Familiarity Breeds Contempt
Does this story sound familiar?
The case is accepted, the injured worker (IW) has returned to a modified position and, thus, you have discontinued temporary disability. Life is great…that is, it seemed great until you receive the “nasty gram” from applicant’s counsel advising that IW has been terminated and you owe temporary disability (TD) retroactively and continuing!
Terminating an IW is just about the surest way of inspiring IW and applicant’s counsel to push for the full 2-year TD cap. You can bet your bottom dollar that TD—retro and continuing—will quickly become an expensive, hard-fought issue. What do you need to know to avoid the TD trap?
What’s TD All About?
“The essential purpose of [TD]…is to help replace the wages the employee would have earned, but for the injury, during his/her period(s) of temporary disability” [Signature Fruit Co. v WCAB, (Ochoa) (2006) 142 Cal.App. 4th 790, 801]. An employer’s obligation to pay TD ceases when the replacement income is no longer needed, such as when IW has returned to work [Huston v. WCAB (1979) 95 Cal. App.3d 856, 868]. If an IW is released to modified duty and the employer offers him/her a job within his/her work restrictions, IW is no longer entitled to TD, even if IW doesn’t accept the modified duty [Vittone v. WCAB (2001) 66 Cal. Comp. Cases 435 (writ den.)]. For example, in Seale v. WCAB (1974) 39 Cal. Comp. Cases 676, 677 (writ den.), the WCAB found than an IW who did not return to modified duty, because his union was on strike and he would not cross the picket line, and therefore he was not entitled to TD because his action “was voluntary and for reasons other than physical inability to work.”
But Termination is an “Employer Thing”!
The case law is clear that IWs who refuse to accept properly tailored modified duty can be denied TD. This usually involves a situation in which the employee—and the employee alone—has made the unilateral decision to stymie the employer’s good faith efforts to return IW to work. But what happens when it is the employer who takes the action, such as terminating IW, thereby making it impossible for IW to take advantage of modified duty? In other words, isn’t the scenario somehow different where the lack of availability of modified duty is due to an “employer thing” (aka terminating IW), as opposed to an “employee thing” (aka refusing to cross a picket line, etc.)?
The WCAB has made this clear, time and again, in various scenarios. For example, it was held that a termination for “participation in unlawful activities” of an IW who had accepted an offer of modified duty, but not yet begun working, “was a ‘for cause’ termination justifying the termination of [IW’s] right to vocational rehabilitation” [Anzelde v. WCAB, (1996) 61 Cal. Comp. Cases 1458 (writ den.)]. Not surprisingly, this reasoning has been extended to TD.
Think about it. While friends at CAAA may claim—as suggested above—that termination is an “employer thing,” is it really?
- Is an employer truly free to keep an employee who, for example, participates in illegal activities?
OF COURSE NOT!
- Should California’s workers’ compensation laws, as they pertain to TD, penalize employers for good faith firings of IWs?
OF COURSE NOT!
- And don’t forget…it is IW’s burden to prove that his/her wage loss is due to his/her industrial injury. If modified duty was or would otherwise be available but for IW’s bad behavior requiring his/her termination, has IW met his/her burden of proof?
OF COURSE NOT!
So you’ve received the “nasty gram” from applicant’s counsel advising that IW has been terminated and, because he/she can no longer take advantage of the proffered modified duty, you owe TD retroactively to the date of the termination and continuing!
What do you need to know to assess your liability?
If the employer had, prior to the termination, accommodated the IW’s restrictions, persuasive evidence that the termination was “for good cause” should result in a defense verdict!
But what if IW was terminated for cause before modified duty is offered or accepted? The WCAB, in at least one panel decision, has suggested that “a more rigorous inquiry regarding the genuineness of the offer of modified duty is necessary” [Quiett v. System Transport, (5/15/08) OAK 0336115)]. If an employer indicates it would have offered the applicant modified duty but for applicant’s termination for cause, the WCJ and Appeals Board must determine… whether the… putative offer… is genuine, in good faith, and within the applicant’s work restrictions [Robertson v. WCAB (2003) 112 Cal.App.4th 893].
An “Odd” Argument
As you fight the good fight on TD issues, expect applicant’s counsel to attempt to muddy with waters by referencing the “odd lot doctrine.”
What is it?
The essence of the “odd lot doctrine” is that if an IW is temporarily partially disabled and only able to do “odd” jobs or “special work,” the burden shifts to the employer to establish that there is work available that IW could perform. If there is no such work available, temporary total disability is owed [See Meyers v. IAC, (Titsworth) (1940) 39 Cal.App.2dd 665)]. However, when IW is released to light work of a general nature, the burden does not shift to the defense; it remains with IW to show that his/her inability to obtain employment is a consequence of the industrial injury (Id. At 669).
IW has been fired and modified duty was—or would have been —available? Expect a fight (particularly in this economy). Deny the TD and collect your evidence to prove:
- IW was terminated
- Termination was “for cause”
- Termination was in “good faith”
- Modified duty was (or would have been) available
- Modified duty was within IW’s restrictions
- Offer (or putative offer) of modified duty was in “good faith”
Donald R. Barthel is a founding partner of Bradford & Barthel, LLP, as well as B&B’s Rating & File Consultation Services. Mr. Barthel is an acknowledged expert regarding the AMA Guides (5th) and the 2005 PDRS. Much of his time is dedicated to teaching these topics to adjusters, human resource directors, employer representatives, attorneys, and physicians throughout California and the United States. Have a PDRS or AMA Guides question? Call Don Barthel at (916) 996-1263 or email him at email@example.com.
 While I recognize that the “Terminator,” aka “Governator,” aka Governor Schwarzenegger was officially replaced when Jerry Brown was formally inaugurated as governor on January 3, 2011, I hereby predict that references to the “Governator” will continue to make regular appearances in B&B’s BLOG!
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