Written by: Bruce Hamilton

On Friday, June 9, 2017, the North Carolina Supreme Court issued its eagerly anticipated decision in Wilkes v. City of Greenville, in significant part, unanimously affirming the Court of Appeals. Wilkes involves two primary issues. First, whether Johnnie Wilkes failed to meet his burden of establishing that his anxiety and depression were the result of a work-related accident and, more specifically, whether the “Parsons presumption” applied, giving Mr. Wilkes the benefit of a presumption that these conditions were related to his accident. The second issue is whether Mr. Wilkes was entitled to disability payments made after January 18, 2011. The Court’s decision on the Parsons presumption is potentially one of the most significant decisions involving North Carolina worker’s compensation claims in the last 30 years.

The Supreme Court agreed with the Court of Appeals that Mr. Wilkes was entitled to a presumption of compensability in regards to his continued medical treatment and affirmed that part of the decision. In addition, the Supreme Court concluded that the Commission failed to address the effects of Mr. Wilkes’ tinnitus in determining whether he had lost wage earning capacity.

Moving forward after Wilkes, we recommend that any decision regarding filing a Form 60 or a Form 63 and paying indemnity benefits beyond the applicable time period be very carefully considered. Defendants should not unreasonably deny claims, but must consider that by accepting a questionable claim, a rebuttable presumption is likely created that treatment for all other medical conditions or symptoms are related to that work accident.

We anticipate a significant potential increase in denial of questionable claims with this expansion of the Parsons presumption. Defendants will also need to be prepared to obtain independent medical evaluations quickly to evaluate whether any disputed condition is “directly related” to the compensable work injury.   In addition, defendants can expect to see an increase in expedited medical motions relying on the Parsons presumption when employees seek additional medical treatment for new conditions.  As the current expedited medical motion procedure provides a very short timeline with no ability for extensions, this will likely make obtaining independent medical evaluations to rebut the presumption extremely challenging for defendants.

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Mr. Wilkes was working as a landscaper on April 21, 2010, when he was involved in a motor vehicle accident. On April 29, 2010, the defendants filed a Form 60 with the North Carolina Industrial Commission and described the injury as “worker involved in MVA and had multiple injuries to ribs, neck, legs and entire left side.” The defendants began paying temporary total disability and provided medical compensation for Mr. Wilkes’ injuries, but never specifically accepted his anxiety and depression as compensable conditions.  Defendants subsequently disputed Mr. Wilkes’ need for medical treatment related to his work injury.

The case was eventually heard by a Deputy Commissioner who entered an opinion and award determining that Wilkes’ low back and leg pain, anxiety, depression, sleep disorder, tinnitus, headaches, and TMJ pain were causally related to the April 21, 2010 compensable injury.   The Deputy Commissioner also awarded Wilkes ongoing temporary total disability benefits, concluding that he had demonstrated that it would be futile for him to seek employment because of pre-existing conditions, including his age, IQ, education level reading capacity, previous work history and physical condition resulting from his work injury.

The defendants appealed to the Full Commission, which concluded that Mr. Wilkes suffered from tinnitus as a result of the April 21, 2010 accident, but determined that the evidence regarding his alleged anxiety and depression was conflicting. The Commission ultimately concluded that, based upon the preponderance of all of the evidence, Mr. Wilkes’ alleged anxiety and depression was not caused by his April 21, 2010 work-related accident.

On appeal, the Court of Appeals vacated the Commission’s opinion and award concerning Mr. Wilkes’ request for additional medical treatment for anxiety and depression. The Court of Appeals held that the Commission erred by not applying the rebuttable Parsons presumption to Mr. Wilkes’ anxiety and depression, and instead placing the burden on him to demonstrate the cause of those conditions.

The Supreme Court affirmed the Court of Appeals, holding that the Mr. Wilkes is entitled to a rebuttable presumption that additional medical treatment is related to his compensable conditions. The Court reaffirmed that a presumption of ongoing disability only arises in limited circumstances. The Court also reaffirmed that when an employer admits “compensability”, by filing a Form 60 or a Form 63, when the employer fails to contest compensability within the 90 day time limit, no presumption of “disability” arises in those circumstances.

Nonetheless, reviewing the plain language of N.C.G.S. §97-82(b), the Supreme Court concluded that when compensability and liability are admitted, that this shall constitute an award of the Commission on the question of compensability of and the insurer’s liability for the injury for which payment was made. Accordingly, an admission of “compensability” approved under §97-82(b) entitles an employee to a presumption that any additional medical treatment is causally related to his compensable injury. In reaching this conclusion, the Court cited the language in N.C.G.S. §97-25(a) which states that medical compensation “shall be provided by the employer.”

The Supreme Court specifically rejected the defendant’s argument that applying the Parsons presumption to a Form 60 will discourage direct payment, upset the framework of the Act, and convert the Act into a general health insurance program. According to the Court, applying the rebuttable Parsons presumption merely removes the burden from the employee to prove that each medical treatment sought is to the compensable condition. The employer may rebut this presumption with evidence that the condition or treatment is not “directly related” to the work injury.  The Court noted that medical issues can be complex and the extent of an employee’s injuries may be difficult to determine at the time of the accident.  The Court also noted that the Act provides the Form 63 procedure which allows employers to pay benefits without prejudice while they investigate such injuries without admitting liability and requires employees to submit to medical examinations by the employer’s authorized physician.

In addition, in a footnote the Court indicated that the presumption could have been applied during the expedited medical motion procedure. In other words, it appears that the Court wants parties and the Commission to quickly determine what medical conditions are and are not related to a compensable injury.

With respect to Mr. Wilkes’ medical conditions, the Supreme Court expressed no opinion on whether the evidence was sufficient to rebut the presumption that Mr. Wilkes’ current complaints are related to his initial compensable injury. Therefore, the claim was remanded back to the Commission for further review.

There are numerous issues unresolved by the Supreme Court’s decision in Wilkes. The first is whether defendants can file a Form 60 accepting a clearly compensable claim and body part, but simultaneously file a Form 61 with respect to a disputed medical condition. In the plainest reading of the Court’s decision, the filing of a Form 60 or a Form 63, without a denial within the applicable time periods, creates the rebuttable presumption. Therefore, even if a Form 61 is filed, it may have not have an impact and the employee may still enjoy the presumption of compensability despite a clear denial of disputed body part or condition.

The Supreme Court also does not appear to place any limitations on the scope of the presumption based upon the exact injury listed in the Form 60 or Form 63. Wilkes dealt with physical injuries that allegedly caused anxiety and depression. What is potentially left unresolved is whether a defendant accepting one undisputed body part on a Form 60 is also going to have to rebut a request for medical treatment for any other body part or symptom not specifically listed on the Form 60 or Form 63.

It is also unclear how conditions that develop after the initial injury by accident will be treated, such as an employee who has a compensable right knee injury and develops back pain allegedly related to the knee injury two years later.  In addition, the Court leaves open whether an employee is entitled to a presumption that a work-related injury aggravated or accelerated a pre-existing condition.  The Supreme Court’s decision states that the additional medical treatment being sought by the employee must be “directly related” to the compensable injury, but it is unclear how that term will be interpreted and how the presumption interacts with prior case law.

Finally, while the Supreme Court acknowledges that the filing of a Form 60 does not create a presumption of disability, Wilkes ignores the fact that many times, if not most times, the disability determination is driven by the medical conditions in a claim. Consider an employee who has a compensable right knee injury which does not cause any physical limitations and who also has back pain allegedly caused by the right knee injury, which is totally disabling. If treatment for the back pain is found compensable, as a result of the rebuttable presumption, because the right knee injury is accepted, then the medical presumption has morphed into a disability presumption as well.

Risk Handling Hint: Employers and carriers should carefully investigate and evaluate all claims before filing a Form 60 or 63.  As always, the Form 60 or 63 should specifically address exactly which body parts and injuries are being accepted. In appropriate cases, where the defendants have investigated the claim and determined that certain body parts are not related, they should file a Form 61 denying those body parts and conditions. However, employers and carriers need to realize that, following Wilkes, it is not clear that filing a Form 61 will provide protection. The employee may still be entitled to a presumption that any additional medical condition is related to the compensable injury and defendants will likely be required to litigate many of these claims and to present contrary evidence.

Jessica Barta was reappointed by Governor Greg Abbott as Public Counsel for The Office of Injured Employee Counsel (OIEC) for a term to expire in February 2019.  In that role, Barta has also accepted a position on the Board of Kids’ Chance of Texas, along with Jane Stone from the Firm, who has been on the Board since its inception. 
 
Kids’ Chance is a non-profit organization that creates and supports scholarship programs for children who have had a parent involved in a workplace accident that was fatal or left them severely injured.  Look for new upcoming Kids’ Chance events in Texas in the near future.  In the meantime, don’t forget that Kids’ Chance is also looking for eligible scholarship recipients.  Please visit Kids’ Chance of Texas’s website (www.kidschanceoftexas.org) for more details.       --Erin Shanley, Stone Loughlin & Swanson, LLP 

Senate Bill 1895 (Sen. Larry Taylor) was passed by the Texas Legislature and signed into law by Governor Abbot on May 26, 2017.  The bill amends the Texas Labor Code to require the commissioner of workers’ compensation in assessing an administrative penalty under the Texas Workers’ Compensation Act, to consider, in addition to other existing factors: (1) whether the administrative violation has a negative impact on the delivery of benefits to an injured employee, and (2) the history of compliance with electronic data interchange requirements.  The bill also requires the commissioner to adopt rules that require the Division, in the assessment of an administrative penalty against a person, to communicate to the person information about the penalty, including the relevant statute or rule violated, the conduct that gave rise to the violation, and the factors considered in determining the penalty.
 
The amended statute is effective on September 1, 2017.  --Erin Shanley, Stone Loughlin & Swanson, LLP  

We occasionally field questions about “EFA.”  This is a product that is being heavily marketed to Carriers, so we thought we’d address the procedure inThe Compendium. 
 
EFA (Electrodiagnostic Functional Assessment) is basically a surface (not needle) EMG done pre-employment and post-injury.  The stated goal of EFA is to age injuries and provide a potential defense to injury or aggravation claims.  
 
One vendor who aggressively markets this service claims that its technology is noted in ODG (the Division’s official treatment guideline)– the implication being that the ODG in some way endorses it.  However, EFA is not recommended by the ODG.  In fact, the ODG states, “surface electromyography, the primary technology used by this device, is not recommended for the diagnosis of neuromuscular disorders.”  Therefore, any claims made based on test results from the device could be very easily discredited.  Now you know.
 
As a substitute for “EFA”, the carrier or insured would be better-served by investing time and resources into clarifying a claimant’s diagnoses early on in a claim, before the horse is out of the barn and galloping away.   For example, in a motor vehicle accident, the adjuster should obtain crash photos, Texas Peace Officer’s crash reports, and ER notes, and conduct a full interview of the claimant immediately after the accident.  This strategy for claims management is well-known, economical, and time-proven.  --Erin Shanley, Stone Loughlin & Swanson, LLP

Gone are the days where a party can count on adding an issue to be adjudicated at a CCH at the last minute, without first raising the issue at the BRC or properly and timely requesting to add the issue after the BRC and before a CCH.  At least, maybe.  In a recent decision, the Appeals Panel found no abuse of discretion when the Hearing Officer found “no good cause” to add an extent of injury issue requested by the Claimant.  The issue was not raised at the BRC, the parties did not consent to adding the issue, and the Hearing Officer thus did not find good cause to add the issue.  Citing Downer v. Aquamarine Operations, Inc., 701 S.W.2d 238 (Tex. 1985) and Morrow v. H.E.B., Inc., 714 S.W.2d 297 (Tex. 1986), the Appeals Panel found no abuse of discretion on the part of the Hearing Officer in denying the request to add the issue. 
 
Hopefully this will prevent the all-to-often scenario in which a Claimant attorney or ombudsman will move for a continuance at the very last minute (after the Carrier representative has fully prepared for and traveled to the CCH), citing an extent of injury issue that he neglected to either raise at the BRC or timely request to be added after receipt of the Benefit Review Officer’s report. 
 
As always, whether a party will be allowed to raise an issue at the CCH (or request a continuance on the basis of raising a new issue) will remain a fact-specific, case-by-case matter.  Nevertheless, the Appeals Panel has given Hearing Officers a decision that supports their not having to automatically grant a continuance at the eleventh hour.  --Erin Shanley, Stone Loughlin & Swanson, LLP

A man has filed suit in Tarrant County district court, alleging that his former employer, a mortuary, discriminated against him because he filed a workers’ compensation claim.  He claims he developed asthma after performing mortuary services on a man who had died from ingesting paint fumes in November 2016. He says he had not been provided with personal protective equipment and began to suffer chronic asthma after being exposed to the fumes. 
 
The employee also alleges a trauma claim occurring the following month, after he had been assigned to handle the bodies of a mother and 3-month-old son who had been decapitated.  (The decedents’ husband and father had been arrested in their deaths.)  He is claiming a post-traumatic stress reaction from performing the services on the victims.
                                               
The former employee is seeking monetary relief of $100,000 to $1 million. The suit alleges loss of earnings and mental anguish because the mortuary did not pay for his medical expenses, and terminated the employee two days after they learned he had filed for workers’ compensation.
 
The mortuary has issued a prepared statement, stating that the claims are without merit, that the suit contains information that is “both misleading and inaccurate,” and that the former employee “is making claims that didn’t come up until after his termination.”  --Erin Shanley, Stone Loughlin & Swanson, LLP 

Eleven years ago, a film titled Idiocracy was released.  In the movie, Luke Wilson plays an American of average intellect who wakes up 500 years into the future, only to discover that he is now, by far, the most intelligent person in the “dumbed down” society in which he finds himself.
 
Some might findIdiocracy an excellent metaphor for the Division’s current project to revamp the PLN (Plain Language Notice) forms. The Division is currently proposing revisions to plain language notices PLN-1 through PLN-12, and is proposing a new PLN-13 and PLN-14, intended to act as subsets of the PLN-3.  One of the stated goals for the proposed changes to the forms is to provide an emphasis on use of plain language and communication via a “simple and easy to understand” manner.  More specifically, the Division’s research apparently shows that the average claimant reads at a fifth-grade level, and that language on the current forms exceeds this reading level. 
 
Yes, you read this correctly– the Division wants to make the forms comprehensible to someone whose vocabulary is roughly equivalent to an eleven-year-old child.  As an example, below is the current language of the PLN-1, followed by its proposed revision:
                       
Current:
We are denying your claim for workers’ compensation benefits.  Workers’ compensation benefits, including medical benefits, are not being paid because _____.
 
Proposed:
We, [Name of carrier], looked at your workers’ compensation claim. Based on the facts we got about your claim, we are not going to pay income or medical benefits.&nbnbsp; The reason for this is_____.
 
The Division is proposing division of the the PLN-3 (Notification of MMI/First IIBs payment) into three different notices: the PLN-3, PLN-13, and PLN-14.  Each proposed form is to be used to report a different payment scenario when a claimant reaches clinical or statutory MMI.
 
Additionally, while the PLNs are forms prescribed by the Division, the new forms indicate that insurance carriers must print the PLNs on their own letterhead. 
 
At this time, there is no indication as to whether (or not) the Division has conducted any specific research or surveys to determine the reading level of injured employees in Texas.  However, many have expressed concern that revising the PLNs to simplify the reading level to that of a fifth grader may offend the many injured employees (not to mention other system participants) who read at a higher grade level.  Does “plain” language really equate to “dumbed-down” language, and if so, do the forms really warrant this drastic of a change?   
 

We’ll leave you to decide for yourself. The draft plain language notices are available on the TDI-DWC website atwww.tdi.texas.gov/wc/rules/drafts.html.   --Erin Shanley, Stone Loughlin & Swanson, LLP

Written By: Kyla Block

When Plaintiffs are injured at work under circumstances which raise the question of whether the precipitating activity was “in furtherance of” versus “incidental to” the job duties assigned and the employer’s interest, the North Carolina Courts will look closely at the nature of the activity and the behavior immediately prior to the incident to determine whether the injury arose out of and in the course of employment. If the underlying facts prevent a clear determination and application of the relevant law, the Court of Appeals will remand for further clarification. In a recent decision,Weaver v. Dedmon, the Court of Appeals did just that, ultimately remanding the case to the Full Commission for clarity on whether Plaintiff was in the actual performance of a direct job duty or whether he was performing an incidental activity, and whether this incidental activity constituted a reasonable action.

In Weaver, Plaintiff was employed as a fence builder and was required to regularly operate a forklift and move fencing supplies around the outdoor storage yard. Plaintiff testified that on the date of injury, he had just finished unloading supplies with the forklift and was about to return the forklift to the warehouse when he turned the forklift too quickly and it overturned. However, a witness approximately 350 feet from Plaintiff testified he heard the loud noise of equipment “running at a high throttle” and saw Plaintiff doing “donuts” with the forklift just prior to the accident. The witness saw no work materials and “there was no indication that there was any work being done.” Plaintiff sustained a crush injury, closed head injury, multiple fractures, liver and renal lacerations, splenic injury and cardiac arrest. The Defendants denied the claim and asserted that Plaintiff had not sustained an injury by accident or specific traumatic event arising out of and during the course and scope of his employment.

Following a hearing, the deputy commissioner entered an Opinion and Award denying Plaintiff’s claim in its entirety and the Plaintiff appealed to the Full Commission.

The Full Commission affirmed the deputy commissioner’s Opinion and Award, finding the witness’ testimony credible because the witness was an unbiased, disinterested eyewitness of the events immediately preceding the accident. The Commission also found credible testimony by an accident reconstruction expert that photos of the tire impressions at the scene of the accident were consistent with the forklift having been driven in tight circles. The Commission concluded that Plaintiff was “operating the forklift at such a speed to cause it to rollover,” he was “joyriding” or “thrill seeking” when the accident occurred, and this activity bore no relationship to accomplishment of the duty for which Plaintiff was hired. The Commission further concluded that “to the extent Plaintiff may have initially performed some work-related tasks with the forklift, his decision to do donuts . . . was too remote from customary usage and reasonable practice and constituted an extraordinary deviation from his employment.”

Plaintiff appealed to the Court of Appeals.

In remanding the matter back to the Full Commission for reconsideration of whether Plaintiff’s injuries arose out of and in the course of his employment, the Court of Appeals determined the Commission’s conclusions regarding the lack of relationship between Plaintiff’s activity on the forklift to the accomplishment of his employment duties and the proposition that Plaintiff may have initially been performing some work-related tasks with the forklift were findings of fact, not conclusions of law, as these determinations were reached through logical reasoning from the evidentiary facts.  The Court further concluded that the factual findings – one stating Plaintiff’s action of performing “donuts” bore no relation to his job duties and the other stating that Plaintiff may have initially performed some work-related tasks with the forklift – were inconsistent with each other and precluded the Court from determining whether the Commission’s findings supported the legal conclusion that Plaintiff’s operation of the forklift removed him from the scope of employment. Specifically, the Court found the Commission’s finding that Plaintiff “may have initially performed some work-related tasks with the forklift” undermined the Commission’s conclusion that the injury did not arise out of and in the course of employment. On remand for redetermination by the Commission, the Court directed the Commission to reexamine whether it found Plaintiff’s testimony that he was returning the forklift to the warehouse after using it for work purposes credible and what impact that finding would have the conclusion that “Plaintiff operated the forklift preceding his injury [in a manner that] was unreasonable and reckless, in essence joy riding and/or thrill seeking.” The Court specifically sought clarity on whether Plaintiff was operating the forklift in furtherance of – or incidental to – his job duties and his employer’s interest, as that would determine whether the work-related activity would be characterized as “actual performance of the direct duties of the job activities” or as “incidental activities” and would direct the Court to follow evolved precedent for each characterization. 

Judge Tyson dissented and argued that since the Commission found that Plaintiff “may” have been initially engaged in a work-related task at the time of the accident, the majority’s opinion asserting that the Commission’s findings failed to support the conclusion that Plaintiff’s injuries did not arise out of and in the course of his employment “unduly parses the Commission’s findings and conclusions” and fails to apply the plain and ordinary meanings of the Commission’s words. He further argued whether Plaintiff initially performed work-related activities was inconsequential because the employee carried the burden of proving a causal connection between the employment and the injury and in this case, the Commission found that Plaintiff’s joyriding or thrill seeking ultimately broke the causal connection between Plaintiff’s employment and his injuries. Thus, the Commission’s Opinion and Award denying Plaintiff compensation was consistent with precedent, supported by competent evidence, and should have been affirmed.

Given this attention to detail at the Court of Appeals, all parties defending these types of claims need to clearly delineate arguments at the Commission level which demonstrate a succinct break between the actual performance of the direct duties of the job activities and incidental activities which can be shown to be unreasonable. 

On May 19, 2017, the Alabama Supreme Court released its opinion in SSC Selma Operating Company, LLC, d/b/a Warren Manor Health & Rehabilitation Center and SavaSeniorCare Administrative Services, LLC v. Jackie Fikes in which it reversed the trial judge’s order denying the employer’s motion to compel arbitration of a retaliatory discharge claim brought pursuant to §25-5-11.1.

On appeal the Court noted that there was no question as to whether or not the employment dispute resolution program (hereinafter EDR Program), was valid and that the parties had agreed to be bound by it. However, the issue on appeal was whether or not the language in the EDR Program that stated disputes not covered under the EDR Program include claims that relate to workers’ compensation...would also exclude a retaliatory discharge claim filed pursuant to §25-5-11.1 of the Alabama Workers’ Compensation Act. §25-5-11.1 specifically states that an employee cannot be terminated solely for bringing a workers’ compensation claim. On appeal the employer stated that the EDR Program specifically stated that it covered employment matters related to termination, discrimination, retaliation and harassment and other legally protected rights. The employer acknowledged that the EDR Program specifically stated that disputes not covered under the program are ones that relate to workers’ compensation, unemployment benefits, health, welfare and retirement benefits and claims by companies for injunctive relief to protect trade secrets and confidential information.

On appeal, the employee relied solely on the provision that stated claims related to workers’ compensation are not covered under the EDR Program and argued that the language was plain and unambiguous and, therefore, the discharge claim pursuant to §25-5-11.1 should be excluded from the EDR Program. However, the employer argued that, while the Alabama Workers’ Compensation Act gives rise to the discharge claim, that the retaliatory discharge claim pursuant to §25-5-11.1 is not a claim in the nature of a workers’ compensation claim and is actually a tort claim that was clearly intended to be included in the EDR Program requiring arbitration. In its opinion, the Supreme Court stated that it was apparent from the language in the EDR Program that the intent of the program was to submit to arbitration those employment related disputes where the plaintiff would ordinarily be entitled to have resolved by a jury, specifically noting claims arising from tort law and not claims governed by specific statues such as the Workers’ Compensation Act. The Court specifically stated that while a discharge claim pursuant to §25-5-11.1 arises out of the workers’ compensation factual setting, the claim is never the less a tort action and governed by general tort law. This includes the ability to recover damages for mental anguish and lost wages. The Court noted that while there are claims that relate to workers’ compensation laws, that those claims are generally for occupational disease and accident injuries as opposed to claims alleging retaliatory discharge. They also pointed out that the two claims, a workers’ compensation claim and tort claim (retaliatory discharge claim), are mutually exclusive.

In conclusion, the Supreme Court stated that the trial court erred in denying the employer’s Motion to Compel Arbitration of the employee’s retaliatory discharge claim since it was the clear intent of the EDR Program to have employment related disputes such as a retaliatory discharge claim brought pursuant §25-5-11.1, resolved by arbitration as opposed to a jury trial. Therefore, the Court held that the employee’s retaliatory discharge claim was not “related to” disputes concerning workers’ compensation laws, which are governed by the Workers’ Compensation Act, and are instead governed by the general rules of tort law.

ABOUT THE AUTHOR                

This article was written by Joshua G. Holden, Esq., a member of Fish, Nelson & Holden, LLC, a law firm dedicated to representing employers, self-insured employers and insurance carriers in worker’s compensation and related liability matters. Mr. Holden is AV rated by Martindale-Hubbell, which is the highest rating an attorney can receive. Holden and his firm are members of the National Worker’s Compensation Defense Network (NWCDN). The NWCDN is a national network of reputable law firms organized to provide employers and insurers access to the highest quality of representation in workers’ compensation and related employer liability fields. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Mr. Holden by emailing him at jholden@fishnelson.com or calling him directly at 205-332-1428.