her in the face. McDonald employee Nigel Haskett, 21 at the time, rushed at Kennon and pushed him out of the restaurant. Haskett then stood by the door to prevent Kennon from re-entering. Kennon, not surprisingly, took offense to Haskett's chivalry. He went to his car, retrieved a gun, and shot Haskett in the stomach multiple times.

    Haskett has undergone three abdominal surgeries and has incurred over $300,000 in medical bills. Surely, you know where this is going: McDonald's denied Haskett's workers comp claim. They assert that the injuries did not occur in the "course and scope of employment."

    According to Haskett's lawyer, Philip M. Wilson:

    "McDonald's position now is that during a thirty-minute orientation Mr. Haskett and the other individuals going through the orientation were supposedly told that in the event of a robbery or anything like a robbery . . . not to be a hero and simply call 911. Mr. Haskett denies that anything like that was even mentioned during orientation or at any time during his employment with McDonald's."

    Cowards Preferred?
    It is reasonable to train employees not to resist robbers. By all means, hand over the cash and stay out of harm's way. Such a policy may or may not be a viable basis for denying this particular claim, but it's a strategy that comes with a big hole and significant cost. The hole is this: the incident was not "anything like a robbery." It was an assault. Haskett rushed to the aid of a defenseless woman. He acted instinctively, as good samaritans usually do. In most states, the actions of good samaritans are considered compensable under workers comp statutes.

    The cost of McDonald's policy may prove greater than the short-term savings on the comp side. McDonald's can try to set corporate policy that prevents employees from being good samaritans, but society frowns on such corporate indifference to suffering. It's one thing to encourage employees to hand over the money, it's quite another to prohibit them from helping people with urgent needs.

    This much we know: Haskett was working when his instinctive, chivalric response resulted in serious wounds. McDonald's could have shared the glory and given Haskett a medal. Instead, they gave him the boot. If their corporate strategy is stamping out any hint of heroism among their underpaid employees, I'm not lovin' it.

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    February 10, 2009


    Arthur Pierce worked for a trucking company in Virginia. In September 2006 he was found lying beside his dump truck. He had suffered a severe brain injury and was unable to communicate any details about what had happened. Physicians speculated that he had fallen from the truck (falls are the number one cause of injuries to drivers), but there was no proof and no witnesses. The unfortunate driver required constant care until his death in January 2008.

    Due to the uncertainty of the circumstances surrounding the injury, Pierce was denied workers comp benefits. (This would have been a very large claim.) Ironically, if he had been found dead, the death would have been deemed compensable: when an employee is found dead at work, the fatal injuries are presumed to arise out of employment, unless there is a "preponderance of evidence" to the contrary.

    Legal Remedy Fails
    Lawmakers in Virginia, sympathizing with the plight of Pierce and his widow, proposed changes to the state's comp statute. Senate Bill 821 was aimed specifically at employees who suffer severe brain injuries and are unable to recall the relevant circumstances of the accident. (How many of these cases would there be in a year - or even a decade?)

    Alas, SB 821 died in committee. Opponents feared that the bill would increase the likelihood of workers' comp fraud. They were actually concerned that employees would fake severe brain injuries to secure benefits. To be sure, fraud can be a real problem, but how can you possibly fake a brain injury?

    SB 821 would have come too late to help Pierce, and was so specific in nature, it would probably never have been helpful to severely injured workers. It was a mostly a symbolic gesture toward a family that was not served well by the Virginia comp system. Arthur Pierce's work-related fall simply fell through the cracks.

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    February 6, 2009


    Nadya Suleman recently gave birth to octuplets, six boys and two girls. These newborns join the six other children that were also conceived through in-vitro fertilization. Suleman is a single mother of 14 young children, living at home with her (distressed?) parents. As the father of two teenage daughters, I certainly appreciate the joys (and challenges) of parenting. But this is ridiculous.

    Workers comp has played an interesting role in enabling Suleman to become the media's latest and greatest fertility symbol. Back in 1999, Suleman worked the graveyard shift as a psychiatric technician at the Metropolitan State Hospital in California. She was injured in a mini-riot, when a patient threw a desk at her, injuring her spine. The back injury was clearly visible on her MRI and obviously compensable. She was disabled from work and collected workers comp. We don't know how hard the hospital tried to bring Suleman back to work.

    In 2001 she was on her way to a treatment session, when she was involved in an auto accident, injuring her back, shoulders and neck. She filed a claim for continued benefits based upon these new injuries. Her employer objected, but Suleman prevailed at a hearing. (I would have thought that going to a scheduled appointment, like "to and fro" in going to work, would not in itself be "in the course and scope" of employment - but obviously, the judge disagreed.) As a result of her continued indemnity payments, Suleman was supported by workers comp during her extensive and remarkably successful attempts to have children.

    Pregnancy and a Bad Back
    Suleman admitted that her back injury was exacerbated by her pregnancies. At the most recent hearing, in August 2008, Dr. Steven Nagelberg attributed 90 percent of her injury to the work incident and 10 percent to her pregnancy. (Obviously, Dr. Nagelberg has never been pregnant!)

    In any event, Suleman has collected about $165,000 on her workers comp claim. Here is the key point: Suleman claimed to love her job, but her employer was unwilling or unable to bring her back to work. Given her attitudes toward life, marriage and children, she was undoubtedly a handful. Nonetheless, an aggressive attempt to return her to productive work might have saved the state a lot of money. As it was, comp became Suleman's primary means of support as she pursued her dream of having a family. Some dream!

    In a recent interview on the Today show, Suleman says she had six embryos implanted in her fertility procedure — far more than industry guidelines recommend — and was well aware that multiple births could result. Indeed, during the very early stages of the pregnancy, the six became eight. (Hmm. I wonder if the infertility doctor consulted his/her local medical ethicist when agreeing to do this procedure.)

    "I wanted them all transferred. Those are my children, and that's what was available and I used them. So, I took a risk. It's a gamble. It always is."

    "It turned out perfectly," Suleman added.

    Perfection is not the word that comes to my mind. This is a failure of mind-boggling dimensions, with profound implications for 14 innocent children. It is ironic that workers comp, the safety net for injured workers, has played a relatively small, but definitive role in this sorry saga.

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    February 4, 2009


    We know how James Strickland died. Strickland worked for Bay Area Regional Transit (BART) in San Francisco. On October 14, he was walking east on the westbound track, checking for safety problems. An eastbound train, traveling 70 mph, slammed into him. (Now there's a safety problem!) He died instantly. But when you review the post-accident activities of BART, you get the impression that they are not quite sure Strickland is really dead.

    We read in that Strickland's widow Linda is still waiting for workers comp benefits, nearly four months after the accident. According to BART, they are lacking some paperwork - not enough, mind you, to prevent them from paying the $5,000 burial benefit, Strickland's final paycheck and a life insurance policy.

    Systemic Failures
    Linda Strickland complains that BART failed to contact her directly on the day her husband was killed. BART responds that they tried unsuccessfully to reach her. Mrs. Strickland first learned about the accident on the radio; a friend later informed her that her husband was involved.

    BART has apparently told Linda that Strickland himself was at fault in the incident: he should have known that BART was single-tracking trains on the day of the accident. Of course, under workers comp laws, even if Strickland was at fault, the accident is still compensable and Linda is entitled to benefits. (A more gracious employer might avoid placing blame directly on the deceased, especially in the course of informal conversations with the grieving widow.)

    As far as the missing documentation goes, it's easy to understand why BART needs a copy of the marriage certificate. But why are they asking for the death certificate, the coroner's report and earnings statements? Don't they know the circumstances of the death and how much they paid Strickland? Don't they have enough information readily available to commence weekly benefits and adjust them later, if necessary?

    The comp system is designed to provide prompt benefits, usually commencing (by law) within 14 days of an injury. Sometimes there are significant questions of compensability, which under rare circumstances might delay the initial payments. In this case, it's hard to imagine the rationale for any delays. BART prides itself in providing on-time transportation for its customers. They should approach benefits for their own employees with the same determined attitude.

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    January 26, 2009


    Ed Abney is 53 year old tool-and-die worker with Parkinson's disease. For over 20 years, he was literally up to his elbows in drums of the powerful solvent, trichloroethylene (TCE). He worked for the now defunct Dresser Industries in Kentucky. As we read in Felicity Barringer's excellent article in the New York Times, Abney's illness was probably caused by work, but in the world of workers comp, "probable" does not meet the standard for compensability. Even with compelling research by the University of Kentucky suggesting that exposure to TCE increases the risk for Parkinson's, Abner is unable to access workers comp benefits.

    The Kentucky study focused on Ed and his co-workers at Dresser. Researchers sent surveys to 134 former employees; 65 responded. The research found 27 workers with Parkinson's symptoms or with impaired motor skills. That's 42 percent of respondants and 20 percent of the total surveyed. Statistically significant, to be sure. Nonetheless, the medical researchers were unwilling and unable to certify that the onset of Parkinson's was caused by workplace hazards.

    As Dr. Don Gash, one of the researchers, put it: "Was it the [TCE]? It could have been. But it could have been other things, too," including a genetic predisposition to the disease. Unfortunately for Abney and thousands of workers like him, the world of workers comp operates on a rather simplistic model of cause and effect: if you can prove that the injury or illness is work related, it is compensable. In cases of occupational disease, there is almost always grounds for doubt. You simply cannot prove definitively that chemical exposure caused the illness - even though there is compelling anecdotal evidence that it did.

    Fighting Fire with Politics
    Which leads us back to the world of firefighters. As we discussed in a June 2008 posting , 40 states have created a presumption of compensability for heart disease and cancers occurring in firefighters. Like Ed Abney, firefighters are exposed to cancer causing substances in the performance of their work. But unlike Abney, firefighters are much more likely to receive disability benefits based upon this exposure. There is little if any burden of proof on the firefighter to demonstrate that the illness is work-related.

    Where firefighters get the benefit of the doubt, ordinary workers just get the doubt. Ed Abney and thousands of other industrial workers suffering from debilitating and often fatal occupational illnesses face virtually insurmountable obstacles in collecting workers comp. As Dwight Lovan, Kentucky's commissioner of workers comp, puts it: "We are dependent upon the scientific and medical communities for the element of causality." Well, yes and no. Ultimately, compensability is a political issue: state legislatures have blown open the causality issue for firefighters. They could do the same for ordinary workers, but in all likelihood, they will not. Everyone supports public safety, but when it comes to the ordinary Joes and Josephines, Eds and Ednas, who do their jobs and come home reeking of toxic solvents, sympathy quickly evaporates under the guise of keeping employer costs to a minimum. In their struggles to treat their illnesses and support their families, these plain folks from Main Street are pretty much on their own.

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    December 9, 2008


    On December 1 we blogged the story of Taneka Talley, an employee of the Dollar Tree stores who was stabbed to death at work by a deranged racist. We believed that Talley's death was compensable under workers comp, as she died at work, performing her job (she was stocking shelves at the time of the assault). Dollar Tree's TPA denied the claim under the theory that the death was not work related because the killer was motivated solely by Talley's race (she was African American). A few of our readers agreed with the denial.

    This was no personal dispute. Talley and her assailant had no prior relationship. She died because she was in the wrong place at the wrong time. If she had been stabbed on the street, there would be no workers comp claim. But she died while working, so in our view her orphaned son is entitled to benefits.

    Dollar Tree's mission statement refers specifically to the importance of good judgment: "Do the right thing for the right reasons." Well, Dollar Tree has now agreed to pay the full amount allowed by California workers comp for death benefits. The company's statement asserts that it was acting voluntarily because "we feel this is the right thing to do." Mission accomplished!

    In this emotion-laden situation, a literal and nit-picking interpretation of the law is simply not in the company's best interests. To be sure, a case for denial can be made. They might even prevail in workers comp court (we doubt it), but Dollar Tree had much to lose in the court of public opinion. Some customers had called for a nationwide boycott and protesters picketed the Fairfield store where Talley died. With this agreement to pay the claim in full, Dollar Tree ends a public relations nightmare and preserves its standing in the community. Dimes to dollars, that's money well spent.

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    December 4, 2008


    Jdimytai "Jimbo" Damour took a temp job for the Christmas rush at the Walmart in Green Acres Mall on Long Island. Some rush. When a crowd of bargain hunters pushed into the store at 5 am on "Black Friday," Damour, a 34 year old who weighed 270 pounds, fell to the floor and was trampled. He died within an hour of heart failure. Undeterred by Damour's plight, many shoppers pushed on toward the electronics department, where big screen TVs were going for $800.

    Damour was employed through Labor Now, a temp agency. Because Walmart was not the employer of record, Damour's family has a number of options for legal recourse. They have filed suit in the Bronx Supreme Court, alleging that Damour's death was caused by "the carelessness, reckless negligence, wanton disregard for public safety and gross negligence" in the "staging, conducting and advertising for sales events."

    The lawsuit names Walmart, the shopping mall and the security company employed by Wal-Mart to control the crowd. Heck, they may as well include the advertising company that stirred up the masses. Despite what appears to be a good faith - albeit unsuccessful - effort to control the mob, the settlement is likely to be substantial.

    The Green Acres Mall, where the incident took place, has a troubled past. According to New York Times reporters Ken Belson and Karen Zraick, the mall opened in 1956 on the site of the Curtiss Wright Airport. It was one of the first open-air shopping centers on Long Island, with 1.2 million square feet of retail space. In the 1980s, the mall was dubbed the "car theft capital" of Long Island. In 1990, four moviegoers were shot, one fatally, when two groups of teens opened fire in a movie theatre. What was playing? Appropriately enough, The Godfather, Part III.

    The most telling comment concerning this sorry indictment of consumer mania came from an anonymous employee stationed at the time of the mayhem in the electronics department. "It was crazy. The deals weren't even that good."

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    December 1, 2008


    Dollar Tree is a national company with stores in all 48 states. Everything they offer costs a buck. (They are doing very nicely in this recession.) Here's how they describe themselves:

    Walk into one of our stores and it hits you immediately: this is a place where shopping is fun. We call it "Thrill of the Hunt". We have worked hard to create an environment where our customers can discover new treasures every week. Where entire families can enjoy looking for that special something.

    As you will soon see, the "thrill of the hunt" has become a very unfortunate metaphor for the Dollar Tree experience, at least for one hapless employee.

    Taneka Talley worked at a Dollar Tree store in Fairfield, California. On March 29, 2006, Tommy Joe Thompson walked into the store not looking for a bargain, but for someone black. Identifying Talley as a person of color, he stabbed her to death. Talley left a son, Larry, who was 8 years old at the time of the murder.

    It seems pretty obvious that Talley was in "the course and scope" of employment at the time of her murder. She had no prior relationship with Thompson. Her death, therefore, is a compensable event under workers compensation. Thompson's racist motives have no bearing on that compensability.

    Well, it appears that it's not just the merchandise at Dollar Tree that's worth a buck. Their legal advice is equally on the cheap. Dollar Tree's TPA, Specialty Risk Services, has denied the Talley family claim for survivor benefits. Their reasoning? Thompson's sole motivation for attacking Talley was her race. The death had nothing to do with her being a Dollar Tree employee. She just happened to be at work when Thompson walked into the store on his demonic errand.

    The insurer's denial is based upon testimony during Mr. Thompson's mental competency hearing. District Attorney Dane Neilson asked psychiatrist Herb McGrew, "You know that he (Thompson) got up that morning and he said, 'I'm going to kill a black person.' She was unfortunately, the first person he saw, correct?"

    "Correct," McGrew said.

    It took the jury less than half an hour to determine that Thompson could understand the proceedings against him and was competent to stand trial. At some point, if this case reaches a judicial proceeding, Specialty Risk's denial of the claim will be brushed aside with equal fervor. Dollar Tree would do well to work out a (generous) settlement prior to any such hearing.

    If Dollar Tree needs additional motivation to reach a settlement, perhaps they should begin by reading their own "mission and values" statement:

    Attitude: Responsibility, Integrity, Courtesy
    Judgment: Do the Right Thing For The Right Reasons.
    Commitment: Honor and Respect for Self and Company

    Do the Right Thing for the Right Reasons, indeed.

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    November 11, 2008


    Here are two items you might never expect to appear together: frozen embryos and workers comp. But a case in Arkansas reveals that the comp system can easily be drawn into the ongoing (and apparently endless) debate of when life begins.

    Wade and Amy Finley were married in 1990. They were unsuccessful in having children, so in 2000 they initiated infertility treatments. They froze several embroyos as part of this effort.

    In July of 2001, Wade was killed in a job related accident. In accordance with Arkansas's comp statute, Amy received survivor benefits. In June of 2002, nearly a year after Wade's death, Amy had the previously frozen embryos emplanted in her womb. Wade Jr was born in March of 2003. Amy immediately filed for comp dependency benefits on behalf of her newborn son.

    Her claim was initially declined, then allowed, and then brought before the Arkansas Supreme Court. The court defined the problem as follows: Does a child, who was created as an embryo through in vitro fertilization during his parents’ marriage, but implanted into his mother’s womb after the death of his father, inherit rights under Arkansas comp law?

    Suspended Animation?
    Amy asserted that the child was Wade's and as such was entitled to dependency benefits. The workers comp commissioner argued that Wade Jr was neither born nor conceived during the Finley's marriage, which ended upon Mr. Finley’s death.

    It is clear from the statute that in order to inherit through intestate succession as a posthumous descendant, the child must have been conceived before the decedent’s death. However, the court points out that the statutory scheme fails to define the term “conceived.” Was the merger of cells in a petri dish - followed almost immediately by freezing - a conception? Was that microscopic event the beginning of life?

    Ultimately, the court did not buy Amy's argument. The justices state that their role "is not to create the law, but to interpret the law and to give effect to the legislature’s intent." Arkansas statutes do not specifically define the petri dish merger as a "conception." Wade Jr is the child of his father (whom he sadly will never know) and the dependent of his mother. But he is not a dependent as defined for workers comp purposes and as such does not qualify for benefits.

    Amy was certainly within her rights to have Wade's child after his death. The state is apparently within its rights to preclude dependency benefits for the child. The court punted on the issue of when life begins, leaving that sticky question for the state legislature. I recommend against their trying to resolve it once and for all.

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    September 17, 2008


    I am pleased to report that workers comp has entered into the informed debate that characterizes our pending national election. It is inspiring to see the national dialogue confront - one by one - the complex issues that face this country as we creep on all fours through the new millenium.

    Mike Wooten is a trooper with the Alaskan state police. He was involved in a messy divorce from the sister of Alaska Governor and GOP Vice Presidential nominee Sarah Palin. Palin and her husband, Todd (AKA "the First Dude") apparently had concerns that Wooten was collecting workers comp, even as he was participating in some heavy (as opposed to "light") duty functions away from work. Palin and the Dude believed that Wooten had gone “snowmachining” during his alleged disability. Perhaps he was just having a good day?

    It also appears that Wooten had “applied for and got a ticket to go hunt a moose.” I can't speak for our readers, but I do know that when I strained my back a couple of years ago shoveling snow, my first thought was that it might help to go hunt moose, until I realized that there weren't any in my immediate neighborhood. A number of close friends advised me that the best cure for intense back pain is to go out and shoot something, preferably from a moving snowmachine. It was a compelling argument, which at that time I chose to ignore.

    Fraud, Malingering or Politics?
    In the fall of 2006, Wooten injured himself in the line of duty when he pulled a body from a wrecked automobile, slipped on icy pavement and injured his back. He underwent surgery and was on “light” duty and had filed for worker’s comp when he could not work. The records do not indicate how long Wooten was on light duty or why this assignment came to an end.

    John Cyr, head of the union for state troopers, believes that the guv and first dude were up to no good. “Todd Palin was following Mike around snapping pictures of him,” he is quoted as saying. “Frank Bailey (Palin's director of boards and commissions) was getting people to say that Mike was lying on his worker’s comp form. The governor’s family was following Mike around everywhere. They forwarded that information to the worker’s comp division."

    While I'm impressed that the First Dude took it upon himself to run a secret investigation, thereby saving taxpayers the cost of hiring an outside investigator, he might have been better off leaving this to the professionals. Given the magnitude of the fallout from "troopergate," the First Couple might do better next time to "drop a dime" to the insurance fraud bureau through an anonymous call: I'm guessing that they still have pay phones in Alaska.

    Regardless of what you think of their politics or their methods, Palin and the Dude have taken a pro-active stance on workers comp fraud and they deserve credit for raising the profile of this under-reported issue. The Insider embraces this opportunity to further the national dialogue on the compelling issues of our time, even as we peruse Craig's List for barely used snowmachines in good running condition.

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    August 11, 2008


    Is a suicide compensable? In certain circumstances it is, according to a recent ruling by the Nevada Supreme Court in Sharon Vredenburg v. Sedgwick CMA and Flamingo Hilton-Laughlin. While Nevada state law prohibits benefits if a worker's death occurs due to a "willful intention to injure himself," this does not apply if a "sufficient chain of causation is established." Roberto Ceniceros of Business Insurance noted that, "To establish such a chain, claimants must demonstrate that the employee suffered an industrial injury that in turn caused a psychological injury severe enough to override rational judgment. Claimants must then establish that the psychological injury caused the employee to commit suicide, the court said.

    Dan Vredenburg was a bartender for the Flamingo Hilton in Laughlin. He suffered back injuries in a fall down stairs while working and was compensated for his injuries. According to the, he suffered relentless pain. He couldn't keep food down and spent his life in bed. Nealy three years after this accident, he killed himself. Under the state's "willful intention" clause, his widow was denied benefits several times until the matter reached the Supreme Court and the precedent-setting determination was made.

    Other workers comp-suicide rulings: MA, WY, ND
    There have been other cases involving suicide where workers comp has been awarded to surviving spouses. This past November, we covered a suicide that was deemed compensable in Massachusetts. In that case, Gilbert Dube injured his back at work. When he tried to return to work on light duty, he was terminated. He then grew depressed and commit suicide a few weeks later. The insurer made the case that his termination was an independent, intervening event that broke the chain of causation. At the hearing, the claimant's attorney introduced medical evidence that the employee's back injury caused him to become clinically depressed, and that the termination exacerbated his depression to a degree that he was acting irrationally when he commit suicide. The justices concluded that the injury and termination were inextricably connected.

    In the 1992 case of State ex rel. Wyoming Workers' Compensation Div. v. Ramsey, an Appeals Court upheld benefits for a decedent's widow using the chain of causation test as the predominating principle in its decision.

    Steven R. Ramsey was receiving workers compensation benefits after suffering a severe 1988 industrial accident that left him unable to resume work. In 1990, about 5 weeks after his pain medication was mostly discontinued, his pain increased, he became depressed, and he killed himself. In determining to continue benefits, the Court agreed with his widow:

    "The circumstances of this case are clear. Steve Ramsey would not have committed suicide if not for his work place injuries. There were no pre-existing conditions that caused him to be susceptible or prone to suicide, there were not intervening conditions or situations that occurred between the time of his work place injury and his death, and Steve Ramsey continued to do all those things necessary to try and get well. But for the injury at the Wydak Power Plant, Steve Ramsey would not have committed suicide."
    In the same year, a North Dakota Appeals Court denied benefits to the widow of Richard L. Kackman in the wake of his suicide, finding no cause and effect relationship between Richard's work injuries and his suicide. In this case, two doctors presented conflicting testimony. One doctor concluded that Richard's work injuries caused chronic illness, which caused depression, which in turn caused him to take his life. The other physician stated that Richard had a prior history of interpersonal problems, delusions, and a paranoid disorder before any work injuries occurred, and those preexisting conditions were what caused Richard to commit suicide. The Court agreed and denied benefits.

    These cases show the importance of addressing pain and depression in recovery plans, particularly those involving life-altering injuries. Suicides in workers comp will likely continue to be outliers, but state courts have shown sympathy to the idea that pain and depression can pierce a "willful intention" defense by the insurer. The courts seem consistent from state-to-state in requiring a chain of causation. But despite the precedent-setting nature, we note Jane Ann Morrison's observation in the Nevada ruling: "None of the lawyers I spoke to thought there would be a rash of suicides by injured workers as a result of this ruling."

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    July 28, 2008


    When it comes to fraud in workers comp, we usually look to employers, doctors and lawyers. They go after the big bucks. While there are opportunities for ordinary workers to exploit the system, most decline to do it. Today we examine two claims, both involving real injuries and both involving fraud. Coincidentally, it's a bi-coastal story.

    Let's begin in the east, in Gardner, Massachusetts, where Erik Teong managed a Shell Station. On October 28, 2006, Teong reported to Gardner police that he had been assaulted and robbed while taking cash receipts to the bank. He sported a bruised face and injured eye.

    The police did not buy his story. He eventually confessed to stealing the $7,000 deposit. In February 2007 he was charged with larceny and making a false report of a crime. In April, he pled guilty to both charges and was sentenced to one year of probation. He also must pay the insurance company $7,900 (to repay the "stolen" payroll).

    The injury to his eye? Teong told police that he had a friend give him a hard punch to the face, to make his story more credible. The hapless Teong has permanently damaged his vision. And because the injury appeared to occur in the course of employment, Teong filed a comp claim. AIG, the comp insurer (with a few problems of their own!), paid his $16,000 medical fees and $3,000 indemnity. Now AIG wants its money back. They referred the matter to the fraud bureau, which led to Teong's indictment by a Worcester County grand jury.

    So Teong has earned himself a place in the Hall of Fame for Incompetent Criminals. He botched the fake robbery. His friend all-too-convincingly smashed him in the face. He has to repay the medical expenses and ill-gotten indemnity. And to top it off, given his permanently impaired vision, he may have trouble reading the charges against him.

    California Scheming
    Now let's hop across the continent to the Lake Tahoe, where Nicholas Jason Beaver resides. Nick worked for the Sierra-at-Tahoe resort, but busy as a Beaver he was not: the resort told him they would not rehire him for the following season. One night, after a few beers with his buddies, Nick decided to get even. He decided get himself injured on the job.

    On April 9, 2004 Nick jumped up and down on a snow bridge that covered the top of percolation test hole. After three or four jumps, he broke through the bridge and fell into the 5 foot deep hole, injuring his knee. He collected comp (the injured knee required surgery) and then decided to sue the resort: he wanted to pierce comp's "exclusive remedy" shield due to the resort's "extreme negligence" in allowing an "unprotected" hole to exist on their grounds. (Nick's story belongs in the burgeoning archives defining the word "chutzpah.") The resort spent $40,000 defending itself and over $42,000 in medical bills on Nick's injured knee. They offered Nick $110,000 to make the case go away.

    Nick refused to accept the chump change. He apparently told his buddies that he wanted really big bucks. At that point, one of the (disgusted) friends who witnessed the incident dropped a dime on him. His friends were given immunity from prosecution; while technically co-conspirators, they did not benefit financially from the fraud. Nick was convicted of stealing more than $65,000 and now faces up to four years in prison.

    Benefit of the Doubt?
    Erik and Nick were both injured on the job, but their injuries were part of a conscious effort to defraud the employer and insurer. Their stories demonstrate how the comp system defaults toward accepting a reported claim: Erik and Nick both were successful in accessing comp benefits for their injuries. The wheels of justice in these cases ground a bit slowly, but they did grind exceedingly fine. The pain of the actual injuries, with the exception of Erik's impaired vision, has already faded. But the pain of lives ruined by impulsive greed will linger for a long, long time.

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    July 23, 2008


    Unless you are an aficionado of marginal sports, you do not follow arena football, which has taken a classic outdoor sport of considerable violence and transposed it to an indoor setting, with little if any reduction in the violence. The main difference between outdoor and indoor football? Money.

    Our focus today is Tarrence Rhodes, a defensive back for the Huntington (WV) Heroes. (Any Heroes fanatics out there?) Rhodes played his first game with the Heroes on April 11, 2008. During the game he tore his right ACL. He was placed in "pre-hab," which is rehabilitation before surgical repair of his torn ACL.

    It's safe to say that arena football was not what Rhodes had in mind when he played college ball at Missouri Valley. He was under consideration by NFL teams during the 2006 draft, but apparently did not make the grade. He played briefly for the Florida Firecats (another arena team) and then signed with the Heroes, where his career came to an abrupt end.

    Fat Cats and Ordinary Joes
    We are all used to the absurdly inflated salaries of professional athletes; a good defensive back often pulls down several million dollars a year. Rhodes, alas, signed a contract that paid him $250 per game (!) with a whopping $50 bonus if the team happened to win. His contract apparently stated he was covered by workers compensation, but when Rhodes filed a claim for his knee injury, Brickstreet (WV's sole insurer at the time) denied it, saying there was no policy in place for the team.

    So now Rhodes has filed suit in Cabell Circuit Court against the team and its owner, Barbie Moody-Wood. Rhodes claims he is unable to have his surgery because of BrickStreet's denial. He has no other insurance to cover the cost of his surgery and subsequent rehabilitation.

    Rhodes also claims he was not paid his $300 (the Heroes won!) when it was due, and did not receive it until the end of April.

    In the three-count suit, Rhodes seeks compensatory and punitive damages, as well as liquidated damages of $900, plus attorney fees.

    Professional athletes remain an outlying conundrum in workers comp. With their inflated salaries, they don't usually care about indemnity - it's the lifetime medical benefits they want, to cover all-too-frequent permanent partial impairments. Tarrence Rhodes, who once dreamed of playing in the NFL, now shares a fate with ordinary workers whose employers neglected to secure comp coverage. There is nothing special or glamorous about his situation. Rhodes would like to see some wage replacement, modest though it may be, and he would like his former team to cover the cost of his surgery.

    Football careers can be brutal and short, with that of the unfortunate Rhodes being shorter than most. Here's hoping he took some courses at Missouri Valley to prepare him for life after football.

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    July 21, 2008


    Last week we blogged the suspicious "total and permanent" disability of Boston firefighter Albert Arroyo, who celebrated his profound disability rating by placing 8th in 2008 Pro Natural Body Building Championship. Yeah, I know, he was just having a good day.

    Not having a very good day is Arroyo's doctor, John Mahoney, a neurologist at Caritas Carney Hospital. Dr. Mahoney claims that Arroyo did remove his shirt during the most recent exam (which resulted in the permanent and total disability rating), Mahoney noted that Arroyo "had lost some weight and was working hard on his physical therapy and being fit." Mahoney goes on: "If someone is doing bodybuilding and doesn't tell me, how the hell would I know?" Excellent question, Doc. For starters, you might put your hands on his (rock hard) body and ask him to try a few push ups.

    Mahoney concedes that his diagnosis is not looking too brilliant in the light of Arroyo's recent triumph. "I knew my practice would be destroyed. I accepted that. I am prepared to get [expletive]. I am [expletive] and it was in the stars." Which I amend (via Shakespeare): "the fault, dear Brutus, lies not in the stars, but in ourselves..."

    Mahoney goes on to say that were it not for the restrictions imposed on him by the doctor-patient relationship, people would understand that his diagnosis was legitimate. Here's hoping that some well-timed indictments lift those restrictions. I would love to know just what evidence Mahoney used to reach his dubious conclusions.

    Culture Problem
    As the Boston Globe's Walter Robinson points out, this is not an isolated case of fraud. Boston firefighters retire on disability at a rate three times higher than those in other cities. Many of the "disabled" include high ranking chiefs - and therein lies the crux of the problem. As chiefs go, so go the line workers. Boston has a deeply rooted culture of disability among its firefighters. As we saw in the parking department of Philadelphia, disability cultures run from top to bottom. Chiefs on the take are hardly in a position to discipline line workers who want a piece of the action.

    I am pleased to report that Albert Arroyo has been ordered back to his regular job as an inspector (no heavy lifting!). Meanwhile, the retirement board may want to take a closer look at the 25 firefighters whom Dr. Mahoney has rated as totally disabled since 2001. While there may not be any more bodybuilders in this group, I would not be shocked to find a few on boats in Florida, gamely working to overcome their disabilities by reeling in 200 pound sportfish. It's not easy, but it sure beats putting out fires.

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    July 8, 2008


    Ronnie Ramroop was an employee of Flexo-Craft Printing in New York. In March of 1995 he caught his hand in a press, crushing four fingers. After seven surgeries, two fingers were amputated. It goes without saying that this is a work-related injury; workers compensation paid the medical bills, loss of function benefits (Ronnie lost 75% of the use of his hand), along with indemnity for lost wages. Ronnie received benefits through January 2000, at which point his eligibility ended.

    Ronnie then applied for the "additional benefits" available under New York law. To receive these benefits, Ronnie had to prove that the impairment to his wage-earning capacity was due solely to the work-related injury. That's where Ronnie's claim hit a big snag: Ronnie is an undocumented worker. Yes, his inability to work is connected to his rather severe injury, but it is also related to the fact that he is not qualified to work in this country. As the court put it, Ronnie's appeal puts into clear focus the tension between the statute's voc rehab objective to return an injured worker to the marketplace and the re-employment of a worker who is not allowed to work. Some tension, indeed!

    The NY Court of Appeals, in a 5 to 1 vote, has denied Ronnie's claim for additional benefits. They concluded that it was not the Legislature's intent to "restore to re-employment" a worker who cannot be lawfully employed.

    The Lone Dissent
    The dissent by Justice Ciparick raises an interesting issue. The judge quotes Chief Judge Cardozo, who emphasized the humanitarian purposes of the comp statute, with its goal of ensuring that injured employees "might be saved from becoming one of the derelicts of society, a fragment of human wreckage." Judge Cipatrick believes that the right to full benefits should be considered an absolute, unrelated in any way to a worker's immigration status. For this (dissenting) judge, there are no tiered benefits. All workers are entitled to all the benefits.

    Virtually all the comp statutes in the US were drafted before the issue of undocumented workers became visible. A number of states have begun to step into the documentation and enforcement void created by a paralyzed Congress: they are drafting punitive laws on the hiring of undocumented workers (and thus giving rise to great concerns among American businesses). Some of these same states are toying with the idea of curtailing comp benefits for undocumented workers. This would be the final step in the creation of a truly third-class workforce, with sub-standard working conditions, wages and protections. We will have come full circle, with the fears of Judge Cardozo fully realized: millions of essential jobs performed by a marginalized workforce - derelicts of society, fragments of human wreckage.

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    June 25, 2008


    Anthony DePalma has an interesting analysis of the 10,000 claims against New York City in the aftermath of 9/11. The city has reviewed the claims submitted by people involved in the immediate aftermath and clean up. As many as 30 percent of the claimants are suffering from nothing more than a runny nose or cough. In over 300 of the records, there was no evidence of any illness at all. What's going on?

    Nearly seven years after the twin towers collapsed, we are not even close to resolving the fate of the 40,000 individuals who rushed in to help. A quarter of the rescuers have filed claims, but it turns out that many of the filings are incomplete. Alvin Hellerstein, the U. S. District Court judge overseeing the claims, has asked for detailed medical records on all claimants going back to 1995. At this point, literally thousands of documents are missing.

    Attorneys for the claimants admit that nearly a third of the filings involve minor or even non-existent problems. But they defend the submissions as a necessary hedge against future illness: even though there are no major symptoms today, debilitating illnesses related to the clean up may develop sometime down the road. The attorneys say that New York law allows a suit if the claimant has "a rational basis" for their fear. Heck, under that standard every single person involved in the clean up could file a claim.

    Some of the ailments listed bear no obvious connection to the events of 9/11: deviated septum, multiple sclerosis, high blood sugar, and Bell's Palsy. The attorneys concede that these problems are not likely related in any way to 9/11 and will be dropped. But then again, maybe there was something in the dust...

    Second Thoughts in Catastrophic Moments?
    New York City is struggling with a monumental liability in the aftermath of 9/11. As a result of the failure to require rescuers to wear breathing masks (remember Rudy Giuliani's maskless photo op on a pile of rubble?), the city faces charges of negligence that may exceed $1 billion. From day one there have been complex problems in establishing a relationship between 9/11 and subsequent illnesses; these problems are now likely to stretch more than a decade beyond the event itself.

    My concerns are not so much retrospective - the individual claims stemming from 9/11 will be determined on a grueling, case-by-case basis. But what happens the next time catastrophe strikes - be it terrorist attack, earth quake, hurricane or meteor from outer space? Humans tend to respond instinctually, rushing in to help those in need. The events of 9/11 have created a cloud of doubt as thick as the one raised by the collapsing towers. Going forward, rescuers may and perhaps should ask themselves, "Will I be protected? Will my family be provided for if my rescue work harms me? Have the people in control - even in the context of unimaginable disaster - set up reasonable risk parameters for my entering the damaged area?"

    My guess is that we have learned a few things about risk management in the months and years following 9/11, but we still fall far short of readiness. One thing is certain: we cannot have first responders worried about their own health and the well-being of their families. Yes, "fools rush in where angels fear to tread." But rational human beings (some politicians excluded?) are not fools. We have all seen the inordinate delays, the complex arguments and the sheer passage of time as the legal system struggles with compensability for 9/11 rescuers. Setting aside the marginal claims, which probably deserve their current fate, the legal system must be able to protect courageous responders in a timely manner. Someday, alas, they will be needed again.

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    June 24, 2008


    We sometimes forget that the USA is not the only country with an undocumented worker problem. Anywhere you find developed countries with lots of (relatively high paying) jobs, you will find people willing to do anything to get them. Which leads us to an article in Korea Times by Park Si-soo.

    Zhang Shuai, 22, entered South Korea on a student visa in March of 2005. He took a language course at a nearby university, but he also began working (illegally) at an electronics firm in a neighboring city. In May 2006, immigration officials raided the building (shades of last year's ICE raids in New Bedford). His employer told Zhang to skedaddle pronto (using, of course, the Korean equivalent). During his flight, he accidentally fell from the building, suffering brain damage and paralysis in his left arm and leg.

    Zhang filed for the South Korean equivalent of workers comp benefits. His initial petition was denied, because "his escape had nothing to do with his duties at work." But the Busan High Court has granted Zhang compensation for his injuries. The court is able to connect the dots between Zhang's job duties and his escape attempt (please excuse the rather byzantine grammar, a product, perhaps, of hasty translation):

    His escape attempt was to avoid many disadvantages that he would receive after the inspection, but it is also true that his employers forced him to escape so as to continue their operations because they were not able to find local workers despite repeated recruitment advertisements. Therefore, the escape was part of his duties at work.

    There are several seemingly universal principles here: people will gravitate to available work with minimal consideration of national boundaries or workrules; undocumented workers will be injured on the job with the same or higher frequency of regular workers; in most instances, undocumented workers will be eligible for workers comp or its equivalent.

    We have an undocumented worker problem in this country of humongous proportions, but we are by no means alone. Perhaps the United Nations could come up with a solution that attacks this problem not just in the US, but across the entire world. Just kidding. That would imply a rational and universal approach to shared problems. No way, Jose! It is far more likely that undocumented workers will continue to break the rules and continue to do the work, country by country, across the face of the earth.

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    June 6, 2008


    We have been following the case of Edgar Valasquez, the undocumented worker who was seriously injured by a chain saw in 2006. (Our two prior blogs are here and here.) His employer, Billy G's Tree Service, failed to carry workers comp insurance. When Edgar showed up at the courthouse for his comp hearing, federal agents (apparently tipped off by Billy G) arrested and deported him.

    The story appeared to have a reasonably happy ending. With a lot of community support, Edgar secured a temporary visa to plead his case. He was supposed to receive a $30,000 settlement. Now Billy Gorman has fired his attorney, Michael St. Pierre, claiming he never agreed to the deal. St. Pierre says he sent Gorman three "very detailed" letters specifying the settlement's terms. (After working with the recalcitrant Gorman, St. Pierre has earned his sainthood!)

    The settlement involves 10 monthly payments of $300 per month, for 30 years. Because he failed to carry insurance, Billy himself was on the hook for the payments. That's a lot of tree trimming. Meanwhile, Edgar's lawyer, Maureen Gemma, thinks the settlement was too easy on Billy: too small an amount, paid out over too long a period of time. She will undoubtedly take advantage of Billy's balk to up the ante.

    Gemma reports that Edgar, back home in Mexico, is "patient as always. He's just a good person." Probably not the way anyone would describe his former boss.

    This all brings to mind the query, "If a tree falls in the forest and no one hears it, does it make a sound?" A tree has fallen in Rhode Island, felled by Billy G. and his crew. A lot of people heard it and are still listening, as the sound reverberates through dusty halls of the workers comp system.

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    June 3, 2008


    In yesterday's blog, my colleague Julie Ferguson discussed the issue of compensible illness for firefighters. Forty states already have statutes giving the benefit of the doubt to firefighters: if they become ill from many forms of cancer or heart disease, the illness is presumed to be work related. The burden of proof (and "burden" is surely the operative term) falls to the municipality to prove that the illness is not work related. Nevada has taken it a step further: in the police department, any heart attack is considered work related, with no consideration of personal habits (smoking, overweight, high fat diet) or family history. That is a very generous - and potentially expensive - public policy.

    As with any medical issues, you have to examine the evidence. Where it can be demonstrated that specific occupational exposures lead to specific illnesses, a basis for presumption is established. That is a fundamental of evidence based medicine. But as a matter of public policy, it is extremely hazardous to build presumption into the comp statutes. There are many forms of cancer. There are many risk factors for heart disease. By establishing a presumption that virtually any illness related to these dreaded diseases is work related, state and local governments are exposed to an enormous - and open-ended - liability. To be sure, there is always a risk that a deserving firefighter might have to undergo lengthy litigation to prove his or her illness is work related. But that process - universal in the comp system - is the necessary price we pay for participating in comp's unique disability coverage. As much as I admire the public service contributions of police and fire personnel, I believe that they should operate under the the same rules that cover all employees: their illnesses are compensable if they are demonstrably work related. In most instances, this requires a case by case review.

    Follow the Money
    The issue here is not medical treatment: these illnesses, if determined to be unrelated to work, would be covered under conventional health insurance. (To be sure, it's cheaper for the claimant to be treated under the comp system, as there are never any co-pays or deductibles.) As is often the case with comp, the real issue is indemnity. For firefighters, that usually means wage replacement that is 100% of their usual pay, tax free. In other words, a firefighter on workers comp makes more than one on active duty. When you combine a presumption of compensability with an already generous indemnity benefit, you have created a bitter and expensive cocktail (with state and local taxpayers picking up the tab).

    Virtually all municipalities operate under a "zero sum" budget, where increased expenditures in one area (expanded coverage for illnesses under comp) become a net subtraction in another (municipal services, public safety, schools, water supplies, etc.). It may seem politically expedient to speed compensability for some of our most valued local employees (police and fire), but governments do this at great risk to the bottom line, not to mention reducing all other valued municipal employees (city workers, teachers, public works) to second class citizens.

    In a word, a presumption of compensibility is a slippery slope toward budget chaos. We have an obligation to protect our public protectors. But offering presumptive comp coverage for virtually any illness is an invitation to fiscal ruin.

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    June 2, 2008


    Sally Roberts has written a good article on firefighters and state workers comp laws in the recent edition of Business Insurance. Regardless of profession, illnesses have traditionally posed more of a compensability challenge than an out-and-out injury. When someone suffers an injury, it is generally a discrete event so matters are usually black and white as to compensability. Because illnesses are progressive, it can be more difficult to associate them with a work exposure - particularly illnesses like cancer that might have other contributing life factors. For most professions and in most states, the burden of proof is on the employee to demonstrate the work-relatedness of an illness. But as Roberts notes in her article, more than 40 states have some type of presumptive disability statutes for firefighters. According to the International Association of Firefighters, this means that the burden of proof shifts from the employee having to prove that the illness is work related to the employer having to prove that the illness is not work related. In most states the presumption is rebuttable, but in some states it is not.

    Proponents point to studies documenting that firefighters are at heightened risk of certain diseases and illnesses, such as infectious disease, heart disease, lung disease, and cancer. Opponents see presumptive laws as favoring one class of workers over another. Plus, opponents also cite the cost and inefficiency of treating medical conditions under the workers comp system, which has rudimentary managed care in comparison to the group health system.

    It's a sticky dilemma. Putting the burden of proof to establish the work-relatedness of an illness on the employee often seems to be an unfairly high hurdle for certain high-risk, high-exposure professions; employers face a similarly high hurdle in trying to establish proof that an illness is not work related. Firefighters are exposed to danger and toxins as a part of their normal work conditions. Determining whether the job exposure or a nightly diet of hamburgers was the cause of a heart condition is work for a Solomon. Establishing which exposures are work-related and which are more likely due to ordinary life circumstances is near impossible. This seems to be a good test area for the "24-hour coverage" concept. Perhaps high risk, essential service public personnel such as firefighters and police need to be treated more like the military in terms of being afforded comprehensive medical care for both on- and off-the-job injuries and illnesses.

    The International Association of Firefighters has clickable maps with links to presumptive laws related to firefighters in U.S. and Canada.

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    May 5, 2008


    Rosemary Verga worked for United Airlines as a staff representative in human resources. This seems an odd choice for a woman described by co-workers as "a difficult person to get along with" - "impolite, unpleasant" and quick to explode. In addition to being rude, inflexible, easily upset and demeaning toward others. All in all, a rather marginal member of the HR team!

    After a group of employees had a carefully structured opportunity to confront her bad behavior in the summer of 2000, Verga sought help from the Employee Assistance Program. The company doctor treated her, authorizing a brief medical leave and then cleared her for return to work. She sought treatment with her own physician, Dr. Ho (no comment), who authorized an indefinite medical leave in 2000. She has not worked since.

    Verga filed a workers comp claim for psychological stress, claiming the disdainful actions of her peers caused her mental disability. Even conceding that her own actions may have contributed to this disdain, she argued that because workers comp is no fault, it didn't matter. She was entitled to compensation for work-related stress.

    California's labor code (S3208.3,(B)(1) states that "In order to establish that a psychiatric injury is compensable, an employee shall demonstrate by a preponderance of the evidence that actual events of employment were predominant as to all causes combined of the psychiatric injury." At her initial hearing, the workers comp board ruled that the disdain expressed by her fellow employees was not an event of employment, but something brought on by Verga's own (consistently obnoxious) actions. They denied the claim. The Court of Appeals has now upheld the denial.

    Shrink Wraps
    The role of psychiatrists in this case is instructive. Dr. Perry Segal, a Qualified Medical Examiner (QME) offered the opinion that Verga suffered from "adjustment disorder with mixed anxiety and depressed mood, resulting from cumulative trauma caused by negative interactions with her co-workers and her supervisor." Dr. Perry based this rather dubious diagnosis solely on Verga's version of the events. A second QME, performed by Edward Duncan, PhD, diagnosed Verga with an adjustment disorder and mild depressive symtoms, but he did not find her psychiatrically disabled from work. Duncan observed that statements of co-workers and Verga's employment records reveal ongoing problems in her relations with co-workers and customers going back 20 years. Prior to working in HR, Verga had served as a customer service rep for United (now there's a great job for someone with a short fuse!).

    So the court has determined that Verga's "harassment" by fellow workers was caused by her own harassment of fellow workers. Her disability is the cause - not the result - of workplace stress. With her low frustration level, Verga abused co-workers when they did not meet her expectations. Verga was the aggressor. She created the negative work atmosphere which she claimed (unsuccessfully) caused her psychological injuries. Her supervisors tried to counsel her that rudeness and inflexibility were counterproductive. She ignored their advice and continued to belittle her co-workers. Needless to add, Ms. "Gloom and Doom" has not been missed during her prolonged absence from work.

    ADA Remedy?
    One final note. It does seem clear that Verga has psychological issues. Can she sue United to get her old job back, claiming that they must make "reasonable accommodation" for her under the Americans with Disabilities Act? Does her anxiety and depression qualify as an ADA disability? I doubt it. It is not at all clear that her mental disability "signficantly limits" one or more major life activities. Then again, you might well view her inability to establish friendships and collegiality as a disability. I am inclined to. But I still would not encourage United to take Verga back. She has proven unwilling to make her own accommodations for others and as such would be a huge liability anywhere in the company. After all, being "nice" is really an essential job requirement, one well beyond Verga's reach. With all their current problems, United has no need for an intractable, inflexible and embittered worker.

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    April 22, 2008


    In conventional medicine, people are generally free to choose their care, up to the limits of their coverage. They can opt for certain procedures or decide to forego them. For the most part, adults are independent players in the medical system, acting in accord with their own wishes. In the final analysis, our health is an individual concern, factoring in, of course, the concerns of family members and "generally accepted" medical practices.

    Workers comp is somewhat different. In addition to the preferences of the injured worker, his/her family and the treating physician, you have to take into account the interests of the employer, who is paying the bills (no co-pays or deductibles for the patient). Unhealthy behaviors or refusing treatment might be acceptable in conventional health care, but they raise compelling issues in workers comp. The case can and should be made that under comp, the injured worker has an obligation to get better.

    Let's look at two cases: one involves an invasive diagnostic procedure, the other medically imprudent behavior.

    Uncomfortable Diagnostics
    Sewell Chan writes in the New York Times about Brian Persaud, a 33 year old construction worker. He was working at a Brooklyn construction project when he sustained a head injury. He was driven to New York Presbyterian hospital, where he received eight stitches for a head wound. As part of standard medical procedure, doctors wanted to perform a rectal exam, in order to rule out spinal injury. Persaud objected, a physical struggle ensued. While it's not clear whether the invasive procedure even took place, Persaud filed a civil suit, claiming that the exam comprised assault and battery at the hands of hospital workers.

    Persaud’s lawyers turned to two experts, a neurologist-psychiatrist and a forensic psychologist, who testified that Persaud suffered from anxiety, depression and post-traumatic stress disorder as a result of the episode. The hospital put forward a doctor who testified that a rectal examination is an important part of advanced life support for trauma patients.

    The case took eleven days to present, but the jury rejected Persaud's claim in less than an hour. In this case, the invasive procedure was deemed necessary to rule out more serious injuries. In general, patients may decline medical treatment if they are informed of the consequences of doing so and capable of making such a decision. But doctors have more leeway to perform a procedure if a patient has sustained a potentially life-threatening injury and if the doctor doubts the patient’s capacity to make informed decisions.

    While the employer's interests were not directly represented in this confrontation, they were part of the mix: the employer would want to ensure that Persaud received a complete diagnostic work up, so that liability for this particular claim would be limited to the incident that occurred at work. Persaud's refusal of a necessary diagnostic test might lead directly to expensive medical complications.

    Which leads us to our second example (from Lynch Ryan case files).

    Incomplete Treatment
    Maria M. worked as a maid for a home cleaning service. While approaching a job site, she slipped and fell on an icy sidewalk and broke her ankle. (It had recently snowed, so there was no negligence on the part of homeowner.) No question about compensability here. In order to repair the break, a temporary pin was inserted. Unfortunately, Maria was doctor-phobic. She refused to have the pin removed. As months went by, her condition worsened. She walked with a pronounced limp. The employer tried to accommodate her on light duty, but eventually they ran out of tasks. Maria was only getting worse. She was terminated due to her inability to perform the work.

    The insurer was caught in the middle of a difficult situation. The injury was clearly compensable, but Maria's refusal to cooperate in her treatment involved "wilful intent" - a refusal to get better. The carrier had an opportunity to deny the claim within the six month "pay without prejudice" period, but they failed to do so. The claim dragged on. Even after an independent medical exam favorable to the employer, the carrier continued paying the claim. Eventually, the case settled for about $35,000, for the indemnity and loss of function exposures. Given the severity of Maria's condition, this is not a huge settlement. (The carrier feared an exposure of twice that amount.) However, the employer expressed frustration at the increase in his comp premiums. Maria's disability was the result of her own refusal to cooperate with recommended treatment, not the work-related incident itself.

    Inconclusive Conclusions
    All of which leads us to an inconclusive conclusion: do injured employees have an obligation to get better? Must they submit to medically necessary diagnostics? Are they required to do everything possible to return to productive employment? Is it necessary to take the employer's interests into account when determining diagnostic and treatment options? Well, maybe yes and maybe no. It all depends...

    In the world of comp, the interests of employee, employer and medicine itself strive for an elusive balance. In the case by case, state by state approach, results vary dramatically. It's hard to find a consistent pattern. In the ideal world, injured workers do everything possible to get better and their employers do everything possible to facilitate a return to work. But in case you haven't noticed, we live in a world that falls way short of the ideal.

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    April 21, 2008


    A reader sent us a story from the Boston Globe that we previously missed about contractors who are suing KBR for toxic exposures to sodium dichromate in Iraq. Nine Americans are suing the erstwhile Halliburton subsidiary for " ...knowingly exposing them to the deadly substance and failing to provide them with the protective equipment needed to keep them safe."

    Sodium dichromate is a very dangerous substance, yet the 100+ workers at the Qarmat Ali water injection plant worked in and around the substance without protection. Some workers were observed eating lunch on the floor next to chemical tanks and others exhibited nosebleeds, eye problems, shortness of breath, and ulcers on the skin.

    Regular readers may recall that we've discussed Iraq-based contractors previously - all contractors - whether nationals or foreign - are covered by the Defense Base Act. Although this involves some creative insurance arrangements, the DBA essentially acts very similarly to workers comp.

    As with workers comp, one of the cornerstones of the coverage is that the DBA is the employee's exclusive remedy. In other words, it is an employee's only legal redress in the event of injuries or illnesses. However, in workers comp, there are generally some exceptions, although the window for such exceptions is pretty narrow. Some states allow an employee to pierce the exclusive remedy shield if "willful intent" of injury can be proven or if there was substantial certainty that an injury would have been likely to occur. The burden of proof is on the employee, and courts usually require something more that goes beyond the realm of mere negligence - the employer's actions need to be quasi criminal.

    KBR is relying on exclusive remedy for protection, but this troublesome matter may be a factor:

    "But the company's own actions have undermined its case: To avoid payroll taxes for its American employees, KBR hired the workers through two subsidiaries registered in the Cayman Islands, part of a strategy that has allowed KBR to dodge hundreds of millions of dollars in Social Security and Medicare taxes.
    That gives the workers' lawyer, Mike Doyle of Houston, a chance to argue to an arbitration board that KBR is not an employer protected by federal law, but a third-party that can be sued."
    Interestingly, this "independent contractor" argument is the same one that Blackwater is using to justify why the company didn't pay $50 million in U.S. payroll taxes. So far, the IRS isn't buying that argument - they don't think that the Blackwater workers fit the definition of contractors. It seems that Blackwater might be trying to play both sides of the fence by not paying the taxes which would be an employer obligation but claiming the employer privilege of exclusive remedy afforded by the DBA when it comes to other matters.

    My colleague has talked about the matter of independent contractors vs employees several times in the past - most notably in the case of the fascinating Fedex state-by-state saga 1, 2, 3, 4, 5, 6 and 7. It will be interesting to see how the matter of these giant federal contractors play out. Being a military contractor is apparently good work for the firms that can get it: lucrative no-bid contracts, U.S. taxpayers subsidizing the DBA coverage, and little in the way of pesky employee taxes, labor laws, or government oversight.

    In looking into these issue, we stumbled on the Defense Base Act Blog (who knew there was such a critter?!) and blogger Aaron Walter makes some good points about being careful what you wish for - if KBR is not covered by DBA, then thousands of injured or deceased employees and their families would no longer receive income benefits or medical treatment. He also has good commentary on the Blackwater matter.

    Stay tuned for more.

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    March 5, 2008


    Paul Lees-Haley, PhD, is a psychologist who has come up with a 43 question test to separate the truly disabled from malingerers. Lees-Haley is either a genius or a pompous fraud right out of Mark Twain. Read on and decide for yourself. (This posting is based upon an article by David Armstrong in the Wall Street Journal, which limits access to subscribers.)

    Lees-Haley studied the Minnesota Multiphasic Personality Inventory (MMPI), a standard tool for determining personality characteristics. He isolated 43 questions that he believes, taken together, clearly separate the truly disabled from malingerers and frauds. Lees-Haley's brainchild, dubbed the "Fake Bad Scale" test, was developed in 1991 and is finding its way into courtrooms around the country. Lees-Haley is available to testify in person on behalf of insurance companies as an expert witness. He charges $3,500 to evaluate a claimant and $600 per hour for depositions and testimony. Worth every penny, I'm sure, if his testimony results in the denial of benefits to a claimant.

    Testing the Test
    Below you will find a sample of questions from the test, requiring a "True" or False" response. A "T" before the question indicates a "true" response is indicative of malingering. Likewise for "false."
    F My sex life is satisfactory.
    T I have nightmares every few nights.
    F I have very few headaches.
    F I have few or no pains.
    T I have more trouble concentrating than others seem to have.
    T I feel tired a good deal of the time.
    F I am not feeling much pressure or stress these days.

    You don't need a PhD in psychology to identify the ambiguity and unfairness in these questions, which are typical of the test as a whole. In the aftermath of an injury, someone might well feel stressed out, have difficulty concentrating, be tired much of the time and have frequent headaches. These responses do not necessarily indicate malingering. They can just as easily be valid indicators of post-traumatic response to injury. The "Fake Bad Scale" fails to account for anything that might have happened in the real world. Using this corrupt measure, every survivor of the 9/11 attacks would be deemed a "malingerer."

    Fortunately, the validity of the test has come under fire. A number of courts have thrown it out. That's the good news. The bad news is that untold numbers of people who have answered these questions honestly have ended up being labeled (and libeled) as "malingerers." Shame on the attorneys who rely on this phony science, and shame on the insurance carriers who retain them. And double shame to the originators of the MMPI, who have formally given their stamp of approval to this inept tool. To be sure, we all know that there are malingerers out there: but the "Fake Bad Scale" is no help whatsoever in singling them out.

    Revised March 10, 2008.

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    February 26, 2008


    There are various circumstances in which an injury that occurs during a recreational activity might be compensable. One exception might be if the injury occurs on company premises or at a company-sponsored event, a likelihood that approaches near certainty if participation in the event was mandatory. Another common exception is in the case of traveling employees. When employees are engaged in business travel on behalf of their employer, compensable activities may encompass a variety of activities that would likely not be compensable for a "fixed place" employee. For the purpose of workers compensation, a traveling employee is generally considered to be working continuously during the business trip unless a special deviation from business can be determined. Daily life and personal comfort activities that would not be covered at home are generally considered work: eating, sleeping, and traveling, for example, as well as some recreational activities.

    Roberto Ceniceros of Business Insurance has a brief write-up of a judgment by Washington's Supreme Court that offers an excellent illustration of the traveling employee doctrine at work. Alfred Giovanelli was a skilled firebrick mason who regularly traveled the country to rebuild and fix furnaces for Saint-Gobain Corporation (formerly Ball-Foster Glass Container Company). During one assignment at one of the company's plants in Seattle, he was injured on his day off. He was headed to a park with his supervisor to investigate a concert, but on crossing the street in front of his hotel, he was struck by a vehicle and grievously injured. He applied for and was granted workers compensation. His employer continued to appeal on the basis that the Giovanelli was engaged in a recreational activity that had no business purpose. The appeal wended its way through the various strata of the court until the matter reached the Supreme Court where compensability was upheld. In his article, Ceniceros notes:

    The doctrine--also known as the "commercial traveler rule" or the "continuous coverage rule" -- generally states that a traveling employee is considered to be in the course of employment during his or her entire trip, except for "a distinct departure on a personal errand," court records show.

    The case document - Ball Foster Glass Container Company v. Alfred Giovanelli and the Department of Labor and Industries in the State of Washington - is worth a read. It's pretty plain-spoken and it illustrates various principles that generally apply to workers compensation. It offers a brief history of how workers comp evolved, and the adoption of the British Compensation Act's formula of an injury "arising out of and in the course of employment" - nine not-so-simple words that have spawned innumerable court challenges. The document discusses this phrase in this context and moves on to discussing the matter of whether Giovanelli fit the definition of a "traveling employee" (yes) and the meat of the case, whether Giovanelli had "left the course of employment" when he was injured. In its discussion, the court referenced a few cases when compensability for recreational activities was denied:

    Although distinguishing between reasonable personal ministrations and purely personal amusement ventures may be difficult, courts have had little difficulty denying compensation for unusual or unreasonable activities. See, e.g., E. Airlines v. Rigdon, 543 So. 2d 822 (Fla. Dist. Ct. App. 1989) (denying compensation for employee injured during skiing trip at resort over 50 miles from hotel); Buczynski, 934 P.2d 1169 (hot tub injury occurring in hotel 150 miles away from convention center and days before convention not compensable).

    The employer argued that Giovanelli's activity was a deviation and that crossing a thoroughfare without the right of way was an "inherently dangerous" activity. The Court disagreed, citing the personal comfort doctrine, and finding that negotiating unfamiliar streets is one of the typical risks that a traveling employee faces. In the discussion of personal comfort, the Court stated:

    The scope of activities covered by the personal comfort doctrine depends on the particular circumstances of employment. A traveling employee is entitled to broader coverage than a nontraveling employee because a traveling employee is in a significantly different position of risk than a nontraveling employee. The nontraveling employee may satisfy his personal needs without leaving the comfort of home. In contrast, the traveling employee must face the perils of the street in order to satisfy basic needs, including sleeping, eating, and seeking fresh air and exercise.
    In evaluating this particular activity, the Court found that Giovanelli's crossing the street did not represent a significant deviation from the course of employment.

    For further discussion on these matters, see Jim Pocius' excellent discussion of Workers Compensation and Course of Employment. He looks at the issues of course of employment, fixed place versus traveling employees, and scope of employment. He also offers excellent advice to employers on how to minimize risk:

    • Make social events voluntary. An employer should not make attendance at a social event mandatory. The less control that an employer exerts over social events, the less chance there will be that an injury during a softball game, volleyball game, basketball game, etc., will be considered within the course of employment.
    • Enforce work rules. If the employer has a valid set of work rules that are enforced, such employee behavior as fighting, foul language, and wandering to restricted areas of the plant can all be considered activities which would remove the employee from the course of employment.
    • Keep traveling employees to a minimum. There are innumerable cases of traveling employees being hurt while in vehicles, hotels, and restaurants. In order to avoid this liability, traveling employees should be kept to a minimum if your business permits.
    • Do not send fixed place employees on special missions unless absolutely necessary. If your employees work at one location, the employer must try to keep casual missions by these employees to a minimum. Thus, sending an employee to obtain a form at a state office building or run other errands increases workers compensation exposure.
    • Investigate all claims. As always, good factual investigation on any questionable course of employment claims will pay dividends during litigation.

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    February 14, 2008


    Chad Hennings spent nine years as a lineman for the Dallas Cowboys. He accounted for 28 sacks, 6 fumble recoveries, 4 return yards and 1 touchdown in 107 games before retiring after the 2000 season. He also suffered permanent damage to his back. The question is whether or not his work-related back injury is compensable under the Texas workers comp system.

    The Texas workers' comp law treats pro athletes as a special class. Under Texas Labor Code §406.095(a), a pro athlete "employed under a contract for hire or a collective bargaining agreement who is entitled to benefits for medical care and weekly benefits that are equal to or greater than the benefits provided" by workers' comp must make an election between the two types of benefits. At first glance, it's a no-brainer. Henning's benefit package as a player dwarfs benefits under the comp system: he earned $1.4 million in salary and benefits in his final season with the Cowboys, including $225,000 under an "injury-protection clause," $38,921.98 from the Cowboys to cover his medical costs and $87,500 in severance pay.

    Reversing Field
    At first, the court system threw Hennings for a loss. The 10th Court's original July 23, 2007, opinion deemed Hennings' overall contractual package of salary and medical benefits during his pro football career to be higher than benefits available under workers' comp, thus rendering Hennings ineligible for such benefits under Texas law. But in its Jan. 30 opinion, the court reversed itself and upheld a jury finding that, in Hennings' case, workers' comp was a better deal for him because of its longer duration. After re-consideration, the court separated the indemnity benefit (where comp was insignificant) from the medical (where taken over a lifetime, comp might well exceed the deal offered by the Cowboys). In other words, Hennings's medical benefit of $38,921 might well prove less than the lifetime medical charges for treating his back problems. Heck, he could blow through that in a single surgery.

    Based upon the Court's ruling, a Texas-size door has been opened for all professional athletes in the state to access the robust medical benefits of the workers comp system.

    The decision may not help many retired pro athletes, because it may be too late for them to seek workers' compensation; the statute of limitations may have run on their potential claims. (Most states require that claims be filed within 2 years or less of the occurrence.) Going forward, I would not be surprised to see players routinely file comp claims immediately after injuries, knowing that they will not qualify for benefits in the short run, but protecting their interests once they quit the game.

    Rate Setting Dilemma
    If professional athletes are increasingly successful in their efforts to win workers comp benefits, insurance carriers and regulators will face an interesting dilemma: determining an actuarially defensible rate for coverage. Right now, the Scopes classification manual offers just two classes for professional athletes:

    Class code 9178 Athletic Team or Park: Non-Contact sports. Applies to players, coaches, managers or umpires and includes all players on the salary list of the insured, whether regularly played or not. Non-contact sports include baseball and basketball.

    NOTE: Authors of the Manual obviously did not see the Detroit Piston "bad boys" in their prime!
    Class code 9179 Athletic Team or Park: Contact Sports. Applies to players, coaches, managers or umpires...Contact sports include football, hockey and roller derbies.

    As a point of reference, the current rate for class 9178 in Massachusetts is $23.11. Oddly enough, the rate for 9179 (contact sports) is slightly lower at $22.55. That is well below the rates for roofers and steel erectors.

    NCCI might want to consider some serious revisions to the Scopes Manual. To begin with, separate classes are needed for coaches (relatively modest exposures) and players (huge exposures). They might even want to approach it in a manner similar to the construction industry, where the payroll is broken out by activity: field goal kickers, for example, are lower risks than lineman. Running backs are always at risk for knee injuries. And after the most recent SuperBowl, it appears that quarterbacks take their lives in their hands with every snap of the ball.

    A Parallel Universe?
    Professional athletes and workers comp are an odd mix. Where comp offers a combinatin of indemnity and medical benefits, for athletes the only issue is medical. With their enormous salaries, athletes will rarely have a need for indemnity benefits, which top out around $50,000 a year in even the more generous states. Medical benefits are a different matter entirely. When it comes to work-related injuries, comp provides lifetime coverage, with no co-pays, no deductibles and no time limits. Comp offers the best medical coverage of any kind, anywhere in the world. Just what a disabled athlete needs...

    The permanent partial and permanent total exposures for football players are humongous: concussions, back injuries, blown out knees, torn rotator cuffs, torn biceps, nerve damage. Feed the injury data from pro football and pro baseball to an actuary and you'll generate a rate that exceeds the current top ticket professions of structural steel erectors and lumberjacks. The rate would soar well above $100 per one hundred dollars of payroll.

    The optimum solution lies outside of the comp system. Workers comp indemnity is simply not crafted to protect the interests of (wildly overpaid) athletes. The players associations of the various professional sports need to sit down with management and craft a parallel universe: not the conventional workers comp system, but a combination of income protection and lifetime medical benefits that contemplate the real risks inherent in professional sports.

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    February 8, 2008


    In conventional medicine, breast implants come in pairs: in most circumstances, you install (or replace) both at the same time. There is a compelling aesthetic symmetry in the process. In the idiosyncratic world of comp, however, symmetry is trumped by the "work-related" standard.

    Penny Rumple Richardson was injured in an on-the-job car accident. Her breast implants were damaged. The North Carolina Industrial Commission determined that the damage was work-related and approved replacement of both implants. The insurance company appealed. Ms. Richardson's doctor, Greensboro plastic surgeon Dr. David Bowers, originally testified that the right implant had ruptured in the accident and the left implant showed signs of rippling, so he replaced both. But presumably when pressed by defense counsel, he conceded that the left implant most likely had rippling because it was under-filled. In other words, damage to one implant is clearly related to the accident, but damage to the other is not.

    At the appeals court level, Judges Barbara Jackson and Sanford Steelman Jr. agreed that breast implants are covered in workers' compensation claims, because they are a "prosthetic device that functions as part of the body." However, they determined that only one implant was damaged as a result of the accident. They sided with the carrier in denying coverage for the "rippled" implant.

    Judge James Wynn, Jr. dissented. He pointed out that Richardson needed both implants replaced to ensure that they were "symmetrical and evenly matched." Judge Wynn sought to expand comp coverage to include the rather obvious aesthetic considerations, but he failed to convince his colleagues on the bench.

    The Draconian remedy, of course, would be to remove the uncompensable implant. Fortunately, that won't happen.
    The case has been sent back to the workers comp commission for resolution. We hope Ms. Richardson has conventional health insurance and that it will cover half of Dr. Bowers's fee. If that doesn't work, Richardson herself will have to pay the price for maintaining essential symmetry.

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    December 5, 2007


    We have frequently blogged the implications of an aging workforce. We are very interested in seeing how the workers comp system will handle older workers - people beyond the normal retirement age - when they are injured. Well, here is an interesting case from California.

    Lois Vaira was a receptionist for the California Travel and Tourism Commission. In January of 2003 she was 73 years old. She bent over to pick up some travel brochures that fell off a shelf and injured her back. She suffered a compound fracture at T12 on her spinal column and was totally disabled from work. The medical examiner concluded that Vaira's age and preexisting osteoporosis contributed to her disability. He apportioned 40 percent of the disability to the preexisting conditions and 60 percent to the industrial injury. Vaira was awarded $51,152 in permanent disability benefits.

    There have been three appeals, along with three reconsiderations. Vaira contends that the comp board erred in apportioning part of her disability to her age and her osteoporosis, thereby reducing the amount of the final award.

    Permanent Disability and Apportionment
    First, the appeals court defines permanent disability: "...the irreversible residual of an injury." The court goes on to state that "a permanent disability is one which causes impairment of earning capacity, impairment of the normal use of a member, or a competitive handicap in the open labor market." In other words, permanent disability payments compensate workers for two distinct losses: the physical loss and the loss of earning capacity.

    The long-overdue comp reforms contained in CA Senate Bill No. 899 (2003) redefined apportionment as follows:

    A physician shall make an apportionment determination by finding what approximate percentage of the permanent disability was caused by the direct result of injury arising out of and occurring in the course of employment and what approximate percentage...was caused by other factors both before and subsequent to the industrial injury.

    Let's paraphrase this: the new approach to apportionment is to look at the current disability and parcel out its causative sources - nonindustrial, prior industrial, current industrial - and isolate the amount directly caused by the current disabling injury.

    Vaira claimed that age and osteoporosis were unrelated to the disability caused by her work-related injury. The fact that age and osteoporosis made her more susceptible to a spinal injury is irrelavent. Employers must accept people "as they are." Apportionment is appropriate only if these conditions contributed directly to the disabling injury - which Vaira says they did not.

    Here is what the medical examiner had to say:

    It was my opinion that, you know, her age predisposed her to the injury, the presence of osteoporosis, and possibly other factors of which, you know, in the physical examination may have shown up.

    The court zooms in on this statement. To the extent that the examiner based his apportionment of 40 percent of disability on Vaira's age, he violated the statute prohibiting age discrimination. You cannot reduce benefits simply because Vaira is older (a lot older) than other workers doing similar work.

    Back to Square One
    Ultimately, the appeals court could not determine how much of the apportionment was based upon age. If osteoporosis becomes more acute with age (it surely does), and if this deteriorating condition contributes directly to the disability, then some degree of apportionment is appropriate. But the medical examiner failed to explain how he came up with his numbers. As a result, the appeals court remands the case back to the comp bureau for further consideration.

    I can only wonder how the medical examiner is going to tackle his new task. How do you assign a specific percentage to such open-ended factors as age and preexisting conditions? Doctors are expected to come up with a precise number, but they are only making educated guesses. Their medical training does not prepare them for this work. This is not about healing, it's about indemnity benefits.

    Ironically, as American workers continue in the workforce well beyond the age of 65, this type of assessment is going to become increasingly important. Lois Vaira does not think of herself as a pioneer and pace-setter for the comp system, but she is. Her struggle to secure benefits for her retirement will be re-enacted in courtrooms across the country.

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    December 4, 2007


    In yesterday's post, Julie Ferguson mentioned a recent study that directly links night shift work with certain forms of cancer. The International Agency for Research on Cancer (IARC) is about to list shift work as a "probable" carcinogen. This will put shift work into the same category as anabolic steroids, ultraviolet radiation and diesel engine exhaust.

    The potential number of people impacted by this designation is staggering - roughly 15 to 20 percent of the workforce in developed countries.

    The scientists suspect that shift work is dangerous because it disrupts the circadian rhythm, the body's biological clock. Light shuts down melatonin production, so people working in artificial light at night may have lower melatonin levels, which can raise their chances of developing cancer. Sleep deprivation might also be a factor. Not getting enough sleep makes your immune system vulnerable to attack and less able to fight off potentially cancerous cells.

    Perhaps the most alarming finding is the impact of switching between night and day shifts: it's probably better to work just at night and adjust accordingly. Shifting back and forth - a common practice in medical facility shift assignments - appears to compound the risks. The body's clock is prevented from establishing a steady course.

    The studies do point the way toward making shift work safer, with one relatively simple recommendation: shift workers should make sure that when they do sleep, they do so in a darkened room. The balance between light and dark is important for the body. When shift workers finally climb into bed, an (artificially) darkened room might enhance the body's ability to generate protective melatonin.

    Compensable Cancers?
    What does this mean for workers comp? Not much. The comp system is notoriously conservative, slow to react and even slower to allow compensability where definitive proof is lacking. Under the prevailing standard in most states, work exposure would have to be the "predominant cause" for cancer to be compensable. A claimant would be hard pressed to prove that other risks for cancer in their lives were not significant factors in the illness: family history, lifestyle issues and other exposures. Given the general uncertainty about cancer's origins, claims will be routinely and aggressively denied.

    Our colleague Peter Rousmaniere has completed a remarkable series of articles in Risk & Insurance magazine, which graphically illustrate the inability of the comp system to confront workplace illness issues. The system balks at comprehending - and compensating - victims of illness caused by the events of 9/11, even though the "cause" -- toxic dust - is pretty difficult to overlook.

    Thus it is highly unlikely that shift workers with cancer will receive much of a welcome - let alone sympathy - in the comp system. They are awake for all of us, doing the jobs that must be done at night. Their "thanks" is limited to higher pay (shift differential). Their lives are disrupted, their health is apparently at risk. But when it comes to work-induced cancers, they are on their own.

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    November 27, 2007


    Kristina Wait worked for the American Cancer Society in Nashville TN. Due to a lack of office space, she worked from home, in a converted bedroom/office set up by her employer. In September 2003, she was making lunch when the doorbell rang. She invited her neighbor, Nathaniel Sawyers, into her home. With no provocation, he brutally assaulted her, causing head trauma, broken bones, stab wounds and permanent nerve damage. (So much for "good neighbors"!)

    Kristina filed a workers compensation claim, based upon the fact that she was "at work" and involved in a "work related activity" (making her lunch). The claim was denied by the carrier. Her appeal was dismissed on summary judgment and dismissed again by the Tennessee Supreme Court. The court agreed that her injuries arose "in the course and scope" of employment: she was indeed "at work." However, her injuries did not "arise out of" employment. Mr. Sawyer did not come to her house on a work-related matter. Her relationship with him (a casual acquaintance) had nothing whatever to do with work. So the court rejected her claim for workers comp benefits.

    Had she been covered by comp, Kristina would have had all of her medical bills paid from dollar one, with no co-pays or deductibles. Her future medical bills - which will be considerable - would also be covered. Her prescriptions would have been covered as well, again with no co-pays. And she would have collected indemnity (two thirds of her average weekly wage), retroactive to the date of injury. The world under the comp umbrella would have been a lot more secure than the one she is facing.

    The court pointed out that even if Kristina had been in a conventional office setting, the assault might not have been compensable. Her (marginal or neutral) relationship with Sawyer had nothing at all to do with work. Her employer did not create the conditions that made the assault possible. (It's probably fair to state that compensability is somewhat more likely if the assault occurs in a conventional work setting, as opposed to a home office.)

    In a better world, we would all be protected by 24 hour coverage. In the world we inhabit, our coverage under workers comp is limited to the times we are working and covers only risks arising from our work. Coverage for telecommuters remains a gray area (which we have blogged before). For most of us, working in a home office would be the safest possible environment. For the unfortunate Kristina Wait, her home office was host to horrendous and unforeseen risks that had nothing at all to do with her work.

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    November 14, 2007


    There is a bill pending in the US Congress to require parity between mental and physical health benefits. The bill is a follow up to similar legislation passed in 1996, which was severely limited in scope: Employers did not have to provide any mental-health benefits. Copays and deductibles could be higher for mental-health expenses. Visits could be limited. And small businesses and self-insured employers which cover healthcare costs directly were entirely exempt. Not exactly my understanding of the word "parity."

    Full Parity for Mental Illnesses expands the Mental Health Parity Act of 1996 (MHPA) to prohibit a group health plan from imposing treatment limitations or financial requirements on the coverage of mental health benefits unless comparable limitations are imposed on medical and surgical benefits.

    Here is a summary of the pending bill prepared by the National Alliance for the Mentally Ill:
    [The proposed legislation] provides full parity for all categories of mental disorders, including schizophrenia, bipolar disorder, major depression, obsessive-compulsive disorder, and severe anxiety disorders. Coverage is also contingent on the mental illness being included in an authorized treatment plan, the treatment plan is in accordance with standard protocols and the treatment plan meets medical necessity determination criteria.
    Defines "treatment limitations" as limits on the frequency of treatment, the number of visits, the number of covered hospital days, or other limits on the scope and duration of treatment and defines "financial requirements" to include deductibles, coinsurance, co-payments, and catastrophic maximums.
    Eliminates the September30, 2001 sunset provision in the MHPA. Like the MHPA, the bill does not require plans to provide coverage for benefits relating to alcohol and drug abuse. There is a small business exemption for companies with 25 or fewer employees.

    No Parity in Comp
    Parity is an important concept, but one that simply does not exist in the workers comp system. Comp carriers habitually reject any claims for benefits based upon work-related mental disability (post traumatic stress syndrome, stress in general, depression, etc.). The insurer strategy is usually "Deny, Deny, Deny" until a judge orders otherwise.

    There are a number of reasons for this virtually universal aversion to accepting mental disability claims:
    : The standards for eligibility in most states are very high: work must be the predominant cause of the disability. Most of us have plenty of stress in our lives away from work.
    NOTE: Long gone are the days when in order for a claim to be compensable under comp, California required a mere 10 percent of the stress to be work related!
    : Comp benefits tend to be very open ended. Once the carrier accepts a (mental health-based) claim, they are likely to own it forever. As a result, they usually start by rejecting the claim.
    : Unlike physical injuries, where objective criteria for treatment and recovery are often (but not always) straight-forward, the end-point for a mental disability can be very elusive.
    : managed care can limit treatment for open-ended physical problems (requiring, for example, limited physical therapy, chiropractic visits, etc). Similar limits on mental health treatment (up to and including hospitalization) are more difficult - but not necessarily impossible - to impose.

    It's unfortunate that comp turns its back on the mental aspects of injury. Over the years we have seen many claims where a little counseling after the injury could significantly speed recovery. Well-structured groups could provide support to workers recovering from injuries at a very modest cost. As a culture, we have no problem treating physical disabilities, but when it comes to issues of mental health, we balk. Ironically, as often as not the mental barriers to recovery trump the physical. Out-of-work employees often succomb to depression - and once that happens, full recovery and return to productive employment are much less likely to occur.

    Ultimately, it's a matter of who pays, how much and when. The enormous cost of losing a productive worker is seldom factored into the equation. While Congress is about to force the parity issue on employers and insurers for conventional health coverage, no such pressure is pending - or is even foreseeable - for the workers comp system.

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    November 6, 2007


    Lee Davidson of Salt Lake City's Deseret Morning News looks at the workers' compensation benefits that will be paid to survivors of the Crandall Canyon Mine disaster, asking, "How much is a miner's life worth?" The article illustrates several realities about the workers comp system: it was neither designed as a mechanism to make an injured worker (or his or her survivors) whole, if any measure can indeed ever make someone whole after a serious injury or death; nor was it designed as an enforcement measure to ensure compliance with safety standards. Rather, it is a no-fault social insurance that serves as a safety net in the event of a work-related injury, illness, or death. But because it is the "exclusive remedy" in work-related occurrences - meaning that the employee cannot sue the employer - sometimes it doesn't seem to be a sufficient remedy, particularly when matters involve multiple deaths and real or perceived flouting of safety standards. And as Davidson points out, benefits pale in comparison to those awarded in many civil suits. On the other hand, there is certainty and immediacy to the benefits, rather than the uncertainty, waiting, and burden of proof involved with litigation - that's the trade off. It may not seem equitable in every individual case, but in the aggregate, it is a system that has worked well for nearly a century.

    Some state laws do allow for exceptions to exclusive remedy in cases of employer or insurer misconduct, although the bar is pretty high. One such reason under many state laws would be if willful intent could be established, but this generally requires establishing a standard of intent that goes beyond recklessness. By the same token, while no-fault generally extends to workers, there are exceptions that may result in denial of benefits, such as intoxication. The bar for these exclusions can be pretty high, too - we recently discussed an Ohio case of a teen worker at Kentucky Fried Chicken, in which benefits were upheld despite violation of company safety rules. In some states, such as Arizona, even intoxication is insufficient reason to deny benefits. Exceptions notwithstanding, workers comp is no-fault in nature. Occasionally, suit can be brought against a third party, such as a manufacturer of faulty equipment that resulted in the accident. This is called subrogation and is often initiated by an insurer or employer to recoup costs.

    Is the stick big enough?
    The article also raises the issue of whether the financial cost to employers is sufficient to ensure concern for safety. Workers comp has two pricing mechanisms to address the cost of risk. One, as the article points out, is that rates vary depending on the specific industry and job classification. Obviously, the risk for a clerical worker at an ad agency is not the same as the risk for a construction worker. Industries with high rates of injuries, such as roofers and miners, pay substantially more for comp. Secondly, a company's unique loss experience is factored into the rates just the way that it is in auto insurance for most drivers. An employer with poor loss experience will pay a significantly higher rate than a competitor with favorable loss experience. But beyond pricing for loss, workers comp generally does not encompass any penalties or damages for safety violations. Penalties would be the province of OSHA, or in this case, the Mine Health & Safety Administration (MHSA).

    Certainly, a case could be made that that regulatory actions need to carry more weight - Crandall Mines had many prior citations, but apparently of insufficient magnitude to effect a change. In the case of mining, many think this is a fox guarding the hen house scenario. There is no disputing that many OSHA fines are little more than slaps on the wrist to large corporations and some serial safety violators. Often, media will report on the imposition of a fine but won't follow up to see the frequency with which federal penalties get reduced or go unpaid entirely. Obviously, to have a deterrent effect, measures need to have strong teeth. For example, criminal penalties for serial safety violations that result in deaths might be warranted. We like incentive programs that align interests, but recognize that sometimes you need to carry a big stick.

    In most instances, workers comp does the job that it was intended to do, but in some instances, it does not seem sufficient or fair. The regulatory and legal hair splitting in this post certainly offer cold comfort to survivors. We would hope that events of this nature might serve as a catalyst for more and better safety, but that is what we hoped for after tragedies in West Virginia, too.

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    October 9, 2007


    Our colleague Peter Rousmaniere is writing an important 4-part series on the World Trade Center and workers compensation that is being featured in Risk and Insurance. These articles are part of the publication's in-depth focus on how Sept. 11 forever altered the workers' comp landscape and eroded the trust implicit between employer and employee. The first two issues have been published and the remaining articles will be published in upcoming issues. The series should be mandatory reading for anyone involved in any aspect of workers comp. The first two articles in the series demonstrate how the magnitude of the disaster and its aftermath have exposed innumerable fault lines in the century-old insurance institution.

    In Part 1: Up in Smoke, Rousmaniere discusses the appalling lack of any attention to safety in the mammoth WTC cleanup. As a work-related insurance event, the unprecedented number of deaths that occurred may represent the tip of the iceberg as the health problems of some 10,000 to 20,000 recovery workers are now beginning to emerge. Some of the problems in evidence include disabling and chronic rhinitis, "RADS," or Reactive Airways Dysfunction Syndrome, and post traumatic stress disorder. (And this says nothing about the potential ill health effects on the nearly 250,000 local residents, workers and students.)

    The workers - both on-the-clock employees and volunteers - labored daily in a highly toxic stew with a stunning lack of attention to the barest minimum of health and safety standards. Rousmaniere describes the abject failure on the part of environmental safety agencies to enforce any safety codes and offers some theories for why safety was so overlooked:

    One theory is that assurances to the public about the absence of environmental hazards lulled workers and employers into indifference. Days after the attack, EPA and OSHA issued press releases saying Lower Manhattan was safe to enter.

    New York City's Department of Design and Construction personnel "are not being exposed to unhealthy levels of chemicals and that air quality around the WTC is generally good," read an Oct. 17, 2001, OSHA communique.

    Another theory is that the World Trade Center collapse decapitated the work safety leadership inside New York City's government.

    "In the collapse of the towers, essentially the whole emergency response command structure of the FDNY was lost, as well as a majority of the department's (hazardous materials) instructors, technicians and specialists," wrote NIEHS consultants Moran and Elisburg.

    In Part 2: The Disease Within, Rousmaniere examines the insurance challenges that were faced in the immediate aftermath of the WTC event. In a single event, the death tally equaled 10 years of "normal" or expected work-related fatalities. He looks at some of the decisions that were made and some of the ongoing repercussions of those decisions, painting a portrait of a total collapse of the system as various weaknesses and flaws were exposed.

    Rousmaniere calls this collapse "the dead elephant in the room no one wants to mention" and points to several root causes for the collapse:

    • Agonizingly slow administration of claims.
    • Barriers for disease claims--the very claims that disasters will create.
    • The proclivity for people to seek financial relief for work-related conditions through tort litigation and federal assistance.

    He traces one disease claim to point out the complexities and the 3-year labyrinthine process that it has taken to come to any resolution. This does not bode well for the estimated 5,500 workers who will need ongoing care for respiratory diseases and the nearly 14,000 workers who need care for mental conditions.

    In discussing these articles with Rousmaniere, he notes that while federal intervention in state workers compensation benefit structures has traditionally been very low, it may well take a big leap after the debacle of the World Trade Center aftermath is better understood. His series provides one of the most comprehensive examinations of the event to date. And we can see many of the same issues, such as the lack of attention to safety and prevention, in the aftermath of Katrina.

    The final two parts in the Rousmaniere series will appear in Risk and Insurance in the October 15 and November 1 issues. We will be sure to bring them to your attention.

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    October 2, 2007


    Back in January we blogged an unusual case from Ohio. David Gross was a 16 year old working at a Kentucky Fried Chicken. Despite safety training and warnings to the contrary, he insisted on cleaning the fryer his own way, filling it with water boiled under pressure. When he opened the fryer, he burned himself and two co-workers who came over to help. Because he wilfully disregarded safety directions, his claim for temporary total disability was denied. When the Ohio Supreme Court reviewed the case, they upheld the denial, equating Gross's wilful disregard with job abandonment.

    After giving themselves the summer to think it over, the court has reversed itself and found in Gross's favor. Lawyers pointed out at the time of the initial ruling that the court seemed to be taking the "no fault" out of comp: by holding Gross accountable for his actions, they appeared to open the door to routine denials, based upon failure to follow safety instructions.

    The court writes:"Although KFC appears justified in firing Gross for violating workplace rules, the termination letter established that his discharge was related to his industrial injury. Therefore, upon reconsideration, we hold that Gross's termination was involuntary."

    I found the logic in the original decision a little hard to follow. The justices claimed that wilful disregard of safety instructions was the equivalent of "voluntary resignation." But he was still working - that's hardly a resignation. And while his own negligence was the sole cause of the injury, he was injured at work. Workers comp is no fault. Gross was at fault, but it doesn't matter. The injury is compensable, pure and simple. KFC should have fired Gross before he got hurt!

    Bobbing for Drumsticks?
    Two justices dissented from the revised opinion, including a long-winded justice named O'Connor. Follow her convoluted reasoning trying to uphold the original opinion, if you wish. Lest you think judicial discourse is always dry and musty, I quote at length from the concurring opinion of Justice Pfiefer, who slams the dissenting O'Connor with literate panache:

    The chicken Littles in dissent predict a workplace apocalypse, where employees bob for drumsticks in hot oil, ultimately resulting in an increase in the price of a bucket of "extra crispy." Back in the real world, nothing has changed, due to this court's wise rethinking of its prevous decision in this case. Gross was injured on the job. That he should receive workers compensation benefits for his injury is completely consistent with the philosophical underpinnings of the workers compensation system. The lead dissent is full of citations and fury signifying nothing - of the many cases cited in the dissent, not one comes anywhere close to even tangentially involving a worker being fired and denied workers compensation benefits for a violation of workplace rules that caused his own injury.
    The lead dissent invites a system in which workers who make poor decisions (removing a guard, working on a roof without scaffolding, overriding a control on a punch press) can end up being denied benefits. That dissent's Dickensian dreamworld - where presumably the Union workhouse, the Treadmill, and the Poor Law remain in full vigour - does not exist. We enjoy instead a constitutionally established system that renders fault irrelevant in compensating employees for their workplace injuries.

    Nothing personal, Justice O'connor! Can I buy you a cup of coffee?

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    September 26, 2007


    The good news is there are new technologies that hold the promise of ending fraudulent or inappropriate disability and workers' compensation claims. The bad news is that you'll need to get in the business of harvesting and tracking your employee's DNA to get there, venturing into relatively uncharted legal waters. Workforce Management and BBC both discuss the new technologies in DNA Technology May Curb Bogus Disability Claims and DNA test hope over damages claims. According to the Workforce article:

    Developed by the Cytokine Institute, a research and consulting firm affiliated with the University of Illinois College of Medicine at Chicago, the technology uses DNA to determine a link between exposure to a toxin and a serious illness. It does so by identifying a toxin's unique DNA signature on a person's affected cells.

    The technology, launched in June, has already been used in two dozen civil lawsuits between workers and insurance companies to verify the connection between exposure to toxins and a serious illness, says CEO Bruce Gillis, a doctor specializing in medical toxicology.

    "It will get rid of all the nuisance and frivolous lawsuits once and for all," Gillis says.

    In addition to the application for illnesses and exposures to toxins, testing may also be able to tell if an injury has even occurred. The Workforce article also discusses technology that can measure cytokines or small proteins in a person's cells, which elevate when an injury occurs. Cytokines can be measured as a before and after baseline to verify that an injury has occurred.

    Exercise caution when jumping in the gene pool
    Before you get too excited, you might check in with your lawyers, many of whom are likely to advise caution due to potential problems with privacy and discrimination issues. While there are no federal prohibitions against genetic testing, at least 30 states have laws that may say otherwise. HR Hero sheds light on the status of federal legislation putting limits on genetic testing in Lifeguard on duty: Congress patrols the gene pool, excerpted from Arizona Employment Law Letter. While many of the legal prohibitions deal with matters related to hiring discrimination and insurance denial rather than work injuries, attorneys advise a conservative approach in matters dealing with employees' genetic information.

    Genetic testing is already a hot button employment issue. Its application to workers' compensation and other disability matters is an issue that bears watching. For a handy reference guide, the National Conference of State Legislatures offers a chart on State Genetics Employment Laws.

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    September 24, 2007


    Gilbert Dube was a mechanic with a chronic back problem. He was working for National Fiber Technology LLC in Lawrence, MA, when he re-injured his back on November 7, 2001. He tried to return to work on a light-duty basis a couple of weeks later, but his employer informed him that there was no light duty available. (Red flag number one.) On December 4, he was terminated. (Red flag number 2.) On December 18, less than six weeks after the injury, Dube committed suicide. His widow filed for workers comp death and burial benefits. She prevailed at the industrial accident board. The carrier appealed, but three justices of the appeals court (McCarthy, Horan and Fabricant) found in her favor as well.

    The insurer tried to argue that the termination - not the injury itself - was the cause of the suicide. Because bona fide personnel actions are usually not grounds for filing a claim, they sought a reversal. The justices concluded that the injury and termination were inextricably connected. And further, the statute prohibits claims that link a personnel action to a disability - - death is not a disability. The justices go all the way back to Chief Justice Rugg, writing in 1915, just four years after the workers comp law was passed in Massachusetts:

    The single inquiry is whether in truth it did arise of out of and in the course of employment. If death ensues, it is immaterial whether that was the reasonable and likely consequence or not; the only question is whether in fact death "results from the injury.

    Unanswered Questions
    The Insider is left to puzzle over some issues that were glossed over in the ruling. First, why did National Fiber Technology not have any light duty? They make wigs and costumes, primarily those involving fake fur. (If you're casting a Sasquatch or a gorilla in your next play, give these folks a call. Here is a link to some samples of their work.) At least some of the work - lifting and arranging fake hair! - would be very light duty indeed.

    Then there is the mystery of the quick termination. Dube was injured on November 7 and terminated barely 4 weeks later, on December 4. What was the hurry? The quick trigger on termination surely raises the specter of discrimination based upon a work-related disability. Even if the employer could not accommodate Dube (they didn't appear to try), they could have kept him on the roster, pending a more complete recovery. That would not have cost them anything and it would have provided Dube with some motivation during his recovery.

    In this particular situation, everyone loses. The unfortunate Mr. Dube, first loses his job and then, confronted with the possible end of his career as a mechanic, takes his own life. His employer terminates in haste and repents at leisure. The carrier pays for the burial and provides ongoing support to the widow. In most instances, suicide is a private matter that falls outside the scope of employment. In this sad situation, suicide and employment are joined forever.

    This case has important implications for MA employers. The court is saying that any suicide stemming from a work-related injury defaults to compensability under comp. The fact that a personnel action was involved is not a viable defense. The burden of proof falls to the employer and the carrier to show that the suicide was not work related. With this ruling in hand, that will be a very difficult standard to meet.

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    September 14, 2007


    Here's an update on a case we recently blogged. Edgar Velasquez worked for Billy G's Tree Service in Rhode Island. He sliced open his face with a chain saw (ouch!). When he tried to file for workers comp benefits, his employer fired him. Edgar was an undocumented worker. The employer did not carry workers comp insurance.

    On August 2, 2006, Edgar went to the Garrahy Courthouse in Providence for a hearing on his comp claim. He was met outside by immigration agents, accompanied by Billy Gorman, his former boss. As he watched the agents take Edgar away, Gorman was heard to say "Adios, Edgar." Edgar was deported to Mexico later that month. (Gee, I wonder who dropped a dime...)

    Edgar, who lives in a remote mountain village in the state of Chiapas, has not received any further medical treatment for his injury. The scar on his face is still infected. Ho, Hum. Another immigrant worker screwed by an unscrupulous employer. End of story? Not quite.

    Billy Gorman has a few legal problems of his own. He is being sued by the state for running a business without the requisite workers comp insurance. And Rhode Islanders, who recognize a serious injustice when they see it, are raising money to return Edgar to this country - so he can pursue his comp claim, among other possible legal remedies against Gorman.

    Ah, but how will Edgar get back into the country, when he was here illegally at the time of the injury? Germann Murguia, the Mexican consul general in Boston, says they are trying to bring Edgar back through a humanitarian visa. "This is up to the American authorities, but we are trying to do as much as possible. He deserves compensation."

    I wonder if Billy has a call into his congressman, expressing his moral outrage that Edgar might be allowed back in. "He never should have been here in the first place!"

    Gorman's lawyer, Michael St. Pierre, reports that Gorman has no assets to satisfy the claim, which exceeds $70,000 in medical bills alone. St. Pierre also says that Edgar may not have met the definition of "employee." I guess he must have been an independent contractor.

    Here's hoping that Edgar finds his way back to America for a brief and legal visit. He needs some medical attention for his injury. And he deserves the opportunity to watch them put the cuffs on his former boss and to say, with all due sincerity, "Adios, Billy."

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    September 7, 2007


    This is a tale out of the North Carolina woods, concerning the Forbes brothers, Ernie and Wilbert. Here's a legal account of what took place on September 26, 2000:

    Wilbert Radel Forbes, his brother Ernest Forbes, James Duncan, Ronnie Duncan, and William Dobson traveled together in a van to a logging site in Halifax County. The men were members of a logging crew scheduled to work that day. During the drive to the logging site, defendant and his brother began arguing because Ernest did not stop at a convenience store where the crew usually stopped.

    Upon arriving at the logging site, Ernest got out of the van and walked away, and defendant got out, punched Ronnie Duncan in the side and said “watch this.” Duncan then testified that defendant told his brother “if you can do so much without me on Saturdays go grease the loader and change the oil.” Ernest stopped, turned around and said to defendant, “why do you f--- with me so much.” Ernest then started back towards defendant, and the two began pushing and shoving. Duncan then got in between the two men and separated them, and Ernest told defendant “if I had any knife I would cut your m --- f--- throat.” Duncan testified that Ernest did not have a knife at the time.

    Duncan then testified that defendant pulled out a gun, pointed it at Ernest and said to Duncan, “you don't believe I'll blow his m --- f--- brains out?” Duncan told defendant to “stop playing,” but defendant pulled the hammer back, said to Ernest “I'll blow your m --- f ---,” and pulled the trigger. Ernest died from a gunshot wound to the head.

    Ernie's widow filed a claim for workers comp benefits, which were awarded under the theory that the death was work related, because Wilbert ordered his brother to "grease the loader and change the oil." His brother responded in anger, the fight erupted and Ernie ends up dead. It's work related because the argument stemmed from work - even though work had very little to do with the brothers's deteriorating relationship.

    Lessons for Management?
    You have to wonder how much of the animosity between the Forbes brothers was revealed prior to the fatal encounter. Logging is a tough, high risk occupation, usually taking place in remote areas. The employer, Goodson Logging, would have been better off firing one (or both) of the brothers for what we can assume were long-standing problems in dealing with each other.

    Cynics might assume that Wilbert filed a comp claim for post-traumatic stress syndrome. After all, he did lose a brother in this terrible incident. Well, you cannot collect comp while in prison, and Wilbert is currently doing life without parole. He appealed his sentence, claiming the whole thing was an accident. It might have been a compensable incident, but the appeals court determined that it was no accident. Wilbert acted wilfully and is paying the consequences. As far as the comp benefits going to Ernie's widow, this is one family quarrel where the employer is stuck with the bill.

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    July 5, 2007


    We read in the Sydney (Australia) Morning Herald that workers comp benefits have been reduced for government workers. COMMONWEALTH public servants are no longer entitled to claim damages for accidents on the way to work or during lunch breaks. In addition, participation in the public service lunchtime football league is no longer covered.

    Claims for stress have also been severely curtailed under strict new guidelines on what constitutes mental injury. Public servants will no longer be able to claim damages for stress after disciplinary action, reprimand from a superior or a bad performance appraisal.

    The unions are not happy about the reduction in benefits (but then, why would any union endorse a loss of benefits?). Responding to the elimination of coverage for lunchtime soccer players, union head Stephen Jones comments that it is "counterproductive" to discourage public servants from keeping fit.

    "Why, when it's known that exercise can reduce workplace stress and reduce compensation claims for stress, would the government be making it harder to participate in these activities?"

    Insurance actuaries would respond, naturally, that the risks inherent in soccer are not contemplated in the rates for government office workers. If stateside rates can provide a point of comparison, most office workers would fall under rates well below $1.00 per hundred of payroll, while soccer players would likely be around $30.00 per hundred. The issue here is not discouraging fitness, but separating high risk fitness activities from work.

    Stressed Out
    Previously, public servants could claim for stress if a reprimand or disciplinary procedure exacerbated an existing mental health condition. Now, a successful claimant must prove that stress or mental injury was caused by unjust behaviour.

    Once again, Mr. Jones is not pleased: "There is an acknowledgment that in the past perhaps some individuals may have taken advantage of [it]. But if the change to how stress claims are assessed and compensated was being matched by a vigorous attempt to reduce workplace bullying, people would be more comfortable with it - this is just a smash-and-grab exercise."

    That's an interesting and rather odd metaphor - comparing a reduction in benefits to breaking a plate glass window and snatching something valuable. I believe he is saying that it's unfair to reduce the standard without increasing management accountability - which would have been a point well taken.

    Mental health groups in Australia have also opposed the changes. The national depression initiative beyondblue stated that the changes would "make it more difficult for individuals with a psychological illness/injury to make a successful claim for workers' compensation". This is undoubtedly true. The real question, of course, is finding an appropriate level of accountability for employers. If you have to pay workers comp for routine personnel actions, your costs are going to spiral out of control.

    The Pendulum Swings
    From the Insider's perspective, it appears that our colleagues down under are simply trying to bring their comp coverage into the 21st century. The pendulum has swung away from injured workers. In the USA, most state laws long ago eliminated coverage for routine commutes to and from work and during recreational activities, unless the latter were sponsored by the employer. As for stress claims, we now look for work to be the "predominant cause" of the stress. We've come a long way from the California gold standard that awarded benefits if 10 per cent of the stress was work related. Now that was a standard only a claimant attorney could love!

    NOTE TO READERS: For the next few weeks, the Insider will publish on a reduced summer schedule. We are planning to enjoy a little time off and recommend that you do likewise.

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    June 18, 2007


    Donald Delaware worked for Sunland Beef Co. in Arizona. He was in charge of processing hides. In October of 2004 the 71 year old took a bathroom break. The last thing he remembers is standing in front of a urinal. Co-workers found him bleeding on the floor. He suffered a concussion and some loss of memory. He apparently passed out and fell backward, hitting his head on the concrete floor.

    Is this a compensable injury? The fundamental question is "why did he pass out?" Doctors could not pinpoint a cause. One consulting physician thought the fall was due to "micturation syncope" - a rather fancy way of saying "fainting while urinating." (Note to male readers: you can add this obscure risk to the ever-growing list of bad things that can happen to good people.) If this diagnosis were conclusive, Delaware's injury would not be compensable. Micturation syncope is not a work-related condition. However, another doctor said he could not be sure that the fall involved this specific cause. Ultimately, he stated, the cause of the fall could not be determined.

    Given these facts, the administrative law judge and the appeals court ruled in Delaware's favor. (You can read the Appeals Court ruling here.) If something unexplainable happens at work and results in an injury, the injury is likely to be compensable. The benefit of the doubt always goes to the worker. The burden of proof for presenting a specific diagnosis to rule out compensability falls on the employer. Where a definitive diagnosis might force Delaware onto his own resources, an uncertain or neutral diagnosis results in concrete benefits for the injured employee.

    One final thought. We have blogged with some frequency (here and here) the ramifications of an aging workforce. Mr. Delaware was 71 at the time of the fainting spell. I wonder how long he had worked at the company and how long he was planning to work. I wonder if his age had anything to do with the fainting spell. As the American workforce ages, we are likely to see a number of cases revolving around diagnostic conundrums: is it work related or is it micturation syncope?

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    June 13, 2007


    Chuck Bodine was an appliance repairman for Colorado based American Appliances, Inc. In June of 2005 he stepped out of a company truck and collapsed in a heap. (That's how drivers often are injured - getting in and out of their trucks). Bodine's artificial hip had shifted and sent him sprawling. He got a new hip, but his claim for workers comp was contested by his employer. Their attorney, Jonathan Robbins, cited an 81 year old legal precedent known as the "wooden leg" argument. Under this obscure doctrine, an accidental "injury" to a wooden leg did not qualify for workers comp. Comp covers "personal injuries" not "personal property."

    Bodine argued, naturally, that his replacement hip is an integral part of his body. "This isn't something I can pop on and off."

    Bodine won his case in front of an administrative law judge and at the state's Industrial Claims Appeals Panel, but for reasons unknown to the Insider, he was unable to collect a dime while attorney Robbins pursued his Quixotic appeals, all the way to the Colorado Court of Appeals. Meanwhile, unable to work, Bodine and his wife had to move in with his parents. The Court of Appeals has finally ruled in Bodine's favor. They point to changes in the state's comp law (in 1991 and 1994) which distinguish between internal and external prostheses. When the device is in your body, it's covered by comp.

    After two years of inordinate delays, Bodine is finally in position to collect indemnity for his many months of inactivity. Comp will also reimburse his health plan for the cost of the hip replacement. This one looks like a no brainer. But when an attorney with a theory shows up, on behalf of an employer who appears deficient in compassion and common sense, any inventory of brains is at risk.

    Government Property
    A Google search of "wooden legs" turned up a moving column by Beth Quinn in the Times Herald-Record about a couple of soldiers from WW II - one American, one German. Both lost legs during combat. Both suffered all their lives from recurring pain in their amputated limbs. And when they finally died, their respective governments asked that the limbs be returned. After all, these particular artificial limbs are government property. The German widow dutifully complied, but the American widow ignored the request and buried her husband with his prosthesis in place. I'm with her. If the government really wants it back, they know where to find it.

    Thanks to faithful reader Jann Browning, an editor at Standard Publishing, for the heads up on this interesting case. She thought we would find it irresistible and, of course, she was right.

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    June 4, 2007


    In March of 2004 four contract employees of Blackwater Security Consulting were sent out into the streets of Iraq to provide an escort to a food convoy. They lacked heavy armour, they were never briefed on the nature and parameters of the job, and there was no pre-mission reconaissance. Oh, they also lacked a street map. You will remember these four men: they were ambushed and shot by insurgents, their bodies were burned, and the charred remains were hung from a bridge across the Euphrates River in Fallujah.

    We know that these contract employees were covered by workers comp (see Julie Ferguson's previous blog here.) But what about employer negligence? Is Blackwater accountable in any way for these deaths? We may never know. We read in the Gulf Times, that after years of legal wrangling, the case has been sent to arbitration, where the proceedings will remain confidential and the rulings will be binding.

    Prior to working, all Blackwater contract employees sign a document releasing the company from "any liability whatsoever" even if it is the result of "negligence, gross negligence, omissions or failure to guard or warn against dangerous conditions." I hardly need add that such language in a stateside employment contract would be illegal and unenforceable. But in Iraq, birthplace of the middle east's new democracy, anything goes.

    Lawyers for the four workers had hoped to invalidate the contract itself: the lawsuit alleged that Blackwater broke explicit terms of its contract by sending the men off without sufficient preparation and protection. Blackwater is lucky that Iraq is beyond the reach of OSHA, where employers must provide a workplace free from unusual risk of injury. As Borat would say: "Not!"

    Unprotected Emigrants
    we have been blogging the plight of undocumented workers in this country: substandard working conditions; substandard pay; marginal benefits. Despite all these problems, they may have better employment protections than contractors in Iraq. We are sending U.S. citizens into harms way with virtually no employer accountability and no protection.

    Lawyers view the judge's decision in this particular case as a victory for Blackwater. Even if the company has to pay for these deaths, their approach to employment - the blanket release of employer accountability for any and all of the dangers that employees face in Iraq - remains intact.

    Put enough money on the table and people will sign anything. It's only in the agony of retrospection that the consequences of a simple signature are truly understood. Nearly one thousand private contractors have died in Iraq. I wonder how their parents, widows and children view in hindsight the hefty hourly wages available in that absurdly dangerous country. Perhaps the families have a newfound appreciation for the protections offered to all workers in America, where we at least theoretically hold employers accountable for the way they train and support their employees.

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    March 21, 2007


    When a plant closes, the bond between employer and employee is broken. We often find that long-term employees, stung by the loss of jobs, file workers comp claims. Given the cumulative trauma of industrial work, the claims are often supported by objective medical evidence. With no opportunity to accommodate injuries through modified duty, the employer is stuck with the bills, which can be substantial. Most employers throw up their hands and write off the claims as an uncontrollable cost of doing business.

    Which brings us to the case of Melard Manufacturing in Passaic, New Jersey, cogently outlined by Greg Saitz in the New Jersey Star Ledger. Melard, a manufacturer of bathroom fixtures, closed in 2002, laying off the entire workforce of 111 people. Enter Michael Policastro, an attorney at the time for Ginarte O'Dwyer Winograd and Laracuente (the website speaks for itself). Policastro aggressively recruited the laid off employees and filed workers comp claims on their behalf. Policastro must have been pretty convincing, as more than 80 of the workers filed claims.

    Unfortunately, Policastro was more focused on quantity than quality. Most of the claims were identical except for the personal identifying information. The law firm apparently directed employees to provide false information to doctors. Subsequent exams by company doctors found virtually no disability attributable to work.

    The Company Fights Back
    In 2004 Bath Unlimited, the successor company to Melard, sued the law firm and the employees in federal court under the RICO statute. By this time, Policastro had left the law firm. Gilante was represented by Alan Zegas. Zegas claims that "the Ginarte firm did whatever was in its power to do to protect the workers." Which turns out to be absolutely nothing. The law firm settled out of court, leaving the 84 workers on their own.

    Judge Chesler ruled in favor of Bath Unlimited, signing a default judgment of $2.2 million against the former employees. These are people who made less than $20,000 a year, working in an aging plant under difficult (if not substandard) working conditions. That comes down to $26,000 per employee (more than any of them made in a given year).

    One of the many fascinating aspects of this case is the basis for the $2.2 million fine. Included in the calculation are at least two compensable claims, totaling about $36,000. Under federal rules, the judge tripled these amounts and added attorney costs. Thus a federal judge rules the awarding of benefits to be fraudulent, even though a state judge found that at least one of the claims, involving lung damage, was related to the working environment.

    While we don't have all the facts, we can come to a few conclusions:
    - the mass filing of identical claims does reveal a pattern of racketeering
    - the law firm apparently instigated the filings
    - while the employees had reason to be upset at the plant closing, signing onto these contrived claims was a serious error (in fact, a criminal act)
    - The interests of the laid off workers were poorly represented in federal court
    - Bath Unlimited won't be able to buy a pair of crutches with the money they collect from these indigent, uneducated, unskilled and perhaps permanently unemployed workers

    Fed vs State
    The lingering issue is one of jurisdiction. The New Jersey workers comp system continues to handle the claims, one at a time. In at least two cases so far, they have concluded that the former employees suffered compensable injuries. The broad net of fraud cast over all 84 employees has apparently included at least a few legitimate claims. Will the judge continue to add the compensable claims to the fines? Will he hold the employees in contempt if they cannot come up with the big bucks? Does Bath Unlimited really want to see these people locked up?

    We hope that employees who experience a plant closing find better legal advice than that offered to the Melard workers. We also hope that employers contemplating a plant closing take affirmative steps to transition their employees, first and foremost by providing job search assistance. If comp claims are filed at the time of the closing or soon after, they should be managed aggressively and humanely: the legitimate, work-related injuries should be paid; the fraudulent claims should be denied. The broad brush of the RICO statute is almost never needed and should be an absolute last resort.

    Business necessity sometimes requires the closing of a plant. But managers should never lose sight of the contributions made by a committed workforce. Shut the door if you must, but try not to slam it in the faces of your people.

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    February 26, 2007


    With 15,000 "independent contractor" drivers across America, FedEx is in the midst of a huge experiment in human resources. The fundamental question, of course, is whether their decision to contract out a significant portion of their basic operations is legal. A number of states (Including California, New Jersey, Montana and Massachusetts) have ruled that the drivers are actually employees, entitled to all the benefits of employment, including workers comp. We have blogged the issue a number of times, and will continue to do so.

    The adverse findings have not slowed down the ubiquitous delivery company. They are appealing all the losses and are confident that their strategy is both legal and appropriate. It's certainly no secret. They stipulate the nature of the relationship with drivers up front and in writing. Only time will tell if they will prevail. Despite their chain of losses in a number of state courts, it appears that they can operate comfortably in at least one jurisdiction.

    In April 2002 Edward Maskowsky began operating a FedEx pick up and delivery service in Connecticut. In an hour-long orientation meeting, the company made it very clear that he was to function as an "independent contractor." To set up the business, he purchased a truck, insurance, uniforms and his own disability policy. He filed taxes as a sole proprietor in 2002 through 2004.

    Maskowsky suffered a lumbar spine injury in April 2005. He collected weekly indemnity benefits from his disability carrier, which also paid some of his medical expenses. We can safely assume that the benefits under the disability policy were substantially less than those under workers comp. No disability insurance can match the zero co-pays and zero deductibles of workers comp.

    Seeking better benefits, Maskowsky filed a workers comp claim, alleging he was an employee of FedEx. In his claim, he stated that FedEx controlled the means and methods of how he conducted his delivery service within the specified route. Maskowsky's attorney did not have to dig deep to find a rationale for the claim. There are entire websites devoted to proving that FedEx drivers are really employees of the company.

    FedEx countered with documentation that Maskowsky, from day one, knew that he was an "independent contractor."

    Workers Comp Fraud
    George Waldron, a Commissioner in Connnecticut's workers comp bureau, found in favor of FedEx. You can find his terse ruling here. We might be tempted to conclude that the commissioner buys the FedEx theory of employment, hook, line and sinker. I'm not so sure. Maskowsky's claim was undermined by a rather startling fact: during the period he worked for FedEx, he engaged in workers comp fraud.

    As an "independent contractor" for FedEx, Maskowsky was free to hire others to perform the work (provided, of course, that they followed the strict FedEx rules and wore the FedEx uniform). He apparently hired at least one person to carry out some of the work. Thus Maskowsky himself became an employer. (In doing so, he inadvertantly strengthened FedEx's argument that he is an independent contractor - employees cannot contract out their responsibilities). However, he chose to pay his employee in cash. He did not provide any benefits. You can almost sense the rage as Commissioner Waldron typed (or dictated) these words: "The claimant did not provide workers' compensation insurance for his employee."

    It is a very, very bad idea to seek coverage under the comp umbrella, while declining to provide this same coverage for your own employee! Waldron hoists Maskowsky on his own petard. As for other FedEx drivers in Connecticut, they should assume for the moment that they are indeed independent contractors. And they better make sure that they secure coverage for any and all employees, lest they end up like Maskowsky, at risk for being charged with workers comp fraud.

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    February 15, 2007


    Eric Burns drove a cement truck for Kennon Ready Mix. Because the job requires hosing down the chutes after delivery, cement trucks carry a pressurized water tank. When Burns noticed the tank on his truck leaking, he brought it to the attention of his supervisor, Lynn Smith.

    "No problem," said Smith. "I'll fix it." Smith spot welded the crack in the tank. Despite his doubts about the safety of the tank, which showed signs of corrosion, Burns ignored his wife's advice to quit and find a better job. He could not afford to be out of work. On April 7, 2000, the tank exploded, virtually destroying Burns's hip. He is now permanently disabled.

    The question before the Missouri Supreme Court was whether Burns's recovery was limited to workers comp or whether the negligence of his supervisor reached the level of "affirmative (negligent) action." In other words, was the exploding tank a routine hazard of the job (and thus covered by comp's "exclusive remedy") or did it involve something over and beyond the hazards normally confronting a cement truck driver. (The court's complete ruling, well worth reading, is available here.)

    The facts in this sad story aligned pretty dramatically against Kennon Ready Mix:
    - the tank was cannibalized from a decrepit, 30 year old vehicle rusting in the yard
    - Smith was not a certified welder
    - Smith admitted to having "poor vision" - which he corrected with "$2.00 reading glasses"
    - evidence showed that the welding job was completely incompetent
    - the metal in the tank was so corroded, not even a skilled welder could have fixed it
    - Smith apparently told Burns to "drive the truck until it blows."

    When asked how he was able to complete the welding job despite his poor vision, Smith described his approach to the work as "kind of a feeling in the dark thing."

    Pinching Pennies
    You're probably wondering how much a new water tank costs. All of $400. Instead of making that modest investment in basic equipment, the employer chose to cut a corner. As a result, Burns, who is only 30, has already had three hip replacement surgeries and faces the prospect of additional surgeries every decade for the rest of his life.

    The Supreme Court upheld the judgment of a lower court, which found that the affirmative negligence of the employer did indeed pierce the "exclusive remedy" provision of the comp statute. The court upheld the $2.6 million awarded by a jury. Not a lot of money in the context of Burns's lifetime of suffering, but easily enough to buy a dozen brand new cement trucks, a couple hundred water tanks and a few pair of prescription lenses.

    Note: for a detailed summary of "exclusive remedy," check out our posting from last year.

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    February 5, 2007


    Ted Johnson was a linebacker for the New England Patriots. His specialty was stopping the run. As any viewer of the recent NFL playoffs knows, run stoppers use their heads: first, to think strategically -- where to go in the course of a given play - but then literally: torpedoing head first into the body of an opposing player. That's how you "stop the run." The result? All too often what football practitioners call "dings" and what the rest of us call concussions.

    Ted Johnson has three superbowl rings, a broken marriage, a life in tatters and, it appears, a broken brain. At age 34, he has incipient Alzheimers. His persistent depression has led him to abuse medications. The brain damage he suffered in football appears to be permanent, placing him on an inexorable downward path (see our recent blog on permanent brain damage and depression among football players here).

    Johnson thinks he knows exactly when the brain damage occurred. In 2002, he suffered a concussion in a game. In middle of the following week, he was given a "no contact" jersey for practice, which legendary coach Bill Belichick converted for unknown reasons to "full contact." In a subsequent drill, Johnson suffered another concussion. He eventually returned to full action, again, suffering countless "dings" over the course of three more seasons in the NFL. We may never know whether the two successive incidents were the cause of his current problems, but there is little question that he has suffered permanent brain damage.

    All of which brings us to the issue of sports medicine and the concept of returning to work as quickly as possible.

    Modified Duty in the Working World
    Workers comp practitioners understand that injured workers recover quicker if they are able to return to the workplace and perform some or all of their pre-injury duties. Treating doctors determine what the employee can and cannot do. Employers match the restrictions with available work. For some employees with extensive restrictions, that might mean performing job functions totally unrelated to the original job. Any work can be performed, as long as it is valuable to the employer and within the capacities of the recovering employee. The important part of modified duty is getting dressed and going to work: the worker feels productive and feels like part of the team.

    The whole system falls apart if two conditions are not met: the doctor must accurately specify the restrictions necessitated by the injury, along with appropriate time frames; and the employer must make sure that the employee follows those restrictions carefully, never exceeding the doctor's limits. If any ambiguity or doubt arises, the employer communicates with the doctor to clarify which work activities are acceptable and which are not.

    Modified Duty in the NFL?
    Now let's return to the violent world of the NFL. There is a lot of money at stake. The pressure to win from week to week is intense. Indeed, winning is the only way the entire league measures performance. As Vince Lombardi said, "If winning isn't everything, why do they keep score?"

    With all this focus on winning, it's not surprising that the league itself does not know how to handle concussions. There is no explicit protocal for treatment and no required period for "time away from work." (With high profile cases of brain damage such as Johnson's, maybe that will change.) At the same time, there really is no "light duty" available for injured players. Whenever a player takes the field, it's all full duty - full duty with a vengeance. The opposing side shows no mercy. If they can exploit the injury to their advantage, they will do it. Players whose injuries prevent them from returning to the playing field indefinitely are placed on "injured reserve." Once on this dreaded list, they are ineligible for the remainder of the season.

    In Ted Johnson's case, the doctor apparently restricted his activity for a few days following the initial concussion. The trainer set him up for limited duty. For reasons that may never be clear, the coach ordered him to participate in full contact drills. Johnson did not object. As one teammate said of him, "Teddy was one of those guys who...played by the code. He played hurt. He played tough, he played physical and he never let his teammates down. He was there for you every play.’’ Despite all of his recent problems, despite his bitterness directed at his former coach, he talked about returning to the Patriots as an active player just a few months ago.

    Ted Johnson has become a symbol of all that is ambiguous about professional football. His precipitous demise reminds us that sports medicine analogies have their limits. The pressures of our working world - the need to get valued employees back to "full duty" as quickly as possible - must always be tempered by the needs of the worker and the time frame of the healing process itself. Life, fortunately, is not a football game. We have many ways to measure success and accomplishment, only one of which involves the final score.

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    January 29, 2007


    Over 12 million American workers perform their jobs away from the office: many work out of their homes, perhaps commuting occasionally to the office for mandatory meetings. The benefits of working at home are pretty obvious: you can set your own hours (at least to some degree); you don't have to worry about traffic and bad weather; and no one cares how long you take for a coffee break. No wonder so many people prefer this work option. It's a no brainer.

    Well, the no brainer has become a brainer. We read at that class action lawsuits have been filed in California, Colorado, Missouri, New Jersey, New York and Ohio. The suits allege that at-home work arrangements violate basic labor laws: no pay for overtime work; no severance pay; no travel reimbursement for mandatory trips to the office; and no pay for being on "stand by" while computers are down. The fundamental issue is the nature of the employer-employee relationship. Are at home workers subject to overtime and related regulations ("non-exempt") or more like supervisors and managers (exempt from these regulations)? Most employers assume that these employees are exempt, simply by the nature of their workplace. But that's not necessarily the case.

    It's deceptively easy to view at-home workers as "independent contractors" because they function, well, independently. The distance from the customary worksite leads to ambiguity. Nonetheless, home employees are still employees, whether exempt or not, and companies should take steps to clarify their status. That means treating at-home workers the same as worksite-based employees. Not treating them identically - that is simply not feasible - but establishing clear and explicit groundrules, preferably in the form of a written agreement. The optimum time for doing this, of course, is before the work at home begins:
    : develop timesheets which document hours on task (these can usually be incorporated into the log on /log off process)
    : require approval for any proposed overtime
    : set ergonomic standards for at-home workstations (see below)
    : clarify in writing the benefits available to at home workers, including travel reimbursement, sick leave and severance pay (Be prepared to explain any differences in the benefits involving commuting employees)
    : outline the explicit criteria for exempt and non-exempt employees, so the at-home worker understands his or her status

    Workers Comp at Home
    Then there is the subject near and dear to the Insider's heart: the status of workers comp coverage for at home workers. Employers might be tempted to exclude at home workers from this benefit, but this is not an option. The payroll for at home employees gets rolled into the workers comp premium calculation. Employees are covered by workers comp while they are "in the course and scope of employment." In other words, they are covered while working at home, even if they set their own hours and despite the fact that they have no direct supervisors. This raises some intriguing issues: what if I slip and fall or trip over a box in my home office? What if my work station is ergonomically risky? What if I burn myself making a cup of coffee? What do I report to my manager and how?

    There are no easy answers here. But one thing is sure: with over 12 million at-home workers, work-related injuries are going to occur. The "work at home" culture - with its many benefits - will continue to grow. At the same time, management needs to learn how to manage employees who are definitely out of sight, but, one hopes, not out of mind.

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    January 24, 2007


    We read in the New York Times that State Farm has suddenly agreed to accept liability for many of the claims it had previously denied in Katrina-ravaged Mississippi. The giant insurer has set aside a minimum of $80 million to settle 640 lawsuits. They have also agreed to re-open 35,000 denied claims. In most cases, home owners will collect half of the policy value. In a few cases, they will cash out at full value.

    This is a dramatic turnaround from the insurer's prior position: they based their initial denials on the premise that most, if not all, the damage from Katrina was caused by storm surge (flooding is not covered by conventional homeowner's insurance) and not by wind (wind damage would be compensable). In the final analysis, I doubt that they are backing away from the scientific premise of their denials. They still probably believe that they are on solid legal ground for denying the claims. No, in the end, State Farm has agreed to pay claims it really feels are not compensable for one simple reason. They are still in the insurance business. They still want to sell policies. And the negative fallout from their routine denial of Katrina claims threatened their core reputation, the brand name they have so carefully cultivated over the years.

    The Times article quotes Randy Maniloff, a lawyer at White & Williams in Philadelphia who represents insurance companies. He said yesterday that it was clear that the bad publicity had been a big factor in State Farm’s decision to settle. “They spent 80 years building up a brand,” he said, “and the adverse publicity from these lawsuits has been clearly doing damage to the brand. It just flies in the face of their portrayal of themselves as good neighbors.”

    When we first blogged this issue, we raised the irony of State Farm's "good neighbor" tag line. Real neighbors help out regardless of the circumstances. In contrast, corporate "good neighbors" might well use the small print of an insurance policy to serve stock holders and maximize profits. If that means boarding up entire communities, so be it. There is at least some legitimacy to State Farm's original position. The case can be made that this capitulation is wrong and sets a dangerous precedent for the industry. Other carriers now have to scramble to recalculate their earnings statements. In addition, all purveyers of home owners insurance are revising policies to clearly and explicitly exclude storm surges from future coverage. But they are all going to help pay for Katrina.

    Business and The Public Good
    The scale of this disaster was so great, it transcends the insurance industry itself. While insurers are extremely reluctant to compromise the sacred language of the policy, they are involved here in something much greater than corporate bottom lines. Entire communities have been wiped out. The scale of displacement caused by Katrina is unprecedented in American history. State Farm's settlement is a small part of a great public good. As a result of this agreement, desperately needed cash will begin flowing at long last into the devastated communities. The rebuilding will finally gather some momentum. At the same time, State Farm can credibly tout itself again as a "good neighbor." Not the most willing, perhaps, and not entirely convinced they want to be doing it. Nonetheless, for the people of Mississippi, State Farm, like a good neighbor, is finally there.

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    January 19, 2007


    As we head toward the climax of the football season, with just four teams left on the path to the Superbowl, we read in the New York Times (registration required) that the big hits we cheer for may be causing permanent damage.

    In November, Andre Waters, a 44 year old former safety for the Philadelphia Eagles, killed himself. He may have been a great safety, but he did not perform his job safely. He was famous for his relentless style and his ferocious hits. Waters thought he might have had as many as 15 concussions during his career. "I just wouldn't say anything. I'd sniff some smelling salts, then go back in there."

    For the moment, we will pass on the question whether Waters's death - despite the wilful intent - is work-related and possibly compensable under workers comp.

    Chris Nowinski, a former lineman for Harvard and professional wrestler, convinced Waters's family to provide brain tissues for testing. The results revealed the brain of an 85 year old man with early stage Alzheimer's. Nowinski himself suffers from bouts of depression, which he relates directly to his half dozen concussions. "I have maybe a small window of understanding that other people don't," he says, "just because I have certain bad days when my brain doesn't work as well as it does on other days...But I know and understand...because I know it'll probably be fine tomorrow." Of course, Nowinski is only 28 years old. I wonder how he'll feel at 44.

    The NFL policy on concussions is what you might label "wishful thinking." They allow players who sustain a concussion to return to play the same day if they appear to have recovered. Despite a concussion, the Jets' Laveranues Coles was available during the playoffs, as is the Colts' Cato June, who suffered a concussion last week and who looks forward to jamming his helmet in the bodies of the New England Patriots this week. The NFL's mild traumatic brain injury committee has published several papers in the journal Neurosurgery defending the practice. They see no signs of neurocognitive decline among the players returning to "work" immediately after being injured. But Nowinski points out that these studies are limited to active players. When you look at players after retirement, the picture is not so rosy.

    In a survey of more than 2,500 former players, the Center for the Study of Retired Athletes found that those who had sustained three or more concussions were three times more likely to develop earlier onset of Alzheimer's. A new study finds a similar correlation with depression. That's after just three concussions. The odds against Andre Waters, with his 15 or so concussions, must have been formidable.

    Let the Games Begin!
    Humankind needs danger-ridden spectacles. We cheer on our gladiators, even as we deride the behemoths from the other city. According to Wikipedia, the Roman gladiators were less prone to killing off the losers than Hollywood has led us to believe. Some died, some lived to fight another day. After three years of toil, the best-performing gladiators of old could retire and live the good life. Not all that different from modern times. But at what price? When the spectators have left the stadium, when the awards have all been handed out, we're left with the walking wounded, the ones who paid the price. It's enough to give us pause, but not for long, as we breathlessly look forward to the Sunday kick off.

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    January 16, 2007


    Police Officer Michelle Ross was injured in a car crash outside Salt Lake County while driving with her infant son. She was off-duty, operating a marked police vehicle. (I've never seen a police cruiser with an infant carseat.) She crossed the center line of State Road 36 and struck a tractor-trailor, injuring two people. Is she covered by workers comp? Is the city liable for her driving mistake?

    You would expect a consistent answer: if Ross was "in the course and scope" of employment, she would collect workers comp and the city would be liable for her negligent driving. If she was truly off duty - "coming and going" - she would not be eligible for comp and the city would be off the hook for the injuries she caused.

    Well, as Ralph Waldo Emerson once wrote, "foolish consistency is the hobgoblin of small minds." No small minds in Utah! Because Officer Ross was part of a "take-home car" program designed to increase the visibility of the police and to speed response time, she was, in effect, on duty at all times, even when driving with her child. So the court ruled that she is entitled to workers comp for her injuries.

    If Ross was on duty, then the city is liable for her actions, right? It turns out that prior to the awarding of comp, the state Supreme Court ruled exactly the other way. They overturned a judgment against the city on behalf of the injured parties, Chad and Stacy Ahlstrom. The court ruled that the city cannot be held liable for an employee who is simply "coming and going" from work.

    Ross was and was not in the course and scope of employment. The city was liable (for comp) and not liable (for Ross's negligence). The city has it both ways, at the expense, it appears, of the Ahlstroms. Their heads must be spinning, like vehicles in this week's ice storm on the slippery roads of Utah.

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    January 15, 2007


    The plight of undocumented workers who are injured on the job brings to mind a quote from the late Groucho Marx. When told a swimming pool was off limits to Jews, Groucho replied: "My son is half Jewish. Can he wade up to his knees?" Our colleague Peter Rousmaniere summarizes the status of undocumented workers in the workers comp systems across the country. They're lucky if the water covers their ankles.

    Most injured undocumented workers never try to access the comp system. They are the phantom workers who self-treat their (relatively) minor injuries. It's when they are seriously hurt that they try to secure comp benefits. In many states, the medical treatment of undocumented workers is covered by comp, but indemnity payments are routinely denied. And if the workers reach the stage of maximum medical improvement (MMI), they rarely are entitled to permanancy benefits or vocational rehabilitation. The Catch 22, of course, is that tecnically they are not available for work, because they are illegal, so the concept of wage replacement disappears into the mist.

    Rousmaniere cites a case in Indiana, where an undocumented Mexican worker has been unable to collect indemnity for his injury. The carrier apparently has cut off his medical benefits as well, claiming he has reached MMI. Logic tells us that an independent medical exam is warranted, but to be eligible for an IME in Indiana, an injured worker must have received total temporary disability. With state law excluding undocumented workers from indemnity benefits, there is no way to challenge the MMI determination.

    The blog goes on to quote Jake Knotts, (presumably no relation to Don), a South Carolina lawmaker who is pushing to exclude undocumented workers altogether from his state's workers' comp system."My bill is a very simple bill," he asserts. "It says that if a person applies for workman's compensation, they must show that they are a legal citizen." Simple it is, fair it isn't.

    Truth and Consequences
    We may be heading for a fork in the road. One fork will create some form of documentation and recognition for most or all current illegals, thus opening the door to full coverage under each state's comp law. With President Bush perhaps leaning in this direction (in opposition to much of his party), and with the Democratics in control of Congress, this might actually happen. As we have pointed out before, this is probably the most realistic path, and the most inflationary: the cost of business will go up dramatically as millions of "under the table" workers become eligible for all benefits, including but not limited to comp.

    At the other fork, Senator Knott and like-minded state representatives are moving to explicitly exclude illegal workers from comp benefits. That might provide some clarity to the situation, but certainly would not improve it. It's hardly fair to blame workers for getting hurt, regardless of how they entered the workforce. We need to hold employers of these undocumented workers accountable, not reward them for their ethically-marginal choice of hiring illegal workers. On the other hand, you could argue that if applicants provide false documentation of their status, and if the employer hires them in good faith, then perhaps the illegal workers are guilty of "willful misrepresentation" and as such are not entitled to full benefits.

    For the moment the status quo, as ambiguous and unsatisfactory as it is, still trumps the options. The status quo works because it offers a virtually unlimited supply of cheap labor, keeping the cost of business down. Once injured, undocumented workers will continue to receive second class benefits under the comp system. They will stay in the shallow end of the pool, if, indeed, they can get into the water at all.

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    January 9, 2007


    David Gross, 16, had a job at Kentucky Fried Chicken. One of his responsibilities was cleaning a 690 Henny-Penny gas pressure cooker. His preferred approach to the task was to put water in the cooker, seal it and boil away the grease. This was against the manufacturer's recommendations (written right on the equipment) and against store policy. The boiling water, under pressure, put anyone near the equipment at risk. Gross was warned several times, the last time in writing. Nonetheless, he persisted in cleaning the cooker with water.

    On November 26, 2003, he was injured when boiling water spewed from the cooker, causing third-degree burns around his hip and groin and second-degree burns on his arms and back. Two co-workers, who tried to stop him from opening the cooker, were also burned. Gross's application for workers comp benefits was denied by the Ohio Industrial Commission, based on his willful disregard of safety instructions.

    The case went to the Ohio Supreme Court, which upheld the denial of benefits. The court wrote that Gross "willfully ignored repeated warnings not to engage in the proscribed conduct..." Gross "voluntarily abandoned his employment" by ignoring explicit written and verbal warnings not to clean the pressure cooker with water. More than 2 months after the 2003 incident, the operator of the KFC franchise fired Gross for violating those safety warnings.

    "When I got the court's decision, I just thought to myself, 'This is a sad day for injured workers,'" said Gross's attorney, Gary Plunkett of Hochman & Plunkett Co. in Dayton, Ohio. (It certainly was a sad day for Mr. Plunkett.) Many people appear to agree with the dissenting opinion of Justice Evelyn Lundberg Stratton, who expressed concern that the ruling represented a slippery slope. "Should the employee's fault preclude his receiving temporary total disability? The answer to this question is no. Our workers' compensation laws do not permit the introduction of fault."

    Attorney Plunkett envisions a situation in which a truck driver injured in an accident is denied benefits because he was driving nomially faster than the speed limit in violation of company rules.

    Slope or Plateau?
    The issue here is one of accountability. In determining that Gross's repeated ignoring of safety instructions was "willful intent," the court has not really changed the nature of workers comp. This is less slippery slope than unique plateau. The standard set in this case for transcending the traditional "no fault" of comp is very high indeed: repeated verbal warnings; written warnings on the equipment itself; a written warning to the employee; verbal alarms from co-workers just prior to the event. There is a significant difference between holding employees accountable for their actions and routinely denying them comp benefits when they are injured due to carelessness or simple human error.

    The part of this case that puzzles me the most is why KFC allowed Gross to continue on the job after he first violated the safety rules for cleaning the cooker. They should have fired him well before the unfortunate event took place. I question KFC's wisdom in relying on the judgment of a 16 year old in this type of work situation. The adolescent brain can be very resistant to logic and set procedure. (Some 16 year olds can handle the details; some cannot.) This is surely a lesson that Gross will remember for a long time. Perhaps, now that he has been denied the "exclusive remedy" of comp, Gross can sue KFC for negligent management in allowing him to continue on the job. That would certainly be the American way.

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    January 3, 2007


    Back in July 2005 we blogged the way Walmart squeezes its vendors to achieve the lowest possible prices. Today we read in the Wall Street Journal (paid subscription required) that the behemoth retailer is instituting a computerized scheduling system that enables it to use the same squeeze tactics on its own employees. Now that's a shocker!

    The plan involves moving workers from predictable shifts to a staffing pattern that is based on the number of customers in stores through the day and week. Workers may be asked to be "on call" to meet customer surges, or sent home because of a lull, resulting, of course, in less pay. The new systems also alert managers when a worker is approaching full-time status or overtime, which would require higher wages and benefits. Such individuals are red flagged - "descheduled" - so payroll costs remain as low as possible. Oh, the marvels of computerization! (I doubt the programmers at Kronos, who devised this system, are subject to similar payroll and benefit caps.)

    What does this mean for Walmart workers? They might not know when or if they will need a babysitter or whether they will work enough hours to pay that month's bills. They might have trouble scheduling doctor appointments. Senior employees, whose hourly rates are higher, might find themselves scheduled for fewer and fewer hours. Rather than working three eight-hour days, someone might now be plugged into six four-hour days, mornings one week and evenings the next. Unless they live near the store, they're going to spend a lot more time commuting.

    The benefits to the company are pretty obvious: lower payroll costs; less time spent on scheduling for local managers; and more people on the floor when you need them, especially during midday and evening shopping surges. The goal of "enhancing the shopping experience" will be readily achieved. As for the problems the new system creates for workers, Walmart apparently will just take their chances. As they say, if you want make wine, you have to crush the grapes.

    Compensable "To and Fro"
    By instituting this extreme version of flex scheduling, Walmart has inadvertantly opened the door to new workers comp liabilities. Normally, the "to and fro" commuting time for employees is not covered by workers comp. Your workday - and your comp coverage - begin when you arrive at the workplace. However, in most states there is an exception for "on call" workers. Because they have no set schedule, but must appear when called (or leave when no longer needed), workers comp coverage begins when they receive the call and head out to work and it continues when they are sent home. Their coverage includes the commute in both directions. Walmart may have succeeded in reducing the payroll, but they have significantly increased their workers comp exposures. (Given the management style at Walmart, they cannot be comfortable with the fact that commuting itself is totally unsupervised.)

    I imagine that Walmart managers will not lose much sleep over this problem. Filing a claim for a work-related injury - whether it occurs onsite or off - is probably a daunting and perhaps even intimidating process. If this new scheduling system succeeds in lowering costs, it will surely be copied by others. Wall Street will love it. It's good for consumers, eternally in search of bargain prices. It's good for shareholders: lower payroll costs means higher profitability. Sure, it's tough on the marginally skilled workers trying to raise families and balance their own budgets. If they don't like it, they can go work for Target or Radio Shack (where they will find similar systems already in place).

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    October 26, 2006


    Yesterday, the Maine Supreme Court made a ruling in an interesting case related to the "going and coming" rule. It involved Justin Laliberte, an employee of VIP, Inc., who was returning from a weekend work project when his car veered off the highway and collided with another car, killing Nancy Spencer and injuring her husband and daughter. The Spencers are now suing VIP, Inc. and Laliberte for damages. Attorneys for VIP Inc have argued that, because this case was not work-related, Laliberte alone is the responsible party. Yesterday's 3-2 ruling by the Supreme Court overturned a lower court ruling that the collision was not work related, thus upholding workers compensation for Laliberte and clearing the way for the Spencer's lawsuit against VIP Inc.

    Employees who work at one fixed location are generally not covered by workers compensation should an injury occur during the normal commute back and forth to work. Although state law varies, this going and coming rule generally holds true - but the devil is in the details, as they say. Every state has some exceptions to the going and coming rule, and one fairly common exception is when an employee is on a "special assignment." In this case, the employee was performing a service for his employer's company-related special event at an off-site location, and he was remunerated $25 and tee-shirt.

    This case is a bit ironic in that workers compensation generally protects an employer from lawsuits but, in this instance, the fact that the accident was work-related opens the employer to suit. Jim Pocius of Marshall, Dennehey, Warner, Coleman & Goggin has a good article on Workers Compensation and Course of Employment that covers traveling employees and offers several common exceptions to the going and coming rule. In addition, we've covered similar issues a few times in the past - here are some related items:

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    October 19, 2006


    Five years after the fall of the World Trade Center towers, there are lingering issues concerning the health of the rescuers. Over 40,000 workers rushed to the site in the immediate aftermath, and then sifted debris in the following weeks. It now appears that many of these workers have suffered lung damage, much of it permanent, some of it fatal. So who is responsible? Who pays?

    Not me, says the city. Not me, says the Port authority of New York. Not me, says the federal government. OSHA was just advising, they weren't in charge. The city was following the feds. No, the feds were following Rudy Guiliani, braving the flying dust at ground zero for yet another photo op (and not wearing an unphotogenic respirator).

    Writing in Risk & Insurance, our colleague Peter Rousmaniere tries to separate the immediate response crisis from the safety issues emerging after it was known that there were no more survivors. Once the last living person was extricated from the wreckage, there was time to think coolly and balance the sense of urgent recovery with the safety of the workforce. But as Rousmaniere notes, instructions in the "safety playbook" were ignored:
    : A single point of authority was needed. But the feds and locals bickered in a power struggle that led to many of the subsequent problems.
    : Once it was clear that there were no survivors, they could have closed the site to let the dust settle for a while.
    : Given the obvious toxic respiratory exposures, project leaders could have screened out workers who smoked or who suffered from pre-existing respiratory problems.
    : The use of personal protective equipment could have been mandated (including the ubiquitous Guiliani!)

    Who should Pay?
    Federal Judge Alvin Hellerstein refused recently to dismiss more than 3,000 lawsuits against New York City, the Port Authority of New York and New Jersey, and contractors who cleared Ground Zero. The suits were brought by emergency workers who claimed respiratory damage and other illnesses from the cleanup. At the same time, the Judge left open, on a case by case basis, whether individuals harmed during the clean up can collect any benefits. (The complete ruling can be found here. PDF.)

    According to Mark Hamblett, writing in the New York Law Journal, the judge ruled that it was too early in the litigation to determine whether the defendants are entitled to immunity under the New York State Defense Emergency Act (SDEA) or other immunity doctrines, including one claim that the federal government supervised key elements of health and safety conditions at the site and the Fresh Kills landfill.

    The SDEA, §9102-a, provides immunity for actions taken "in good faith carrying out, complying with or attempting to comply with" any law or order issued in response to an emergency and relating to "civil defense." Judge Hellerstein said two competing interests had to be weighed on the issue of immunity-"namely the need to allow for an immediate and effective response to an attack on the state as against the need to ensure persons a right of redress."

    The immunity provision of the defense emergency act, he said, "operates to ensure that fear of liability will not operate to dissuade government and private entities from responding to a disaster, even in the absence of otherwise mandated safety protocols and procedures."

    But as the "emergency condition fades," he said, "the need for immunity diminishes and the obligations and duties otherwise imposed must be protected." In other words, once we knew that there were no survivors, the health and well-being of the rescuers should have become paramount.

    Who's in charge?
    The defendants said the Army Corps of Engineers had assumed control over the design and enforcement of health and safety monitoring at the Fresh Kills landfill on Staten Island, where debris from the site was taken and sorted. The Occupational Safety and Health Administration (OSHA) took the lead role in distributing respirators at Ground Zero and the Environmental Protection Agency took the lead on environmental monitoring and hazardous waste removal. So the Feds were in control?

    But at Fresh Kills, the judge said, the city "continued to exercise an independent degree of control over operations." OSHA, he said, worked in an "advisory capacity, providing assistance only as needed and requested by the city. So the city was in control?

    Judge Hellerstein notes that while the defendants developed "a viable health and safety plan for workers at the site," the pleadings show there were "critical lapses in the enforcement of safety standards and in the dissemination of vital information about the safety of the air at Ground Zero to those most affected, the workers themselves." As Rousmaniere notes, the safety play book was carefully drafted and then stuck in a bookcase, collecting (non-toxic) dust.

    Responding to Emergencies
    It may be impossible to distinguish between prudent and emotion-driven response to a crisis on the scale of 9/11. In the mad scramble to re-establish order, the public wants to believe that the situation is under control. Indeed, our personality-driven culture seems to demand that we put a face on the post-crisis leadership. (Then again, the face is occasionally air-brushed from history. Did someone say "Brownie"?)

    In any event, I find it hard to focus on the nominal leaders who jockey for position in the klieg lights following a disaster. It's just too hard to separate the self-promotion from the public good. My thoughts are with the dedicated and truly selfless people who offer their services in a time of emergency. They are not thinking about the future. They are not worried about political capital. They are simply trying to help. It is ironic and surely a symptom of our times that in the aftermath of 9/11 we have given notice to any such responders: think twice about rushing into the inferno. You may well be on your own for any health problems emerging from your work. The very people who urged you to participate are running away from your pain as fast as they can. The rhetoric has gone from "I'm in charge" to "you can't blame me." They have plenty of justification for their hold harmless/immunity arguments, but surely that does not mean that no harm has been done.

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    October 17, 2006


    The Insider is partial to actuary jokes. Perhaps it's because so much depends upon the actuarial viewpoint. These are the people who drive the insurance bus. Those of us seated in the bus often feel a bit queasy, as the driver has the vehicle pointed backwards and attempts to drive while looking through the rear view mirror. They drive in this hazardous manner, because historical losses are the primary predictor of future losses. Well, sort of.

    One joke says that actuaries are accountants who couldn't stand the excitement. But when you look at the big picture in workers comp today, there is plenty of excitement and a lot of uncertainty. You have to admire anyone trying to make sense of current trends by predicting future losses in the comp field. In a word, you have to admire the actuaries. (Check out our links to a number of admirable actuarial blogs.)

    Retirement Receding
    The comp industry is confronted with many issues relating to an aging workforce - including the fundamental fact that many people are postponing retirement: some won't retire because they like working, while many more plan to keep working because they have to. As people work longer, we will begin to see more claims activity in the higher age groups: people in their 60's, 70's and even 80's will suffer work-related injuries and, despite their ages, will file comp claims. Comp administrators in each state will be confronted with new issues as these claims wend their way through the system.

    Here are a few of the condundrums that we assume might lead the actuaries to lose a bit of sleep:
    : aging employees with no retirement options (except, perhaps, retiring on comp)
    : People in manufacturing and construction in their 50's and 60's, their bodies breaking down, with work a significant contributing factor in the breakdown
    : Aging, over-weight and poorly conditioned workers performing physically demanding jobs
    : Aging workers whose ability to perform the job safely erodes a little each year
    : Older workers returning to work after knee surgery, at risk for further surgeries
    : Older workers with little education, broken bodies and no transferable skills
    : Illegal immigrant workers, working hard, growing older and suffering from permanent partial disabilities

    Casting No Aspersions
    I have no idea how actuaries will go about factoring in the new and largely unprecedented risks of an aging workforce into the calculation of premiums. We can only wish them luck - and perhaps, have a little fun at their expense. While the Insider would never cast aspersions toward the work of actuaries, we think it appropriate to let them make fun of themselves. Here's a little sample of their self-deprecating humor, compiled by Jerry Tuttle. Based on these examples, actuaries may be having a better time than the rest of us have been led to believe.

    "Old actuaries never die - they just get broken down by age and sex."

    How do you get an actuary to laugh on a Thursday? Tell him or her a joke on a Monday.

    How do you tell the difference between an actuary and the deceased person at a funeral? The deceased
    has a new tie.

    Workers compensation fatality benefits are generally payable to the surviving spouse until death or remarriage, so remarriage is the actuarial equivalent of death.

    An actuary is someone who expects everyone to be dead on time.

    Two actuaries are duck hunting. They see a duck in the air and they both shoot. The first actuary's shot is 20 feet wide to the left. The second actuary's shot is 20 feet wide to the right. The actuaries give each other high fives, because on average they shot the duck.

    What does an actuary's wife do when she has insomnia? She rolls over and says, "Tell me again, darling. Just what is it you do for a living?" [NOTE: this works just as well for insurance consultants.]

    "I once told an actuary to go to the end of the line. He came back five minutes later and said he couldn't because someone else was already there."

    Here's wishing the best of luck (and solid projecting) to the actuaries in their rear-view oriented look toward the future. And good luck to the rest of us, who must live with the consequences of their work!

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    September 25, 2006


    Is an injury that occurs as the result of a dive at a swimming hole a compensable injury? It is if swimming is one of the activities at a mandatory company-sponsored event. Roberto Ceniceros of Business Insurance alerted us to a recent ruling by the Arkansas Court of Appeals in the case of Tina Engle vs. Thompson Murray Inc. and Continental Casualty Co.. Ms. Engle was injured while diving at a company retreat, a team-building exercise. An administrative law judge had originally denied the claim, finding that the employee was not at work at the time of the injury. The Appeals court disagreed, finding in favor of the employee.

    An article from the Arkansas News Bureau tells us that Ms. Engle had the responsibility of organizing the off-site company activity, which included pontoon boat rides and a place for employees to climb rock and jump into the water.

    "The purpose of the off-site meeting was for employees to bond, refresh, set new goals and have fun," Crabtree wrote. "As long as the participants were advancing the purpose of the meeting, they were furthering the interest of their employer."
    Crabtree said it "defies reason to assert that (Engle) was required by her employer to find a place from which to jump, but was not expected to participate in the jumping."
    Engle "was engaging in conduct permitted and participated by the employer; therefore, it was erroneous for the commission to conclude that (Engle) was not engaged in employment services because the employer did not expressly direct (Engle) to jump from the cliff," Crabtree wrote."

    This concept of advancing or furthering the interests of the employer is one that surfaces frequently as a determining factor whether an employee should be compensated for injuries that occur outside the normal place or time of work. Does the employer derive some benefit from the performance of the activity? What we refer to as "mandatory fun" - activities that an employer requires - are generally found compensable, even when they involve riding around in go-karts. If you don't want to own any resulting injuries, think twice about requiring the activity.

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    August 23, 2006


    Back in 1925, legislators in Arizona wrote the first workers compensation statute for that state. It's safe to say they had no idea that the absence of a single comma would send lawyers scrambling for clarification some 80 years later. The story involves workers comp coverage for illegal immigrants.

    "Mario Lopez" hurt his back moving furniture in 2001. He filed a claim for permanent disability benefits, which was denied based upon the lack of medical evidence. He appealed. It turns out that "Lopez" was really Jose Luis Gamez, an illegal immigrant. The court of appeals upheld the lower court's ruling, but in doing so, one of the three judges, Daniel Barker, filed a "special concurring opinion" that went much farther than the original denial. Barker, carefully parsing the original statute, concluded that the law did not include coverage for illegal immigrants.

    Here's the original wording of the statute: employees eligible for benefits include "aliens and minors legally or illegally permitted to work for hire." According to Judge Barker, the phrase "legally or illegally permitted to work for hire" refers only to minors. He believes that applying the phrase to "aliens" goes beyond the syntax and meaning of the statute. While not binding, his statements could lead others to deny benefits to undocumented immigrants solely on the basis of their being here illegally. Put a comma after "minors" and the problem goes away. Without the comma, the dependent clause "legally or illegally" might well be construed to apply only to minors.

    While the Insider has no desire to serve as grammar police, we think the judge has spent a few too many hours with the Chicago Manual of Style. If this nitpicking were to become public policy, Arizona would face a chaotic and very dangerous situation. Eliminating undocumented workers categorically from the comp system would lead, at a minimum, to the following:
    - the only recourse for injured workers without comp coverage would be to sue their employers
    - insurers could not include the payroll for undocumented workers in their calculation of premiums
    - Arizona employers would be tempted to hire undocumented workers simply to skimp on safety programs and lower the cost of doing business (some already do this anyway)
    - Arizona would create a second class workforce, leaving thousands of workers vulnerable to exploitation

    Give Me a Comma!
    Even though Judge Barker's "special concurrence" is not binding on lower courts, it surely muddies the waters. As a result, the state's leading workers' compensation insurer is asking the Arizona Supreme Court to settle whether illegal immigrants are eligible for comp benefits. The state fund wants the Supreme Court either to erase Barker's concurrence or issue its own ruling on the issue. The fund, along with the state Industrial Commission and an association of lawyers who represent injured workers, all argue that current state law protects illegal immigrants. They point to the fact that a recent bill to deny benefits to illegal immigrants was defeated in the state legislature.

    After three quarters of a century, the fate of hundreds, even thousands of workers hangs on a simple comma. Judge Barker's reading of the statute opens the proverbial can of worms, presumably with a comma-shaped opener. Let's hope the Arizona Supreme Court puts the lid back on the can, where it belongs.

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    July 28, 2006


    Julio Medina was a baker for the Panera Company. He routinely moved large racks of baked goods over a greasy, slippery floor. The employer provided "slip-resistant" shoes (which didn't work very well - they usually don't). After complaining to his supervisor about the slippery conditions, Medina, with a smirk on his face, lifted his right leg as if to kick a co-worker (who happened to be well out of kicking range). Medina slipped and fell, spraining his wrist and suffering a hernia.

    When Medina filed for workers comp benefits, his employer objected, saying that his horseplay (the feigned kick) was outside of the course and scope of employment. Panera pointed to the fact that they did not tolerate horseplay - any such activities were subject to disciplinary action.

    The ALJ and the Colorado Court of Appeals sided with Medina. In their thoughtful and clearly written opinion (PDF), they cited Professor Larson's four point test on horseplay, which examines:
    1. the extent and seriousness of the horseplay. [Medina's kick was very short-lived indeed];
    2. the completeness of the deviation - in other words, how far outside of the usual course of work did the horseplay extend [Medina's act was a direct extension of the work and the working conditions]
    3. the extent to which horseplay was a regular part of the work [the court found no reason to question Panera's contention that horseplay was generally not tolerated]
    4. the extent to which horseplay is expected in the work environment [some jobs are inherently playful; we might assume that baking bread is not].

    It's important to note that the four criteria are independent of one another; you don't need to demonstrate all four to achieve compensability. In Medina's case, compensability was probably determined solely in point number one: this was an unpremeditated and spontaneous act arising directly from his employment. The working conditions - slippery shoes and greasy floors - contributed directly to the injury. While Panera's appeal is understandable, there is no way that Medina loses this case.

    Horseplay vs. Humor
    There is an important distinction to be made between horseplay and humor in the workplace. It would be counter-productive, if not impossible, to stamp out every vestige of fun in the course and scope of the working day. Human nature requires a bit of comic relief, especially in jobs that are repetitive and boring. Humor can be a welcome relief - as long as it does not come at the expense of a class of employees - women, minorities, short people, obese people, etc. Humor often raises a number of concerns, but safety is not usually one of them.

    Horseplay, on the other hand, all too often crosses a line into immediate risk of harm to workers. Medina's injury was the result of a spontaneous and short-lived act. There's not a whole lot management could do to prevent the injury. When employees start goofing off in a workplace full of hazards, management needs to intervene as quickly and decisively as possible. Fun ends abruptly when horseplay results in an injury. Just ask Mr. Medina.

    Special thanks for the heads up on this case to Michael Fitzgibbon, whose informative and well-written blog covers employment law from the perspective of the beautiful country to our north.

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    June 9, 2006


    Last July we blogged the story of Michael Forman, a suffolk County policeman who had been indicted for workers comp fraud. He was charged with illegally collecting $250,000 in worker's compensation while climbing the ranks of the Bethpage Volunteer Fire Department. Disabled by "excruciating pain" in his wrist, he nonetheless was able to respond to hundreds of fire calls. In a stark demonstration that the wheels of justice can turn in unexpected ways, Forman was recently acquitted of all charges by a jury that deliberated for just three hours. When we examine the details, as provided by Julia Mead in the New York Times, perhaps the acquittal is not so surprising.

    Forman had told police doctors that he was in so much pain that he could not drive or pick up objects. A surveilla