Board Panel Steps Back from Delta Airlines Rule in New Labor Market Attachment Decision
On August 7, 2017, a new Board Panel Decision, Barbella Environmental Tech., WCB #G0796969 (Aug. 7. 2017) introduced a change in the law on labor market attachment by backing away from the rule created by the Board Panel decision inDelta Airlines and the Full Board decision in Cranesville Block which allows claimants who were still employed by the employer of record to be found attached to the labor market without the need to produce proof of same as required by theAmerican Axle decision. The Board Panel in Barbella was split, with Commissioners Ausili and Hull in the majority and Commissioner Levelt in dissent. The split decision gives the claimant an appeal by right to the Full Board. The majority opinion outlined a two-pronged test for claimants who remain “on-the-books” at the employer of record, rather than applying a conclusive presumption that those claimants are attached.
The new test has two elements:
- Does the Board file contain objective medical evidence that the claimant can return to work with the employer?
- Does the claimant have a realistic expectation to return to work with the employer?
If the answer to both questions is yes, then the claimant is attached to the labor market. If the answer to one or both questions is no, then the claimant needs to satisfy the requirements ofAmerican Axle to prove labor market attachment. This rule will apply only to claimants during a period of temporary disability because the 2017 statutory changes to §15(3)(w) provide that permanently partially disabled claimants entitled to benefits at the time of classification no longer need to demonstrate ongoing attachment to the labor market.
The majority said that the claimant inBarbella, a union member who was partially disabled and potentially pending surgery, did not have objective medical evidence that he could return to work for the employer. Thus, he did not have a reasonable expectation to return to work and perform his essential job functions. The claimant also did not meet the requirements for labor market attachment outlined inAmerican Axle, so his awards were rescinded until he proved reattachment to the labor market.
This new rule gives carriers and employers another tool to limit indemnity liability during the period of temporary disability. We expect that the claimant will take the case to the Full Board and we’ll plan to report on that decision when it becomes available.
Don't Ignore Loss Transfer Opportunities in MVA Claims
Workers' Compensation claims arising from motor vehicle accidents (MVAs) present complex legal issues for claims handlers. Many of these claims involve a third-party action filed by the claimant against a negligent driver involved in the accident. Most claims professionals know that when a MVA involving two “covered persons” occurs in New York State, there is no workers’ compensation lien for payments made in lieu of “first party benefits” as defined by the New York No-Fault Law. The workers’ compensation carrier or self-insured employer (SIE) has lien and offset rights only for payments deemed outside the definition of “first party benefits”. Payments outside of "first party benefits" include: 1) combined payments of medical, indemnity and no-fault in excess of $50,000.00; 2) indemnity payments in excess of $2,000.00 per month; or 3) indemnity payments for lost time occurring after three years from the MVA.
Loss Transfer Arbitration allows the carrier or SIE to recover payments made in lieu of "first party benefits" even though the carrier or SIE does not have a lien against the third party recovery for those payments. Loss Transfer applies only in cases where at least one of the vehicles involved in an accident is used principally for the transportation of persons or property for hire or weighs in excess of 6500 pounds unloaded. In these cases, the carrier or SIE can pursue recovery up to $50,000.00 against the automobile carrier for the negligent party.
Hamberger & Weiss handles Loss Transfer claims and Arbitration hearings across the state, as those hearings are now conducted via teleconference. Over the past 5 years, we have recovered nearly $5,000,000 in Loss Transfer reimbursement for our clients.
We also prepare third party consent letters associated with the settlement of the bodily injury claim. Although Loss Transfer and third party actions are separate legal matters there are overlapping legal issues that intertwine your lien, credit and Loss Transfer recoveries. Involving expert counsel in third party cases will maximize your Loss Transfer recovery and protect your consent, lien and credit/offset rights in the third party action. Please contact Dan Bowers of our Loss Transfer practice group for assistance in these cases. For advice in regard to third party settlements generally, please contactRon Weiss, Susan Duffy, or Dan Bowers.
Stay Tuned – New SLU Guidelines Are Coming!
The 2017 Workers’ Compensation reform law (Part NNN of Chapter 59, Laws of 2017) requires the Board, in consultation with representatives of labor and business, to develop new permanency impairment guidelines concerning SLU findings by 9/1/17 for implementation on 1/1/18. The Board is reportedly on schedule to issue the proposed SLU Guidelines on 9/1/17. We will present our analysis of the proposed Guidelines as soon as possible after they are published.
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