Case Law Update

BCPWQ Seminar

2019

CAUSATION

“Arising Out Of and In The Course Of”

Assault

Williams v. Park Family Health Care PC (MCAC, August 2, 2018)

The Appellate Commission affirmed the Magistrate’s holding that the decedent’s murder by a coworker did not arise out of her employment.

The decedent began dating a coworker, but later discovered that he was married and was not seeking a divorce. She broke off the relationship and began dating a different man. After the break-up, the coworker went to their workplace, murdered the decedent, set the building on fire, and killed himself. It was later learned that the coworker used his work keys to enter the building the evening before the assault to bring in items that he used in the murder and arson, such as a can of gasoline, a shotgun, and shotgun shells. He also used the same keys to enter the building on the morning of the assault.

The plaintiff argued that the Magistrate’s finding that the decedent’s murder did not arise out of her employment was legal error. According to the plaintiff’s theory, the defendant facilitated the assault by providing the coworker with keys and ability to access the decedent. The Commission noted that the coworker was a maintenance man and had keys to all the Park Family Health Care buildings. However, his possession of the keys was merely incidental to the fact pattern and did not impute any contribution on the part of the employer to the decedent’s murder. The Commission also found that nothing on the record supported that the employer knew of any incidents of violence between the decedent and co-worker, nor that the decedent had taken out a personal protection order against the coworker. On these bases, the Commission affirmed the Magistrate’s order.

Intentional Act

Moore v. Wellington Industries (Board of Magistrates, July 2, 2018)

The Magistrate held that the plaintiff’s right hand fracture arose out of and in the course of his employment with the defendant.

The plaintiff worked in the welding area at the defendant’s premises. He testified that the employees would stop working ten minutes before the end of their shift to clean up and change clothes. During this ten-minute period, many employees would also go to the parking lot to start their vehicles. On the date of the alleged accident, the plaintiff and each employee who worked the prior evening was written up by a new manager for leaving work early.

After the plaintiff was written up, the new manager approached the plaintiff at his workstation. They discussed the disciplinary actions against the plaintiff and his coworkers. The plaintiff testified that as he was gesturing towards a coworker, his right hand struck a bin. He did not realize that his hand was injured until he finished his conversation and attempted to lift a part. He advised his supervisors of his injury and left to obtain medical attention. The next day, the plaintiff was fired because the supervisor alleged that he had repeatedly punched a bin in anger, resulting in injury. When the plaintiff disputed the supervisor’s account of the event, the defendant countered that video surveillance confirmed the supervisor’s account.

Ultimately, the Magistrate found the plaintiff’s testimony as to how the accident occurred to be credible. The Magistrate did not find the defendant’s allegations that the plaintiff’s injury occurred by repeatedly striking a bin with both his hands credible based on the ER records indicating injury to only the right hand. The employer’s failure to produce the alleged surveillance video further invalidated their contention. Therefore, the Magistrate held that the plaintiff was entitled to a closed period of wage loss and medical benefits associated with the right hand fracture.

Social & Recreational

Heestand v. Cintas Corp. No. 2 (MCAC, November 20, 2018)

The Appellate Commission reversed the Magistrate’s finding that the plaintiff’s injury was a compensable work-related injury, rather than an injury that occurred in the pursuit of a social or recreational activity.

The plaintiff worked for the defendant-employer as a custodian since 2008. On the date of the injury, the employer hosted an event in which it provided lunch and held games. The plaintiff testified that the human resources manager invited her to participate in an egg toss game, which she accepted. As she jumped to catch the egg, she hit a sign behind her, and fell onto her right side. She alleged injuries to her right leg, hip, arm, and shoulder in her Application for Benefits.

MCL 418.301(3) excludes injuries that occur “in the pursuit of an activity the major purpose of which is social or recreational.” If a magistrate finds that the alleged injury occurred during a social or recreational activity, the injury is excluded from coverage under the Act.

At the trial level, the Magistrate found that the plaintiff’s injury was work-related, rather than recreational based on multiple factors that transformed the activity into an occupational activity. The factors were that the injury occurred on the defendant’s premises during normal work hours, the plaintiff only joined in the activities at the personal direct request of the HR manager and that the plaintiff was being paid during the game.

The Commission considered the Magistrate’s factors in finding the activity was not social or recreational and deemed that two of the factors, the injuries occurring during the work day and at a time when the plaintiff was being paid, were not controlling. Precedent set by numerous Supreme Court and Commission decisions have examined these issues and held that these factors do not avoid the coverage exclusion provision of Section 301(3).

The Commission also found no competent, material, and substantial evidence to support the Magistrate’s finding that the plaintiff was singled out, compelled, or coerced into participating in the game. Testimony of both the plaintiff and defendant witnesses indicated that the plaintiff was not ordered to participate. Rather, the invitation was a general request made to all employees, some of whom declined. There was also no evidence that the plaintiff was threatened with adverse employment actions nor did the employees who declined to participate receive adverse employment actions.

Ultimately, the Commission held that the major purpose of the activity the plaintiff was engaged in at the time of her injury was social and recreational. It based this decision on its finding that the game was not associated with the plaintiff’s employment duties or functions. The Commission could also find no evidence that the game served a business purpose. Further, the defendant received no benefit, except the hope that the employees would experience comradery. Therefore, the Commission reversed the Magistrate’s order and found that the plaintiff’s injury was not compensable under the Act.

Work Travel

Adams v. Selective Way Insurance Co. (MCAC, October 25, 2018)

This case was appealed to the Appellate Commission by an intervening no-fault carrier. The issue on appeal was whether the Magistrate’s opinion that the worker’s injuries did not arise out of his employment was supported by material and substantial evidence. The Commission upheld the Magistrate’s decision to deny benefits.

The employee in this matter was injured in a motor vehicle accident while on his way to work. The vehicle he was driving was owned by his employer and all expenses for the vehicle were covered by the employer as well. The Magistrate went through the four Forgach factors to determine whether the injury arose out of the employee’s job. While the fact the vehicle was owned by the employer favored a work-related injury, the other factors outweighed it. The employee had not yet clocked into work, even though the accident occurred at 9:15 AM. Therefore, the injury did not occur during working hours. For the third factor, any benefit the employer received in his travel to work in the company truck was outweighed by the detrimental aspects of the arrangement. Finally, the employee was not subjected to any increased traffic risks that would be any more excessive than driving to work in a non-company owned truck. Therefore, benefits had been properly denied.

Huey v. Valley Electrical Contractors, Inc. (Board of Magistrates, November 13, 2017)

This matter arose out of an automobile accident while the employee was on break. The only issue in litigation was whether the accident arose out of and in the course of employment. The Magistrate held the automobile accident did arise out of and in the course of employment, finding the plaintiff entitled to worker’s compensation benefits.

The plaintiff was on a worksite at Dow Chemical. As part of his employment he received two, paid fifteen- minute breaks. During break periods, employees were allowed to drive an employer van off the worksite. On the day of the accident, the plaintiff and two other employees used the employer van to simply get off the job site. The employees did not stop anywhere. Testimony revealed there was no rule against such use of the van. When returning to the jobsite, the van was t-boned by another vehicle. The plaintiff suffered several fractures and a severe left arm injury.

The Magistrate utilized the Forgach four factor test that helps determine whether an injury arose out of and in the course of employment in “going to and coming from” work situations. The test is: 1) whether the employer paid or furnished employee transportation; 2) whether the injury occurred during or between work hours; 3) whether the employer derived a special benefit from the employee’s activities at the time of injury; and 4) whether the employment subjected the employee to excessive exposure to traffic risks.

The first two prongs were clearly met. For the third prong, the Magistrate held that because the employees got off the worksite to take a truly meaningful break, this boosted morale. Moreover, the logo on the side of the van provided a form of advertising. As such, the employer obtained a special benefit from the employees’ breaks. Finally, the availability of the van in itself exposed the employee to increased traffic risk.

Generally, there must be a causal nexus between driving and employment for the injury to be work related. Here, the Magistrate determined that even though this seemed like a drive with no purpose, there was a causal nexus because the employees needed to get away from the plant to have a meaningful break. As such, benefits were awarded.

Lewis v. LexaMar Corp. (Board of Magistrates, December 26, 2017)

The Magistrate held that the decedent’s motor vehicle accident arose out of and in the course of his employment.

The decedent worked in the tool room for the defendant for fourteen years. He took classes towards an associate degree in welding and manufacturing at Kirtland Community College. On the date of his motor vehicle accident, he left his employer’s site in Boyne City and was travelling to Gaylord to attend a class. The decedent’s vehicle crossed the center line and struck the side of a tractor trailer.

The general rule in Michigan is that injuries sustained while going to and from work are not compensable. However, an exception to the general rule exists when various factors show a nexus between the employment and the injury to bring the injury into the realm of compensability. The factors necessary to find a business travel case compensable are: 1) a sufficient nexus between the travel and employment; 2) a direct benefit to the employer; and 3) the travel is required, urged or expected by the employer or represents a special mission for the employer.

The Magistrate found that the travel in this case represented a direct benefit to the employer. Testimony presented at the time of trial revealed that the employer previously had trainers come to their worksite. However, they wanted to explore whether it would be more advantageous to send their employees off-site for training. They approached the decedent about becoming a “test case” for off-site training. Initially, the decedent was hesitant to participate in the off-site classes; however, the defendant offered additional incentives beyond what was provided-for in their policies on tuition reimbursement. Based on these incentives, the decedent accepted the defendant’s offer.

Additionally, the Magistrate found an additional benefit to the employer. Once the decedent had completed his training, he would become a certified welder. The defendant testified that at the time of the decedent’s death, the defendant only had one certified welder working in the tool room. The decedent’s status as a certified welder would enable the defendant to have an additional certified welder on another shift or be able to cover in the case of absence or illness. Therefore, the Magistrate held that the injury did meet the exception to the general rule and ordered the defendant to pay medical, funeral, and burial expenses.

CAUSATION

Causal Relationship

Change of Condition

Ray v. MGM Resorts International (Board of Magistrates, January 18, 2018)

In Ray, the defendants paid medical benefits and weekly wage loss benefits pursuant to an open award for injuries to the plaintiff’s neck and thoracic spine. The current litigation arose from the defendant’s Petition to Stop the weekly benefits.

The defendant argued that the plaintiff had recovered from her work-related disability and could return to her prior employment. The defendant relied on their medical expert, who performed an independent medical examination on the plaintiff. The defendant’s medical expert found that the plaintiff’s subjective complaints were mild and there was no objective evidence of impairment.

The plaintiff relied on the testimony and records of her treating physician. However, the Magistrate did not find the treating physician’s opinions persuasive. The Magistrate noted that the treating physician’s opinion regarding the plaintiff’s condition and treatment had not changed in the fifteen years that he had been treating her. Further, the treating physician testified that the plaintiff suffered from cervical radiculopathy, but electrodiagnostic studies showed no evidence of cervical radiculopathy. Therefore, the Magistrate found the defendant’s expert’s opinions to be the most persuasive and granted the defendant’s Petition to Stop.

Degenerative Condition

Lupu v. Livonia Public Schools (Board of Magistrates, December 8, 2017)

The plaintiff worked as a school bus driver for the defendant for twelve years. She alleged that she sustained injuries to her neck and right shoulder as a result of driving a bus with a defective air seat. She did not allege a specific event but did report the defective condition of the seat to her employer. In response, the defendant replaced the reportedly-defective seat. After the plaintiff complained that the new seat was not secure, the employer’s mechanic fixed the issue with the replacement seat. The plaintiff alleged that her conditions then worsened to the point where she could no longer work. The defendant denied compensability on the basis that plaintiff’s conditions were due to degenerative processes.

The Magistrate held that the plaintiff failed to show that she sustained injuries to her neck and shoulder as a result of driving a bus with a reportedly-defective seat. The holding was based on the timeline of events, as the plaintiff testified that her condition did not worsen to the point of alleged disability until after the complained-of problems had been remedied by the employer. The Magistrate also noted that the testimony of the plaintiff’s treating surgeon regarding etiology was inconsistent with the plaintiff’s claims. While the plaintiff consistently alleged the defective seat caused her issues, the treating surgeon testified her condition was due to her other job duties of reaching and pulling the door lever. Therefore, the plaintiff’s claim for benefits was denied.

Stinson v. Chrysler Group (Board of Magistrates, May 16, 2018)

The plaintiff in this matter alleged several dates of injury that led to multiple injuries, including her knee, low back, and upper extremities. The majority of the alleged injuries involved falls and repetitive motion that caused injury. The Magistrate held that due to a lack of evidence, the plaintiff did not sustain any compensable, work-related injury.

When discussing the plaintiff’s carpal tunnel syndrome, the Magistrate focused on the plaintiff’s expert witness’ testimony. The doctor testified that the claimant’s work activities accelerated her condition in the wrist so that the “straw that breaks the camel’s back” occurs at an earlier stage than it would have. The Magistrate rejected this analysis, as the Appellate Commission has also rejected this type of reasoning. Therefore, the carpal tunnel claim was dismissed.

With regard to the plaintiff’s knee claim, there was no dispute that she had underlying bilateral knee osteoarthritis that was partially related to her morbid obesity. Specifically, the plaintiff’s expert could not differentiate between the plaintiff’s daily activities and her work activities, in terms of overall weight-bearing. Therefore, because the symptoms were equally attributable to the progression of a pre-existing condition and a work event, benefits were denied.

Hernia

Driedric v. Chippewa Regional Correctional Facility (MCAC, April 25, 2018)

The issue on appeal was whether there was competent, material, and substantial evidence to determine the plaintiff suffered a work-related hernia incident. The Appellate Commission reversed and denied benefits.

The plaintiff was a corrections officer for Chippewa Regional Correctional Facility. When the plaintiff was performing a cell search, his partner was assaulted by an inmate. At that time, the plaintiff ran toward the incident, approximately 40-50 feet. The incident stopped without any physical altercation between the plaintiff and the inmate. Following the event, the plaintiff noticed a bulge in his abdomen.

Prior to the work incident, the plaintiff had a history of pancreatic cancer and had undergone a Whipple procedure for treatment. After that procedure, he sustained recurrent hernias near the site of the Whipple procedure. The Commission analyzed the medical evidence and determined it did not support a work-related injury. First, the treating physician opined that the plaintiff’s recurrent hernias were due to the pre-existing cancer and Whipple procedure. Moreover, the plaintiff’s expert did not fully understand what transpired during the work event and only stated the plaintiff had exerted physical force. The doctor’s testimony did not indicate whether the plaintiff was involved in a physical altercation or not. Because the doctor did not know specifics about the event, his testimony did not provide competent evidence that would support a work-related injury. Therefore, the Magistrate’s decision was reversed and the plaintiff did not receive any benefits.

Mental Injury

Dickey v. Delphi Automotive Systems, LLC (MCAC, July 11, 2018)

The plaintiff worked as a sales account manager for the defendant. He took a business trip to El Paso, Texas and Juarez, Mexico to meet with business associates for dinner. Shortly after they were seated, masked gunmen entered the restaurant and executed several nearby patrons. The plaintiff and his party took cover and made it to safety. After he returned home to Detroit, the plaintiff reported he began to experience headaches, back pain, poor sleep, nightmares, anger issues, difficulty concentrating, and anxiety. He was diagnosed with disabling post traumatic stress disorder (PTSD). At trial, the Magistrate awarded the plaintiff benefits.

On appeal, the defendant argued that the plaintiff had failed to prove a disability based on mental illness. In order to prove mental disability, the plaintiff must show there has been an actual employment event leading to disability and that the plaintiff’s perception of such actual employment event was grounded in fact or reality, not in delusion or imagination.

The Commission found that it was logical that one who witnesses a horrific, stressful, and traumatic event, such as multiple murders, could be afflicted with PTSD. Further, the Commission found that the plaintiff’s account of the events was not challenged nor disputed. Therefore, the Commission affirmed the Magistrate’s findings and award of benefits.

DISABILITY

Job Search Efforts

Dupuis v. General Motors Corp. (MCAC, August 28, 2018).

The Appellate Commission affirmed the Magistrate’s decision that the plaintiff was entitled to full benefits because he showed a good faith job search effort.

The plaintiff injured his low back and was voluntarily paid weekly wage loss benefits of $473 per week. A wage-earning capacity analysis was performed at the behest of the defendants and the plaintiff’s rate was reduced to $113 per week. The plaintiff then applied to all six open positions that were found through the wage-earning capacity analysis. Four of the prospective employers never responded, one was out of business, and the last rejected the plaintiff due to his restrictions. The Commission seemingly held that contacting all six employers in the vocational expert’s report was enough to rebut a showing of wage-earning capacity. However, the plaintiff also sent out nearly 700 resumes and had seventeen interviews that did not lead to a job. Therefore, it is difficult to tell what is the exact threshold a claimant must cross in order to consider his job search as a “good faith effort.”

Thomas v. Mobis North America, LLC (Board of Magistrates, November 20, 2017)

The plaintiff alleged injuries of acute and chronic allergic contact dermatitis related to his work as an assembler for the defendant. The plaintiff’s treating doctor performed patch testing on the plaintiff, which indicated positive reactions to three chemicals used in processing rubber. The treating doctor also warned against returning to any job that exposed him to these chemicals. The claimant commenced a job search to obtain subsequent employment. He told all prospective employers about his medical condition and the requirement that he avoid the offending chemicals.

The defendant argued that the plaintiff’s current unemployment was not due to the work-related injury, but rather his disclosure of his medical condition to prospective employers. The defendant’s wage-earning capacity evaluation showed that the plaintiff’s prior jobs and qualifications establish many jobs that do not involve exposure to chemicals.

First, the Magistrate held that the plaintiff sustained work-related injuries by a preponderance of the evidence. Secondly, the Magistrate held that the plaintiff had made a good faith job search effort. He based his findings on the plaintiff’s testimony that the plaintiff filled out numerous job applications, attended job fairs, and gone on interviews, but was still not able to secure subsequent employment. The plaintiff’s identification of his dermatitis to prospective employers was found to be prudent considering the widespread use of chemicals, the frequency of the plaintiff’s allergic reactions, and the treating doctor’s reasonable restrictions.

Proof of Disability

Bessinger v. Our Lady of Good Counsel (MCAC, July 10, 2018)

This matter came before the Appellate Commission to determine whether the plaintiff met the definition of “disabled” as set forth in Stokes v. Chrysler, LLC, 481 Mich 266 (2008). The defendant argued that the plaintiff had no compensable work-related disability. At the trial level, the Magistrate found that the plaintiff had not met his burden of proof in proving disability.

In Stokes, the Michigan Supreme Court set forth several steps that a plaintiff must meet for prima facie finding of disability. The plaintiff must: 1) disclose his or her qualifications and training; 2) prove what jobs, if any, he or she is qualified and trained to perform at his or her maximum wage-earning capacity; and 4) show that he or she cannot obtain any of these jobs.

In this case, the plaintiff’s employment application to a prospective employer indicated that he had graduated from an auto mechanic training program. The plaintiff was evaluated by three vocational evaluators, but he did not disclose this training to any of the evaluators. Thus, the evaluators reached their conclusions about the plaintiff’s wage-earning capacity without full knowledge of the plaintiff’s qualifications and training. The Commission affirmed the Magistrate’s finding that the plaintiff did not meet his burden of proof because he failed to disclose all his qualifications and trainings, preventing the remainder of the Stokes steps from being fulfilled.

Davis v. General Motors Corp. (MCAC, July 30, 2018)

In this matter, the Appellate Commission upheld the Magistrate’s determination that the alleged work injury did lead to a pathological change in the claimant’s underlying condition. However, the Commission did not feel the evidence supported a finding of total disability.

The plaintiff in this case suffered from a significant lower back condition. Prior to the injury at issue in the case, the plaintiff had undergone three lumbar fusions, all of which were voluntarily paid by the defendants. After his third fusion, he was able to return to work in the capacity of a hi-lo driver. On October 22, 2005, while he was seated in his hi-lo, the plaintiff was struck by another employee. This allegedly caused severe pain in the lumbar spine and eventually lead to his fourth lumbar fusion. The Commission upheld the Magistrate’s finding that because the treating doctor felt the incident caused a “very new process,” including leg weakness and drop foot, there was a pathological change.

The Commission did not believe there was enough evidence to find total disability. The plaintiff’s vocational expert found the plaintiff was not capable of earning a wage. However, he did not use updated restrictions, but rather only restrictions on the date of the plaintiff’s surgery. Moreover, at the time of trial, the plaintiff testified he had not received any treatment for his low back in almost nine months. The Commission believed this type of behavior was not consistent with a person who claims to be unable to perform even sedentary work.

Isaac v. SDW Holdings Corp. (MCAC, June 26, 2018)

The Appellate Commission affirmed the Magistrate’s decision granting an open award of benefits. The plaintiff had been previously granted an open award years before, but the award was subsequently modified after a number of appeals because the plaintiff did not comply with the Stokes requirements. Specifically, the plaintiff did not have a vocational expert who determined whether she had a wage-earning capacity. As such, she did not receive wage loss benefits despite having a work-related injury. When the plaintiff refiled her Application for Benefits, the defendant asserted the claim was barred by res judicata because there had already been a final decision with regard to her disability. However, the Magistrate noted disability and wage loss in workers’ compensation cases are not a static fact. As an example, defendants can file an Application to Stop Benefits because the economy has improved to a point where there are now jobs within a claimant’s qualifications.

The same concept holds true for a claimant. The fact that the plaintiff was not in compliance with Stokes at the time of her trial does not preclude her from being compliant at a later date. Therefore, when the plaintiff presented evidence from a vocational expert that her restrictions prevented her from obtaining employment, she was able to receive her full wage loss benefits in her open award.

Rate Calculation

Cavness v. General Motors Corp. (MCAC, August 7, 2018)

The Appellate Commission reversed the Magistrate’s decision to include fringe benefits when he recalculated the plaintiff’s rate.

Plaintiff had been receiving workers’ compensation benefits since 1989. His average weekly wage (AWW) was $717.27 with a corresponding rate of $389.38. At that time, the plaintiff’s rate was more than two-thirds of the state AWW. Therefore, the plaintiff’s fringe benefits were not considered. In 2010, the employer stopped paying his fringe benefits. In 2013, the defendants reduced his weekly benefit rate to $264.51 due to coordination with Social Security benefits. Therefore, the new rate was below two-thirds of the state AWW in 1989. The Commission cited to the Supreme Court’s decision in Schmaltz v. Troy Metal Concepts, 469 Mich 467; 673 NW2d 95 (2003), which said the average weekly wage is established once and for all at the time of the injury date. Fringe benefits cannot be added later simply because the benefits now fall below two-thirds the state AWW. The concept of adding fringe benefits later is contrary to the mitigation/favored work doctrine. Therefore, the plaintiff’s AWW was established at the initial 1991 trial and his discontinued fringe benefits cannot be added later to increase his workers’ compensation benefits.

Reasonable Offer Of Employment

Razo v. GM & Sons, Inc. (Board of Magistrates, March 19, 2018)

The employee worked as a cement layer and suffered a specific-event injury on November 10, 2015. The Magistrate found the employee sustained a compensable, work-related, low-back injury. One of the issues in the matter was whether the employer provided a bona fide offer of reasonable employment, which would have mitigated wage loss exposure.

At the trial, the plaintiff testified that he attempted to return to work. He informed his employer he could not perform the duties, and the employer said he could drive the pick-up truck. Plaintiff apparently attempted to drive the truck but was unable to do so because of his condition.

A representative from the employer testified that he orally informed the employee he could return to work as a pick-up driver. The employee would receive the same pay as he did pouring concrete and the offer was still open. However, the employer never repeated the offer to the plaintiff either verbally or through a written document before trial.

The Magistrate held that the purported job offer was not a bona fide offer of reasonable employment. The offer lacked specificity, as there was no job description. Further, there was no effort from the employer to actually determine what the employee’s physical status was before making the offer. They also did not follow up with the employee after he attempted to drive the pick-up truck. Finally, the employee testified that he never received a job offer from the employer. As such, the plaintiff was entitled to full benefits for his injury because he proved partial disability and a good-faith job search effort.

Residual Wage-Earning Capacity

Carson v. Bandit Industries (Board of Magistrates, January 30, 2018)

The Magistrate found that the plaintiff did sustain a work-related injury, but surveillance evidence proved he had a residual wage-earning capacity.

The plaintiff worked as a welder. On April 22, 2014, he went to lift a stabilizer when he felt a pop in his back, which caused immediate pain and burning into his legs. Following the injury, the plaintiff continued to work his regular duties, despite having restrictions, which led to a worsening of his condition. Benefits were voluntarily paid until they were terminated following an IME.

Based upon the various medical reports, the Magistrate found the history of the injury to be consistent and that lead him to believe an injury did occur while at work. Moreover, the continued employment worsened his condition. However, the Magistrate found the plaintiff did have a residual wage-earning capacity that he based upon a combination of sedentary work restrictions and surveillance evidence. The surveillance showed the plaintiff was able to operate a riding lawnmower, a weed whip, and a limb saw, while apparently working for his brother’s business. Therefore, the defendants were entitled to reduce the average weekly wage during periods of time the plaintiff was not looking for work. Moreover, while defendants attempted to recoup benefits paid based upon the surveillance, they were unable to do so. The Magistrate determined there was no basis for fraud, as he believed the plaintiff was not being paid for the work seen on surveillance.

EMPLOYER-EMPLOYEE RELATIONSHIP

Employee Under the Act

Koleski v. Chippewa County (Board of Magistrates, February 15, 2018)

The issue in this matter was whether the plaintiff was an employee of the county because she had been selected for jury duty. The Act defines “employee” as a “person in the service of the state, a county, city, township, village, or school district under any appointment.” Based upon prior case law, the Magistrate held the County was not an employer under the Act.

Plaintiff had been selected for jury duty with Chippewa County. On the day of the injury, the plaintiff had reported to the Circuit Court when she slipped and fell in the parking lot. She never made it inside the courthouse to fulfill her jury duty. Based upon the Michigan Supreme Court case Jochen v. The County of Saginaw, the Magistrate held that the plaintiff was injured before she was accepted as qualified for service and was not a “person in the service of the county.” The fact that the plaintiff filled out a questionnaire after she was selected and was not deemed exempt from the jury pool did not make her a “person in service of the county.” Essentially, being a part of the jury pool is not enough to be covered under the Act despite the broad language of the statute. One must actually be selected to serve on the jury.

Mallory v. Merkel & Kenny, Inc. (MCAC, July 30, 2018)

The issue on appeal was whether the Magistrate was correct in ruling the plaintiff was an employee of Merkel & Kenny and not an independent contractor. The Appellate Commission affirmed the Magistrate’s decision based on the IRS 20-factor test.

Plaintiff was working as a roofer and there was no dispute that he suffered a work-related injury when he fell from a roof and broke his hip. The Magistrate utilized the IRS 20-factor test as required by MCL 418.161(1)(n). The Magistrate held the plaintiff was an employee based on several factors, including that he was told where to go each day, he was paid hourly, he did not place any bids, he had no significant outside work, and he was provided an employer American Express card. The simple fact that the plaintiff filed his taxes as self-employed and received a 1099 instead of a W-2 was not dispositive. The Magistrate held it was only a factor to consider. Because the Magistrate’s decision was supported by competent, material, and substantial evidence, it was affirmed.

MEDICAL BENEFITS

Attendant Care

Severson v. Harbison Walker (Board of Magistrates, June 5, 2018)

The plaintiff sustained a work-related injury to his lumbar spine after he slipped and fell while going to clock out for a break. The plaintiff originally was assigned a nurse case manager by the employer to help with his treatment. However, after a disagreement between the plaintiff and the nurse case manager, the plaintiff hired his own nurse case manager and sought expenses to be paid by defendants. Moreover, the plaintiff sought attendant care payments for his son who took care of the plaintiff following an operation for the alleged lumbar spine injury.

With regard to the nurse case manager expenses, the Magistrate held that the charges were not reasonable. The plaintiff was prescribed case management services by his surgeon, and his nurse case manager performed all regular duties of setting up appointments and making sure the plaintiff received proper care. She charged several thousand dollars for these services that were well documented. However, the Magistrate held that charging $110 per hour for services that could have been performed by an attendant care provider for a lower rate was exorbitant, especially since the manager hired by the plaintiff was not an actual nurse. Therefore, the lien was not to be paid by defendants because the plaintiff failed to prove that the services were reasonable and necessary.

With regard to attendant care services, the Magistrate held it was reasonable to pay the plaintiff’s son $15 an hour for attendant care services for the maximum 56 hours a week. The son kept a log of general activities he performed, but he did not keep a log of how long those activities took to complete. Despite this lack of proof, the Magistrate held the plaintiff was in such a dire position physically following his operation that it was reasonable to grant 56 hours a week for family-provided attendant care.

Medical Marihuana

Newville v. State of Michigan, Department of Corrections (Board of Magistrates, December 8, 2017)

This case involved the issue of whether a Magistrate could award the cost of medical marihuana as a reasonable and necessary medical expense. The Magistrate held that various provisions of both the Act and the Medical Marihuana Act (MMA) forbid the award of medical marihuana costs against a defendant.

The plaintiff worked for the defendant as a corrections officer for eleven years. In his Application for Benefits, he alleged several low back injuries throughout his years while restraining inmates, containing altercations, and slipping and falling on ice. The plaintiff was diagnosed with spondylolisthesis at L5-S1. He underwent extensive treatment, including a surgery. At the time he filed his Application for Benefits, his treatment consisted of symptomatic pain relief; he was taking Oxycodone, Fentyanyl, and medical marihuana.

The plaintiff argued that his medical marihuana use was reasonable and necessary under the Act because he was able to reduce his opioid pain medication while using the medical marihuana. As a preliminary matter, the Magistrate first held that the plaintiff suffered personal injuries arising out of the course and scope of his employment based on the unrebutted testimony of the plaintiff. The Magistrate then held that the use of the Oxycodone and Fentyanyl was reasonable and necessary under the Act, but the use of medical marihuana was not reasonable and necessary. The Magistrate’s reasoning was that Section 315 of the Act specifically excludes from reimbursement any professional service that was not subject to state registration and licensure before January 1, 1998. The MMA was enacted in 2008, well after 1998. Further, the MMA itself specifically states that a carrier or employer shall not be forced to reimburse the cost of medical marihuana.

WORKERS’ COMPENSATION BENEFITS

Coordination of Benefits

Beck v. Alpine Shredders Ltd. (Michigan Court of Appeals, April 9, 2018)

The plaintiff was injured in the course and scope of his employment when he was operating the machinery of a paper shredding truck. A conveyer belt roller became jammed and the plaintiff attempted to dislodge the jam. As he was clearing the jam, his glove became caught in the roller and his arm was pulled into the roller. The plaintiff received both workers’ compensation benefits and no-fault benefits for his injuries.

At the trial level, the workers’ compensation carrier filed a notice of lien on any settlement or judgment in favor of the plaintiff for the amount of the benefits it had paid to the plaintiff. The trial court found that the paper shredding truck was not being used as a motor vehicle at the time of the plaintiff’s injury. Thus, the first three years of wage loss benefits paid by the workers’ compensation carrier did not substitute for no-fault benefits and the workers’ compensation carrier was entitled to assert a lien for all benefits.

On appeal, the court considered the question of whether the no-fault benefits were owed and properly paid to the plaintiff. The general rule is that when an employee is injured in a motor vehicle accident while working, workers’ compensation benefits substitute for no-fault benefits to the extent that the benefits duplicate what would otherwise be no-fault benefits. A workers’ compensation carrier is not entitled to be reimbursed or to assert a lien for benefits provided-for in the no-fault statute.

The court considered whether the trial court had erred when it found the vehicle was not being used as a motor vehicle at the time of the plaintiff’s injury. The Michigan No-Fault Act provides that benefits are payable as a result of injuries resulting from a parked vehicle when the injury was a direct result of physical contact with equipment permanently mounted while the equipment is being operated or used. Further, the injury must arise out of the use of a motor vehicle as a motor vehicle. The appellate court found that the vehicle was being used as a motor vehicle. A recent case held that unloading property from a vehicle upon arrival at its destination constitutes use of a motor vehicle as a motor vehicle. Because the plaintiff’s injury in this case occurred as a result of unloading the vehicle, the vehicle was still in its transportation function at the time of the injury. Thus, the appellate court held that no-fault benefits were properly paid and that the workers’ compensation carrier’s lien must be limited to those benefits that did not substitute for no-fault benefits.

Berger v. Durand Area Schools (Board of Magistrates, May 11, 2018)

The plaintiff was receiving benefits pursuant to an open award for an injury date of October 3, 1984. Effective January 1, 2013, he began receiving a pension of $873.18 per month. The defendant disputed their obligation to continue paying the full amount pursuant to the open award due and began to coordinate the award with the amount of the pension. The plaintiff filed his Application for Benefits seeking reinstatement of the full amount of the open award and penalties against the defendant.

MCL 418.354(e) prior to the 2011 amendments allowed for coordination of pension benefits in a proportional amount, based on the ratio of the employer’s contributions to the total contribution to the plan of the after-tax amount of the payments if the employee contributed directly to the pension. The rationale behind Section 354 was to prevent employees from “double dipping” their workers’ compensation benefits with other benefits funded by employers, such as disability, unemployment, and old age Social Security.

The parties agreed that the plaintiff’s pension benefits could be coordinated. Rather, the disagreement was as to the percentage that the defendant could coordinate and the dates that applied to the coordination. Testimony of an auditor for the Michigan Public Schools Employees Retirement System confirmed that the plaintiff had directly contributed to his pension plan and the total amount made to his pension plan during his employment. The auditor also testified that the defendant made contributions to the State’s general pension fund as opposed to direct payments into the plaintiff’s plan.

The Magistrate found that the amount of pension benefits the plaintiff received in the first four years of his pension benefits was for the amount that he contributed over his career. To allow the employer to coordinate for amounts that the plaintiff contributed himself would be inconsistent with the purpose of Section 354 and would provide an unearned benefit to the employer. Therefore, the Magistrate held that the plaintiff was owed full, uncoordinated benefits for the first four years after he began receiving his pension, plus interest during that time when defendant coordinated benefits.

Exclusive Remedy Provision

McQueer v. Perfect Fence, Co. (Michigan Supreme Court, July 10, 2018)

The issue in this matter was whether the exclusive remedy provision of the Act prevented the plaintiff from bringing a civil action against his former employer. The plaintiff contended his employer violated MCL 418.171(4) because it used coercion, intimidation, deceit, or other means for him to pose as a contractor to evade liability. The Court held because the plaintiff was not the employee of a contractor engaged by Perfect Fence, he had no cause of action under MCL 418.171 and was barred by the exclusive remedy.

Plaintiff sustained an injury to his head after he was hit by the bucket of a Bobcat. Claimant was receiving benefits pursuant to the Act. He sued his employer in an attempt to receive civil tort damages and claimed Perfect Fence was liable for same under MCL 418.171(4). He alleged a fellow employee instructed him to not tell anyone at the hospital that he was injured while working for Perfect Fence because he was “not on the books.” He also asserted the owner of the business told him he was not covered under the company’s workers’ compensation insurance.

Normally, an injured worker’s only remedy against an employer is workers’ compensation. However, MCL 418.641(2) states that if an employer violates MCL 418.171, then the injured employee is entitled to recover damages in a civil action. Section 171(1) creates a statutorily imposed employment relationship when an employer assumes the role of a principal by contracting with an independent contractor. The principal would become liable for any person employed by the contractor if the contractor is not subject to the Act or if the contractor is not properly insured.

The Court focused particularly on Section 171(3) in its interpretation of the statute. The Court held that Section 171(3) explicitly states that the statutory-employer provision is applicable only if the contractor engages employees as defined elsewhere in the Act. Moreover, the Court held that a principal is not the same as an employer. In order to be a principal, it must be an employer who contracts with a contractor that is not properly covered under the Act.

The Court held that Perfect Fence was the direct employer of the plaintiff. Therefore, there was no statutory-employer relationship. Thus, because the requirements of Section 171(3) were not met, Section 171(4), which prevents principals from attempting to circumvent the Act through coercion or intimidation, was inapplicable and the plaintiff could not bring a civil claim.

Recoupment of Benefits

Fisher v. State of Michigan, Kalamazoo Regional Psychiatric Hospital (MCAC, March 13, 2018)

The defendant appealed an opinion by the Magistrate denying the defendant’s petition to recoup overpayments of wage loss benefits. For approximately three and a half months, the defendant voluntarily paid weekly wage loss benefits to the plaintiff in the amount of $606.62 per week. The defendant later calculated the rate to be $548.88 per week. The plaintiff agreed to a payment plan to reimburse the overpayment, but no payments were made.

At the time of the trial, defendant claimed an outstanding overpayment of $595.11. The Magistrate held that the defendant was not owed the overpayment amount. He reasoned that established case law indicated that voluntary payments made absent of any fraud or misrepresentation by the plaintiff should remain undisturbed.

On appeal, defendant argued that to deny recoupment would discourage voluntary payment and result in unnecessary disputes and delays in otherwise compensable matters. The Appellate Commission was not receptive to this argument, stating that defendants and employers are under a “clear duty to make professional and prompt evaluation of workers’ compensation claims.” The Commission could also find no other compelling reasons to deviate from the established case law in this matter. Therefore, the Commission affirmed the Magistrate’s order.

Tasley v. General Motors Inc. (MCAC, July 30, 2018)

The Appellate Commission reversed part of the Magistrate’s decision that allowed the defendants to obtain an offset for wage loss benefits voluntarily paid to the plaintiff during two periods of time wherein the plaintiff was not conducting a good faith job search.

The plaintiff was being voluntarily paid benefits for carpal tunnel syndrome. Benefits were subsequently reduced based upon a residual wage-earning capacity. The Magistrate held the plaintiff was entitled to full benefits from May to June 2013 and from January 2014 going forward, based upon a good faith job search. However, the Magistrate held the plaintiff was not entitled to full benefits for two periods of time where she had no evidence of a job search. The Magistrate held the defendants were entitled to an offset of benefits paid during those periods.

The Commission held the Magistrate’s “offset” was essentially a recoupment. Benefits that are voluntarily paid cannot be later recouped. Whirley v JC Penney Co., 1997 Mich ACO 427. Therefore, even though the plaintiff was technically undeserved of the benefits because she was not performing a job search, the defendants were not allowed to recoup the benefits because they had been voluntarily paid absent of fraud.

Turner v. Technicolor Inc. (Board of Magistrates, August 6, 2018)

The defendants in this matter sought reimbursement due to an overpayment following a redemption agreement. The plaintiff had settled her workers’ compensation claim with the defendants for $29,441.13. After the claimant received and deposited this money, she received a check, made out to her, for an additional $4,775.52. The check was intended for her attorney.

The Magistrate held that even though the plaintiff knew the check was not meant for her, the defendants could not be reimbursed for the overpayment. The Magistrate held it is well-settled law that defendants are not entitled to recoupment in these circumstances. “Voluntarily made payments, in the absence of any fraudulent behavior, should remain undisturbed.” The Magistrate rejected the defendants’ argument that depositing the second check was an intentional act that would trigger reimbursement rights. Moreover, the plaintiff and defendants had actually entered into a repayment agreement, and the Magistrate ordered those payments stopped. (Note: this should not be confused with reimbursement for overpayments made to a claimant who is still receiving benefit payments. These are fact specific cases.)

Retaliatory Discharge

Sharrow v. S.C. Johnson & Son, Inc. (U.S. District Court, Eastern District of Michigan, April 12, 2018)

The plaintiff filed a lawsuit against his former employer alleging unlawful retaliatory discharge for asserting his right to FMLA and workers’ compensation benefits for a work-related sesamoid fracture and chronic knee pain.

While the plaintiff was off work for his alleged injuries, the defendant was notified of Facebook pictures showing the plaintiff participating in a golf outing and tubing down a river. The defendant investigated and confronted the plaintiff with its findings. The plaintiff downplayed the inconsistencies with his physical limitation, insisting that he used a cart during the golf outing and that tubing was not physically exerting. The defendant disciplined the plaintiff and placed him on an action plan due to his attempted sick benefit fraud violation. The plaintiff was warned that any additional work performance issues or violations during the time the action plan was in effect would result in termination. Shortly thereafter, the plaintiff was caught sleeping on the job and was terminated.

In his arguments against the defendant’s Motion for Summary Disposition, the plaintiff argued that the reason for his firing (sleeping on the job) was simply pretextual because he was able to identify four other individuals who also slept on the job and remained employed by the defendant. To establish a prima facia case of retaliatory discharge, the plaintiff must establish: 1) an asserted right to workers’ compensation benefits; 2) the defendant knew of the asserted right to workers’ compensation benefits; 3) the plaintiff suffered an adverse employment action; and 4) a causal connection between the plaintiff’s assertion of his right to workers’ compensation benefits and the adverse employment action. Once the plaintiff establishes a prima facie case, the defendant can rebut the prima facie case with a legitimate, non-retaliatory reason for the adverse employment decision. The plaintiff must then show that the legitimate reasons offered by the defendant were merely a pretext for the adverse employment action.

The court granted the defendant’s motion. In its reasoning, the court explained that the plaintiff produced no information regarding the identified individuals, whether they were similarly situated to the plaintiff, or whether they also engaged in protected conduct. Thus, the court found that there was no evidence upon which a reasonable jury could conclude the defendant’s reason for the plaintiff’s termination was pretextual.

Suspension of Benefits

Davis v. Wolverine Packing Co. (Board of Magistrates, July 9, 2018)

The Magistrate found that the plaintiff’s failure to attend an independent medical examination did not constitute refusal to submit to a medical examination.

The defendant was paying the plaintiff pursuant to an open award of benefits. The defendant scheduled the plaintiff for an independent medical examination in February 2017 and notified the plaintiff via a regular mail letter. The plaintiff failed to attend that appointment. The IME was rescheduled to April 2017 and another notification letter and mileage check were sent via certified mail. The plaintiff signed the certified mail receipt and cashed the mileage check but failed to attend the second examination. The defendant filed a Motion to Suspend or Forfeit Compensation Benefits.

Ultimately, the Magistrate found that the defendant failed to establish that the plaintiff had refused to submit himself to the medical examination. The magistrate noted that the defendant had failed to comply with the requirement to send travel expenses with its first IME notification. Further, the Magistrate found that the plaintiff’s assertion that he missed the second IME due to an illness was plausible. Therefore, the Magistrate denied the defendant’s motion.