NCCI’s Countrywide Court Case Update provides a look at some of the cases and decisions monitored by NCCI’s Legal Team that may impact workers compensation (WC) across the states. This April 2023 edition contains updated information on cases previously introduced and presents new cases and decisions.
To view previously reported decisions, click the case links. For more information on cases monitored by NCCI’s Legal Team, visit previous Court Case Updates, COVID-19 Court Cases, and
Court Case Insights on
ncci.com.
COVID-19
COVID-19 and its impact on WC remain an issue of interest for stakeholders. Since the onset of the pandemic, courts have considered cases that address whether contraction of COVID-19 is work related and therefore compensable, or the application of exclusive remedy where employees contract COVID-19 and sue their employers in tort. Some recent cases include:
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West Virginia, Compensability of COVID-19 Claims—On March 6, 2023, the West Virginia Intermediate Court of Appeals held, in
PrimeCare Medical of WV v. Foster, that a WC claim for contraction of COVID-19 is generally not compensable as COVID-19 is an ordinary disease of life. However, the court noted that West Virginia statute 23-4-1 provides that ordinary diseases of life can be compensable as occupational diseases pursuant to six different statutory factors. In this case, the court noted that the board of review erred when it found the COVID-19 WC claim filed by a healthcare employee was compensable because it failed to consider the application of the six statutory factors.
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California, Employer Liability for Injuries Suffered by the Employee’s Spouse—The Supreme Court of California, in
Kuciemba v. Victory Woodworks, is expected to decide whether an employer is liable in tort for injuries sustained by the spouse of an employee who allegedly contracted COVID-19 at work and spread it to the spouse at home.
Exclusive Remedy
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Alaska, Intentional Tort Exception to Exclusive Remedy—On February 22, 2023, the Supreme Court of Alaska, in
Estate of Parks v. Petersburg Borough, considered the application of the intentional tort exception to WC exclusive remedy. In this case, the estate of an employee who died in a work-related car accident brought a wrongful death action against the employer and the coemployee who caused the accident. The estate alleged that the coemployee’s extreme indifference to the value of human life in causing the accident amounted to an intentional tort for purposes of the intentional tort exception to exclusive remedy. The Alaska Supreme Court disagreed reasoning that the estate’s allegations of “extreme indifference to the value of life” did not arise to a specific intent to harm, which is required for the intentional tort exception to apply. With this decision, the court affirmed the dismissal of the wrongful death lawsuit as barred by exclusive remedy.
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New Mexico, Negligence Claim Barred by Exclusive Remedy—The Court of Appeals of New Mexico, on February 23, 2023, in
Camarena v. Superior Contracting Corp., ruled that an employee who suffered permanent injuries when an overloaded scaffold collapsed could not sue the employer for negligence. The employee argued that the employer, sending him to work on a dangerously overloaded scaffold, brought his claim outside of the scope of WC exclusive remedy and was an intentional tort based on the New Mexico Supreme Court decision in
Delgado v. Phelps Dodge Chino, Inc. Under Delgado, a worker’s claim is not barred by exclusive remedy if (1) the employer engaged in an intentional act or omission without just cause that is reasonably expected to result in the injury to the worker; (2) the employer expected the intentional act or omission to result in the injury; and (3) the intentional act or omission proximately caused the injury. In this case, the court concluded that the employee presented no evidence that the employer had specific knowledge about the danger presented by the overloaded scaffold or that it disregarded the consequences of a dangerous situation. Thus, the court held, the employee’s lawsuit did not fall outside of the scope of WC exclusive remedy.
Developments in Marijuana
Although marijuana continues to be illegal at the federal level, for the past few years, several states have enacted laws or passed ballot measures allowing for its medical or recreational use.
So far in 2023,
Indiana,
Iowa,
Kansas,
Kentucky,
Nebraska,
North Carolina, and
South Carolina have introduced bills in favor of the legalization of medical marijuana. At the same time,
Delaware,
Florida,
Hawaii,
Indiana,
Kansas,
Kentucky,
Minnesota,
Nebraska,
New Hampshire, and
South Carolina considered proposals to legalize its recreational use, and recently, in March 2023, Oklahoma voters rejected a recreational marijuana ballot measure.
States have also been considering legislative proposals that address the issue of marijuana reimbursement as WC treatment. Most of these proposals, including a recently enacted law in
Kentucky (SB 47), state that WC reimbursement is not required. However,
New York introduced legislation (A 4713/S 2568) that would consider medical marijuana a prescription drug for WC purposes and
Massachusetts (HD 258) introduced legislation that would allow for reimbursement for medical marijuana in WC.
Marijuana and WC Court Decisions:
- On March 17, 2023, the Commonwealth Court of
Pennsylvania, in the cases
Fegley v. Firestone Tire & Rubber and Appel v. GWC Warranty Corp., held that an employer or WC carrier may be required to reimburse an injured claimant for medical marijuana treatment costs despite a provision in the state’s Medical Marijuana Act (MMA) stating that nothing in the MMA should be construed to require an insurer or health plan to provide coverage for medical marijuana.
Marijuana and the Workplace Decision:
- The Supreme Court of Nevada, on December 1, 2022, in
Freeman Expositions, LLC v. The Eighth Judicial District Court of the State of Nevada, held, as a matter of first impression, that employees who use medical marijuana outside of the work premises during nonworking hours may sue their employer for failure to accommodate the employees’ medical marijuana use. In this case, an employee who was an authorized medical marijuana user under the state’s law, was fired after testing positive for marijuana. The court analyzed Nevada statute 678C.850, which provides that an employer must attempt to make reasonable accommodations for the medical needs of an employee who engages in the medical use of cannabis if the employee holds a valid registry identification card. The court reasoned that the employee in this case was part of the class for whose benefit the statute was enacted and that recognizing an implied right of action for these types of employees, and allowing them to sue their employers, gives force to the public policy behind the statutory scheme.
Employee v. Independent Contractor
The classification of workers as employees or independent contractors has been top of mind for some time. In October 2022, the United States Department of Labor published a notice of proposed rulemaking that would revise current guidance on how to determine who is an employee or independent contractor under the Fair Labor Standards Act.
State legislatures have also considered the issue of employee or independent contractor classification, particularly as it applies to drivers for transportation network companies such as Uber, Lyft, and DoorDash. For example,
Kansas (HB 2019),
North Dakota (HB 1381), and
Oklahoma (HB 2464) have introduced legislation establishing criteria for when these drivers are to be classified as independent contractors.
In
California, the state’s First Appellate District Court, on March 13, 2023, in
Castellanos v. State of California, reversed a decision by a trial court that declared unconstitutional a voter initiative (Proposition 22) that allowed app-based transportation companies to classify drivers as independent contractors. The appellate court concluded that Proposition 22 did not violate a state constitutional provision that vests the legislature with plenary powers to create a WC system. The court, however, struck down as unconstitutional and severed a portion of the initiative that defined the term “amendment” in a way that limited the legislature’s ability to modify the provisions of Proposition 22.
Other state courts have considered the question of how to determine employee or independent contractor status for purposes of WC. Some examples include:
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Kentucky—Oufafa v Taxi, LLC (Supreme Court of Kentucky)
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Michigan—The Court of Appeals of Michigan, on February 16, 2023, in
Wittenberg v. Bulldog Onsite Solutions, LLC, rejected the application of the “economic realities test” when determining whether a worker should be classified as an employee or independent contractor for purposes of WC. Instead, the court held, the employee/independent contractor analysis should be based on the application of the definitions and criteria under WC statute 418.161(1)(l) and (n). The court ultimately found that the case should be remanded to the lower court because although the worker conceded that he was under a contract for hire with the employer, the parties never addressed whether the criteria of the statute were met.
Other Federal and State Developments (by Geographic Zone)
Across the states, courts continue to address other issues related to WC.
Northeast
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Maryland, Meaning of "Definite Proof"—On December 1, 2022, the Court of Appeals of Maryland, in United
Parcel Service v. Strothers, for the first time, considered the meaning of the phrase “definite proof” in Maryland statute 9-504(a). This statute requires an employer to provide compensation to an employee for work-related hernias if the employee provides definite proof that the hernia did not exist before the accidental injury or strain or that as a result of the accidental injury, a preexisting hernia has become so aggravated that an immediate operation is needed. In this case, a claimant with a prior history of hernias sustained a work-related abdominal injury and was later diagnosed with a hernia that required surgery. The employer contested the claim alleging that the phrase “definite proof” imposed upon the claimant a burden of clear and convincing evidence, as opposed to merely preponderance of the evidence. The court held, as a matter of first impression, that “definite proof” refers to the quality of evidence under a claimant’s burden of production and does not affect the standard of proof, which is held to be a preponderance of the evidence in hernia cases.
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Pennsylvania, Mesothelioma Claim Not Subject to Occupational Disease Act (ODA)—The Commonwealth Court of Pennsylvania, on February 16, 2023, in
Herold v. University of Pittsburgh, held that an employee who was diagnosed with mesothelioma 15 years after his last work related asbestos exposure could file a civil lawsuit against the employer because his disease manifested more than four years after the last exposure and was therefore not barred by exclusive remedy. The court analyzed Pennsylvania statute 77 Pa. Stat. Ann. §1401, which provides that wherever compensable disability or death is mentioned as a cause for compensation under the ODA, it shall mean only compensable disability or death resulting from occupational disease and
occurring within four years after the date of the last employment in such occupation or industry. The court concluded that the four year limitation period operates as a de facto exclusion of coverage under the ODA for certain occupational diseases that are prone to latency. The court also noted that the exclusive remedy provision of the ODA would not bar the employee’s claim because it extends only to those claims asserting compensable disability or death resulting from occupational diseases manifesting within four years after the employee’s last exposure.
Southeast
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Alabama, Benefit Review Agreement—The Supreme Court of Alabama, in
Ex Parte American Cast Iron Pipe Co., on September 23, 2022, ruled that the 60-day limitation period to set aside a benefit review agreement—provided in Alabama statute 25-5-292(b)—does not apply when a claimant is seeking to set aside an agreement based on the lack of mental capacity at the time the agreement was signed. In this case, the claimant and his employer entered into a benefit review agreement. A few years later, the claimant, through a court-appointed guardian, sought to invalidate the agreement alleging that when the agreement was signed he lacked the mental capacity to make informed decisions given the nature and extent of the work-related injuries. The employer moved to dismiss, arguing that the 60-day period in Alabama statute 25-5-292(b)—which provides that an agreement of this type is binding upon the parties unless a court, within 60 days of the parties’ signing the agreement, relieves them of its effect upon a finding of fraud, newly discovered evidence, or other good cause—had passed. The court noted that the word “agreement” commonly requires a degree of understanding between the parties and reasoned that if the claimant is asserting a lack of capacity to understand the agreement, then mutual assent between the parties was not possible. Therefore, the court concluded, because the statute only applies to actions challenging an “agreement” signed pursuant to 25-5-292, an action disputing the existence of that agreement falls outside the 60-day limitation period.
Midwest
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Oklahoma, Avoiding Claim Dismissal—On December 16, 2022, the Court of Civil Appeals of Oklahoma, in
White v. 918 Construction, LLC, considered the application of Oklahoma statute 85A O.S. Supp. §69(A)(4), which requires dismissal of a WC claim if, within six months of filing the claim, the claimant does not make a good-faith request for a hearing or receive or seek benefits. In this case, the claimant filed a WC claim but failed to make the request for a hearing and did not receive benefits within the six-month time frame. However, the claimant participated in discovery with the employer, including scheduling depositions. The court held that the claimant’s activities of engaging in discovery and depositions qualified as seeking benefits for purposes of the statute. With this decision, the court reversed an order of the state WC commission dismissing the claim.
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Oklahoma, Choice of Two Forums—On February 14, 2023, the Supreme Court of Oklahoma, in
Kpiele-Poda v. Patterson-UTI Energy, Inc., held that an injured employee could not file a WC claim before the WC commission and simultaneously maintain a lawsuit in the district court against the employer for an intentional tort. The court analyzed Oklahoma statute 85A O.S. §5(I), which provides that in the case of an intentional tort, the injured employee may maintain an action either before the commission or in district court, but not both. The court reasoned that according to the statute, the employee’s allegation of intentional tort against the employer provided him with a choice between two forums. However, in this case, the employee chose the commission as a forum by filing there first a notice of claim. Therefore, the court concluded, the employee was statutorily prohibited from maintaining a simultaneous action in district court.
For more information on these and other cases, visit
INSIGHTS.
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