NY Court Remands Case Where Occupational Disease Disablement Date Was Close to Date Policy Lapsed

Where an employee retired in 2014, and was determined to be disabled by an occupational disease in 2016, at which time his employer had no workers’ compensation policy in effect–and might possibly have been out of business–remand was necessary to determine whether the former employer was required to have a policy in place on the date of disablement, held a New York appellate court [Matter of Pisarski v. Accurate Plumbing & Heating Co., 2021 N.Y. App. Div. LEXIS 601 (Feb. 4, 2021)]. Only then, held the court, could it be determined whether the appellate insurance company, which had insured the employer on the last date the claimant was employed, should bear the cost of benefits, or whether the benefits should be paid by Uninsured Employers Fund.

Background

Claimant retired on November 24, 2014, after being employed as a union plumber for 37 years. Claimant subsequently established an occupational disease claim of bilateral knee and shoulder injuries, ultimately receiving schedule loss of use awards for those injuries. Initially, the date of disablement was set as November 25, 2014, the date claimant retired. Upon review by the Board, however, the date of disablement was changed to July 12, 2016.

Norguard Insurance Company, which provided workers’ compensation coverage to claimant’s employer, disputed its liability on the claim, asserting that the workers’ compensation policy was canceled effective June 23, 2016, prior to the date of disablement. The Uninsured Employers Fund was then placed on notice.

An October 2018 investigation report prepared by the Board’s Bureau of Compliance Enforcement Unit noted that no active workers’ compensation coverage on June 12, 2016 was found for the employer and that a computer search indicated that the employer currently was out of business.

WCLJ Hearing & Board’s Affirmation

Following a hearing, the WCLJ discharged the Uninsured Employers Fund. The WCLJ further found that, because there was no insurance policy in place on the date of disablement, coverage reverted back to the policy in effect at the time that claimant was last employed. As such, the WCLJ ruled that Norguard, which provided coverage from September 1, 2014 through September 1, 2015, was the liable carrier. The Board affirmed, citing Matter of Cammarata v Caldwell & Cook Inc. 19 AD3d 884, 797 N.Y.S.2d 188 (2005).

Was Cammarata Distinguishable?

Norguard contended that Matter of Cammarata was distinguishable. The appellate court noted that in Matter of Cammarata, the claimant filed a claim for workers’ compensation benefits following the 1996 death of her husband. The claim was established for an occupational disease causally related to his workplace exposure to asbestos. On the date of the husband’s death, however, no workers’ compensation policy was in place because the entity that last employed him had ceased doing business and dissolved in 1982. Under those circumstances, indicated the court, where there was clearly no obligation to maintain workers’ compensation insurance after an entity ceased doing business and was dissolved, the Cammarata court affirmed the finding that the policy in effect at the time that the husband was last employed was the carrier responsible for the payment of the claim.

Critical Factor

The appellate court continued that in Cammarata, the critical factor in reverting liability to the carrier that provided coverage during the exposure to asbestos that resulted in the death of the claimant’s husband was that the entity that employed the husband had ceased doing business and had been dissolved prior to the date of death. In the instant case, however, there had been no determination as to the business status of the employer on the date of disablement. The court added that the record reflected inconsistent information on the issue. Accordingly, the matter was remitted for a determination as to the business status of the employer on the date of disablement in order to determine whether it or the Uninsured Employers Fund was responsible for payment of the award.