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Menard, Inc. and Zurich American Insurance v. James Jones Jr., No. 2-579/12-0027

[(1) Substantial evidence supports Commissioner's decision that a running healing period was appropriate; (2) Merely stating that an employee is working part time hours is not enough to invoke the rate calculation set forth in 85.36(9).  Evidence as to the hours worked by similarly situated full time employees in the same field is required.]

 The Claimant, James Jones Jr., was a recipient of social security benefits who began employment at Menards stocking shelves. He was employed four hours a day for five days and was considered a part time employee. Six weeks after he began his employment the Claimant injured his back.


Many years prior, the Claimant had injured his low back with another employer. He underwent surgery for the injury and was ultimately given lifting restrictions. This was not disclosed on his Menards application as he stated he felt better than he had in a decade. After his injury at Menards the Claimant saw an orthopedic surgeon who saw no need for surgery and referred him to a pain specialist. This specialist found the injury to be an exacerbation of his previous injury. Once Menards learned of this they refused to approve further treatment.


The Claimant then filed a petition with the Workers’ Compensation Commissioner alleging an injury to his low back. Menards stipulated that the Claimant’s injury arose out of and in the course of his employment but disputed the permanency of the injury and his rate of compensation. At hearing, the deputy found that the Claimant had not yet reached MMI and awarded him healing period benefits. This was affirmed by the Commissioner and eventually appealed to the district court.


The district court affirmed the ruling that the Claimant had yet to reach MMI but reversed the agency’s rate calculation under section 85.36(9) finding that there was no evidence to support the application of the provision. Both the employer and the Claimant appealed the ruling of the district court.


The Court first examined the issues presented to it, whether the Claimant had reached MMI and whether the rate was correctly calculated, and noted that both fell under the Court’s substantial evidence standard of review; meaning the rulings would be upheld if substantial evidence was found to support them.


The Court then began its analysis of the issue of whether the Claimant had reached maximum medical improvement. The Court noted that the finding of the agency rested upon two independent medical examinations which opined the Claimant required further treatment and was not at MMI. Thus the Court found the finding supported by substantial evidence. These opinions had been provided by both an examiner chosen by the Claimant and one chosen by the employer. Thus the finding of that MMI had not been reached was affirmed.   


The Court then turned its attention to the issue of the Claimant’s weekly compensation rate. The agency in making its rate determination relied upon section 85.39 of the Iowa Code which provides:


If an employee earns either no wages or less than the usual weekly earnings of the regular full-time adult laborer in the line of industry in which the employee is injured in that locality, the weekly earnings shall be one-fiftieth of the total earnings which the employee has earned from all employment during the twelve calendar months immediately preceding the injury.


The district court had found that substantial evidence did not support the application of this provision. The district court had stated:


The provision found in subsection 9 requires a finding that the employee was earning nothing, or less than the usual full-time employee in that field. . . .

. . . [T]here is no evidence in the record of the usual weekly earnings of other workers in [the Claimant’s] field. . . . The Commissioner relies upon the fact that Jones worked four hours per day, as shown by Menards’s own records. The number of hours worked is not determinative of this issue. . . . The true inquiry is into wages earned. No evidence on this subject is discussed by the commissioner or contained in the record.


The Court noted that invoking section 85.39 required more than the Claimant’s claims that he was a part time employee. Indeed, the Court noted that recently the Supreme Court of Iowa emphasized that a finding of part time employment is not sufficient to invoke 85.39. The Court noted that the Supreme Court had held that 85.39 distinguished between full and part time employees on the basis of weekly earnings and not the number of hours worked per week. Thus, a factual finding must be made as to whether the employee earns no wages or  earns less than the usual weekly earnings of the regular full-time adult laborer in the line of industry in which the employee is injured in that locality.


The Court went on to state that such a finding had not been made in this case as the agency simply found that the Claimant worked four hours per day and was clearly a part time worker. The Court did not find this to be enough to invoke section 85.39 based on previous Iowa Supreme Court precedent. Thus the finding of the district court was affirmed and the case was remanded to the agency for a recalculation of the Claimant’s healing period benefits under section 85.36.

Call Mark Bosscher or Lee Hook with any questions @ 515-243-2100.  We’d be happy to help, whether it be a quick or a complex issue!