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Practical Advice In New Jersey Workers’ Compensation
N.J.S.A. 34:15-57.4 (commonly known as the Workers’ Compensation Fraud Act) states in pertinent part: “If a person, purposely or knowingly makes, when making a claim for benefits pursuant to R.S. 34:15-1 et seq., a false or misleading statement, representation or submission concerning any fact which is material to that claim for the purpose of obtaining the benefits, the division may order the immediate termination or denial of benefits with respect to that claim and a forfeiture of all rights of compensation or payments sought with respect to the claim.”
This means that both past and future benefits may be forfeited as a result of fraud (past benefits generally being medical and TTD, and future benefits generally being potential permanency benefits).
The Fraud Act goes on to state: “[I]n addition to any other remedy available under law, if that person has received benefits pursuant to R.S. 34: 15-1 et seq. to which the person is not entitled, he is liable to repay that sum plus simple interest to the employer or the carrier … and the division shall issue an order providing for the repayment …” N.J.S.A. 34:15-57.4(c)(2).
The Fraud statute sets a very high burden of proof for Respondents, as Respondent needs to demonstrate: 1. A false or misleading statement was made by petitioner; 2. The false statement must be material to the claim; and 3. The false or misleading statement was made for the purpose of obtaining benefits in the workers’ compensation case.
Below are hypothetical situations where Respondent may have a good argument that an employee committed fraud, and should consider filing a Motion to Dismiss for Violation of the Fraud Act.
Scenario 1: Tom is under authorized treatment for a January 1, 2022 work accident where he injured his low back and left shoulder. The authorized doctor placed petitioner out of work as of January 25, 2022. Petitioner is receiving TTD as he is out of work and he continues to deposit his TTD checks but at the same time, he continues to work as a delivery driver for a food delivery company and is paid from his second job as a delivery driver at the same time he receives TTD from his first job.
Our position is that this is fraud. An injured worker cannot collect TTD for not being able to work but actually be working. In this example, petitioner is representing that he cannot work but is working and therefore, he is making a fraudulent representation.
Scenario 2: During testimony on a Motion for Med/ Temp, Ryan testifies that due to his April 15, 2022 work injury, he cannot walk more than one block. He also cannot do any household chores and testifies that he has had to hire a housecleaning service. However, surveillance shows Ryan performing in triathlons and marathons, winning awards for being in second and first place in various events. He is also seen working on his home and building an addition to his back patio.
As Ryan has grossly exaggerated his abilities, our position would be that this is fraud. Misrepresenting of abilities to this degree is similar to the case of DuBrel v. Maple Crest Auto Group, No. A-3321-10T3 (App. Div. January 30, 2012), where petitioner testified that he could no longer do a variety of things, including training and trailering horses. However, petitioner was observed doing these activities, in direct opposition of his testimony. The court in this case found that this type of false testimony was a flagrant violation of the Workers’ Compensation Fraud Act. The Appellate Division affirmed the decision of the Judge of Compensation in terminating all benefits.
Scenario 3: Mary has a work accident of March 1, 2022, where she injures her left knee. During her course of authorized treatment, she specifically denies any prior left knee issues, injuries, or treatment. However, Respondent’s investigation reveals that on January 2, 2022, petitioner underwent arthroscopic surgery to the left knee. She then underwent a course of post-operative physical therapy through February 15, 2022 and treated with her prior surgeon through February 28, 2022. When confronted with this information, Mary indicates that she simply “forgot” about her prior surgery and prior treatment.
We would maintain that this is fraud in misrepresenting past medical history. In a case like this, testimony, or specific interrogatories, would likely be needed to elicit further details. It is difficult to believe that Mary “forgot” about a surgery from two months ago and “forgot” about her prior relevant treatment, which ended just before her work accident to the same knee, but the Judge of Compensation will ultimately decide on this issue.
Scenario 4: Bob says he got hurt in Aisle 4 of the grocery store, falling by the cereal boxes. He reported the injury right away and specifically says he fell by the Cheerio boxes. Security video shows Bob never even walked down Aisle 4 on the alleged date. In fact, he never fell at all.
It would be our position that this is fraud. The fabrication of a work injury for the purposes of obtaining medical treatment, TTD, and/or permanent disability benefits, is fraud.
If Respondent obtains new information in a closed file, Respondent can re-open the case. For example, in a case where a prior Order Approving Settlement was awarded and there may now be fraud (for example, petitioner is observed doing very physical activities that he stated he could not do at the time of settlement), Respondents can file its own Re-opener application to lower the Award. Alternatively, Respondents can file a Motion to Vacate the Prior Order Approving Settlement. Finally, Respondents can file a Motion to Dismiss for Violation of the Workers’ Compensation Fraud Act. Respondents may also be able to negotiate a small Section 20 settlement, or dismissal, of a case where the employee committed fraud.
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Maura Burk, Esq., is a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Ms. Burk concentrates her practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation matters. If you have any questions or would like more information, please contact Ms. Burk at 856.840.4941 or by e‑mail at mburk@capehart.com.
In Saiti v. Garden Homes, No. A-1328-20 (App. Div. October 11, 2022), the petitioner received an award for $66,074 on September 3, 2020. The terms of the settlement were memorialized in an order signed by the Judge of Compensation and both parties. Petitioner’s attorney made numerous phone calls in the ensuing 60 days regarding non-payment of the order. After 60 days, petitioner moved to enforce the Order since payments still had not been made. Over 90 days after the Order was entered, a telephone conference occurred on December 7, 2020 regarding the late payment. There was no record of the conversation and no record of any oral argument by the parties, although there is mention that the parties appeared.
On December 7, 2020, the Judge of Compensation issued an oral decision on petitioner’s motion, noting that the payments were now due over 90 days. The Judge of Compensation ordered:
1. Costs and interest on the settlement payments;
2. An additional assessment of 25% of the monies due for the unreasonable payment delay to the petitioner with $16,287 payable to Saiti;
3. $4,000 in attorneys’ fees payable to counsel for Saiti;
4. $5,000 in penalties payable to the Second Injury Fund;
5. Additional legal fees of $2,188 to counsel for Saiti in relation to enforcement efforts.
Respondent appealed the December 7, 2020 Order and argued that the Judge of Compensation abused his discretion in awarding penalties and sanctions without affording counsel the opportunity to be heard.
The Appellate Division observed, “The Workers’ Compensation Act does not establish a specific timeframe for payment of workers’ compensation settlement proceeds.” That statement is puzzling because N.J.S.A. 34:15-28 states as follows: “Whenever lawful compensation shall have been withheld from an injured employee or dependents for a term of 60 or more days following entry of a judgment or order, simple interest on each weekly payment for the period of delay of each payment may, at the discretion of the division, be added to the amount due at the time of settlement.” While this statute gives the Judge of Compensation some discretion, it also clearly refers to a 60-day time period.
The Appellate Division held, “Having reviewed the parties’ arguments in light of the record and the applicable legal principles, we are unable to determine whether the imposition of penalties and assessments under the December 7, 2020 order was reasonable.”
The Court held, “We are satisfied that it was a mistaken abuse of discretion to enter an order awarding sanctions without permitting counsel to be heard and without findings as to why the payment delay was unreasonable.”
The Court directed that the Judge of Workers’ Compensation “shall conduct a hearing and consider the steps taken by Saiti’s counsel to secure payment within sixty days of the entry of the September 7, 2020 order.” The Order was vacated pending a new hearing. The case seems to turn on procedural due process, namely the need for the Judge of Compensation to hear oral arguments on the reasonableness of the delay, specifically whether the delay in payment had some justification.
This decision provides no comfort for respondents. It is true that the December 7, 2020 Order was vacated, but a new hearing will be held in which the Judge of Compensation will hear oral arguments from defense counsel explaining the reason, if any, for delays in paying the Order of September 3, 2020. The best advice to employers remains this: all orders need to be paid within 60 days. That is the clear import of the relevant statute.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
We are living through a period of sharp inflation in almost everything from food and gasoline to automobiles and airfare, but one area where costs are sharply declining in New Jersey pertains to the cost of getting copies of medical records. Governor Phil Murphy signed S 2253 on September 22, 2022. This legislation dramatically lowers the costs that hospitals and physicians can charge for providing copies of medical records.
We begin first with a key definition. The bill refers to a “Legally authorized representative.” That means the patient’s spouse, domestic partner, or civil union partner; the patient’s immediate next of kin; the patient’s legal guardian; the patient’s attorney; the patient’s automobile insurer; or the patient’s worker’s compensation carrier, if the carrier is authorized to access to the patient’s treatment or billing records by contract or law, provided that access by a worker’s compensation carrier shall be limited only to that portion of the treatment or billing record that is relevant to the specific work-related incident at issue in the worker’s compensation claim.
Here are the allowable fees for a legally authorized representative under the new law:
“Authorized third party” means a third party, who is not a legally authorized representative of the patient, with a valid authorization, subpoena, legal process, or court order granting access to a patient’s medical or billing records.
Here are the allowable fees for authorized third parties under the new law:
Before passage of this new legislation, providers could charge $1 per page up to $125 for copies plus a search fee up to $25. The new $50 cap represents a significant cost reduction. Workers’ compensation practitioners need to know about this legislation because it has been routine to obtain requests for records that amount to hundreds of dollars. The law is so new that medical providers and hospitals may not even be aware of the changes.
Our thanks to Francine Viden, our firm’s excellent librarian, for obtaining the information and organizing the salient changes in the law.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
Few readers of this blog may know that the New Jersey Division of Workers’ Compensation achieved a number of notable firsts this year with the appointment of the Honorable Maria Del Valle Koch as Director of the Division in June 2022. Director Koch is the first woman Director and the first Hispanic Director in the history of the New Jersey Division of Workers’ Compensation. This is particularly noteworthy right now because September 15, 2022 through October 15, 2022 is National Spanish Heritage Month, an annual observance established by President Lyndon B. Johnson in 1968 to celebrate the histories, culture and contributions of Hispanic Americans. I recently had the pleasure of meeting Director Koch for the first time, and she was kind enough to allow me to interview her for this blog regarding her Hispanic heritage and her aspirations as Director.
Director Koch grew up in Jersey City, N.J. with four sisters and two brothers. She said education was stressed at home. She attended James J. Ferris High School and received her B.A. in History from St. Peter’s University in Jersey City. She graduated in 1987 from Seton Hall University School of Law in Newark, N.J.
Her mother, who is now 94 years of age, was born in Cuba and came to the United States in 1955. Her natural father and her step-father were both born in Puerto Rico. The Director learned to speak, read and write Spanish. “I’m very proud of my being Puerto Rican and Cuban.” She added, “The hallmark of my family is this: my mom told us to be proud of our Hispanic culture and to be proud to be American.” Both of her brothers were born in Cuba, and both served in Vietnam. She added, “We all believe in serving our country and our community.”
Director Koch worked in general practice in Jersey City, then worked for the Middlesex Region of the Public Defender’s Office until 1996. She established her own law practice in 1996. She worked as a Public Defender from 2002 to 2008 in Perth Amboy, N.J. In 2014, she was appointed a Judge of Compensation. In December 2020 she was appointed Administrative Supervising Judge while sitting in Plainfield vicinage. Governor Phil Murphy nominated her as Director of the Division on June 9, 2022.
Director Koch had not practiced workers’ compensation law before becoming a Judge of Compensation. She credited several former judges of compensation with helping her develop a deep appreciation for the New Jersey Workers’ Compensation Act, including former Judge of Compensation Nilda Hernandez, former Judge of Compensation Yolanda Adrianzen and former Judge of Compensation James Welch. In regard to being the first woman Director of the Division, she said, “All of the women judges who came before me have set the standard very high.”
Director Koch describes her style of leadership as collaborative, professional and consensus building. “What motivates me as Director is that I am part of a greater task to do right by people.” She summed up her approach as “be kind and be collegial.” In addition to running the Division of Workers’ Compensation, she handles seven lists in the Plainfield vicinage. “As a workers’ compensation judge, I have to set the tone and example for the way that we treat injured workers, attorneys, and everyone who is part of the Division.”
Director Koch commented that one of the major challenges in recent years for the Division, as for all courts, has been the COVID pandemic. “We in the Division have had an uncanny ability to think outside the box.” She added, “Like a good ballplayer, you have to adjust with each at bat and with each pitch.” Utilizing Zoom and Teams effectively has made a big difference,” she added. “My mission and my goal is to continue the high quality standard of excellence during the pandemic crisis that the Division has always demonstrated in New Jersey.”
The Director remains optimistic about the future of the Division. “Our Division has stood out as a court that is second to none in its ability to produce for workers and for all stakeholders.” She is hopeful that more judges will be nominated in the coming years.
The Director lives at the Jersey shore and when she is not working, she said she enjoys sailing and surf boarding. She has three children who are a big part of her life. She also remains an ardent fan of the New York Yankees and the New York Giants. She noted, “The Giants did not look so good in their most recent game and need to do a little better.”
Our thanks to the Director for allowing readers to learn more about her very interesting personal background and her goals for the Division in the coming years.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
Practical Advice in New Jersey Workers’ Compensation
Under N.J.A.C. 12:235-3.8, interrogatories are allowed in the following types of cases without motion (meaning, neither party is required to file a Motion for Leave to Serve Interrogatories with the Court): dependency cases (See N.J.A.C. 12:235-3.8(a)), re-opener cases (See N.J.A.C. 12:235-3.8(d)), and occupational exposure cases (See N.J.A.C. 12:235-3.8(f); for sample occupational interrogatories, click here).
Pursuant to N.J.A.C. 12:235-3.8(g), interrogatories may be allowed in other cases, upon motion, for good cause shown. Examples of cases where a motion for interrogatories may be filed are COVID-19 cases, medical provider cases, or certain types of denied cases where further information is being sought by the Respondent due to a disputed issue in the claim.
Situations where Respondents may consider filing a Motion for Special Interrogatories are cases where there is a specific issue or dispute requiring further clarification and investigation. Special Interrogatories may be used to obtain critical information of a discovery or factual nature that either party needs to prove its case.
While interrogatories are only allowed without a Motion in dependency, re-opener, and occupational exposure cases, respondents can also file Motion for Leave for Special Interrogatories in other cases, and special interrogatories are under-utilized in New Jersey workers’ compensation. For a client and practitioner, one never wants to start trial without pinning down key facts that could make or break one’s case. Trial by surprise remains a risky endeavor. Practitioners should consider filing Motions for Leave to Serve Special Interrogatories in those cases where there is a factual dispute or issue worth investigating.
While most cases in New Jersey workers’ compensation involve traumatic accidents where interrogatories are not allowed without Motion (and granting of the Motion), consider a situation where the authorized treating physician notes that the injured worker had a skiing accident three years ago in Vermont. In this instance, Respondent should consider filing a Motion for Special Interrogatories seeking further, and specific information, from the injured worker about the prior out-of-state accident, including names and addresses of all treating physicians, the nature of the injury, etc.
Respondent may wish to investigate petitioner’s subsequent/ additional employment, and in that instance, a set of interrogatories could be served seeking information regarding a claimant’s second job, including job duties, earnings, and employment information.
Another example of where special interrogatories would be useful is a situation where there is a dispute over ownership and control of an area. In this instance, interrogatories could be served seeking to obtain deeds and/or tax records and other documents to demonstrate ownership and control, or lack of ownership or control.
In those cases with disputed coverage or policy issues, interrogatories could be served seeking policy documents, cancellation notices, and other documents regarding proper cancellation of coverage.
The ultimate goal with filing a Motion for Leave to Serve Special Interrogatories is to obtain a Court Order granting the Motion, and more importantly, having the Order provide that the requested answers to interrogatories be provided within a certain time frame, such as thirty, forty-five, or sixty days. Then, if the answers are not provided within that designated timeframe, Respondent can file an appropriate motion. Parties and practitioners on both sides should be aware of how important interrogatories can be to centralize the issues.
Turning to those situations where answers to interrogatories are allowed without Motion, we first look at inquiries posed in dependency cases. These inquiries ask the alleged dependent to supply proof of dependency to the decedent, including the manner of relationship between the alleged dependent and decedent, as well as evidence that the decedent’s death was work related. These interrogatories also inquire as to the nature of any financial dependency the alleged dependent had with the decedent prior to the decedent’s passing. Dependency Claim Petitions and filing requirements are subject to N.J.S.A. 34:15-51, which require that a Dependency Claim Petition must be filed within two years of the decedent’s death.
In re-opener cases, inquiries are posed to petitioner regarding any treatment since the entry of the prior Award, including details regarding physicians and the nature of any treatment since the entry of the prior Award. Petitioners are asked to identify any subsequent employment held since the entry of the prior Award, including job duties at any new / subsequent positions. An inquiry is made regarding any new relevant accidents / injuries or claims and any new Awards or settlements. Essentially, these interrogatories are seeking information regarding any new injuries, incidents, or treatment since the entry of the prior Award. It is worth noting that any re-opener application must be filed within two years of the last date of payment made to petitioner, pursuant to N.J.S.A. 34:15-27. If the re-opener application is filed more than two years after the last date of payment or treatment date if treatment is rendered, Respondent should seek a dismissal of the matter pursuant to Section 27.
In occupational exposure cases, a standard set of respondent occupational interrogatories can be found on the NJ Department of Labor’s website, as noted above. In this practitioner’s opinion, the most important inquiry is Number 10: “Set forth the date and circumstances under which the petitioner became aware that the claimed injuries resulted from his employment”. Under N.J.S.A. 34:15-34, a petitioner in an occupational disease claim must file the petition within two years after the date on which the petitioner first knew the nature of the disability and its relation to the employment. For example, if petitioner files an occupational Claim Petition on January 1, 2022, and his response to Inquiry Number 10 states that he became aware of his claimed injuries and their alleged relationship to employment at any time prior to January 1, 2020, Respondent should utilize petitioner’s Answers to seek a dismissal of the claim pursuant to N.J.S.A. 34:15-34. Often, the Answer to Inquiry 10 is something along the lines of, “I became aware of my issues and their relationship to work upon consultation with my attorney”, but if a specific date is noted, Respondent should compare the date listed in Inquiry 10 to the date of the filing of the Claim Petition.
With the increase of COVID-19 cases, this practitioner has seen interrogatories being posed both on petitioners and respondents. Often the interrogatories served by petitioner asks respondent to identify whether petitioner was an essential worker. There is very little guidance on who is an essential employee, so this is actually a complex legal question as proximity to the public is not defined in the Essential Employee Law.
Practitioners should not limit interrogatories to those cases where interrogatories are allowed without Motion, and should consider filing Motions for Leave for Special Interrogatories in cases where further information is needed to flesh out disputed issues.
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Maura Burk, Esq., is a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Ms. Burk concentrates her practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation matters. If you have any questions or would like more information, please contact Ms. Burk at 856.840.4941 or by e‑mail at mburk@capehart.com.
One recurring question which adjusters and practitioners are often asked is this: in computing the workers’ compensation lien, does the employee get to reduce the employer’s lien by the amount the injured worker had to pay for costs and expenses in the third party action? Further, does the employee get to reduce the employer or carrier’s lien by the amount the injured worker paid in counsel fees in the workers’ compensation case?
Let’s deal with costs first. Many third party law suits are complex and require a substantial outlay of funds for depositions, experts and investigation. When it comes time to repay the workers’ compensation lien, some plaintiffs’ counsel will send the subrogation adjuster a ledger of all expenses paid in the third party case. Sometimes those costs can amount to many thousands of dollars.
Nonetheless, N.J.S.A. 34:15-40 only allows a reduction in the employer’s lien for costs up to $750. If the costs are only $300, then $300 is the reduction. But if the costs are well over $750, then the lien is only reduced by a capped amount of $750. Before the 2007 amendments to N.J.S.A. 34:15-40, the cost cap was only $250!
What about counsel fees in the workers’ compensation case paid by the employee to his or her own attorney? Let me provide a scenario to make this situation clearer. Suppose Employer pays $150,000 in workers’ compensation benefits, consisting of $50,000 in medical and temporary disability benefits and eventually $100,000 in permanent partial disability benefits. In New Jersey the petitioner’s attorney is entitled to a fee of 20% of the gross workers’ compensation award. So on a $100,000 workers’ compensation award, the legal fee will be $20,000. Who pays the $20,000 in petitioner’s counsel fee on a percentage award? The answer is that the employer pays 60% of the injured worker’s legal fee and the injured worker pays 40% of that fee. In the above scenario, that means that petitioner is paying her attorney $8,000 from her award and the employer or carrier in the workers’ compensation case is paying $12,000 toward petitioner’s attorney’s fee for a total of $20,000.
The third party case settles for $400,000 before the permanency aspect of the case settles. The attorney in the third party sends a check to the employer for two thirds of $50,000 minus $750 for costs. That takes care of the lien on the medical and temporary disability benefits. The statutory costs have also been resolved. The permanency award settles next for $100,000. Does the employer have a lien on $100,000 or on $92,000. (Remember, the employee paid her lawyer $8,000 from the $100,000 compensation ward). The employee may argue that she did not receive $100,000 in the workers’ compensation award and therefore should not have to pay back two thirds of $100,000. Suppose the plaintiff’s attorney only offers to pay back two thirds of $92,000. Who is right here?
This issue was decided in 2021 in Panckeri v. Allentown Police Department, A-2015-19 (App. Div. March 2, 2021), reaffirmed, (App. Div. August 19, 2022). While this is an unreported case, the case is useful because the Appellate Division answered this very question head on. It affirmed the ruling of the Honorable Christopher B. Leitner, Judge of Compensation, who found that the permanency lien is based on the gross award in the compensation case. So the employer gets back two thirds of $100,000, not two thirds of $92,000. The Appellate Division said, “We further agree with the judge that had the Legislature intended to include the petitioner’s fees and costs in Section 40, it could have done so through the 2007 amendment or at any other time in the Act’s one-hundred-and-ten-year history.”
The Appellate Division made one other important point based on a prior case called Kuhnel. It said the employer cannot lien what it paid toward the workers’ compensation counsel fee of petitioner. In our example above, even though the employer paid $12,000 toward the injured workers’ counsel fee, the employer cannot add that $12,000 to its lien and seek repayment of $112,000 in our scenario above. The employer’s lien is based on the gross permanency award, which was $100,000 in our scenario. It is not reduced by what the injured worker had to pay her attorney nor increased by what the employer had to pay toward the legal fee of petitioner’s attorney.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
Practical Advice in New Jersey Workers’ Compensation
A reader reached out asking about the terms and abbreviations often used in the workers’ compensation practice. Below is a glossary of these abbreviations and phrases often used (listed generally in the order in which they may appear as a case progresses).
“CP” – Claim Petition: This pleading is filed by the injured worker in workers’ compensation court when benefits (most often, permanency) are being claimed by the injured worker.
“MPC” – Medical Provider Claim Petition: In New Jersey, medical providers have the right to file their own petitions.
“FRI/FROI” – First Report of Injury: This form is completed by the employer after an accident. It generally outlines how the accident occurred and the injured workers’ injury(ies). This form gets filed with the Division. (For suggestions regarding what types of inquiries and items may be incorporated into an FRI/FROI and could be asked of the injured worker, please contact the undersigned at mburk@capehart.com or John H. Geaney, Esq. at jgeaney@capehart.com.)
“IW” – Injured Worker
“TTD” – Temporary Disability Benefits: For more information regarding TTD issues, please read our prior blog post entitled, Advice To Employers In Dealing With Complex TTD Scenarios.
“TDB” – Temporary Disability Benefits: These are benefits issued by the State of New Jersey. This is also an abbreviation for “New Jersey Temporary Disability Benefits.” In certain circumstances, an employee may receive State TDB benefits instead of TTD from the employer. In these cases, a lien will likely be filed by the Division of Temporary Disability Insurance in the workers’ compensation case.
“ROC” – Rate of Compensation: This refers to petitioner’s rate of TTD and the amount which is paid weekly while petitioner is out of work and receiving TTD benefits.
“RTW” – Return to Work: This is often used in conjunction with TTD (discussed above).
“LD” – Light Duty: Practitioners may also see the terms “mod duty,” “MD” or “modified duty.” “AD” – Alternative Duty may be used as well.
“FD” – Full Duty
“FCE” – Functional Capacity Evaluation: This may also be referred to as a fitness for duty examination. An FCE may be ordered by a treating physician to better assess return to work status and return to work potential/abilities.
“MA” – Medical Authorization: An MA signed by the injured worker is needed in order to obtain medical records from prior physicians during respondent’s investigation.
“ISO”: Refers to a New Jersey-based national company that searches for prior claims information. This used to be called a “CIB”.
“NCM” – Nurse Case Manager: In certain circumstances, a nurse case manager may be assigned to an injured worker’s case to assist with medical scheduling, appointments, exams, and treatment.
“CMS” – Center for Medicare Services: Medicare’s interests must be considered and protected in workers’ compensation claims and settlements.
“MSA” – Medicare Set Aside: An MSA must be obtained in certain types of settlements if the employee is a Medicare recipient or Medicare-eligible.
“CPL” – Conditional Payment Lien: MedicareCPL information must be obtained in settlements if the employee is a Medicare recipient or Medicare-eligible.
“HMS” – Health Management Systems: This is the Medicaid counter-part to Medicare’s CMS.
“Rogs” or “Roggs” – Interrogatories: Interrogatories may be served seeking additional information in occupational exposure, re-opener, dependency, and certain other types of cases.
“MMT” – Motion for Medical and/or Temporary Disability Benefits: This may be filed by an injured worker during a case if he is seeking additional TTD or treatment.
“RMI” – Request for Medical Information OR “DMI” – Demand for Medical Information: When one party seeks medical discovery from another party.
“IME” – Independent Medical Evaluation: This generally refers to an exam by either petitioner or respondent where a physician will address causation and treatment issues (often during treatment) or address causation and permanency issues (once treatment has concluded).
“PPD” – Permanent Partial Disability: These are benefits which are awarded to a petitioner at the end of the case depending on the amount of permanency petitioner is able to demonstrate. This may also see this abbreviated as “perm.”
“OAS” – Order Approving Settlement: This is one of two ways a case may settle. In Orders Approving Settlement, the petitioner’s case resolves for a specific percentage of disability and the petitioner retains the right to reopen for future benefits. Corresponding with the level of disability, the percentage award is paid over a certain number of weeks.
Readers with questions regarding workers’ compensation terms and phrases, or general questions about practical guidance and workers’ compensation tips may contact the undersigned at mburk@capehart.com.
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Maura Burk, Esq., is a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Ms. Burk concentrates her practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation matters. If you have any questions or would like more information, please contact Ms. Burk at 856.840.4941 or by e‑mail at mburk@capehart.com.
One of the most nettlesome questions in New Jersey workers’ compensation is whether a non-party can attend an IME and whether a petitioner or a physician can record a medical examination without the other party’s consent and use it at trial. It is important to observe that the New Jersey Workers’ Compensation Act provides very little guidance on procedures regarding medical examinations other than one particular statutory provision which allows only an employee’s personal physician to attend an independent medical examination.
The New Jersey Appellate Division in Kathleen DiFiore v. Tomo Pezic, A-2826-20, A-0367-21, A-1331-21, (App. Div. May 3, 2022) recently set down some very clear rules on recording and attendance for defense medical examinations. The case focused on Rule 4:19 Physical and Mental Examination Of Persons. That civil court rule provides as follows:
In an action in which a claim is asserted by a party for personal injuries or in which the mental or physical condition of a party is in controversy, the adverse party may require the party whose physical or mental condition is in controversy to submit to a physical or mental examination by the medical or other expert by serving upon that party a notice stating with specificity when, where and by whom the examination will be conducted and advising, to the extent practicable, as to the nature of the examination and any proposed tests.
In civil court these exams are officially called DMEs (defense medical examinations), although litigation attorneys generally refer to them as IMEs as they are also called in workers’ compensation. The Court discussed prior New Jersey cases that have weighed in on various aspects of DMEs and departed from them to some extent. The Court first observed that a DME is “… not an adversarial proceeding inevitably designed to disprove claims of injury and trap plaintiffs into admitting or showing their claims are exaggerated or fabricated.” Rather, the Court said that the DME is a professional assessment that must adhere to the standards of the examiner’s profession. The Court also added, “Nor is the DME, as defendants tend to portray it, always a purely objective exercise unaffected by any conscious or subconscious biases of the examiner. The examiners tend to be hired repeatedly by insurance companies and defense firms, with the expectation the examiners will assist the defense, if needed, as witnesses at trial.” The similarity of DMEs to IMEs is obvious.
The Appellate Division in the DiFiore case established some basic rules in regard to recording of a DME and third-party attendance. “First, a disagreement over whether to permit third-party observation or recording of a DME shall be evaluated by trial judges on a case-by-case basis, with no absolute prohibitions or entitlements. . . . The trial court must balance the competing advantages and disadvantages tailored to the particular case.”
The Court added that the expert who performs the DME “does not have the right to dictate the terms under which the examination shall be held.” The court noted that if the expert does not wish to proceed with the exam on the conditions imposed by the court, the examiner can withdraw from the examination.
The Court emphasized that to record an examination, the plaintiff must make a request and there must be consent to the request. To that extent the DiFiore Court departed from the Carley case. “Second, despite contrary language in Carley, we hold that, going forward, it shall be the plaintiff’s burden to justify to the court that third-party presence or recording, or both, is appropriate for a DME in a particular case, absent consent to those conditions.”
Next the court suggested that technological advances make recording rather easy. “We take judicial notice that with the pervasive use of pocket-sized smart phones as cameras and audio recorders, they can be unobtrusively placed on a tripod with minimal effort.”
The Court also addressed the presence of third parties in the examination. “… If the court permits a third party to attend the DME, it shall impose reasonable conditions to prevent the observer from interacting with the plaintiff or otherwise interfering with the exam.”
With respect to psychological examinations, the Court concluded that there is no reason to treat psychological examinations differently than physical examinations with respect to recording the examination or having third parties present. “We also discern no reason to favor or disfavor third-party presence or recording for neuropsychological (or any other ‘mental’) DMEs as opposed to other specialties.”
Lastly, the Court stated that if an interpreter is needed for the exam, the examiner shall utilize a “neutral interpreter” agreed upon by the parties.
As all practitioners and judges well know, New Jersey is a state in which only one party has to consent to a recording. Why then did the Appellate Division devote 44 pages to this important decision? It is important to understand that the consequence of the DiFiore decision is that without a request for a recording and without consent, the recording will not be permitted to be used at trial. The point of this case is that if a party wishes to record an exam and use the recording at trial, the party must make an initial request. The same is true of a request to have a third party present in the examination.
These rules are sensible. The fundamental ruling in this case is that a request must first be made by the plaintiff to record the exam or to have a non-party attend the exam. Consent to the recording or attendance by the respondent or IME physician will resolve the issue. Few cases will likely require a Judge to rule on the issue.
As mentioned above, the DiFiore case emerged from civil litigation. It did not involve a workers’ compensation case. This issue will eventually get to the Appellate Division on appeal from the Division of Workers’ Compensation and will probably focus on a non-consensual recording of an IME that counsel attempts to use at trial. Respondent will object based on DiFiore and an appeal will likely follow. This practitioner expects that the Appellate Division will evaluate this issue exactly as it did in DiFiore.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
The case of Donald Servais v. Ocean Wholesale Nursery, LLC., A-2988-20, (App. Div. July 14, 2022) presents an unusual legal issue in workers’ compensation. The case involved a dispute about an employment separation agreement and whether that agreement could have been construed to constitute a payment of workers’ compensation benefits, thereby tolling the statute of limitations.
Mr. Servais suffered an amputation of three fingers of his right hand on January 26, 2016. No claim petition was ever filed within the two-year statutory period, and respondent never paid any workers’ compensation benefits to Mr. Servais, believing that the injury occurred at petitioner’s home and that petitioner was not an employee. Respondent hired petitioner as a consultant and not as an employee, although petitioner contended that over the course of five years his relationship with Ocean Wholesale Nursery, LLC changed to that of an employee. Petitioner ultimately filed a formal claim petition on October 26, 2018, well past the two year statute of limitations.
Respondent, as insured by Farm Family Insurance Company and administered by ESIS, filed a motion to dismiss the claim petition under the two year statute of limitations. Petitioner countered by raising an argument regarding an employment separation agreement signed on January 31, 2017 by both parties by which terms respondent paid $5,000 to petitioner to resolve their business relationship. Petitioner argued that the employment separation agreement was ambiguous and could have led petitioner to believe that the $5,000 payment was in part a payment for the loss of his fingers. Petitioner argued that the claim petition was filed within two years of the date of signing the employment agreement and was therefore timely filed.
The parties agreed to try the issue of the statute of limitations separately and then reserve for a later trial all other issues, such as compensability and employment. The judge heard testimony from petitioner, the Nursery’s owner, and the Nursery’s former general manager. The judge reviewed the terms of the employment separation agreement and found Section 7 of the Agreement to be confusing. That section excluded from the Agreement “claims that may arise after the date (petitioner) signs this agreement.” The judge thought that this language might lead petitioner to believe that any incidents that arose before he signed this Agreement were included. The judge also found paragraph seven to be ambiguous because it excluded “(petitioner’s) rights to receive benefits for occupational injury or illness under the workers’ compensation law” but did not specifically mention a “traumatic injury.” The judge acknowledged that there was no mention anywhere in the agreement of an injury to petitioner’s fingers but criticized the agreement for not informing petitioner of his right to file a workers’ compensation claim.
Based on his interpretation of the separation agreement the judge concluded that the separation agreement included any and all claims, including the loss of fingers. The judge also found that petitioner was an employee and was injured during the course of employment, although the judge previously agreed that these issues would be held for a later hearing. Finally, the judge apportioned $1,000 of the $5,000 paid under the separation agreement to the petitioner’s injury to his fingers.
Farm Family appealed the decision to the Appellate Division, which reversed in favor of Farm Family and vacated the substantial award to petitioner. The Court said, “Reviewing the Agreement de novo, we perceive no ambiguity. The plain language of the Agreement expressly excluded petitioner’s workers’ compensation claim.” The Court added:
Contrary to petitioner’s argument, paragraphs five and six of the Agreement would not reasonably lead a person to believe that the $5,000 payment under the Agreement was also a partial payment for his work-related injury because paragraph seven of the Agreement, clearly entitled in bold ‘Exceptions,’ expressly stated that the release in the Agreement did not ‘affect or limit’ his right to receive benefits for occupational injury under the Workers’ Compensation Law.
In the end, the Appellate Division held that petitioner failed to file his claim petition in time. The Court also added that the Judge of Compensation had no right to apportion $1,000 of the $5,000 payment under the separation agreement to the loss of petitioner’s fingers. The Court said:
The judge’s finding that $1,000 of the $5,000 payment of the agreement was payment for petitioner’s loss of fingers has no basis in the record evidence. The judge faulted the agreement for not addressing petitioner’s loss of his fingers and for failing to inform petitioner of ‘his right to file a workers’ compensation claim and his inability to waive same.’ Yet, in the Agreement, petitioner did not waive his right to file a workers’ compensation claim. To the contrary, in the Agreement, petitioner expressly reserved his right to file a workers’ compensation claim. He just didn’t do so timely.
The Court concluded by reversing the order denying respondent’s motion to dismiss and vacated the final judgment. The Court did not reach respondent’s argument regarding denial of due process given the decision to dismiss the case on the statute of limitations.
This trial and legal brief in this case were handled by former Capehart attorney Dana Gayeski, Esq. and the appeal was argued by John Geaney, Esq.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.
Practical Advice in New Jersey Workers’ Compensation
Our clients often ask great questions regarding settlements in New Jersey workers’ compensation, particularly regarding the two types of settlements (Orders Approving Settlement, and Section 20/full and final), and the differences between them. This post provides examples of scenarios where an argument can be made for a Section 20 settlement.
There are two ways to settle a workers’ compensation claim in New Jersey. Most cases in New Jersey settle under N.J.S.A. 34:15-22 (known as an Order Approving Settlement) with a specific percentage of disability. In this case, the employee retains right to reopen for future benefits and receives a percentage award which is paid over a certain number of weeks corresponding with the level of disability. The higher the disability percentage, the more weeks that are paid.
Section 20 settlements are quite different. First, the Award is paid in a lump sum settlement. This is a full and final settlement of the case and it can never be reopened. A case settling pursuant to a Section 20 settlement must present a disputed issue of, liability, causation, jurisdiction, or dependency. Without one of these issues, there is no legal basis for a Section 20.
Issue of Liability: An issue of “liability” generally refers to a disputed employment issue (such as an off-premises injury) or a dispute regarding the existence of permanency. N.J.S.A. 34:15-36 states that in order to demonstrate permanent disability, a petitioner must prove, via objective medical evidence of an impairment (diagnostic studies) which restricts the function of the body. If the respondent can make a serious argument that there really is no permanent disability, then many judges will permit a Section 20 settlement.
In addition to proving an impairment, the petitioner must show also that the impairment is disabling. Disability is broader than impairment. It requires that the petitioner must also prove that he or she has a lessening to a material degree of working ability or a substantial impact on non-work activities.
Other bases for a Section 20 on the issue of liability are lack of timely notice under N.J.S.A. 34:15-17 or failure to comply with the Statute of Limitations under N.J.S.A 34:15-51.
Issue of Causation: An issue of “causation” generally refers to a disputed medical issue.
Case study/Example 1: Petitioner injures her left knee at work on January 1, 2020. Her post-accident MRI of February 15, 2020 is normal. She then has a subsequent non-work accident on March 1, 2020. An MRI of April 1, 2020 reveals an anterior cruciate ligament tear and a meniscal tear. We would argue that due to the March 1, 2020 subsequent accident which obviously caused new diagnostic findings, this case is appropriate for a Section 20 settlement. This example is similar to the case of Costanzo v. Meridian Rehab, A-5547-18 (App. Div. June 17, 2021), handled by our partner Carla Aldarelli. This case was discussed in our blog article entitled Respondent Prevails Where First MRI Post-Accident Showed No Abnormalities In Knee.
Case Study/Example 2: Petitioner injures her left knee at work on January 1, 2020. Her post-accident MRI of February 15, 2020 reveals an anterior cruciate ligament tear and a meniscal tear. During Respondent’s investigation, it is revealed that petitioner had a prior left knee injury of June 15, 2019 and on August 15, 2019, petitioner underwent a left knee MRI which also revealed an anterior cruciate ligament tear and a meniscal tear. We would argue that since the January 1, 2020 accident did not cause any new diagnostic findings, any disability is related to the prior June 15, 2019 accident, making this case proper for a Section 20 settlement.
Case Study/Example 3: Petitioner injures her left knee on January 1, 2020. On January 1, 2021, she receives an Order Approving Settlement for 15% of the leg from this January 1, 2020 accident. She re-opens her case on June 1, 2021. On May 1, 2021, she had a new left knee injury with a new employer for which she underwent treatment including a series of injections. She had no new treatment for the January 1, 2020 claim after filing her Re-opener. On the Re-opener, we would argue that the May 1, 2021 incident cuts off causation from the initial January 1, 2020 work accident, and the Re-opener should now be settled pursuant to Section 20.
Case Study/Example 4: Petitioner injures her left knee on January 1, 2020. On January 1, 2021, she receives an Order Approving Settlement for 15% of the leg from this January 1, 2020 accident. She re-opens her case on June 1, 2021. On May 1, 2021, she had a new and minor left knee injury with a new employer. The first employer for the January 1, 2020 accident agrees to provide all treatment following the reopener date, and the second employer pays no medical and temporary disability benefits because its incident was very minor. A petition is filed against the second employer. The employer for the May 1, 2021 incident will likely argue for a Section 20 dismissal. Most likely, the employer for the original January 1, 2020 re-opened claim will have to resolve the case on an Order Approving Settlement.
Issue of Jurisdiction: As a general matter, there are three principal ways in which jurisdiction in New Jersey may be found:
1. When the contract of hire is in New Jersey;
2. When the accident occurs in New Jersey;
3. When a substantial amount of employment for the respondent occurs in New Jersey.
There are instances where jurisdiction may be found in more than one state. This is allowed, so long as there is not a duplication of benefits between the two states (medical, TTD, permanency). So an employee may receive temporary disability benefits and medical benefits in another state like New York but apply for partial permanent disability benefits in New Jersey if the injury, hire, or work occurred in New Jersey.
Marconi v. United Airlines, 460 N.J. Super. 330 (App. Div. 2019) holds that localization of the employer in New Jersey and residency of the petitioner in New Jersey was not sufficient to warrant New Jersey jurisdiction where the petitioner worked almost exclusively in Pennsylvania and was injured in Pennsylvania. Petitioner argued that since United Airlines had a hub in Newark Airport (although petitioner worked in Pennsylvania) and petitioner also lived in New Jersey, those facts should be enough for jurisdiction. The Appellate Division disagreed. Our partner, Prudence Higbee, prevailed in this matter for United Airlines. More details about this case may be found in our blog article entitled United Airlines Wins Important Appellate Decision Involving Jurisdiction.
Issue of Dependency:
If it is determined that the work accident was not the cause of death, ultimately, we would argue that nothing except funeral costs are owed. However, in certain situations, a small Section 20 settlement/Award may be offered, in order to close the case.
If it is determined that an alleged dependent is not a valid dependent under Section 13, we would argue that nothing is owed. However, in certain situations, a small Section 20 settlement/Award may be offered, in order to close the case.
Miscellaneous Issues
Finally, there are also some “miscellaneous” considerations when determining if a Section 20 settlement is feasible. First, all Section 20 settlements are subject to petitioner’s, petitioner’s attorney’s, and the Judge’s approval.
Second, practitioners should keep in mind that legal fees are quite different between a Section 20 and an Order Approving Settlement. In Orders Approving Settlement, petitioner’s attorney’s fee (which is 20% of the overall Award) is paid 60% by Respondent and 40% by petitioner. For petitioner’s permanency exam, Respondent pays 50%; petitioner pays 50% (generally $300 each) In a Section 20 Order, petitioner pays 100% of his or her attorney’s fee.
Case Study/Example 1: Petitioner receives an Award for 15% partial total at 2021 rates, or 90 weeks at a rate of $258.00 per week, totaling $23,220.00. Petitioner’s attorney’s fee is $4,644. Of this, Respondent pays $2,786.40 and petitioner pays $1,857.60 (this may be rounded to the nearest dollar and rounded up for Respondent and rounded down for petitioner). Respondent and petitioner each pay $300 for petitioner’s expert. Ultimately, petitioner nets $21,062.40 and retains re-opener rights.
Case Study/Example 2: Petitioner receives a Section 20 Award of $27,500. Petitioner is solely responsible for his attorney’s fee of $5,500 out of his Award; he also pays the full $600 for his report. Ultimately, petitioner nets $21,400 and does not retain re-opener rights.
One disadvantage of a Section 20 is that payments are not lienable when there is a third party recovery unless both parties specifically agree on the record to make such payments lienable. This is quite different from an Order Approving Settlement where the entire permanency payment may be lienable if the third party amount is higher than the amount of the permanency award.
More than two thirds of settlements in New Jersey resolve on an Order Approving Settlement. The reason is that in many accidents there simply is no legal basis for a Section 20 settlement. The advantages of a Section 20 settlement are that the case is closed in a lump sum payment (unlike payments over many weeks for an Order Approving Settlement), there is no admission of liability and there is no potential for a reopener. But there must be a disputed issue of, liability, causation, jurisdiction, or dependency to argue for a Section 20 settlement.
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Maura Burk, Esq., is a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Ms. Burk concentrates her practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation matters. If you have any questions or would like more information, please contact Ms. Burk at 856.840.4941 or by e‑mail at mburk@capehart.com.