Case Law Update

BCPWQ Seminar

 March 18, 2016

CAUSATION

ARISING OUT OF – WORK TRAVEL

Salenbien v. Arrow Uniform Rental Limited Partnership, 2015 ACO #5. This matter arose out of a motor vehicle accident that occurred when an employee was traveling on company business. Prior to the motor vehicle accident, Plaintiff was travelling to meet with a potentially large client. Following the business meeting, Plaintiff was involved in the motor vehicle accident. There was a question of fact with regard to where Plaintiff was traveling to at the time of the accident. The original magistrate found the accident did not occur in the course of and arise out of employment, noting there was insufficient evidence to determine whether Plaintiff was on his way to the office, on his way home, or going to some other non-work location. The Appellate Commission upheld the decision of the Magistrate. However, when appealed, the Court of Appeals found Plaintiff met his burden of proving he was traveling back to his employer’s office at the time of injury. The Court of Appeals did NOT determine the ultimate issue of whether Plaintiff met his burden in proving the accident occurred in the course of and arose out of his employment activities. On remand, the Commission held that the accident did not arise out of Plaintiff’s employment activities. The Commission noted a four-point test to determine whether an incident that occurs on the way to or from work is covered under the Act: (1) Whether employer paid for or furnished employee transportation; (2) Whether the injury occurred during or between working hours; (3) Whether the employer derived a special benefit from the employee’s activities at the time of the injury, and; (4) Whether the employment subjected the employee to excessive exposure to risks. The Commission stated there must be some type of nexus between the alleged injury and Plaintiff’s work. An injury is not compensable just because it occurs while traveling on company business; that may establish it occurred in the “course of” employment but is not dispositive of the issue of “arising out of.” Because Plaintiff failed to meet his burden of proof by a preponderance of the evidence, they held the injury was not compensable.

ARISING OUT OF – WILLFUL MISCONDUCT

Ochodnicky v. BCNM Structured Employment, (Board of Magistrates, April 28, 2015). In this case, Plaintiff alleged injuries to his jaw and head, claiming to have been assaulted while employed by Defendant. The Defendant entered a defense of willful misconduct on the part of Plaintiff, arguing Plaintiff engaged in a fight with a co-worker regarding whether the co-worker was performing his job appropriately and whether he should have to stay at work beyond the time he wished. The evidence revealed Plaintiff was not the aggressor, but rather, was attacked by the co-worker. Nevertheless, Plaintiff was terminated for participating in the fight, consistent with company policy. The Magistrate advised that the general rule is, if an assault is unconnected with the employment and is motivated by personal reasons, it usually does not arise out of the employment. Because the fight in this situation was certainly connected to a work issue, it arose out of the employment. Further, the Magistrate found that the company policy puts employees at risk, as it punishes even those who are defending themselves. Accordingly, this company policy was not a basis for willful misconduct. According to the Magistrate, an employee who is attempting to avoid or minimize risk or injury from risk should not be barred from worker’s compensation benefits. Because Plaintiff was determined not to be the aggressor, but was assaulted and simply defended himself, then he has not willfully proceeded to engage in misconduct sufficient for termination. The Magistrate held that self-defense will not be willful misconduct in this situation and thus, Plaintiff was deemed disabled for a specified closed period.

ARISING OUT OF – HORSEPLAY

Kofaan v. Braile Mini Mart, (Board of Magistrates, July 13, 2015). The claim arose out of an Application filed by the estate of the decedent employee. The Application alleged the decedent died as a result of a gunshot wound to the head in the course of his employment at a gas station. However, it was later discovered the decedent was participating in the activity of Russian Roulette when he shot himself in the head. The Magistrate held the work-related incident did not arise out of and in the course of employment. The Magistrate found that this was a clear case of horseplay. An injury is compensable if it results from the work itself or from the stresses, tensions, or associations of the work environment. Russian Roulette is not an activity that one can reasonably expect to engage in during work hours. The Magistrate referenced the 4-point test adopted to determine when horseplay has gone so far as to remove the incident from the course of employment: (1) the extent and seriousness of the deviation; (2) the completeness of the deviation; (3) the extent to which the practice of horseplay had become an accepted part of the employment, and; (4) the extent to which the nature of the employment maybe expected to include some horseplay. The Magistrate found the activity of gunplay/Russian Roulette is outside the scope of employment, and fails every point of the aforementioned test. Therefore, Plaintiff was entitled to no benefits under the Act.

CASUAL RELATIONSHIP – PATHOLOGICAL CHANGE

Opatrny-Smith v. Michigan State University, 2015 ACO #18. In this case, Plaintiff allegedly suffered breathing problems and chemical sensitivity due to the presence of mold or asbestos in the workplace. However, there was no evidence in the record that supported a pathological change in Plaintiff’s condition, nor was there a medically distinguishable condition, as required under Rakestraw. The only evidence in the record was Plaintiff’s testimony, as well as the testimony of Plaintiff’s treating physician. However, the Magistrate stated he did not find Plaintiff’s testimony to be credible. Further, the Magistrate declined to accept the treating physician’s testimony. Despite the lack of evidence, the Magistrate granted a closed award to Plaintiff. Generally, a Magistrate’s findings will be affirmed if they are supported by the evidence. However, on appeal, the Commission reversed the Magistrate’s decision, finding the evidence could not support a finding of a disability. In addition, Plaintiff’s choice not to look for work did not satisfy her legal responsibility. Thus, the Commission held Plaintiff did not suffer an injury arising out of and in the course of her employment resulting in disability and wage loss.

CASUAL RELATIONSHIP – ARTHRITIS

Thommen v. Delta Tube & Fabricating Corp., (Court of Appeals, April 23, 2015). In this case, Plaintiff injured his left foot in 1984 when a heavy object fell on it. The foot was corrected by surgery, but due to the absence of medical records from that time, the extent of the damage or precise nature of the injury to the foot at that time was unknown. Decades later, Plaintiff developed arthritis in his left foot. Testing revealed the claimant suffered from a Lisfranc injury, which may be caused by a crush injury, and may cause arthritis. However, it was not known whether the Lisfranc injury was in-fact sustained in 1984. Nevertheless, Plaintiff alleged the subsequently diagnosed arthritis was caused by the 1984 injury. The Magistrate agreed and ruled in Plaintiff’s favor. The Appellate Commission reversed, finding the evidence provided no foundation to link the 1984 injury to the arthritis.  The Court of Appeals held that, without evidence establishing that the 1984 injury resulted in the Lisfranc injury, it could not be determined that the arthritis was causally related to the 1984 crush injury. Due to the lack of a causal connection between plaintiff’s 1984 injury and his present arthritic condition, the Court of Appeals affirmed the Commission’s denial of benefits.

PROXIMATE CAUSE – SEVERANCE AGREEMENT

Williamson v. General Motors, LLC, 2015 ACO #14. In this case, Plaintiff was employed with restrictions for work-related carpal tunnel syndrome. While continuing to work, she signed a special attrition agreement, or severance package, which called for her to work through a specific date. Plaintiff testified on the record she had fully intended to work until the date specified in the agreement. However, after signing the attrition agreement, and before the severance date, Plaintiff was reinjured and precluded from performing her job with the Defendant. Benefits were paid through the date of severance and then disputed. The Defendant argued that, because plaintiff accepted the special attrition agreement, and then was rehabilitated, she could not subsequently prove post-injury wage loss. The Magistrate disagreed and granted an open award of benefits. The subsequent appellate process, along with evolving case law, resulted in remand to assess whether Plaintiff had sustained total or partial disability. The Magistrate found Plaintiff had proved partial disability. However, he also found Plaintiff had proven an inability to secure any work within her capacity to perform, resulting in an unreduced award of benefits.  The Commission affirmed the Magistrate’s findings, ruling that Plaintiff fully established she intended to continue working at another job following her severance. Generally, a plaintiff must introduce evidence to allow the WCAC to find, absent the injury, she would have reentered the workforce after her retirement. Plaintiff presented evidence she had conducted a good faith-job search that did not produce a job offer.  Therefore, Plaintiff proved her wage loss was attributable to her injury.

PROXIMATE CAUSE OF WAGE LOSS – EMPLOYER OUT OF BUSINESS

Shaw v. Eaton Corp., 2015 ACO #11. In this case, Plaintiff suffered a work-related injury that resulted in an open award of benefits. Several years later, the Defendant filed an Application – Form C, claiming the Defendant’s plant subsequently closed, and because of that, any wage loss incurred was attributed to the plant closing and not to Plaintiff’s claimed disability. The Magistrate found Plaintiff’s testimony and the evidence presented established that his condition had remained the same since the injury. There was no evidence to support a finding there was another reason or event which was the cause of his total disability. Because Plaintiff’s condition had not improved, the Magistrate found he remained totally disabled and the disability remained related to his original work injury. As such, Plaintiff had a continuing, total loss of his wage earning capacity and was entitled to ongoing wage loss benefits and medical benefits. The Commission upheld the Magistrate’s decision, finding it was supported by the evidence presented.

DISABILITY

WAGE EARNING CAPACITY – ENGAGING IN CRIME

Omian v.Chrysler Group, LLC, (Court of Appeals, February 26, 2015). In this case, Plaintiff qualified for workers’ compensation benefits because of a back injury sustained while working for Defendant. However, after Plaintiff was incarcerated for participation in federal crimes, Defendant filed a petition to stop Plaintiff’s benefits. Defendant argued Plaintiff demonstrated physical and mental abilities to earn money, contrary to his claim of ongoing disability. Plaintiff countered that his involvement in a criminal enterprise did not prove he was capable of performing physical labor commensurate with his previous ability or employment. The Magistrate admitted evidence of Plaintiff’s indictment, establishing the conviction by a guilty plea and sentencing to 30 months’ imprisonment. However, the Magistrate refused to consider evidence of the circumstances underlying the indictment, such as Plaintiff’s bank records or statements by co-conspirators, finding it did not directly relate to Plaintiff’s guilty plea. Despite this evidence, the Magistrate found Plaintiff had not recovered from his work-related disability. He found Defendant failed to demonstrate by a preponderance of evidence that Plaintiff had recovered from his disability. The Commission affirmed the Magistrate’s decision, finding it was supported by the evidence, including the criminal convictions the Magistrate took into consideration. The Court of Appeals disagreed, and found the Magistrate did not address the relevance of the facts underlying the indictment. For example, Plaintiff’s bank activities could have established the criminal activities rendered Plaintiff capable of earning wages. The Court remanded the case for proper consideration of all relevant evidence.

PARTIAL DISABILILTY – JOB SEARCH EFFORTS

Rajski v. Capitol Transit, 2015 ACO #15. In this case, Plaintiff sustained significant injuries in the course of his employment with Defendant, resulting in lumbar spine surgery. After several years of treatment, Plaintiff was evaluated by an IME physician at the request of the Defendant. The IME physician imposed light duty restrictions, thus allowing Plaintiff to return to employment. This opinion contradicted those of two of Plaintiff’s physicians, who had restricted Plaintiff from engaging in any employment activities. Despite that, vocational evaluations and subsequent testimony of two experts established Plaintiff retained the ability to earn wages of $8.00 per hour, or $320.00 per week, resulting in a partial disability if the IME physician’s opinion was controlling. The evidence also established Plaintiff did not put forth a significant effort in seeking employment within his capacity. The Magistrate concluded Plaintiff did sustain a work-related injury, which caused a limitation of his maximum earning capacity. However, based on Plaintiff’s obvious lack of effort in seeking employment, the Magistrate found that, subsequent to the date when light duty restrictions were imposed, Plaintiff was only partially disabled. The Commission found the Magistrate’s decisions was supported by the evidence and affirmed his holding.

FAILURE TO PROVE DISABILITY (STOKES) – JOB SEARCH EFFORTS

Hammond v. Michigan Dept. of Corrections, (Court of Appeals, November 10, 2015). In this case, Plaintiff was working as a nurse in a prison when she was attacked by a prisoner. Thereafter, she began having severe panic attacks and stopped going to work. Plaintiff then filed an application for benefits, claiming she was unable to perform any work due to post-traumatic stress disorder (PTSD). Plaintiff presented deposition testimony of her psychologist and therapist, both of whom diagnosed her with severe and chronic PTSD as a result of the attack, which completely disabled her from working. Defendant offered testimony of a psychiatrist and psychologist, both of whom imposed specific restrictions regarding working in a prison setting or in isolated settings, but allowed Plaintiff to return to work without restrictions in the field of nursing. Both of Defendant’s witnesses testified Plaintiff had preexisting anxiety and mental health issues. The Magistrate found the testimony of the Defendant’s witnesses to be persuasive. The physicians found Plaintiff was capable of working in a different setting as a nurse. Therefore, the Magistrate found Plaintiff was not totally disabled or so severely impaired that she could not do any work. Based on that, the Magistrate further determined Plaintiff failed to establish any form of disability because she admitted she had not looked for alternative work since the attack. The Court affirmed the Magistrate’s decision, holding the Magistrate’s findings were supported by the evidence. Further, Plaintiff did not introduce any evidence identifying what jobs she was qualified and trained to perform, and she admitted that she did not look for any alternative post-injury employment.

WORKERS’ COMPENSATION BENEFITS

SPECIFIC LOSS BENEFITS – LOSS OF USEFULNESS

Pudvan v. Midland Cogeneration Venture, 2015 ACO #4. The claimant here sustained a torn right medial meniscus in the course of his employment on August 27, 2010. Plaintiff eventually underwent a right total knee arthroplasty in April 2011. Based on the evidence, the Magistrate held Plaintiff sustained his burden of proof in establishing he suffered an injury to his right knee on August 27, 2010. However, the main issue was whether the injury, which required a total knee arthroplasty, resulted in a specific loss of the right lower extremity, thus entitling Plaintiff to specific loss benefits. The Magistrate held that to find a specific loss, Plaintiff must establish he “lost the usefulness” of his right lower extremity as a result of the work-related injury, and this loss of usefulness must occur prior to his right knee arthroplasty. In this case, because Plaintiff continued working from the date of his injury until the day before his surgery, drove himself to work, and continued performing his regular duties, the Magistrate found Plaintiff had not sustained his burden of proof regarding the specific loss of his right lower extremity. The Commission agreed, holding that a knee replacement alone is insufficient to establish a specific loss and that the “loss of usefulness” must occur before surgery occurs.

MEDICAL BENEFITS – ATTENDANT CARE

Moore v. Detroit Board of Education, (Board of Magistrates, 2014). In this case, Plaintiff sustained significant physical and psychological injuries as a result of a work-related injury. Her physician authorized attendant care services at least eight hours per day, seven days per week. Plaintiff’s daughter testified she provided attendant care services for her mother for approximately 15 months.  She prepared a summary detailing the services she helped her mother with, which included the hours and the days the services were provided. The Magistrate noted that an employer is responsible for “reasonable medical, surgical and hospital services and medicines or other attendance or treatment…” Therefore, although the employer is responsible for necessary attendant care, that care does not include household tasks, such as house cleaning, preparation of meals and washing and mending of clothes. Bathing, dressing, and escorting a disabled person are examples of attendant care. In this case, Plaintiff’s daughter testified to spending several hours a day assisting her mother with activities such as bathing, dressing, checking blood pressure, assisting with medication and taking Plaintiff to the doctor. However, in addition she included cooking, laundry and cleaning in the list of activities she performed for her disabled mother. However, the daughter did not testify as to the specific amounts of time she devoted to cooking, laundry and cleaning house. Although the Magistrate found Plaintiff entitled to attendant care services, he also found the amount of hours claimed exceeded reasonableness. The Magistrate determined Plaintiff was entitled to attendant care services for two hours per day, which he deemed reasonable, despite being less than what Plaintiff’s daughter had testified to. Further, he ordered attendant care through the date Plaintiff was deemed independent by her physician, despite the daughter’s testimony she performed attendant care for several months after. Finally, the Magistrate awarded the daughter the fee requested, finding it to be a reasonable amount.

MEDICAL BENEFITS – REASONABLE & NECESSARY

Kerr v. Nor-Dic Tool Co. Inc., (Board of Magistrates, May 14, 2015). Here, Plaintiff sustained an injury to his left hand at work that resulted in an amputation of his arm up to his elbow. Plaintiff received a prosthesis hook, which he testified was uncomfortable, sometimes ineffective, and embarrassing. Plaintiff also testified he was unable to perform several household tasks with the hook. He also believed he would be able to return to work with the Defendant if he had a prosthesis hand, rather than a hook. Therefore, Plaintiff requested a replacement prosthesis, and specifically, the Michelangelo or I-limb. There was conflicting medical testimony regarding the need for a replacement prosthesis, and the reasonableness and necessity of the requested prosthesis. The Magistrate found Plaintiff entitled to reasonable and necessary medical treatment, which includes Plaintiff’s request for a hand rather than a hook. However, the Magistrate did not find the request for the Michelangelo or I-limb devices to be reasonable and necessary. Although the Michelangelo and I-limb are more heavy-duty, and would likely give Plaintiff more options to return to work, the evidence presented at trial established Plaintiff did not make any efforts to find employment and had no interest in returning to work. Therefore, Plaintiff was not engaged in any activities that would justify the requested prosthesis.

MEDICAL BENEFITS – RESIDENTIAL CARE

Kelly v. Flint Board of Education, (Board of Magistrates, October 22, 2015). Here, Plaintiff historically sustained a traumatic brain injury in the course of her employment and had already been found to be disabled. However, the basis for this dispute was the type of residential care Plaintiff required, how much it should cost, and whether the family was also entitled to receive compensation for attendant care when Plaintiff was away from the residential facility. Plaintiff asserted she was entitled to reside at a facility that charged $15,000 per month, but assisted her with all physical, psychological and emotional needs. The Magistrate agreed the Defendant was responsible for expenses relating to housing and attendant care, and the claimant was in need of 24-hour monitoring to ensure her safety. The Magistrate held that in such a case, where the parties disagree as to the reasonableness of residential charges, the Magistrate may pick a monthly amount that is reasonable for the Defendant to pay to Plaintiff, allowing Plaintiff to choose his or her own facility. In this case, the Magistrate found there were other facilities that provided all of Plaintiff’s requirements, but charged $10,000 per month. Accordingly, the Magistrate found $10,000 a reasonable monthly figure for residential/attendant care. Further, if the Defendant paid less than $10,000 per month for residential care, then Defendant must pay the difference between the residential facility charges and the maximum monthly charge of $10,000 to Plaintiff’s family.

COORDINATION OF BENEFITS

Arbuckle v. General Motors, LLC (Court of Appeals, February 10, 2015). In this case, Plaintiff was injured during the course of his employment in 1991. During his employment, Plaintiff was represented by his union, UAW. Following his injury, Plaintiff began receiving a total and permanent disability pension. In addition, a workers’ compensation Magistrate awarded Plaintiff workers’ compensation benefits at a fixed rate. At some point, Plaintiff also began receiving SSDI benefits. Initially, his workers’ compensation benefits were not reduced by his disability pension benefits, as it was prohibited under the Collective Bargaining Agreement.  However, several years later, Defendant and the UAW engaged in negotiations that resulted in  reduction of workers’ compensation payments for certain employees based on coordination of pension benefits and workers’ compensation benefits. Accordingly, Plaintiff’s workers’ compensation benefits were reduced pursuant to the new formula. Plaintiff argued the Defendant’s formula was unlawful because it used SSDI benefits to offset the workers’ compensation benefit. Director Jack Nolish found the use of SSDI benefits as a setoff when calculating workers’ compensation benefits was unlawful, resulting in an improper reduction of Plaintiff’s workers’ compensation benefits. The Board of Magistrates agreed that the reduction of worker’s compensation benefits was unlawful, but based on a different analysis. The Magistrate held that, although the use of the SSDI benefits to determine the amount of disability pension to be coordinated with workers’ compensation benefits is not improper per se, reduction of Plaintiff’s workers’ compensation benefits in this case was improper because a contract prohibited the coordination of Plaintiff’s pension benefits with his workers’ compensation benefits. He argued that UAW had no authority to bargain on Plaintiff’s behalf. The Michigan Court of Appeals agreed with the Board of Magistrates, finding the Defendant had no authority to coordinate Plaintiff’s benefits. Plaintiff had no representation when the Defendant attempted to amend the terms of his benefit structure. The Court found no evidence Plaintiff authorized the UAW to act as his representative to modify his benefit structure. Thus, the Court held the contract could not be amended to adversely affect a party when that party had no representation during the amendment process. This matter is now before the United States Supreme Court.

EMPLOYER-EMPLOYEE RELATIONSHIP

EMPLOYEE VS. INDEPENDENT CONTRACTOR

Moore v. Nolff’s Construction, (Court of Appeals, February 6, 2015). In this case, the Defendant is a general contractor in the roofing business. It generally used its own employees for all projects, and provided workers’ compensation insurance for all of the employees. On one larger project, however, Defendant contacted Plaintiff for assistance with a project that would take approximately four to six hours, for a total payment of $100. Although Plaintiff and his employees did subcontract for other companies, this job called for Plaintiff to work alone. Plaintiff accepted Defendant’s offer and started working immediately. During the roofing task, Plaintiff accidentally fired a nail into his foot with a nail gun. The Magistrate determined Plaintiff was not entitled to workers’ compensation benefits because he was not an “employee.” An employee is “every person performing service in the course of the trade, business, profession, or occupation of an employer at the time of the injury, if the person in relation to this service does not maintain a separate business, does not hold himself or herself out to and render service to the public, and is not an employer subject to this act.” The Magistrate held that all three criteria of § 161(1)(n) must be satisfied in order to obtain employee status under the Act. In other words, a person is an employee where he or she: (1) does not maintain a separate business; (2) does not hold himself or herself out to and render service to the public, and; (3) is not an employer subject to the Act. Because Plaintiff maintained a separate business and was an employer subject to the Act, he failed to meet the definition of an employee. The Appellate Commission reversed the Magistrate’s decision and awarded workers’ compensation benefits, noting Plaintiff’s relationship with the Defendant was unrelated to Plaintiff’s separate business. Rather, they found Plaintiff acted as an employee as for the services he provided. However, the Michigan Court of Appeals reversed the Appellate Commission’s findings, holding that Plaintiff was not an employee under the Act because he did not satisfy all three criteria of § 161(1)(n).

EXCLUSIVE REMEDY PROVISION

Hodnett v. Alro Steel Corp., (Court of Appeals, April 21, 2015). In this case, Plaintiff was a truck driver who provided trucking services for Defendant. While at Defendant’s facility, Plaintiff was subject to defendant’s direct control. While loading a truck, Plaintiff sustained an injury. Plaintiff subsequently filed suit in tort (Civil Court). Defendant argued that Plaintiff was its “employee” for purposes of the WDCA and as such was bound by the exclusive remedy provision. The Court noted that, if a worker is “performing service in the course of the trade, business, profession or occupation of an employer at the time of an injury,” that person is an employee so long as the worker does not either “maintain a separate business … hold himself or herself out to and render service to the public … and is not an employer subject to the Act.”  If any of the three is found to exist, the worker is divested of employee status and is an independent contractor. Because Plaintiff was performing a service in the course of Defendant’s business, and did not maintain a separate business, hold himself out to and render service to the public, and was not an employer subject to the WDCA, then Plaintiff was an employee of the defendant. Because Plaintiff was an employee of the defendant, he was therefore subject to the exclusive remedy provision.

INTENTIONAL TORT EXCEPTION – EMOTIONAL DISTRESS

Watz v. Wal-Mart Stores, (Court of Appeals, May 14, 2015). This matter arose out of an intentional infliction of emotional distress (IIED) claim against Walmart and several employees by Plaintiff. Plaintiff is an individual with cerebral palsy and associated physical and social impairments. Plaintiff alleged his supervisors yelled at him and badgered him, refused to give him earned days off, prevented him from performing his job, and removed personnel from his department. Defendant argued Plaintiff’s IIED claim was not actionable because the exclusive remedy provision of the WDCA limits an employee’s remedy to workers’ compensation benefits under the Act, except in cases of intentional tort. An intentional tort exists only when an employee is injured as a result of a deliberate act of the employer, and the employer specifically intended an injury. An employer shall be deemed to have intended to injure if the employer had actual knowledge that an injury was certain to occur and willfully disregarded that knowledge. In this case, the Court found no evidence the defendant specifically intended an injury or had actual knowledge an injury was certain to occur and willfully disregarded that knowledge. Accordingly, the Court dismissed Plaintiff’s claim.

INTENTIONAL TORT EXCEPTION – PRIOR NOTICE

Barnes v. Sun Chemical Corp., (U.S. District Court W.D. Michigan, August 14, 2015). This matter arises out of a wrongful death civil lawsuit filed by the wife of the decedent, who was killed in a workplace accident. The evidence revealed the decedent was walking in the fork-lift designated area when a 1,600 lb. object fell on him, immediately killing him. The evidence also revealed the fork-lift pathway was not adequately marked and employees regularly walked through that area, despite direction not to do so. The floor lines marking the employee-designated walkway may have been faded or obscured by materials on the day of the accident. In addition, an incident similar to this happened in the past, putting the employer on notice of the dangers of this pathway. The Court noted that worker’s compensation benefits are the employee’s exclusive remedy unless the employer committed an intentional tort. An intentional tort shall exist only when an employee is injured as a result of a deliberate act of the employer, and the employer specifically intended an injury. An employer shall be deemed to have intended to injure if the employer had actual knowledge that an injury was certain to occur and willfully disregarded that knowledge. An employer’s intent to injure can be established in two ways: (1) by showing with direct evidence it made a conscious choice to injure an employee, or; (2) by showing the employer had actual knowledge an injury was certain to occur and willfully disregarded that knowledge to prove intent circumstantially. The Court found Defendant did not make a clear conscious choice to injure the decedent. Regarding the second possibility, it is not enough to show the injury had happened before, there was a probability that it would happen again, or that the employer knew a dangerous condition existed. As such, Plaintiff’s wrongful death lawsuit was dismissed.

MISCELLANEOUS

CONTRACTUAL LIABILITY – FORM 400

Ace American Insurance Co. v. Workers’ Compensation Agency/Director, (Court of Appeals, February 17, 2015). In this case, Plaintiffs are two workers’ compensation insurers who failed to properly identify the employer they insured on several Form 400 notifications submitted to the WCA. Specifically, these insurers listed a self-insured employer, rather than that employer’s subsidiaries on the Form 400s submitted to the WCA. Generally, when a self-insured employer becomes insolvent, employees claiming workers’ compensation benefits may receive payments from the Self–Insurers’ Security Fund (SISF). However, when the self-insured employer in this case filed for bankruptcy, the WCA and the SISF Funds Administration objected, claiming that the insurers should be liable to the employees of the insolvent employer. The Michigan Court of Appeals held that the function of a Form 400 is to indicate, inform, or announce the existence of an underlying insurance obligation, but not to create that obligation. Thus, the Court held that a Form 400 does not create contractual liability.

CONTRACTUAL AGREEMENT – LIMITING STATUTE OF LIMITATIONS

Hier v. Douglas J. Management (Court of Appeals, September 15, 2015). This matter arises out of a retaliatory discharge lawsuit filed in civil court. When Plaintiff was hired by the Defendant, she was given a policy handbook providing for a limitations period for actions brought by an employee. Specifically, the policy handbook required an employee commence any claim, complaint, action or suit relating to their employment with the Defendant within 182 days of the event that gave rise to the claim, complaint, action, or suit. Thereafter, Plaintiff sustained a work-related injury. Several days after filing a worker’s compensation claim, Defendant terminated her employment. Two years later, Plaintiff filed a circuit court action alleging retaliatory discharge. This was obviously much later than mandated by the employee policy handbook.  Plaintiff argued she complied with the employee policy by filing a workers’ compensation application prior to her termination of employment, which put the Defendant on notice of her potential claim. The Court held that, under Michigan law, private parties are permitted to contract for any limitations period, even if the contractual limitations period is less than the statutory limitations period. Further, a workers’ compensation claim for benefits is a distinct action from a civil lawsuit for retaliatory discharge. Plaintiff’s worker’s compensation claim pertained to her claim for workers’ compensation benefits that had been disputed, and not for retaliatory discharge, which had not even occurred by the time she filed the application. Therefore, the Court held the retaliatory discharge claim was untimely and dismissed the action.

RETALIATORY DISCHARGE – CASUAL CONNECTION

Lucero v. Michigan, State of/Dept. of Corrections (Court of Appeals, March 12, 2015). In this case, Plaintiff sustained a work-related injury to his right upper extremity. Thereafter, the claimant underwent an IME, where it was determined Plaintiff could return to work with restrictions. Defendant subsequently approved the accommodation of Plaintiff’s restrictions and Plaintiff did report back to work. However, later that day, he left the job without reporting his absence. Defendant ordered Plaintiff to report to work immediately or provide adequate documentation to justify his absence. Defendant stated that failure to comply would result in Plaintiff being separated from his employment for unauthorized absences. In response, Plaintiff provided a disability slip from his physician, and reported back to work. Although the employer attempted to accommodate the restrictions imposed by both the IME physician and Plaintiff’s physician, Plaintiff once again left the job after a few hours without reporting his absence to the employer. This time, Plaintiff provided Defendant with a disability slip excusing him from employment, and he subsequently filed an Application with the Bureau of Workers’ Compensation. Several attempts were made by the Defendant to facilitate Plaintiff’s return to work. Eventually, Plaintiff’s lengthy absence and exhaustion of unpaid leave resulted in Plaintiff’s employment being terminated. Plaintiff settled his worker’s compensation claim but initiated an action alleging retaliation for filing a worker’s compensation claim. The Court held there are four elements necessary to make a prima facie case of retaliatory discharge: (1) the employee asserted a right to obtain necessary medical services or actually exercised that right; (2) the employer knew the employee engaged in this protected conduct; (3) he employer took an employment action adverse to the employee, and; (4) the adverse employment action and the employee’s assertion or exercise of a right were causally connected. The burden is on Plaintiff to show there was a causal connection between the protected activity, i.e., the filing of his workers’ compensation claim, and the adverse employment action.  If Plaintiff meets his burden, the burden then shifts to the Defendant to articulate a legitimate, non-retaliatory reason for its adverse employment action. The Court held Plaintiff failed to establish a connection between his seeking workers’ compensation benefits and his ultimate termination, as the Defendant made several attempts to accommodate Plaintiff and provided him with opportunities to avoid termination.

RETALIATORY DISCHARGE – LEGITIMATE REASONS

Kandler v. Dunn Paper, Inc., (U.S. District Court E.D. Michigan, February 13, 2015). The plaintiff in this case was 74 years of age at the time he suffered a work-related injury that resulted in payment of workers’ compensation benefits. After several attempts to return to work, Plaintiff’s doctor eventually imposed permanent restrictions the Defendant employer could not accommodate in light of the type of work performed. Although the Defendant could provide temporary light duty assignments for employees unable to perform their regular job because of temporary work restrictions, it could not provide permanent light duty assignments to employees with permanent work restrictions. Defendant placed Plaintiff on an unpaid leave of absence, and eventually, Plaintiff was discharged. Plaintiff then filed a claim for retaliatory discharge. The Court explained that, to establish a prima facie case for retaliatory discharge, a plaintiff must demonstrate “a causal connection between the protected activity, i.e., the filing of his workers’ compensation claim, and the adverse employment action.” If the plaintiff establishes a case of retaliation, the burden shifts to the defendant to articulate a legitimate, non-retaliatory reason for its adverse employment action. The plaintiff is then required to demonstrate that the proffered reasons were pre-textual and that the retaliation was a “motivating factor” for the adverse employment action. The Court concluded Plaintiff’s permanent restrictions rendered him unable to perform his job duties, which was a non-retaliatory reason for discharging Plaintiff. There was no evidence the Defendant’s reasons were pre-textual, as no one at Defendant made derogatory comments regarding Plaintiff workers’ compensation claim and several attempts had been made to get Plaintiff back to work.

RETALIATORY DISCHARGE – FILING OF CLAIM FACTOR IN TERMINATION

Brown v. County of Oakland, (U.S. District Court E.D. Michigan, September 4, 2015). This matter also arises out of a retaliatory discharge lawsuit. When hired, Plaintiff was placed on a six-month probationary period. During those six months, Plaintiff fell in a parking lot and filed a workers’ compensation claim. Thereafter, the Defendant terminated Plaintiff’s employment, claiming the termination was because of Plaintiff’s behavior, inability to handle supervision, and inability to work well with her co-workers. Plaintiff’s co-workers and supervisors presented testimony supporting the Defendant’s assertion. Evidence was also presented reflecting a Facebook post made by Plaintiff, complaining about the Defendant’s mishandling of her worker’s compensation claim. The Court noted Plaintiff must establish a causal connection between her assertion of her right to workers’ compensation benefits and the adverse employment action. In this case, there was very short temporal proximity between Plaintiff’s WDCA claim and her termination. In addition, the evidence presented reflected Plaintiff’s supervisor’s frustration over the filing of the claim and failure to process it efficiently. Further, the Defendant’s own testimony reflected that Plaintiff’s Facebook posts regarding her WDCA claim played a factor in her termination. Thus, the Court held that evidence was sufficient to merit the causation requirement for the retaliatory discharge claim, and therefore denied the Defendant’s Motion for Summary Judgment.

NON-PARTY SUBPOENAS

Woodford v. Grand River Printing, 2015 ACO #12. Although this case attacks a procedural issue, it is certainly relevant and quite significant to the field of workers’ compensation. In this case, the intervening Plaintiff, represented by attorney Steven Highfield, brought a motion to compel non-party compliance with a subpoena for the production of records. The Magistrate denied the motion, holding that, because the entity was not a party to the proceedings, it was not subject to the jurisdiction of the Board of Magistrates. On appeal, the Commission reversed the Magistrate’s order and held the Magistrate must issue an order compelling compliance. This decision allows subpoenas to extend beyond parties, to non-parties and to all potential witnesses, and provides for enforcement by the Magistrate should those subpoenas be ignored.

Act No. 267

Public Acts of 2015

Approved by the Governor

December 23, 2015

EFFECTIVE DATE: March 22, 2016

STATE OF MICHIGAN

98TH LEGISLATURE

REGULAR SESSION OF 2015

Introduced by Senators Proos, Brandenburg, Colbeck, Horn, Knollenberg, Robertson and Stamas

ENROLLED SENATE BILL No. 493

AN ACT to amend 1969 PA 317, entitled “An act to revise and consolidate the laws relating to worker’s disability compensation; to increase the administrative efficiency of the adjudicative processes of the worker’s compensation system; to improve the qualifications of the persons having adjudicative functions within the worker’s compensation system; to prescribe certain powers and duties; to create the board of worker’s compensation magistrates and the worker’s compensation appellate commission; to create certain other boards; to provide certain procedures for the resolution of claims, including mediation and arbitration; to prescribe certain benefits for persons suffering a personal injury under the act; to prescribe certain limitations on obtaining benefits under the act; to create, and provide for the transfer of, certain funds; to prescribe certain fees; to prescribe certain remedies and penalties; to repeal certain parts of this act on specific dates; and to repeal certain acts and parts of acts,” (MCL 418.101 to 418.941) by adding section 120.

The People of the State of Michigan enact:

Sec. 120. An employee of a franchisee is not an employee of the franchisor for purposes of this act unless both of the following apply:

(a) The franchisee and franchisor share in the determination of or codetermine the matters governing the essential terms and conditions of the employee’s employment.

(b) The franchisee and franchisor both directly and immediately control matters relating to the employment relationship, such as hiring, firing, discipline, supervision, and direction.