The Concept of Disability
- Definition of "disability"
- In order to establish entitlement to workers' compensation benefits, an employee must demonstrate the existence of a "disability". Although this requirement has existed since the Michigan Workers' Disability Compensation statute became law in 1912, it was not until the 1980's that a definition of disability was written into the statute. Prior to the addition of statutory language, the meaning of the concept of "disability" had been developed through court decisions.
- Disability is presently statutorily defined as "a limitation of an employee's wage earning capacity in work suitable to his or her qualifications and training resulting from a personal injury or work-related disease. The establishment of disability does not create a presumption of wage loss." MCLA 418.301(4) and 401(1).
- The statutory language was recently interpreted by the Michigan Supreme Court in Haske v Transport Leasing, Inc, Indiana, (decided July 30, 1997). In Haske the Supreme Court essentially adopted the "traditional" definition of disability that had been developed over the years. That is, an employee is disabled if the employee can demonstrate a limitation on the employee's ability to perform even a single job within his or her qualifications and training. Of course, in Michigan an employee must be able to prove a wage loss resulting from the disability in order to be entitled to disability benefits.
- Although Haske was a major victory for injured workers, the legislature could get around it by changing the law to redefine disability. The WCAC has also attempted to limit Haske, usually by claiming that the employee, even though disabled, has failed to demonstrate "linkage" between the disability and wage loss.
- Establishing the existence of a disability.
- To establish the existence of compensable disability, an employee must prove that the injury at work caused, aggravated, or contributed to the disability. A disabling injury can result from a single event or from the stresses and strains of work activity performed over a long period of time. In cases involving injuries not attributable to a single event, the time or date of injury is deemed to be the last day of work in the employment in which the employee was last subjected to the conditions that resulted in the employee's disability.
- A work injury need not be the sole cause of a disabling condition. Ordinarily it will be sufficient to demonstrate that work was a contributing or aggravating factor. Certain conditions, including mental injuries and heart, cardiovascular, and other conditions of the aging process, require a showing of aggravation "in a significant manner". The phrase "in a significant manner" has yet to be definitively construed by the courts.
- The existence of a pre-existing condition does not mean that the aggravation of such a condition cannot form the basis of a compensable disability. However, the existence of a pre-existing problem may make it more difficult to prove that the disability results from the aggravation at work and not from the underlying process itself and its natural progression.
- Mental disabilities have received a great deal of attention. In 1994 the Michigan Supreme Court held that, in order to establish a compensable mental disability claim, an employee must prove (1) a mental disability; (2) arising out of actual events of employment, not unfounded perceptions thereof; and that (3) those events contributed to, aggravated, or accelerated the mental disability in a significant manner.
- Return to work/job offer.
- Even if an employee establishes the existence of a compensable disability, an employer can reduce or eliminate its obligation to pay workers' compensation wage loss benefits by tendering an offer of "reasonable" employment. "Reasonable employment" as defined in the statute "means work that is within the employee's capacity to perform that poses no clear and proximate threat to that employee's health and safety, and that is within a reasonable distance from that employee's residence." MCLA 418.301(9).
- "Within the employee's capacity to perform". The employer can insist that the employee perform any job within the employee's medical restrictions, not necessarily a job that comports with the employee's prior work or the employee's level of skill. Theoretically, a neurosurgeon could be forced to flip burgers (or risk losing his or her benefits) if such work was within the surgeon's medical restrictions following the injury.
- "No clear and proximate threat to the employee's health and safety". The reason for this language is unclear and there appear to be no cases that have interpreted it. It was probably inserted to emphasize that the work offered must be within the medical restrictions and not cause an aggravation or acceleration of the existing problem.
- "Reasonable distance from the employee's residence". This is a controversial and unsettled area. Some rehabilitation counselors insist that any job within a 50 mile radius is within a "reasonable distance". However, there appears to be no support in the statute or the case law for this position. An employee who customarily drove 40 miles to work could probably be forced to take a job that required him to drive 40 miles in the other direction but it is highly unlikely that an employee who ordinarily drove 4 miles to work could be forced to drive 40 miles.
- An employee's refusal or failure to perform work within the employee's capabilities results in a complete loss of wage loss benefits for the duration of the refusal, although medical and other benefits would continue to be paid. Even if the employee was receiving partial disability benefits (to be discussed below) because the favored work paid less than the wage that the employee was earning at the time of the injury, all wage loss benefits are nonetheless forfeited.
Recently, the Michigan Supreme Court released three important Decisions addressing favored work, also known as “reasonable employment.” Favored work or reasonable employment is work given to injured worker that accommodates the worker’s restrictions. The three cases are McJunkin v Cellasto Plastic Corp., Perez v Keeler Brass Co., and Russell v World Pool Financial Corporation. Our law firm, Reamon, Fotieo, Szczytko & House, PC, represented the plaintiff in McJunkin. Although, each case is different factually, the three cases have a common thread. The injured workers were offered favored work, they refused or quit the favored work, and they later changed their minds and expressed a willingness to resume work. None of the injured workers had worked more that 100 weeks after his or her injury. This is important because different rules apply when an injured worker has worked more than a 100 weeks.
Mr. McJunkin had suffered a work-related back injury requiring surgery. His employer offered him a job within the restrictions. However, Mr. McJunkin refused the job relying upon the instructions of his surgeon, not to return to work. The employer took the position that his refusal was unreasonable and stopped paying Workers’ Compensation benefits. Later, when Mr. McJunkin’s doctor reviewed a video tape and testified that Mr. McJunkin could do the favored work, Mr. McJunkin contacted his employer and advised the employer that he would accept the job that was previously refused. Unfortunately, the employer advised Mr. McJunkin that the position was no longer available. It had been approximately seven months between the time of the employer’s offer and Mr. McJunkin’s phone call. The Supreme Court had to decide: Was Mr. McJunkin entitled to Workers’ Compensation benefits given the fact that he had changed his mind and favored work was no longer available? The Supreme Court in it’s Decision, held that an injured worker who unreasonably refused an offer of employment was entitled to resumption of his Workers’ Compensation benefits where he later revoked his refusal. Specifically, the Supreme Court stated: “We conclude that, where an employee ends a period of unreasonable refusal, subsection 301(5)[of the Workers’ Disability Compensation Act] requires reinstatement of Disability benefits.” The injured worker would not receive benefits during the period of refusal but once the employee ends the period of refusal then benefits must be reinstated provided the employee is still disabled as a result of the work-injury. The Supreme Court held that there is no provision in the Workers’ Disability Compensation Act for an employee’s permanent forfeiture of benefit as a result to unreasonably refusing an offer of reasonable employment. However, the employee must take some affirmative action to advise his or her employer that the period of refusal has ended.
In Perez, the worker also suffered a back injury. He later returned to work for an employer in a light-duty capacity. However, after a few months he quit to leave the State. When he refused to sign a “quit-slip,” his employer terminated him a few days later. Then approximately four years later, Mr. Perez filed a claim for Workers’ Compensation benefits and offered to return to favored work with the employer. By this time, Mr. Perez had fully recovered from the affects of his injury. The Supreme Court held that Mr. Perez was not entitled to compensation benefits since when he offered to return to work he was no longer under a disability. Therefore, he was not entitled to benefits.
In Russell, the injured worker suffered a carpal tunnel injury. Ms. Russell returned to work for the employer but then stopped work. The employer sent her a certified letter requesting that she explain her absence. A few weeks later, Ms. Russell entered a period of refusal to work and advised her employer that she was again willing to work. The employer then sent her a letter telling her that she was terminated. This case involved a different favored work provision Section 301(5)(e). This provision says that a claimant that loses her favored job within 100 weeks, “ for whatever reason,” is entitled to compensation. The specific question is: must the employer pay Workers’ Compensation benefits to a injured worker who ended their period of refusal to work and then was terminated by the employer for just cause? The Supreme Court answered, yes.
The following principles have emerged from these three Supreme Court Decisions:
- The old rule that an offer of favored work need be kept open only for a reasonable period of time is no longer the law.
- There is no permanent forfeiture of benefits for refusing favored work because the Claimant can always end his or her period of refusal.
- Payment of Workers’ Compensation after the Claimant refuses work does not depend whether or not the offer of favored work remains open. Instead, payment depends on whether the Claimant has ended his or her period of refusal to work and is still disabled at that time.
- When a Claimant has ended their period of refusing work and is terminated for whatever reason within the first few weeks of 100 weeks of favored work, the Claimant is entitled to reinstatement of benefits.
- The workers' compensation law now includes provisions governing what happens when an injured worker finds subsequent work and then discontinues that work.
- Work for Less than 100 weeks. If an employee finds subsequent work and has worked in that position for less than 100 weeks; and then loses his or her job “for whatever reason”, the employee shall receive compensation based upon his or her wage at the original date of the injury.
- Work performed for 100 to 249 weeks. If an employee, after having found subsequent work and having worked in that position for 100 weeks or more; loses his or her job through no fault of the employee, the employee shall receive compensation based on the injury date. After working for 100 weeks, the burden shifts in order for the employee to receive wage loss benefits. The employee must be without fault in losing the employment. This will be an issue for the Magistrate to decide. For an employment lasting between 100 and 249 weeks, another issue to be decided by the Magistrate is whether the worker has established a new wage earning capacity. If so, compensation benefits would be payable based only on the difference between the average weekly wage at the time of the injury and the dollar value of the new wage earning capacity, if any. If the employee's new wage earning capacity, as reflected in current earnings, equaled or exceeded the average weekly wage at the time of the injury, the employee would not be entitled to any disability benefits. Factors to be considered in determining whether a new wage earning capacity has been established would include the nature of the work, whether the work is provided by the employer in whose service the employee was injured or by a different employer, and whether there is regular market for employees to perform the type of work that the injured employee is now doing.
- Work performed for periods of 250 or more weeks. There is a presumption that work performed for 250 or more weeks establishes a new wage earning capacity. This means that the burden of showing that the work did not establish a wage earning capacity is on the injured employee. However, since the employee effectively bears the burden of showing that a new wage earning capacity was not established for employments of 150 to 249 weeks, there is very little practical difference between what the employee must demonstrate in each situation.
- An employee always has the right to file a claim with the Workers Compensation Agency if the employee believes that the job is outside of the medical restrictions, too far from home, etc. Many litigated cases involve issues arising out of offers of favored work.
- Even if an employee establishes the existence of a compensable disability, an employer can reduce or eliminate its obligation to pay workers' compensation wage loss benefits by tendering an offer of "reasonable" employment. "Reasonable employment" as defined in the statute "means work that is within the employee's capacity to perform that poses no clear and proximate threat to that employee's health and safety, and that is within a reasonable distance from that employee's residence." MCLA 418.301(9).
- Special types of disability.
- Although Michigan is a wage-loss state, i.e., benefits are payable only for wage loss resulting from a work injury, there is an exception for the specific loss of body parts. Benefits for specific loss are payable irrespective of whether any disability results from the injury and whether the employee returns to work. Thus, an employee who lost an index finger as the result of a work injury would be entitled to 38 weeks of benefits regardless of whether the employee worked without a wage loss, worked with a wage loss attributable to the injury, or did not work at all, either because of the effects of the injury or for other reasons. It is possible to demonstrate a continuing general disability as the result of a specific anatomical loss, in which case the usual rules would apply. See pages 11 and 12 for more details on specific loss benefits.
- The workers' compensation statute also includes a group of severe disabilities that constitute "total and permanent disability." A finding of total and permanent disability includes a conclusive presumption that an individual is unable to work for 800 weeks from the date of onset of the total and permanent disability. An injured employee who can establish total and permanent disability can avoid the coordination (reduction) of workers' disability compensation benefits with other benefits that the employee might be receiving through the employer. A few employees whose average weekly wage was very high or very low at the time of their totally and permanently disabling injury may also have their weekly benefit rates raised annually based upon increases in the maximum compensation rate and state average weekly wage.