Legal Corner

Franchisor not liable for uninsured franchisee claims - Kentucky

While the Kentucky Supreme Court found that a franchisor may, under appropriate circumstances, be considered a "contractor" and liable for Workers' Comp claims filed by employees of uninsured franchisees, the court determined that the franchisor was not a contractor.

The court reasoned that Doctor's Associates Inc., the franchising company for Subway restaurants did not control the day-to-day activities of the franchisee, nor had it contracted out a "regular or recurrent part of its business" to the franchisee in an attempt to avoid the expense of Workers' Compensation benefits. The court noted that the franchisor was in the business of franchising, not selling sandwiches.

Injury incurred by out of town worker not in scope of employment - Michigan

The Michigan Workers' Compensation Appellate Commission reversed a magistrate's decision awarding benefits to an out-of-state employee who was injured while leaving his employer-paid motel room to play horseshoes. The commission explained an injury occurring in the pursuit of an activity that has a major social or recreational purpose is not covered under Workers' Compensation. Since the worker was in pursuit of a social activity when he was injured, he was not in the course of employment.

Charity golf injury not in scope of employment - Missouri

When playing in a charity tournament sponsored by a voluntary, non-profit sheriff's association, a deputy sheriff was struck in the head and unable to return to work as a result of the injuries. His claim for Workers' Compensation benefits was denied and the denial was upheld on appeal, despite the argument that the activity was work-related because it benefited the department.

The judges found the injury had not occurred in the course of his normal duties as a deputy of the county, but rather as a willing and voluntary participant in the tournament. Participation in the event was voluntary, employees had to use vacation or compensatory time to attend, they were not allowed to wear their uniforms nor use the police cruiser for transportation to the event. The court found no demonstrable, direct link between playing golf in the tournament and the department's community policing operations.

Employee's misrepresentation on pre-employment application does not preclude Workers' Compensation - Nebraska

In a reversal of a 1979 state Supreme Court decision, Hilt Truck Lines Inc. vs. Rajean Jones, the Nebraska Supreme Court found that Workers' Compensation benefits can't be denied to a former hospital employee who did not disclose prior work injuries in a pre-employment screening. In a pre-employment questionnaire, the injured worker did not disclose a work-related back injury suffered in 2001, although she did disclose one incurred in 2000. She injured her back again 2008 and applied for Workers' Compensation benefits, which were denied.

Upon appeal, the Nebraska Supreme Court said the state's Workers' Comp law contained a provision for not paying benefits because of an employee's willful negligence. But in this case, the injured was not an employee, but an applicant, when she filled out the pre-existing injury information.

The Nebraska Supreme Court called its 1979 decision that linked nonpayment to what was listed on an application "erroneous." The Supreme Court sent the case back to the review panel to determine whether the employee should get comp benefits without regard to any misrepresentation she may have made on her employment application.

Comp award does not prevent uninsured motorist benefits - New York

While driving a car owned by the self-insured employer, an employee was in an accident with another car, driven by a person without liability insurance. The employee sought uninsured motorist benefits from the employer through arbitration but a trial court granted a stay of arbitration.

However, an appellate court reversed and allowed arbitration to proceed. The employer argued that because the employee is entitled to Workers' Comp benefits, he is barred from recovering uninsured motorist benefits. While New York state law says an employer's liability for Workers' Comp benefits "shall be exclusive and in place of any other liability whatsoever," the high court found that wording "cannot be taken literally" in all cases.

"Specifically, the statute cannot be read to bar all suits to enforce contractual liabilities," the court ruled. "If an employer agrees, as part of a contract with an employee, to provide life insurance or medical insurance, and breaches that contract, an action to recover damages for the breach would not be barred." It determined that there is no policy reason why uninsured motorist protection should decrease because the employee happened to be driving the car of a self-insurer.

Fall in parking lot is compensable - New York

The New York Workers' Compensation Board held that an accountant for the state could collect benefits for an ankle injury sustained when she slipped and fell on black ice in a parking lot prior to the start of her workday. The state made arrangements for her to park in the lot. The board found that the risk encountered by the accountant in the parking lot was a "special hazard" because the lot was not available for use by the general public during the daytime hours of the workweek.

Although an arena adjacent to the parking lot used a portion of the parking lot on two occasions during the year that she parked in the lot, the accountant's testimony indicated that the blocked-off area of the lot was not available to the general public. Furthermore, there was no evidence that anyone other than state employees were parking in the lot on the morning of the accountant's fall on black ice. She slipped in a lot designated for employee use by the state and in an area in close association with the state's premises.

Daughter entitled to benefits in injured worker's opioid overdose death - Pennsylvania

While a forensic pathologist's report stated that the injured worker "died from drug intoxication due to an overdose of fentanyl prescribed for his work injury," a doctor conducting a utilization review requested by the employer, had found that all treatments, including prescriptions, provided by the treating physician were neither reasonable nor necessary. However, the treating physician's sister, who wrote prescriptions identical to her brother's, also treated the injured worker. The appeal board ruled that the utilization review only applied to the treating physician and on appeal the Commonwealth Court granted survivor benefits finding that the utilization review determination concerned only reasonableness and necessity and was irrelevant in determining whether the employee's death was causally related to his work injury.

Re-injury at home to shoulder compensable - Tennessee

An employee who underwent surgery to repair a tendon and cartilage in his arm reinjured his arm when he returned from a medical appointment and tried to restrain his dog that was running loose. Although the employer appealed the ruling from the Chancery Court that the injury was a "natural consequence of the original injury," the Supreme Court agreed. It relied on the testimony of the employee's doctor who said that employee was not prohibited from walking his dog and that the employee was encouraged to "push past his limits." The court, however, lowered the award of permanent partial disability benefits to 25% from 40%.