Legal Corner

Workers Compensation
Court orders publication of two rulings related to Privette doctrine - California

In McCullar v. SMC Contracting Inc., the 3rd District Court of Appeal has ordered the publication of a case finding the Privette doctrine barred a contractor's employee from suing for his injuries from a fall. The Privette doctrine is a presumption that a hirer of an independent contractor delegates to the contractor all responsibility for workplace safety.

The case involved a Tyco Simplex Grinnell Inc employee who fell when trying to use a ladder on ice and sued the contractor, SMC Contracting Inc., that hired Tyco. A trial and appellate court found that while SMC's actions may have caused ice to form, it was Tyco's responsibility to take the necessary precautions to protect its employees. Therefore, "...facts are insufficient to show that SMC's exercise of its retained control affirmatively contributed to McCullar's injuries."

In Miller v. Roseville Lodge, there was a scaffolding accident at the Lodge. A contractor was hired to move an ATM and he asked a bartender for a ladder, who told him he could use scaffolding in the bar area. The contractor's worker fell from the scaffolding and sued the lodge and bartender. A trial judge and Court of Appeals found that the Privette doctrine applied since the contractor was responsible for taking reasonable steps to address the hazard.

Case illustrates information needed for COVID-19 presumption - California

Although Jackson v. County of Los Angeles is not a "significant panel decision" by the Workers' Compensation Appeals Board (WCAB), is not a binding precedent, and is subject to appeal, it does illustrate what the Appeals Board expects regarding the COVID-19 presumption. The case involved a probation officer who developed COVID-19 on March 11, 2020. The WCAB returned the case to the trial level to further develop the issue of industrial causation. It found that presumption only covers cases of COVID-19 for employees who worked in person from 3/19/2020 to 7/5/2020 and did not apply to the 3/11/2020 injury. Further, the Qualified Medical Evaluator (QME) was not given important information including working conditions, frequency and duration of contact with the public and her coworkers, and the fact that none of her coworkers were diagnosed with COVID-19 during the relevant period.

Uber signs $8.4 million settlement over misclassification - California

The U.S. District Court in the Northern District approved an $8.4 million settlement of a class-action lawsuit against Uber for misclassifying drivers as independent contractors, rather than employees. The settlement applies to drivers who used the Uber Rides App between Feb. 28, 2019, and Dec. 16, 2020, or who used the Uber EATS App between June 28, 2016 and Oct. 7, 2021, and who opted out of Uber's arbitration agreement.

Retaliatory termination claim dismissed - Illinois

In Eckerty v. Eastern Ill. Foodbank, an employee left work without reporting an injury and the next day texted his supervisor that his hip was hurting and he would not be in. About a month later, he had foot surgery, but could not provide a time frame for returning to work. Later, at a meeting, the company informed him his paid time off had expired and he would be terminated if he did not return to work. About six weeks after he was terminated, he filed a workers comp claim and about a year later filed a suit alleging one cause of action for retaliatory discharge.

A trial court found, and an appellate court agreed, that there was no evidence suggesting the discharge was causally related to his comp claim. He was terminated six weeks before he filed the claim, the company had no knowledge he intended to file a claim, and there was no evidence he suffered a work-related injury.

Employer responsible for out-of-state comp claim - Indiana

In Accident Fund Insurance Co. of America v. Custom Mechanical Construction Inc. (CMC) et. al, a contractor failed to disclose to its workers compensation insurer that it did work in Kentucky, although most of its work was in Indiana. The agent claimed he was unaware that CMC performed work in Kentucky although it had been registered to do so since 2009 until the accident in question. A federal district court found, and an appeals court agreed, that the workers comp policy did not cover the claim because "CMC indisputably never notified AFICA that it had work (or began work) in Kentucky."

Jury awards $56 million to severely burned worker - Minnesota

A worker was burned over 40 percent of his body when a connector on the hose he was using failed and 180-degree water was released. In Harris v. Continental ContiTech North America et al, the jurors assigned 85% of the responsibility for the incident to the hose manufacturer, Continental ContiTech and Campbell, and the remaining 15% to the employer, Summit Brewery Company. In the personal injury lawsuit, he was awarded $35 million plus $21 million in interest.

Exclusive remedy bars discrimination claim - Nebraska

In Dutcher v. Nebraska Department of Correctional Services, a worker injured her knee during a mandatory training session and required surgery. She had permanent work restrictions and was terminated because she could not find a new position to accommodate her restrictions. While receiving disability payments and engaging in her vocational rehabilitation plan, she filed a complaint asserting the department had violated the Americans with Disabilities Act (ADA) and Nebraska Fair Employment Practice Act (NFEPA).

The ADA case was dismissed in federal court. The Department of Correctional Services moved for summary judgment on the remaining NFEPA claim, arguing it was barred by the exclusive remedy of workers comp. The state Supreme Court agreed noting this claim arose from the knee injury that was caused by an accident arising out of and in the course of her employment. The statute provides that if an employee files a claim for benefits from an employer subject to the Workers' Compensation Act, that action constitutes a release of all claims arising from such injury against the employer. In this case, there was sufficient nexus between the employee's compensable workplace injury and her disability claim under the NFEPA.

Death benefits awarded based on presumption of work-relatedness - North Carolina

In Frye v. Hamrock, LLC, a dump truck driver lost control of his vehicle on a steeply graded stretch of highway, crossed the double yellow lines, collided head-on with another vehicle, and crashed into an embankment. He died in the accident, as did the driver and a passenger in the other vehicle. An autopsy concluded that the cause of death was ischemic heart disease secondary to coronary heart disease.

Witnesses reported the truck had been traveling at an unsafe speed and that heavy smoke was billowing from the rear axles of the truck. The employer and carrier denied benefits, arguing the death did not arise out of and in the course of his employment. Relying on the Pickrell presumption, "where the circumstances bearing on work-relatedness are unknown and the death occurs within the course of employment, claimants should be able to rely on a presumption that death was work-related, and therefore compensable, whether the medical reason for death is known or unknown," the Industrial Commission found the death compensable.

The employer appealed, arguing the Pickrell presumption did not apply because there was evidence that the driver died from a heart attack. The Court of Appeals noted that the testimony of the employer/carrier's medical expert indicated it could not be determined if the driver had the accident because of a heart attack or whether he had a heart attack because of the circumstances of this accident. Therefore, the circumstances regarding work-relatedness were unknown and the employer and carrier had failed to meet their burden of showing that the heart attack occurred prior to and caused his injury. The Pickrell presumption applied and the death occurred as the result of an injury by accident sustained in the course and scope of employment.

Misconduct not basis for denying benefits - North Carolina

In Richards v. Harris Teeter, Inc., the company terminated a truck driver for causing an accident that resulted in his compensable injuries. At the time of the accident he told first responders he was listening to the radio, may have "just drifted thinking about something," took a sip of Gatorade, and lost control of his vehicle. A camera in the cab showed he closed his eyes for approximately seven to ten seconds, which was a violation of the company's safety policies. Since he had violated the policies, he was ineligible for rehire. Therefore, he was not offered any of the jobs available through the mandatory return-to-work program nor did the company provide any vocational rehabilitative services to assist in locating suitable employment.

A Deputy Commissioner ordered that the employer pay TTD until the worker returned to work and the employer appealed. The court noted that the compensability of the injury was not at issue; the question was whether the worker constructively refused suitable employment since the employer deemed him ineligible for participation in the employer's "return-to-work" program. The appellate court found that the employer's position here was fundamentally incompatible with the established principles of workers compensation and cited an earlier state Supreme Court case, McRae. "[A]ny rule that would allow employers to evade benefit payments simply because the recipient-employee was terminated for misconduct could be open to abuse."

Staffing company sole employer of injured worker - Pennsylvania

In an unpublished opinion, Ruggieri Enterprises LLC v. Teudhope (WCAB), the Commonwealth Court upheld the opinion that a staffing company was solely responsible for a severe work injury incurred by an employee at a client's facility. The court noted that the staffing agency's right to control was clearly delineated in the contract. While the contract contained language granting provisional control to the client over the work, it also imposed numerous restrictions on tasks, as well as the prohibition on any change in job duties or location without the approval of the staffing agency.

Breakdown of third-party settlements relevant to subrogation - Pennsylvania

In an unpublished opinion, Gleason v. Alfred I. Dupont Hospital for Children, a field service technician for Medical Imaging Group, was performing maintenance on an MRI machine and was badly burned when an explosion occurred. After filing suit, the worker and his wife reached a settlement that did not involve the insurance carrier. The settlement was divided - $580,000 for the injured worker and $870,000 in a loss of consortium claim to his wife.

The breakdown is significant because in Pennsylvania employers and carriers facing workers' compensation litigation are not entitled to subrogate loss of consortium claims to the spouses of injured workers. After the trial judge approved the settlement, the carrier objected. The Superior Court rejected the objection, noting the carrier had ample opportunity to object but had not done so until months after both the court's initial approval and the carrier's initial appeal. Further, the wife suffered significant emotional injuries, and there was no 'ploy' to evade a subrogation lien.

Additional-insured endorsement does not provide adequate protection for franchisor - Pennsylvania

In Soft Pretzel Franchise Systems, Inc. v. Twin City Fire Insurance Co., a worker at a franchised restaurant injured her hand in a pretzel rolling machine and ultimately sued the restaurant franchisor. Under the franchise agreement, the franchisee had obtained a liability insurance coverage endorsement naming the franchisor as an additional insured under the franchisee's insurance, but only "with respect to their liability as grantor of the franchise to [franchisee]" and the broker provided the franchisor with a Certificate of Insurance.

The Court held that the franchisor was not insured by the policy. The policy provided insurance to the franchisor for its role as a licensee to the franchisee, and the employee's claims depend on the franchisor's other acts and omissions, not whether the franchisor granted the license to the franchisee.

Split court decision denies disability benefits to injured worker - Virginia

In Virginia Alcoholic Beverage Control Authority v. Blot, a sales associate injured his knee when he tripped over a rug at work. He was diagnosed with a horizontal meniscus tear. Because of restrictions on elective surgeries during the COVID-19 pandemic, the surgeon advised injections to avoid knee surgery and the associate continued to work with no restrictions for about three months. However, his cardiologist told him to stop working out of concerns surrounding the COVID-19 pandemic in March 2020.

In February 2021 he received a note from his surgeon permitting him to return to work on light duty, although restrictions were not detailed. The company had already replaced him and had made changes requiring retraining, so his hours were reduced from his previous position. A deputy commissioner awarded him lifetime medical benefits, except for the period he was out of work on the advice of his cardiologist. He denied TPD, finding that the reduction in his work hours was not related to his compensable injury. However, the Workers' Compensation Commission reversed finding that his inability to work additional hours was causally related to the work accident. The appellate court disagreed, reasoning that "[l]oss of employment should not be deemed due to disability if a worker without the disability would lose employment or suffer a reduction in earnings under the same economic conditions."