2018’s Top 10 Workers’ Compensation Cases

In the Foreword of our forthcoming Workers’ Compensation Emerging Issues Analysis, 6th Edition [LexisNexis], due out in a few weeks, I note that in contrast to 2017, this year has been relatively calm for the workers’ compensation world. I caution that such quiet times will likely not continue and that 2018 might, therefore, appropriately be characterized as “the quiet before the storm.” In spite of the lack of overall turbulence, there have been some important court decisions in our field of interest this year. I take this opportunity to highlight what I think are the 10 most important workers’ comp decisions so far in 2018. The order presented is somewhat random. As I have said in previous years, “importance”—like beauty—is in the eye of the beholder. If you have a different list, by all means, share it with me.

Oklahoma High Court OKs Use of “Current Edition” of AMA Guides

The sections of Oklahoma’s Administrative Workers’ Compensation Act (AWCA) that require use of the “current edition” of the AMA’s Guides to the Evaluation of Permanent Impairment to determine PPD do not violate the Constitution, held a divided Supreme Court of Oklahoma in Hill v. American Medical Response, 2018 OK 57, 423 P.3d 1119 (2018). At first blush, the decision would appear to be in total conflict with that of the 2017 opinion of the Pennsylvania Supreme Court in Protz v. Workers’ Comp. Appeal Bd. (Derry Area School Dist.), 161 A.3d 827 (Penn. 2017), which generally held that the use of similar language in the Keystone State’s Act constituted an unconstitutional delegation of legislative authority to the AMA. A close reading of the majority opinion shows, however, a considerable level of consistency in the reasoning applied by the majorities of the two state supreme courts. For additional discussion of Hill, click here.

Kansas Court Strikes Down Use of AMA Guides, 6th Ed.

In the second important 2018 decision on use of the AMA Guides, 6th Edition, the Court of Appeals of Kansas, in Johnson v. U.S. Food Serv., 427 P.3d 996 (Kan. Ct. App. 2018), struck down as unconstitutional the use of the 6th Edition for measuring permanent impairment of injured workers under the state’s Workers’ Compensation Act (the Act). The court acknowledged that the Kansas Legislature could substitute a statutory remedy for one available at common law and that it had done so to a large extent with its passage of the state’s Act. The Court stressed, however, that due process required that the substitute provide “an adequate remedy for the common-law remedy that has been abolished” [Court Syllabus, ¶ 3]. The Court concluded that following the relatively recent statutory amendments requiring use of the 6th Edition of the AMA Guides for injured workers who suffer a permanent impairment on or after January 1, 2015, the Act no longer provides such an adequate substitute remedy.

At least until such time as an appeal is heard by the Supreme Court of Kansas, the 4th Edition of the Guides must be utilized. It is important to note that the Court of Appeals here did not find the entire Act unconstitutional—only the use of the 6th Edition. This raises the obvious question of whether any other current provisions of the Kansas Act would fail to pass muster if challenged. For additional discussion of Johnson, click here.

California High Court Narrows Rule For Classification of Workers as Independent Contractors

In a decision that continues California’s trend toward allowing the designation of a worker as an independent contractor only under rare circumstances, the Golden State’s Supreme Court held that in determining whether to classify workers as employees or as independent contractors for purposes of California’s wage orders, the state’s “suffer or permit to work” standard requires a hiring entity asserting independent contractor status to establish each of the three factors of the “ABC test”: i.e., to show that a worker is free from its control, performing work outside the usual course of its business, and customarily engaged in independent work [see Dynamex Operations West, Inc. v. Los Angeles County Superior Court, 4 Cal. 5th 903, 416 P.3d 1, 232 Cal. Rptr. 3d 1, 83 Cal. Comp. Cases 817 (2018)]. While the decision has no direct impact in workers’ compensation cases, only a myopic employer can ignore the decision.

The pressing issue to be resolved is whether the relatively straight-forward ABC standard applies to workers’ compensation cases, or must parties utilize the much more complex multi-factorial analysis set for the California Supreme Court’s workers’ compensation case of S.G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341, 769 P.2d 399, 256 Cal. Rptr. 543, 54 Cal. Comp. Cases 80, continues to control in workers’ compensation proceedings. In Perkins v. Knox, 2018 Cal. Wrk. Comp. P.D. LEXIS 490 (Oct. 23, 2018), a panel of commissioners with the Workers’ Compensation Appeals Board (WCAB) concluded that the Dynamex decision was only to be applied in one specific context, California wage order disputes. The panel added that the Dynamex decision did not overturn Borello and found that the Borello standard continues to apply to workers’ compensation disputes. California experts note that Perkins is just one panel decision. It was signed, however, by the Chairwoman of the WCAB. For additional discussion of Dynamex, click here.

Maine Employer Need Not Pay for Injured Worker’s Medical Marijuana

In a case of first impression within the state, the Supreme Judicial Court of Maine, in a 5-2 decision, held that an employer may not be required to pay for an injured worker’s medical marijuana use [Bourgoin v. Twin Rivers Paper Co., LLC, 2018 ME 77, 187 A.3d 10 (2018)]. Indicating that it was deciding the case on “narrow” grounds, the majority reasoned that there was a “positive conflict” between the federal law, as found in the Controlled Substances Act (CSA), and the Maine Medical Use of Marijuana Act (MMUMA) [see Opinion, ¶ 1] and that under such circumstances, the CSA preempted state law. For additional discussion of Bourgoin, click here.

Reviewers Under California’s Utilization Review Procedure Enjoy Immunity from Tort Liability

Under the exclusive remedy provisions contained in Cal. Labor Code § 3602, utilization reviewers performing services under the state’s workers’ compensation utilization review process enjoy immunity and may not be sued by injured workers, held the Supreme Court of California in King v. Comppartners, Inc., 5 Cal. 5th 1039, 423 P.3d 975, 236 Cal. Rptr. 3d 853, 83 Cal. Comp. Cases 1523 (2018). Accordingly, where a utilization reviewer denied a treating physician’s request to continue prescribing a certain medication — Klonopin — the employee could not maintain a tort action against the utilization reviewer based upon allegations that the reviewer caused additional injuries by denying the request without authorizing a weaning regimen or warning him of the possible side effects of abruptly ceasing the medication.

Earlier, a California Court of Appeal had concluded that the tort claim was not preempted because it did not directly challenge the reviewer’s medical necessity determination, but rather had alleged that the reviewer owed the injured worker a duty of care and had failed to provide necessary medical care to the worker. The Supreme Court stressed that in performing their statutory functions, utilization reviewers effectively stood in the shoes of employers. As such, reviewers were to be provided with the same immunity from tort liability as employers.

Worker’s “Undocumented” Status May Be Considered in Determining Degree of Permanent Disability

In Marquez v. Pierce Painting, Inc., 164 Idaho 59, 423 P.3d 1011 (2018), the Supreme Court of Idaho, in a split decision, held that an injured worker’s “undocumented” status may be considered in determining his or her level of permanent disability under the plain wording of Idaho Code Ann. §§ 72-425 and 72-430. Pursuant to those statutes, all personal and economic circumstances that diminish the ability of the claimant to compete in an open labor market must be be considered when determining whether an injured employee is entitled to permanent disability benefits. The Court held that the Commission’s failure to take the claimant’s undocumented status into account was error. The Court refused to address the specific weight to be given to a claimant’s undocumented immigration status. The dissent argued that the multiple illegal acts of both the claimant and the employer should not be ignored.

Oklahoma’s Tort Immunity Provision Favoring Oil and Gas Wells Struck Down as Unconstitutional

In Strickland v. Stephens Prod. Co., 2018 OK 6, 411 P.3d 369 (2018), the Supreme Court of Oklahoma held that 85A Okl. St. § 5, which provides operators and owners of oil and/or gas wells with extended immunity in tort actions filed against them by plaintiffs where those plaintiffs are injured at the well site and are employed by other firms, is unconstitutional as an impermissible special law under Art. 5, § 59 of the Oklahoma Constitution. Under the wording of the statute, an operator or owner of an oil or gas well is deemed to be an “intermediate or principal employer” (essentially the same as a statutory employer in most other states) for any services performed at the drill site with respect to work-related injuries sustained by workers whose immediate employer was hired by the operator or owner.

Among the arguments presented on behalf of well owners and operators was their contention that they needed “certainty” regarding their tort liability exposure. The Oklahoma high court observed that employers in other industries would also like such certainty. It was not afforded to them. Giving such favorable treatment to well owners and operators was constitutionally impermissible.

Alaska’s High Court Upholds Total Bar of Recovery for Non-Dependent Parents of Deceased Employees

The Supreme Court of Alaska, in Burke v. Raven Elec., 420 P.3d 1196 (Alaska 2018), affirmed the constitutionality of the state’s broad exclusive remedy provision [Alaska Stat., § 23.30.055] that bars a parent from pursuing any tort recovery against an employer whose negligence causes the death of his or her employed child even in those instances in which the parent fails to qualify for workers’ compensation benefits because he or she was not dependent upon that child for support at the time of the injury or death. The holding, while consistent with other similar cases around the nation, seems to go against the basic rule that exclusivity applies only where some right to benefits is afforded under the state Act. For additional discussion of Burke, click here.

Alabama Accountant’s Fatal Shooting by Disgruntled Former Client Found Compensable

In a case with a bizarre fact pattern, an Alabama appellate court affirmed an award of workers’ compensation death benefits to the surviving spouse of an accountant who was stalked and then shot to death because her assailant blamed the accountant for tax problems in his business [Lawler & Cole CPAs, LLC v. Cole, 2018 Ala. Civ. App. LEXIS 115 (July 13, 2018)]. Construing Ala. Code § 25-5-1(9) and relevant case law, the appellate court agreed that the murder, although an intentional act on the part of the murderer, amounted to an accidental injury (death) arising out of the employment. For additional discussion of Cole, click here.

The Road Less Traveled: Wisconsin Court of Appeals Shuns Majority Rule Re: Borrowing Employer’s Tort Immunity

Based, at least in part, on the court’s so-called “literal” reading of a Wisconsin statute [Wis. Stat. § 102.29(6)(b)1.], the Court of Appeals of Wisconsin, in Ehr v. West Bend Mut. Ins. Co. (In re Estate of Rivera), 2018 Wisc. App. LEXIS 16 (Jan. 9, 2018), held that a worker employed by one firm and assigned to a borrowing employer may proceed in tort against that borrowing employer (referred to in some jurisdictions as the “special employer”) for injuries sustained in the course and scope of the employment, so long as the worker has not already sought workers’ compensation benefits from the borrowing employer. In its decision, the Court adopted a position in opposition to the vast majority of jurisdictions, which generally bar tort actions by a temporary (i.e., “lent”) employee against the borrowing or special employer [see Larson’s Workers’ Compensation Law §§ 67.01, 100.01, 111.04]. The majority position is illustrated by another 2018 decision from Montana, Ramsbacher v. Jim Palmer Trucking, 2018 MT 118, 391 Mont. 298, 417 P.3d 313 (2018). For additional discussion of Rivera, click here. For additional discussion of Ramsbacher, click here.

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