Smith v. Zielles Tress Serv., Inc. – LIRC
Decided October 14, 2019.
Facts: Applicant told his treating doctors that he had no prior shoulder issues when treating for an allegedly work-related shoulder injury. Medical records showed Applicant had serious preexisting shoulder problems, and was scheduled for surgery prior to his alleged injury.
Decision: LIRC found Applicant’s doctor’s opinion not to be credible because they relied on incomplete and/or inaccurate information/medical histories.
As a reminder, the Families First Coronavirus Response Act or FFCRA becomes effective today. The applies to employers who have fewer than 500 employees. The employers must certify why an employee is taking eave under the Act. This is a simple process that involves the employee answering some simple questions and providing required information. These include:
The employee should re-certify every couple of weeks, if continued leave is needed.
If the employer does not have this certification, that could impact their ability to take a tax credit for these payments.
If you have any questions on how to create this form or why this information is needed, please contact our office.
COVID-19 update: Today, 3/31/20, is the last day for employers to lay off employees prior to FFCRA becoming effective. A few key points for Wisconsin employers and worker’s compensation carriers:
Question #1: If an employee is laid off today (or some prior date), what can they collect? They would qualify for Unemployment. Also, per the CARES stimulus, the amount of the Unemployment benefit increases. That said, you need to make sure there is not a pending worker’s compensation (WC) claim where the employer is accommodating work restrictions. If there is a WC claim pending, see Question 3.
Question #2: What if additional quarantine rules go into effect after today and/or the quarantine is tended longer than first anticipated? Starting tomorrow, 4/1/20, for an employer under 500 employees, FFCRA requires two weeks of Sick Pay and 10 weeks of paid Extended FMLA. The amounts of Sick Pay or Extended FMLA payments vary depending on whether the employee is full time or part time (see Question #7). An employee cannot collect more than the two weeks of Sick Pay even if the employee returns to work and then has to go back off work due to new quarantine concerns.
Question #3: What if there is a pending worker’s compensation claim? Do I re-start TTD benefits? It depends. If your employer is either doing FFCRA or voluntarily continuing pay (as some larger employers are doing), then you may not owe TTD benefit until the FFCRA/salary continuation ends. You should compare what is being paid each week to determine whether Temporary Partial Disability (TPD) is owed.
Question #4: What if the employer objects to the renewed TTD, as a) they were accommodating the employee, b) were forced to close, and c) they think the employee should go on Unemployment instead? Unfortunately, WC overrides Unemployment. If an employer shuts down, the employer is no longer accommodating work restrictions and WC benefits are owed unless the employer is somehow continuing wages. Here is a link to DWD’s website discussing TTD during shut downs: https://dwd.wisconsin.gov/wc/insurance/training/tpd/tpd_layoffs.htm
Question #5: Can an employee collect Unemployment and TTD/TPD at the same time? No. The employee needs to collect one or the other. And with the increase in Unemployment benefits under the CARES Act and waiver for the employee to look for work, employees may already be receiving Unemployment before you even know it. So, talk to your employee before restarting work comp benefits.
Question #6: Do I need to update the WKC-13? That depends on what is being paid and by whom. If the employer is doing salary continuation or FFCRA payments, I would not update the WKC-13 at this time. If the injured worker was laid off before FFCRA went into effect (or you have a large employer), and you restarted TTD benefits, then yes.
Question #7: If the employee is part-time, what would be paid? If the employer is covered by FFCRA, then the employer calculates the average wage over the past six months. This is then FFCRA wage. This wage is likely different than the average weekly wage for worker’s compensation claims. For part-time employees under a worker’s compensation claim, the wage may be expanded to full time unless certain exceptions apply. Or, if the employer is accommodating the light duty restrictions, you use the actual wage instead of the expanded wage to determine whether any Temporary Partial Disability (TPD) benefits are owed. COVID-19 lay offs may impact all of this. FFCRA eligible employees will receive something, but you will need to compare this to the actual wage to determine whether TPD benefits are paid.
Question #8: What does the employee need to do to collect Sick Pay or Extended FMLA? The employer is required to have the employee certify they are collecting these benefits due to a COVID-19 quarantine (there are several reasons). The employer needs this documentation to claim these payments on their tax returns. You should obtain the documentation of the payments and certifications for your WC files.
Question #9: What if the employee begins a new job while off on quarantine (as some employers – mainly grocery stores) are hiring? You would treat this as any other new employer after a WC injury. You obtain the wage records for the new employer and offset these wages against any TTD payments.
Question #10: What if the employer has under 50 employees and FMLA did not apply previously? The new laws apply to small business too, but the Department of Labor can provide exemptions. DOL has not yet provided guidance any the exemptions. We will continue to follow this situation as it develops. We anticipate additional clarification from the Dept of Labor in the coming days, as the exact exemptions have yet to be determined.
Question #11: Can short term disability (STD) off-set the Sick Pay and/or impact WC TTD payments? It depends. Maybe. If the reason for Sick Pay also allows the employee to qualify for STD and the amount of wages paid under STD is equal to or greater than what the employee is entitled for Sick Pay, there does not appear to be an issue in allowing the offset. However, keep in mind that employees are entitled to Sick Pay immediately, so any waiting period or other restriction imposed under a company’s STD plan will need to be accounted for. Also, WC can only offset for STD if the premium is 100 percent paid by the employer.
Question #12: Does the employer have any options if they are required to close, but want to avoid TTD being paid, and if yes, are there any key points in which the employer may want to do this? Yes, the employer can offer telecommute work. If the employer normally does not have telecommute work, they can have the employee watch safety videos or similar type work. The employer may want to do this especially if the injured worker was only part time, and TTD benefits would be expanded to full time. In other words, the employee will have a significant increase benefits from WC whereas the employer may be able to offer only a few hours of work each week to prevent this from occurring.
The Department of Labor (DOL) recently updated its question and answer section on the FFCRA, which came in response to increased questions by employers on how the FFCRA will impact them. Here is a summary of the DOL guidance:
Continue to follow our blog for updates as we continue to monitor this constantly developing situation.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law by President Trump on March 27, 2020. This Act is designed to curb any potential recession caused by the outbreak of COVID-19. The Act included a $367 billion loan and grant program for small businesses. It also expanded unemployment benefits to include people laid off, gig workers, and freelancers who were impacted by the social distancing rules implemented to slow the spread of the virus. Additionally, families making up to $150,000 jointly will receive $2,400 plus $500 per dependent under the age of 17. Single filers making up to $75,000 will receive $1,200.
In addition to the direct payments to taxpayers, the Act provides $130 billion to health care providers and $500 billion fund for loans to corporations overseen by the inspector general and a congressional panel. There are additional funds and grants earmarked for other industries, including airlines, air cargo, and state/local governments. We are happy to discuss these in detail if you are interested, but for the purposes of this blog post, we have limited the discussion to the portions of the bills that impact Employers and Carriers.
For smaller employers (those with less than 500 employees), it is important to remember that eligibility for the loans provided by the Act is still decided by the Treasury or Small Business Administration. That said, the Act also provides for paycheck protection to encourage employers to keep their workers paid and employed during the state of emergency. Any business with under 500 employees is eligible to receive a loan from the $349 billion allocated by the Act to cover payroll and essential overhead with most or all of the loan forgivable. However, this loan is capped at $10 million per business. Additionally, the amount of forgiveness available can be impacted by the average number of employees kept on payroll after the loan origination date. Simply put, if an employer wishes to maintain forgiveness potential for the entire loan, they should not make an unnecessary staffing changes after the loan origination date.
The Act also created a new Employee Retention Credit against employment taxes that encourages employers to retain and pay their employees. This is not available to any business that receives a Small Business Interruption Loan described above.
In addition to helping businesses, the unemployment eligibility is extended to people who would not otherwise be eligible IF their work loss is related to the coronavirus pandemic. It also extends the collection period from 26 weeks to as long as 39 weeks for included workers. Those eligible now include contractors, the self-employed, those who had previously exhausted their existing benefits amounts, and part-time workers. The Act also allows benefits for those with an insufficient work history and broadly includes “anyone else who would not otherwise qualify”. Importantly, the only workers who cannot collect unemployment benefits under the Act are remote online workers and those who already receive other paid leave.
If you wish to discuss this or have any questions, please contact our office.
Kasal v. Stryker – Court of Appeals
Decided March 17, 2020.
Facts: Applicant worked for Aurora Healthcare and was injured in 2016 when a product made by Stryker Industries broke. Sentry represented Aurora Healthcare and paid worker’s compensation benefits to Applicant during her healing period. Applicant filed a subsequent negligence claim against Stryker for the injuries caused by their product. Aurora and Sentry agreed to help, but did not assist as Applicant anticipated. They were added as parties to the negligence claim for their failure to assist. Applicant learned, through discovery, that a Stryker employee had removed the injury causing product prior to Aurora or Sentry being given notice. Thus, the negligence claim against them was dismissed, but Sentry remained a party to suit in order to recover the worker’s compensation benefits paid to Applicant. Sentry also brought a claim for punitive damages against Stryker and began their own investigation independent of Applicant. Applicant settled her claim with Stryker in January 2019. The settlement approved by the trial court apportioned settlement funds to Sentry to reimburse for the WC benefits and to pay Applicant’s attorney fees and costs. Sentry was not reimbursed for their attorney fees and costs. Sentry argued that under Sec. 102.29 Stats., they should be, Applicant said because Sentry’s policy was silent as to fees and costs, they should not be reimbursed.
Issue: When an insurance policy outlines specific reimbursement terms for third party claims contrary to the relevant statute (Sec. 102.29 Stats.), which should be followed?
Discussion: The trial court stated that Sentry’s own policy, which did not discuss reimbursement of attorney’s fees and costs, should be followed because they had the opportunity to include this language in the policy, but did not. The Court of Appeals agreed citing American Family Mut. Ins. Co. v. American Girl, Inc., 2004 WI 2, ¶23, 268 Wis. 2d 16, 673 N.W.2d 65. Specifically they said the court’s job when interpreting an insurance policy is to “determine and give effect to the intent of the contracting parties” and must be construed “as they would be understood by a reasonable person in the position of the insured.” Moreover, the court pointed to the language in the statute that allows for the apportionment of attorney’s fees and costs for all parties involved in the claim “unless otherwise agreed upon.” They expanded stating Sentry’s policy and failure to address reimbursement of attorney’s fees and cost fell into the “unless otherwise agreed upon” category; thus, the Court of Appeals upheld the trial court judgement stating “it is reasonable to conclude that if Sentry had intended to mandate the recovery of attorney’s fees and costs in worker’s compensation cases, it would have included similar language in its policy”
Practical Takeaway: If an insurer wants to recover attorney fees and costs in third party actions, the policy either needs to adopt the language set forth in Sec. 102.29, Stats., as a whole or if they have a specific policy, outlines all the terms of recovery so it is clearly understood prior to litigation.
On March 24, 2020, Wisconsin Governor Tony Evers issued a “Safer At Home” Order. It goes into effect at 8:00 a.m. tomorrow morning (March 25, 2020) and remains in effect until 8:00 a.m. on April 24, 2020 unless otherwise superseded.
That said, there are a lot of exceptions that allow continued working. Page 9 of the Order discusses Essential Businesses and Operations and the list goes on through the next several pages. Each employer will need to determine whether they qualify, in whole or in part, for one of the exceptions. For example, Professional Services (page 13) allows legal offices to continue operations, but asks for use of technology to avoid meetings in person, working from home, etc.
Other examples include Critical Trades (masons, carpenters, fabricators, etc.)(page 12); businesses that support other Essential Businesses (such as IT services) (page 13); and manufacturers, distributors and supply chains for production (page 14).
As always, McManus & Associates will continue to operate to assist you in answering your questions.
Given today’s unprecedented actions by Gov. Evers and the subsequent decisions Wisconsin business are making, here is some guidance from DWD that may be useful in explaining when TTD is owed vs. when UI benefits can be claimed.
https://dwd.wisconsin.gov/wc/insurance/training/tpd/tpd_layoffs.htm
President Trump signed the Families First Coronavirus Response Act (FFCRA) into law on March 18, 2020. This has the potential to significantly impact small and mid-size employers. The FFCRA requires employers with less than 500 employees to provide sick benefits to employees affected by COVID-19. It also expands FMLA, requiring covered employers to provide paid protected leave to employees impacted by school closures and interruptions in school care caused by the virus. Combined paid leave is capped at 12 weeks under the FFCRA. The changes listed below are effective April 1, 2020.
The FFCRA can be broken down into two parts: The Emergency Paid Sick Leave Act and the FMLA Expansion. Here is a brief summary.
The Emergency Paid Sick Leave Act
Expansion of FMLA
If the employee is laid off prior to these provisions take effect (i.e. prior to April 2, 2020), the only benefits they are eligible for are the expanded Unemployment Benefits outlined below. That said, if an employee has returned to work with restrictions from a prior work related injury, carriers/employers may owe a renewed period of TTD based on the employer’s inability to accommodate those restrictions.
Expanded Unemployment Benefits
Tax Credits for Employers
If you have any question on how to navigate this, please contact our office to discuss.
Wisconsin Gov Tony Evers tweeted that he will sign a Stay At-home Order tomorrow. As the Order is not finalized, we have not seen the details. The governor did say there will be exceptions for certain types of businesses. We can let you know as soon as we have more information. Please monitor our blog (www.mil-law.com) and/or LinkedIn page (https://www.linkedin.com/in/stephen-mcmanus-9a73822a/detail/recent-activity/shares/) as well.
If your WI employer shuts down due to the governor’s order, this move may require you to reinstate TTD benefits for any employees where the employer was accommodating sedentary or light duty work restrictions due to a work injury. That said, under the new FFCRA law (that goes into effect on 4/2/20), employers with 26 to 499 employees (unless otherwise exempted by the Department of Labor) are required to continue pay up to 80 hours of paid sick time (depending on whether the employee is full-time or part-time) if the employee is quarantined, taking care of someone who is quarantined, etc. Also, there is up to an additional 10 weeks of paid family leave at two-thirds the employee’s regular rate of pay where an employee, who has been employed for at least 30 calendar days, is unable to work due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.
McManus & Associates LLC will continue to operate as we all have the capability to work from home. We will continue to monitor our VM as well. Please let us know if you have any questions.