West Fraser, Inc. v. Windell Caldwell, Sr.

On January 13, 2012, the Alabama Court of Civil Appeals released an opinion wherein it reversed a Trial Court’s finding of compensability. The matter was bifurcated at the trial court level and the issue of compensability was tried first. At trial, the employee testified that he hurt his back on December 17, 2009. Although he went to the doctor, the medical records did not indicate a workers’ compensation injury. Rather, the records indicated that the employee had been experiencing the problems for one week. The employee denied making that statement. The employee returned to a different doctor on December 19, 2009 and the records from that visit revealed that the employee denied an injury. The employee testified that he must have been misquoted. On December 21, 2009, the employee returned to the doctor for the third time and, this time, he referenced an injury date of December 21. The next day, the employer received a letter from the employee’s attorney which, according to the employer, was its first notice of an injury. Although his orthopedic surgeon initially opined that the plaintiff’s complaints were consistent with his work injury allegations, he backed off that testimony when confronted with the above mentioned medical records. In addition, the employer’s witnesses testified that the employee did not follow proper reporting procedures. In finding in favor of the employee, the Judge relied heavily on the employee’s exemplary work history.

In reversing the Trial Court opinion, the Court of Appeals relied on the fact that the employee repeatedly indicated to his doctors that his injury was not work related before changing his tune on the third visit. In a footnote, the Court indicated that it recognized the possibility that two separate medical providers on two different occasions could make the same error on two separate days. However, it further noted that the law in Alabama does not allow an employer to be held liable on a mere possibility.

Hale v. Hyundai Motor Manufacturing Alabama, LLC (hereinafter HMMA)

On January 6, 2012 the Alabama Court of Civil Appeals released an opinion on the issue of collateral estoppel in a retaliatory discharge case based on the employee allegedly being terminated due to his filing a workers’ compensation claim. The Trial Court granted summary judgment in favor of the HMMA and Hale appealed. On appeal Hale argued that HMMA is estopped from arguing the discharge was due to misconduct because the unemployment board’s decision determined that the employee had not committed misconduct. The Alabama Court of Civil Appeals disagreed with Hale and affirmed the Trial Court’s ruling.

Hale was injured on the job and suffered from carpal tunnel syndrome. He underwent two surgeries and was returned to work at light duty. Subsequent to being released to light duty Hale missed nine days and took one day of bereavement leave. HMMA corresponded with Hale on numerous occasions indicating that he needed to provide documentation related to the nine absences and bereavement leave or it would result in his termination. Hale never provided documentation as requested and even admitted to this despite providing explanations. He was subsequently terminated on March 13, 2009 for violating HMMA’s absentee policy and violating the serious misconduct policy, which included serious and/or excessive violations of HMMA’s attendance policy and intentional misrepresentation or falsification of information regarding employment or reports to HMMA. Violation of the serious misconduct policy placed an employee outside the normal corrective action plan.

Hale sought unemployment benefits and on appeal it was determined, for purposes of unemployment, that Hale had not committed misconduct as defined by the unemployment statute: deliberate, willful or wanton disregard of the employer’s interests or of standards of behavior which the employer has right to expect of its employees. In making the determination the hearing officer stated that Hale had compelling reasons for the acts which he was discharged for. Therefore, the violation was not misconduct such that unemployment should be denied.

On appeal Hale asserted that the Supreme Court’s decisions in Wal-Mart Stores, Inc. v. Hepp, 882 So. 2d 329 (Ala. 2003) and Wal-Mart Stores, Inc. v. Smitherman, 743 So. 2d 442 (Ala. 1999) were controlling. In both of theses cases, the Supreme Court found that the employee was collaterally estopped from arguing he or she was discharge for a reason other than misconduct in a retaliatory discharge claim when they were found to be disqualified from unemployment benefits due to misconduct connected with their work. As such, Hale asserted that the "reverse argument is also true" barring HMMA from arguing that Hale was discharged for a legitimate reason because that reason was determined not to be misconduct that would disqualify Hale from receiving unemployment benefits. The Alabama Court of Civil Appeals disagreed because the issues are not identical due to the posture of the parties.

The Court of Civil Appeals ruled that the unemployment hearing officer found that Hale did not commit misconduct for purposes of unemployment-compensation statue: deliberate, willful or wanton disregard of the employer’s interests or of standards of behavior which the employer has a right to expect from its employees. However, that does not mean that Hale was not discharged for a valid reason under HMMA policies, HMMA’s reasons for the discharge were not legitimate and that HMMA terminated Hale for the sole reason that Hale filed a workers’ compensation claim. In Hepp and Smitherman, the unemployment decision found that the employee committed misconduct so there is a compelling conclusion that the employer had a legitimate reason for the termination. However, the reverse is not true. Alabama is an at-will employment state, so HMMA can terminated for any reason (aside from terminating solely because a filed a worker’s compensation claim), even if that reason does not amount to misconduct as defined in the unemployment context. As a result, HMMA is not collaterally estopped from asserting that Hale was terminated because he violated HMMA policies.

White Tiger Graphics, Inc v. Paul Clemons

On January 13, 2012 the Alabama Court of Civil Appeals addressed a judicial estoppel issue involving an employee claiming he was permanently and totally disabled during the same period of time he was receiving unemployment benefits. The Trial Court found that employee was permanently and totally disabled despite receiving unemployment benefits during the same period. The Alabama Court of Civil Appeals affirmed.

For judicial estoppel to apply the following criteria must be met: 1) a parties later position must be inconsistent with its earlier position; 2) the party was successful in the prior proceeding so that acceptance of an inconsistent position later would create perception that the first or second court was misled; and 3) the party asserting the inconsistent position would derive an advantage or impose an unfair detriment on the opposing party of not estopped. Hamm v. Norfolk So. Ry. Co., 52 So. 2d 484, 494 (Ala. 2010). The purpose being to protect the integrity of the judicial process by preventing parties from deliberately changing positions to suit there needs according to the circumstances. Id.

In order to received unemployment benefits the employee must be physically and mentally able to perform work of a character which he is qualified to perform by past experience or training. Ala. Code § 25-4-77 (a)(3). In order to received a permanent and total disability award the injury or impairment must permanently and totally incapacitate the employee from working and being retrained for gainful employment. Dolgencorp, Inc. V. Hudson, 924 So. 2d 727, 734 (Ala. Civ. App. 2005). This does not mean the employee is helpless, only unable to perform his or her trade and unable to obtain other reasonably gainful employment. Id.

The plaintiff testified at his hearing for unemployment benefits, that he felt like he was able to work, had tried to find work he was qualified for and would give it his best shot. The employer asserted that if the employee takes the position that he is able to work in order to receive unemployment benefits, the employee can not, at the same time, claim he is unable to perform his normal trade.

The Alabama Court of Civil Appeals found that an employee so limited that he can not perform services other than those that are so limited in quality, dependability or quantity that a reasonably stable market does not exist, may be classified as totally disabled. According to the Court of Appeals, this criteria would not be inconsistent with the employee saying he is willing and able to perform work he is qualified to do and give it his best shot. Therefore, the employee would not be judicially estopped from claiming he was permanently and totally disabled during the same time period he was receiving unemployment benefits because there is not an inconsistency.

In a concurring opinion, Judge Terry Moore opined that the employee’s testimony did create somewhat of a contradiction. However, since the employee testified that he was willing and able to give it his best shot, it could not be said that judicial estoppel precluded a finding that he could not work despite his best efforts. In addition, Judge Moore pointed out that the Alabama Worker’s Compensation Act does not address whether or not the receipt of unemployment benefits would prevent a permanent and total disability award or workers’ compensation benefits in general.

On January 13, 2012, the Alabama Court of Civil Appeals released its decision in the case of Goodyear Tire & Rubber Company v. Brian Haygood wherein it upheld the trial court’s ruling that Haygood was permanently and totally disabled due to pain in his foot. Under the "exceedingly high standard" previously set out in the case of Norandal U.S.A., Inc. v. Graben, pain can be used as a basis for removing an otherwise scheduled injury from the schedule when it is totally or virtually totally disabling to the body as a whole. To qualify as an exception to the schedule, the pain must be such that it completely or almost completely prevents the employee from engaging in physical activities with the uninjured parts of his body.

Haygood allegedly injured his foot while working at Goodyear in 2009, and sought permanent and total disability benefits. One of Haygood’s doctors stated that Haygood had pain of partially neuropathic origin, a milder version of complex regional pain syndrome (CRPS). Another of Haygood’s doctors had assigned a medical impairment rating of 10% to Haygood’s right foot, which the doctor translated to a 7% impairment to the lower extremity and a 3% to Haygood’s body-as-a-whole. At trial, Haygood testified that, due to pain from the injury which he consistently rated as a 9 or 10 on a scale of 1 to 10, he could not walk without a cane, he often cried, and had to lie down up to 23 hours per day. Haygood also testified to his inability to sleep, stand, drive, shop, ride his motorcycle, and do other things that he stated were routine in most people’s daily lives. The trial Court found that Haygood struggled with pain even while at rest and, as such, his CRPS-like pain prevented him from engaging in physical activities with the uninjured parts of his body. Based on this finding, the Court of Appeals affirmed the trial court’s ruling that Haygood was permanently and totally disabled due to pain that was totally or virtually totally disabling.

On January 13, 2012, the Alabama Court of Civil Appeals published its ruling in the case of ATI Alldyne v. Wiseheart. Gary Wiseheart was a mechanic who worked at ATI’s metal extraction plant in Huntsville, Alabama. On December 7, 2008, Wiseheart was allegedly exposed to hydrogen sulfide gas and later died. Wiseheart’s widow brought suit against ATI for death benefits and funeral expenses under the Alabama Workers’ Compensation Act.

At the center of the controversy were laboratory test results that purportedly showed significantly elevated levels of thiosulfate in Wiseheart’s urine on the day of the incident. ATI objected to the admissibility of the lab test results on the grounds that no chain of custody had been established between the hospital where the urine sample was collected and the Pennsylvania lab where the sample was tested. ATI also objected to the deposition testimony of the medical examiner who based her opinion that Wiseheart had died as a result of exposure to the gas, in part, on the lab test results. The trial Court admitted both the lab test results and the deposition of the medical examiner, and found that Wiseheart suffered an accidental exposure to hydrogen sulfide gas which caused or contributed to his death. On appeal, ATI asserted that the trial Court erred in admitting the lab test results and the deposition of the medical examiner and that it also erred in finding that exposure to the gas caused or contributed to Wiseheart’s death.

The Court of Appeals noted that even without the disputed lab test results, substantial evidence existed to support the trial Court’s findings that Wiseheart was exposed to hydrogen sulfide gas and that the exposure caused or contributed to his death. The medical examiner testified that she had not based her conclusion, that Wiseheart had died from exposure to the gas, on the disputed lab test results alone. Both ATI’s and Wiseheart’s expert medical witnesses testified that Wiseheart exhibited physical findings consistent with exposure to the gas, although both experts also acknowledged that the same physical findings could result from death by other means. The Court also pointed to other circumstantial factors, such as the undisputed testimony that plant operators reported a rotten egg-like smell prior to finding Wiseheart unconscious and that Wiseheart felt fine only hours prior to being found lying on the floor of the plant. Additionally, ATI’s medical expert acknowledged that even if Wiseheart was not exposed to high enough levels of the gas to kill him, he may have been exposed to high enough levels to cause distressful physical symptoms that could cause cardiac arrest.

The Court acknowledged that ATI presented substantial evidence at trial indicating that Wiseheart did not die from hydrogen sulfide poisoning. However, since the trial Court’s findings were supported by substantial evidence, the Court of Appeals declined to reverse the trial Court’s judgment simply because it may have decided the facts differently than the trial Court.

On January 13, 2012, the Supreme Court of Alabama released its opinion in Ex parte Wright Brothers Construction Company, Inc., and GIBCO Construction, LLC. This case presented an interesting issue on proper venue.

On 2008, the employee, Roger Whited, was involved in an accident at a quarry in Jefferson County. The quarry was owned by Wright Brothers and GIBCO. In 2010, Whited filed a lawsuit in Walker County against both parties to recover damages for his injuries. Whited claimed that venue in Walker County was proper because he was a resident of Walker County and that Wright Brothers had an affiliate, Walker County Rock Products ("WCRP"), based in Walker County. Wright Brothers moved for a change of venue based on the argument that it was a separate entity from WCRP and supported that contention with evidence and affidavits of its corporate secretary. The trial court denied Wright Brothers’ motion. Wright Brothers appealed the trial court’s decision.

The Supreme Court agreed with Wright Brothers’ arguments. The Court held that even if Wright Brothers was affiliated with WCRP, WCRP was not named in the suit. Therefore venue could not be based on WCRP’s presence in Walker County.

On January 13, 2012, the Alabama Court of Appeals released its opinion in Ex Parte Billy Barnes Enterprises. In this case, a female truck driver was injured in Mississippi in January of 2006. Her injury was deemed compensable and she received medical treatment and TTD payments, off and on, until May of 2009. In January of 2007, the employee filed suit in Washington County which is where she lived at the time she was injured. The employer asserted that venue was improper and offered evidence that the employee had moved from Washington County to Tallapoosa County in November 2006. The trial judge denied the employer’s motion for transfer of venue and a petition for Writ of Mandamus was subsequently filed.

The employer’s petition was based on the argument that employee’s claim did not accrue until after she reached MMI and received her last TTD payment in May 2009 at which time she lived in Tallapoosa County. That argument was based on statutory language referring to the commencement of the controversy and the commencement of the 2-year statute of limitation, both of which occurred in May 2009.

The Court disagreed with the employer’s position. According to the Court, the claim began accruing at the time of the injury and, therefore, venue was proper in Washington County.

On June 9, 2011, Governor Robert Bentley signed into law the controversial Beason-Hammon Alabama Taxpayer and Citizen Protection Act. This new law has left Alabama workers’ compensation laws as they apply to illegal aliens in a state of limbo.  Portions of the law have been enjoined by the United States District Court for the Northern District of Alabama and the Eleventh Circuit but the remaining sections raise some interesting issues.

Section 27 of the Act prohibits a court from enforcing a contract between a party and an illegal alien if the non-alien party has: 1) direct or constructive knowledge that the alien was unlawfully present in the USA at the time the contract is entered into; and 2) the performance of the contract requires the alien to remain unlawfully present in the USA for more than 24 hours after the time the contract was entered into or performance could not be reasonably expected to occur without remaining in the USA for over 24 hours.  Alabama law has consistently held that settlement agreements are contracts and, as such, future settlement agreements between illegal workers and employers may be voided by Section 27.  There is previous authority in Alabama that indicates a party should have constructive knowledge than an alien is unlawful if he invokes the Fifth Amendment right against self-incrimination in regards to citizenship questions or admits to not having a social security number.  See Cokely v. Cokely, 469 So. 2d 635 (Ala. Civ. App. 1985); Eagle Hosp. Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298 (11 Cir. 2009).  If a settlement agreement is subject to court approval and the approval will take more than 24 hours to receive, then the agreement would possibly fall under the second prong of Section 27.  It is unclear if Section 27 will ultimately be applied to invalidate settlement agreements under these conditions.

Additionally Sections 5 and 6 of the Act place restrictions on officers of the court from interfering with enforcement of the Act.  Due to the Act’s intended purpose of removing illegal aliens from the state, an attorney (as an officer of the court) could conceivably violate the Act by having an illegal alien appear at a deposition, trial, or mediation.  Similarly, judges (as officers of the court) could violate the Act by allowing an illegal alien to pursue claims in their courts. 

Although the new immigration law raises several new issues to be considered in the realm of workers’ compensation, the question of whether or not an illegal alien even has legal standing to pursue a workers’ compensation claim in Alabama remains unanswered.

On December 9, 2011, State Senator Arthur Orr (R-Decatur) pre-filed a bill (SB77) for the 2012 legislative session that proposes several welcome changes to the Alabama Workers’ Compensation Act. The following is a summary of the proposed changes:

1. The addition of § 25-5-57(a)(3)j - "In the event of an injury to an enumerated member under paragraph a. of this subdivision, evidence of an employee's pain complaints that are limited to that member may not be relied upon by the trial court as the sole basis for an award of compensation benefits beyond those otherwise available for the loss, or loss of use, of that body part as provided under paragraph a. or d. of this subdivision."

Plain English:

The trial judge cannot consider complaints of pain from a scheduled member as a reason to remove the injury from the schedule.

My Two Cents:

This probably amounts to a non-issue since the current pain exception is exceptionally high. As the law now stands, an employee has the burden of proving that his pain is totally or virtually totally disabling in order to remove his injury from the schedule.

2. The following sentence will be added to § 25-5-57(a)(4)a - "Notwithstanding the foregoing, the obligation of an employer to pay benefits based upon a permanent total disability shall continue during the permanent total disability of the employee, except that benefits based upon permanent total disability shall otherwise terminate upon either the date of the employee's sixty-fifth birthday or the date 500 weeks after the date of injury, whichever is longer."

Plain English:

Permanent and Total benefits are cut off at the age of 65.

My Two Cents:

This makes a lot of sense. The employee continues to receive benefits in the form of Social Security and the cost for workers’ compensation goes down. This will make Alabama more attractive to businesses which will create more jobs and help improve the economy.

3. § 25-5-68 will be changed to increase the maximum compensation payable for permanent partial disability to $240 (from $220).

Plain English:

I can’t put it any plainer than that!

My Two Cents:

This is the first increase since 1985 and represents an olive branch to those who might oppose other aspects of SB77.

4. The addition of § 25-5-77(j) - "If the employee does not receive medical treatment related to the claimed injury for a period of two years, a rebuttable presumption arises that any subsequently obtained medical treatment is unrelated to the workers' compensation injury. The employer shall be liable for such medical treatment only upon a finding of clear and convincing proof that such treatment is related to the workers' compensation injury. The obligation of the employer for the payment of medical benefits shall conclusively end if the employee does not receive medical treatment related to the claimed injury for a period of four years."

Plain English:

Two years with no medical treatment means any subsequent treatment is probably not related to the worker’s compensation injury. Four years with no medical treatment means any subsequent treatment is definitely not related to the workers’ compensation injury.

My Two Cents:

As a practical matter, an employee will probably just need to see his or her authorized treating physician for a check up every couple of years to avoid medical benefits closure. If this bill is passed, I predict that there will be litigation over the definition of "medical treatment." In other words, if the employee checks out fine and the doctor does not actually provide any treatment, does that satisfy the § 25-5-77(j) requirement for avoiding the closure of benefits?

5. § 25-5-81(e)(2) will be changed to allow the Court of Civil Appeals to reweigh the evidence considered by the trial court. The actual language is as follows: "In reviewing pure findings of fact, the finding of the circuit court shall not be reversed if that finding, when weighed against evidence in opposition, is supported by substantial evidence."

Plain English:

The Court of Civil Appeals will be able to consider the evidence on its own rather than simply deferring to the trial judge.

My Two Cents:

Check out our blog posting from 2 days ago entitled "Verdict of Employer Reversed due to Inconsistencies in Medical Records" and tell me that the Court is not already doing this.

The 2012 legislative session begins on February 7^th so stay tuned. We will continue to monitor the progress of the bill and report on any new developments.

The Alabama Court of Civil Appeals recently released its opinion in the case of Johnson v. Lowe’s Home Centers, Inc. wherein it reversed the trial court’s verdict if favor of the employer.

The employee, Johnson, alleged that he injured his back while working at Lowe’s in May 2008. Johnson went to the emergency room the morning of Friday, May 16, 2008, and the medical records indicate that Johnson stated he "lifted something on Monday which started the problem" and had an "increase in pain after lifting on Thursday." Another page of the emergency room record stated "lifting heavy object at work, pain x 3 days." The emergency room report also reported the accident was a "home accident" and that the nature of the accident was "lifting crate/back injury" on May 14, 2008 at 5:30 pm. Johnson’s time clock records proved that he did not work on the Monday prior to the emergency room visit, but that he was at work at 5:30 pm on Wednesday, May 14. Johnson filled out a First Report of Injury form on Monday May 19, 2008, where he stated that he hurt his back while stocking toilets on Wednesday May 14, 2008. A subsequent medical record from Dr. Tai Chung indicated that Johnson told him that he hurt his back while lifting a heavy bucket of tools - a statement Johnson claimed was a misprint.

Johnson testified at trial, as did the corporate representative of Lowe’s, Johnson’s supervisor, and one of Johnson’s co-workers. After hearing the evidence, the trial court found that Johnson’s testimony and statements to his doctors about how the injury occurred were not credible and, therefore, found that the alleged injury was not compensable. However, on appeal, the Court of Appeals found that some of the evidence presented by the employer lacked credibility. In its decision, the appellate court pointed to a letter from Dr. Chung to the workers’ compensation adjuster in which the adjuster’s name was misspelled, and Dr. Chung’s medical records which sometimes misspelled Johnson’s name and incorrectly referred to Johnson as "her" or "herself". Based on this, the Court of Appeals determined that the Circuit Court’s factual findings were not supported by substantial evidence, and reversed its ruling.

MY TWO CENTS:

Under the standard of review provided by § 25-5-81 of the Alabama Workers’ Compensation Act, pure findings of fact made by the trial court shall not be reversed if they are supported by substantial evidence. It is well established under Alabama law "that the trial court is in the best position to observe the demeanor and credibility of the employee and other witnesses in a workers’ compensation case." See, Mayfield Trucking Co. v. Napier, 724 So. 2d 22 (Ala.Civ.App. 1998). In this case, the appellate court essentially re-weighed the credibility of the witnesses and evidence instead of deferring to the trial court. This is a very unusual circumstance.

A lesson to take away from this case is that, if you intend to rely on medical records as evidence, any inconsistencies or clerical errors in the records should be addressed with the doctor and resolved prior to trial.

Membership in the AWCO offers a number of professional and social opportunities annually to interact with other workers' compensation personnel. The highlight of the year is the annual AWCO Spring Conference where workers' compensation professionals come together for three days for education and fellowship. Remember that in order to attend the AWCO Spring Conference for free, your application and payment must be received no later than January 20, 2012.

On November 23, 2011, the Federal Motor Carrier Safety Administration and the Pipeline and Hazardous Materials Safety Administration recently issued a joint rule prohibiting interstate commercial truck and bus drivers from using handheld cell phones while operating their vehicles. Violation of this rule can result in federal civil penalties of up to $2,750 for each offense and, in cases where there are multiple violations, possible disqualification from operating a commercial motor vehicle. In addition, states will suspend a commercial driver's license after the driver has committed two or more serious traffic violations. Employers of interstate commercial truck and bus drivers can be penalized up to $11,000 if they allow their drivers to use handheld cell phones while driving.

To view the final rule, go to www.regulations.gov; the docket numbers are FMCSA–2010-0096 and PHMSA-2010-0227.

My Two Cents:          Although this new rule applies only to interstate commercial truck and bus drivers, all employers should have rules against distracted driving. Having such a rule and enforcing same can provide employers, at least to some extent, protection from liability and also provide a valuable defense in the realm of workers’ compensation. In Alabama, indemnity benefits can be denied if a workers’ compensation accident/injury results from an employee’s failure to follow a safety rule.

The Alabama Department of Industrial Relations (ADIR) requires all workers’ compensation adjusters to complete 8 hours of Continuing Education (CE) per calendar year. The hours must be completed in person within the borders of Alabama. Medical only adjusters are exempt from this requirement. In addition to the CE requirements imposed by the ADIR, depending on whether or not the adjuster is handling claims for a private insurer, a self insured entity, or handling claims as an independent adjuster, he or she may also have to satisfy the licensing requirements of the Alabama Department of Insurance (ADOI).

The Missouri Court of Appeals recently upheld a trial court's ruling that an occupational disease does not fall within the exclusivity provisions of the Missouri Workers' Compensation Code. In KCP&L Greater Missouri Operations Co. v. Cook, WD73462 (Mo.Ct.App.2011), the Court held that the WC exclusivity provisions apply only to accidents in the workplace. An accident is defined by the Missouri Code as an "unexpected traumatic event or unusual strain identifiable by time and place of occurrence and producing at the time objective symptoms of an injury caused by a specific event during a single work shift." Since the Missouri WC exclusivity provisions are only applicable to accidents, and occupational diseases do not fall within the Code's definition of accidents, the Court held that an employee could seek recovery for an occupational disease under WC or common law.

My Two Cents:

This issue will not likely ever raise its ugly head in Alabama due to the language in the Alabama Workers’ Compensation Code. Ala. Code Sections 25-5-52 and 25-5-53 specifically incorporate occupational diseases into the Workers' Compensation Code's exclusivity provisions. Therefore, whether the injury is the result of an accident or occupational disease, the exclusivity provision of the Alabama Worker’s Compensation Code would apply.

A hospice nurse in Virginia was recently awarded workers’ compensation benefits after she was involved in a motor vehicle accident while on call.

The hospice nurse worked on call during the weekends and court records showed that her employer mainly contacted her via pager. When the pager did not work, which was common, her personal cell phone served as a backup means of contact. During her on call days the nurse used her cell phone exclusively for work purposes, going so far as to tell her friends and family to call her husband if they needed to get in touch with her.

The accident occurred when her cell phone rang and she momentarily looked down, assuming her employer was trying to contact her. The distraction caused her to drive the vehicle off the road and strike an adjacent embankment. Due to this unique set of facts, a Virginia court stated that her response to the call was the result of her attentiveness to the distinct requirements of her job, specifically monitoring her cell phone for employer communications. Therefore, there was a “causal connection between the claimant's injury and the conditions under which the employer required the work to be performed,” the court ruled.

My Two Cents:

In Alabama, a worker's failure to follow a safety regulation provides a defense to paying indemnity benefits (but not medical benefits). In order to take advantage of this defense, employers must have "anti-distracted driving" rules as part of their safety policy. For example, employers could require employee's to pull over before using their cell phones, GPS, or other electronic devices.
 

On October 14, 2011 the Alabama Court of Civil Appeals released its opinion in Lewis v. Alabama Power Company (APCo) addressing the factors considered when determining if a company is a "special employer" for purposes of the exclusivity provision in the Alabama Worker’s Compensation Act. The Court of Appeals reversed the Trial Court’s ruling which granted APCo’s summary judgment motion.

Lewis was employed by Fluor Maintenance Services (Fluor) to perform work at the APCo Barry Steam Plant. (Lewis reached a settlement of his worker’s compensation claim against Fluor and proceed with his negligence and wantonness claim against APCo, who was made a defendant in the place of Southern Company Services (SCS) by agreement). Fluor entered into a labor broker agreement with SCS to provide laborers to perform construction services at the plant. SCS is a separate entity from APCo but acts as an agent for APCo and signed the agreement with Fluor as APCo’s agent. Pursuant to the labor broker agreement, Fluor provided workers’ compensation insurance for its employees but this cost was added into the fee that SCS paid Fluor for providing the laborers. Lewis signed a "project rules document" that stated he would be subject to the direction, control and the supervision of SCS and Fluor. APCo was mentioned in the "project rules document" but not in regards to supervision and control. Lewis testified at his deposition that he was provided instruction by a Fluor employee and he saw APCo and SCS as "one and the same."

APCo asserted that SCS acted as its agent when entering in to the labor broker agreement, APCo paid for the cost of the worker’s compensation insurance secured by Fluor, APCo kept up with Lewis’ hours and reimbursed Fluor for the paycheck it issued, and under the broker agreement APCc had the right to control and supervise work performed by Fluor employees and the right to deny Fluor employees readmission into the plant.

Lewis asserted the SCS entered into the agreement with Fluor, not APCo, that the agreement indicated SCS had the right to supervise and control the work done by Fluor, the project rules document indicated SCS had the right to supervise and control, not APCo, work instruction came from a Fluor employee, not SCS or APCo, and he never consented to enter into an employment agreement, expressed or implied, with APCo

The Court of Appeals stated that to determine if an employer is a ‘special employer" for purposes of the exclusivity provision they must, for all practical purposes, be considered the primary or co-employer of the employee. This involves a three prong test: 1) "the employee has made a contract of hire, expressed or implied, with the special employer;" 2) "the work being done is essentially that of the special employer;" and 3) "the special employer has the right to control the details of the work." In order to be a special employer all three of these must be met. In this case the Court only reviewed the first prong in coming to its decision.

In order to determine if there was a contract for hire the Courts usually insist that there be a showing of deliberate and informed consent since this could result in a bar to a common-law suit. The Court of Appeals stated that the rules document signed by Lewis did not provide sufficient notice to Lewis that SCS was acting as an agent of APCo in order to establish deliberate and informed consent. In addition, Lewis’ deposition testimony only indicates that he thought SCS and APCo were one an the same at the time of his deposition, not at the time he signed the document. Therefore, at the very least a genuine issue of material facts exists in regards to an expressed contract for hire.

In order to determine if there was an implied contract for hire, the Court of Appeals looked to four factors: 1) "whether the employee submitted to the control and supervision of the special employer;" 2) "whether the general employer was acting as a labor broker or a temporary employment agency for the special employer;" 3) "which entity provided the workers’ compensation insurance;" and 4) "whether the employment with the employer was of such duration that the employee could be reasonably presumed to have evaluated and acquiesced in the risks of his employment."

As to the first factor, the Court of Appeals found that all the evidence indicated that SCS and/or Flour had the right to supervise and control Lewis’ work, not APCo. In regards to the second factor, the Court of Appeals found that the labor broker agreement stated that Fluor was providing laborers to SCS, not APCo. The Court of Appeals noted that the labor broker agreement indicated that SCS was acting as APCo’s agent but there was no indication Lewis was aware of this. In looking at the third factor, the Court of Appeals agreed that APCo indirectly paid for the workers’ compensation insurance. As for the fourth and final factor, the Court held that three months might be sufficient in some cases but with these facts it was not enough time for Lewis to know that the risk of employment involved employment by APCo.

In light of all these facts, the Court of Appeals held that there was at least a genuine issue of material fact as to whether or not an implied contract for hire existed and remand the case to the Trial Court for further proceedings.

On October 7, 2011, the Alabama Supreme Court upheld the Alabama Court of Civil Appeals’ decision in Ex parte Scott A. Cascaden (see August 5, 2011 blog article). The Supreme Court denied Cascaden’s Petition for Writ of Certiorari, with no opinion. This ruling confirmed that an employer is not required to prove that it relied upon an employee’s written misrepresentation as to his physical condition in order to prevail on the misrepresentation defense defined in § 25-5-51 of the Alabama Workers’ Compensation Act. Instead, the employer only has the burden of showing that (1) at the time of or in the course of entering into employment or at the time of receiving notice of the removal of conditions from a conditional offer of employment, the employee knowingly and falsely misrepresents, in writing, his physical or mental condition; (2) the condition is later aggravated or reinjured in an accident arising out of and in the course of his employment; and (3) the employer provided the employee with the following written warning in bold type print, "Misrepresentations as to preexisting physical or mental conditions may void your workers' compensation benefits." However, it is important to point out that this defense does not relieve the employer of its liability to provide reasonably necessary medical treatment for an otherwise compensable accident, because the misrepresentation defense only applies to "compensation", which encompasses indemnity and vocational retraining benefits.

Recently in a case in Arkansas dealing with the Longshore and Harbor Workers' Compensation Act, a Federal Court ruled that Medicare’s interests were considered and protected based on a Medicare Set-Aside (MSA) allocation despite the fact that the settlement was over the $25,000.00 threshold and the Center for Medicare and Medicaid Services (CMS) refused to review it.

Evidence before the court showed that the Medicare vendor who prepared the MSA had repeated conversations and correspondence with CMS representatives who decided not to review the MSA submission. However, the value of the settlement ($1,000,000.00) clearly exceeded the $25,000.00 threshold. The Court stated:

“It is apparent to the Court from the aforereferenced CMS correspondence and affidavit from attorney (for Medicare vendor) that regardless of the details and potential deficiencies in the original submission, that CMS has decided it will not, for whatever reason, review or reconsider the proposed MSA, which response or lack thereof potentially jeopardizes what otherwise appears to be a reasonable settlement in the best interests of Billy Smith to accept and complete.”

After further review of the evidence, the Court found that the parties had done all that was reasonable and prudent and within their ability and authority to do to protect Medicare's potential interest in the settlement. As such, despite the lack of CMS review of a settlement above the $25,000.00 threshold, the Court held that Medicare’s interests were protected.

Read the full opinion here: Smith v. JLH Marine Terminals Of Arkansas

Ex parte El Reposo Nursing Home Group, Inc.

On September 16, 2011, the Alabama Court of Civil Appeals released this opinion wherein it denied the employer’s petition for a writ of mandamus. At the trial court level, the matter was bifurcated and, following a trial, the judge issued an order finding the employee’s back injury and resulting pain compensable. As a result, the employer began paying for the employee’s medical care. During the course of the employee’s treatment, two authorized treating physicians agreed that pain management was necessary but that the pain was not related to the job injury. One of the doctors testified at deposition that, because the employee had the pain prior to the work accident, that the pain management should be paid by the employee’s private health insurance rather than by the employer. Despite the opinions of the doctors, the trial judge ordered the employer to pay for the treatment. The employer then filed a petition for a writ of mandamus asking the Court of Appeals to order the trial judge to reverse his order. The Court of Appeals denied the petition because the opinions of the doctors regarding causation were rendered irrelevant by the judge’s previous order which related the pain to the job injury.