Workers' Compensation and Employment Law: Stress Claims, Retaliation, Termination, Serious and Willful Misconduct and More

These materials have been prepared by the Law Office of Joyce E. Davis for informational purposes only. They are not meant to be and should not be construed as specific legal advice. For assistance with a particular legal question, please consult a licensed attorney.

As with physicians, the trend in recent years has been for lawyers to become increasingly specialized. Yet, just as a patient seeking an expert  medical opinion desires to be treated as a whole person, so too does a client needing legal advice benefit from having an attorney who can take into account the broader implications of his or her case. Thus, in planning overall strategy, it is advantageous to understand the basics of other areas of law likely to affect your clients. This is particularly true for employment and workers’ compensation counsel because the statutory schemes for protecting workers injured on the job and employees experiencing discrimination due to race, religion, gender, handicap and other protected categories were designed by the Legislature to overlap.

This article is intended to enable employment practitioners to identify those employee clients with viable workers’ compensation claims and to appreciate how the employment practices of an employer can affect its workers’ compensation liabilities. It will focus on those areas of workers’ compensation law most likely to be relevant to an employment specialist: stress claims, the penalty provisions of Section 28, temporary disabilities, retaliation, termination, rehiring preference, waiver and pre-employment screening.

A victim of workplace discrimination usually experiences some level of  emotional distress. Such psychological symptoms can form the basis of a workers’ compensation claim if they are severe enough to require treatment and/or become either wholly or partially disabling. A frequent diagnosis in such cases is post-traumatic stress syndrome. For example, in Cuddyer v. The Stop & Shop Supermarket Co., 434 Mass. 521, 527-528 (2001), the plaintiff's psychologist testified that she suffered from “recurrent major depression and post-traumatic stress disorder ‘directly causally related to persistent episodes of sexual harassment and its sequelae allegedly perpetrated upon her in her workplace.’”

The Massachusetts Workers’ Compensation Act specifically provides for coverage of emotional disabilities.  M.G.L. c. 152, §1(7A). The burden of proof for employees asserting such claims is, however, greater than that imposed on employees with physical injuries. All employees seeking workers’ compensation benefits must show that they were injured as a result of an event or series of events arising out of and in the course of their employment. M.G.L. c. 152, §26. For post-December 23, 1991 injuries, an employee asserting a claim for a purely emotional injury has the additional burden of showing that “the predominant contributing cause of” his disability is the work-related injury. M.G.L. c. 152, §1(7A)(emphasis and underlining added). By contrast, for claims based upon physical disabilities, the employee need only establish that the work-related injury was   “a contributing, but not necessarily predominant cause of disability or need for treatment.” Id.,  (emphasis and underlining added).  Moreover, as a threshold matter, an employee filing an emotional disability claim must present an opinion from a physician attesting to her disability and the cause of that disability.  Opinions from psychologists and social workers will not suffice.

 

The causation question in workers’ compensation cases is different from that in employment discrimination litigation. Under Chapter 152, the relevant inquiry is whether an event or series of events caused an employee to become disabled.  Such events need not rise to the level of “a hostile work environment” or other objective standard in order for the employee to prevail.  Thus, an individual who has become disabled or sought medical treatment as the result of an incident at work may well be entitled to workers’ compensation benefits even if she would not prevail at the MCAD.

In addition to showing that work-related events were the predominant cause of his disability, an employee making a stress claim must show that these events were not “bona fide personnel actions.” Pursuant to Sections 1(7A) and 29 of the Act, such bona fide personnel actions include transfers, promotions, demotions, or terminations. Presumably, however, transfers, promotions, demotions or terminations due to unlawful discrimination would not fall within the rubric of a “bona fide personnel action.”  See Beaudry v. Stop and Shop, 4 Mass. Workers' Comp. Rep. 239, 241 (1990)("employers should not be proscribed from good faith changes in the nature of an employee's work, good faith evaluation, critique or criticism or job performance or changing an employee's supervisor or coworkers").  Additionally, the fact that an employee has been terminated or otherwise subject to a bona fide personnel action does not necessarily mean that he does not have a viable workers’ compensation claim. Other events outside of the bona-fide personnel action may have caused the employee’s mental anguish. See Golec v. Chestnut Knoll Retirement Community, 12 Mass. Workers’ Comp. Rep. 76 (1998)(the administrative judge erred by failing to consider events apart from the employee’s termination which the impartial physician found to be causally related to her post-traumatic stress disorder).

Finally, there is an explicit statutory exception for those so-called “bona-fide personnel actions” which constitute the intentional infliction of emotional distress. To prevail on a claim of intentional infliction of emotional distress, it must be shown "(1) that the actor intended to inflict emotional distress or that he knew or should have known that emotional distress was the likely result of his conduct" and "(2) that the conduct was 'extreme and outrageous,' was 'beyond all possible bounds of decency," and was "utterly intolerable in a civilized community..."  Redgrave v. Boston Symphony Orchestra, 557 F.Supp. 230, 236 (198

Since an employee raising a stress claim must show that “the predominant contributing cause” of his disability is the workplace injury, he should be prepared to litigate his prior emotional problems, if any. It is also likely that the insurer will have access to those prior psychiatric/psychological records. Workers’ compensation proceedings are governed by the rules of evidence and, while there are psychotherapist/patient and social worker/patient privileges under M.G.L. c. 233, §20B and c. 112, §135B, they are limited. Specifically, these statutes provide that where “the patient introduces his mental or emotional condition as an element of his claim or defense,” the judge or presiding officer must balance the  “interests of justice that the communication be disclosed” with the need to protect the relationship between patient and psychotherapist. Accordingly, where an employee is claiming an emotional injury, an administrative judge at the Department of Industrial Accidents will, like a civil judge, usually find that the interests of justice require disclosure. See Harris v. Buckley, 1995 WL 13112569 (Mass. Super. 1995)(“[t]he underlying workers’ compensation proceeding is in fact a proceeding where plaintiff has introduced his mental condition as an element of the claim) and  Demare v. Town of Hudson, 1996 WL 1185170 (Mass. Super. 1996)(“[i]f plaintiff chooses to put his psychological or emotional condition at issue in this action, he must allow defendant the opportunity to challenge the causation of any psychological or emotional harm claimed”).

There is a four year statute of limitations for filing a workers’ compensation claim. M.G.L. c. 152, §41.  Thus, an employee who is in the throes of litigating a discrimination case at the MCAD or in court may wish to wait before undertaking the additional burden of a workers’ compensation case. A finding of unlawful discrimination in an employment law case can also be useful in both negotiating and trying a workers’ compensation case. Another consideration is that decisions in workers’ compensation cases involving emotional trauma can take a fair amount of time. There is usually a controversy over the events in question and administrative judges are often loathe to award benefits without having a full hearing. The process of filing a claim, taking the case to a hearing and then waiting for a written decision can easily take more than a year or even a year and a half.

An employee who first sustains a physical injury and later develops an emotional disability has a different burden of proof than an employee who simply files a mental illness claim.  Where there is a physical as well as a mental injury, the administrative judge will apply a “but for” test. Here, an employee must simply show that but for his physical injury, he would not have developed his emotional problems. Recent Reviewing Board cases have eased an employee’s burden still  further by providing that workers’ compensation benefits are available for mental disabilities which are simply “in sequelae” to physical injuries. Cirignano v. Globe Nickel Plating, 11 Mass. Workers’ Comp. Rep. 17 (1997). Even where there is a physical trauma, however, employees who suffered from pre-existing emotional problems will be required to demonstrate that the work-related emotional problem is “a major, but not necessarily predominant cause of” disability. Lotter v. City of Chelsea, 15 Mass. Workers’ Comp. Rep. ___ (2001). In discrimination cases, the “but for” standard of proof comes into play when employees who have been subjected to sexual or other prohibited discrimination have also been physically assaulted in some way at the workplace.

Section 28 of Chapter 152 provides that “[i]f the employee is injured by reason of the serious and wilful misconduct of an employer or of any person regularly intrusted with and exercising the powers of superintendence, the amounts of compensation hereinafter provided shall be doubled.”

Section 28 can be an important avenue of recovery for those employees who have been subjected to especially egregious conduct, even if they do not lose any time from work, because the “compensation” on which the penalty is based includes medical expenses. Boardman’s Case, 365 Mass. 185 (1974). Thus, even though an employee continues to work, he can be eligible for direct payment of a penalty under Section 28 based solely upon his medical treatment. The medical expenses to which the Section 28 penalty applies are, however, calculated using Board rates.  Consequently, an employee treating with a psychologist would not be entitled to twice the billed charges, but only double the amount of the DIA rates for such visits.  

“Serious and willful misconduct” has been described alternatively as a quasi-criminal standard,  Scaia’s Case, 320 Mass.  432 (1946), or “a reckless disregard of safety.” Bruenell v. Town of Framingham, 9 Mass. Workers’ Comp. Rep. 606 (1995). Hence, the Reviewing Board has held that there need not be an actual intent to cause harm. Rather, as set forth in Bruenell, the standard is both objective and subjective:

The conduct for a s.28 finding is met when an employer or superintending individual:

a.   does, or fails to do an act that he, or a reasonable person, would know or

b.   have reason to know

c.   will create an unreasonably high risk of bodily harm that involves

d.   a high degree of probability that substantial harm will result.

Id. at 610.

Under the statute, the employment of minors automatically constitutes “serious and willful misconduct” if such employment violates M.G.L. c. 149.  Other evidence of “serious and willful misconduct” can include the presence or absence of violated safety rules and  coercion. Considered alone, however, neither of these factors is dispositive. Bruenell, supra at 610-611.

Section 75B(1) of Chapter 152 states:

Any employee who has sustained a work-related injury and is capable of performing the essential functions of a particular job, or who would be capable of performing the essential functions of such job with reasonable accommodations, shall be deemed to be a qualified handicapped person under the provisions of chapter one hundred and fifty-one B.

At first blush, this would appear to be nothing more than a restatement of the rights given to any handicapped employee under Chapter 151B. Section 75B(1) may, however, be useful in extending the protections of Chapter 151B to those injured workers who are only temporarily disabled for a short period of time. Thus, in Hallgren v. Integrated Financial Corp., 42 Mass. App. Ct. 686 (1997), the Court held that where the plaintiff did not raise the possible application of M.G.L. 152, §75B, her temporary injury, which did not result in a permanent disability, did not constitute a handicap under Chapter 151B. Carr v. Transgas, Inc., 35 Mass. App. Ct. 581 (1993), rev. denied 416 Mass. 1111 (1994), offers the opposite example of an employee who did file a 151B claim on the grounds that he was handicapped under Section 75B. Carr was a truck driver who injured his shoulder for the third time while at work on January 25, 1990. Slightly more than two months later, on April 4, 1990, he refused to drive a truck without power steering, resulting in his termination two days later.  Although an arbitrator ruled that his termination had not violated the collective bargaining agreement, the Court found that the arbitrator lacked the authority to decide whether Carr was a handicapped person under M.G.L. c. 152,  §75B. Hence, his suit was allowed to proceed.

The Workers’ Compensation Act does not permit employers to retaliate against employees who have exercised their rights to file workers’ compensation claims. M.G.L. c. 152,§75B(2). Under Section 75B(2), employees who believe that they have been the victims of such discrimination can file an action in Superior Court against their employers. An employer found to have violated this law, will be ordered to pay lost wages, provide "suitable employment," and cover the employee’s reasonable attorney’s fees. The Court may also grant such equitable relief as it deems appropriate. The statute provides, however, that “if any right in this section is inconsistent with an applicable collective bargaining agreement, such agreement shall prevail.”  Since the Legislature has provided a statutory remedy for retaliatory discharge in Section  75B(2), employees may no longer file suits based upon common law retaliatory discharge claims. Magerer v. John Sexton & Co., 912 F. 2d 525 (Mass. 1990).

 

Chapter 152 does not prohibit an employer from terminating an injured employee who cannot return to work due to his/her work-related disability. There are, however, several caveats to this general rule.  As discussed above, an employer may not be able to fire an injured worker who would be able to perform the essential functions of her job with reasonable accommodations.  See Carr

v. Transgas, Inc., supra (court upheld an employee’s right to file a claim under 151B, §4(16) on the ground that he was a handicapped person under M.G.L. c. 152, §75B). An employer is also prohibited from terminating an injured employee in retaliation for her exercising any rights under the workers’ compensation statute. Again, the terms of a collective bargaining agreement will control in the event that they conflict with this provision of the law.

While an injured worker can lose her job if she cannot continue to perform, she will be entitled to preference in rehiring once she recovers. Section 75A mandates that when an injured employee recovers and when a suitable position becomes available, her employer must give her preference in hiring over other outside applicants. This preference will not, however, apply if it conflicts with the terms of a collective bargaining agreement.  

Employees who have settled their claims for lump sum settlements may also be disqualified from Section 75A rehiring preference.  Under Section 48, which governs lump sum agreements, an employee will be presumed to be physically disabled from returning to returning to work for the employer where the injury occurred for one month for each $1,500.00 of the settlement.  Thus, if an employee enters into a settlement for $50,000, he will be presumed disabled from returning to his former job for a period of 33 1/3 months.  The statute explicitly provides that during this period of presumed incapacity, “[n]o re-employment rights shall inure to [the] employee.”    

An employee  who believes that he was not rehired in accordance with Section 75A must file an action in Superior Court.  If he prevails, his employer will be exclusively liable for  lost wages, reinstatement in “a suitable job” and reasonable attorney fees.

An employee cannot be forced to waive his rights to workers’ compensation benefits.  M.G.L. c. 152, §46. Pursuant to the terms of a collective bargaining agreement, he  may, however, be required to submit his workers’ compensation claim to binding arbitration, rather than litigating it at the Department of Industrial Accidents. M.G.L. c. 152, §10C. Conversely, an employee cannot be forced to relinquish his rights to bring a wrongful discharge or breach of contract claim as part of a lump sum settlement of his workers’ compensation claim.  Section 48(3) reads in relevant part

:

No lump sum agreement shall contain as part of a settlement a general or specific release that would serve as a bar to (i) employment with any employer, (ii) the receipt by the employee of any pay or benefits due him by an employer, (iii) the bringing of any future workers’ compensation claim or (iv) the bringing of any claims of wrongful discharge or breach of contract.  All such general and specific releases shall be null and void. Any employer, insurer, employer or attorney attempting to obtain such release from an employee shall be punished by a fine of ten thousand dollars.

(Emphasis added).

The information requested from an employee on a job application or a pre-employment physical examination can affect both an insurer’s right to deny a claim on the grounds of misrepresentation of a pre-existing physical condition and its right to reimbursement from the Trust Fund for second injury claims.

Section 27A of the workers’ compensation statute denies benefits to an employee who “knowingly and willfully made a false representation as to his physical condition” at the time of hire if his employer relied upon the false representation and if the employee knew or should have known that “it was unlikely he could fulfill the duties of the job without incurring a serious injury.”  The Reviewing Board has interpreted Section 27A to require that the employee make an affirmative misrepresentation; a simple failure to disclose information will not suffice.  Garbarino v. Vining Disposal, Inc., 13 Mass. Workers’ Comp. Rep. 173 (1999). Thus, if an employer does not affirmatively ask the applicant whether there is any reason that he would not be able to perform the essential functions of his job, the insurer will likely lose its rights under Section 27A. It is also important that doctors performing pre-employment physicals have clear guidelines about which pre-existing conditions require follow-up. For example, in one case in which I was involved, the employee actually did disclose to the doctor that he previously herniated a disc. He was being hired as a nurse in a psychiatric hospital which necessitated the restraint of patients. Only two years earlier, this prospective employee had settled another workers’ compensation case for $70,000.00 on the ground that he would no longer be able to restrain patients. Yet, the doctor performing the pre-employment physical failed to inform the employer of this condition or recommend that the employee provide a release from his physician prior to starting heavy physical work.  Accordingly, the assertion of a Section 27A defense was defeated.

A second potential impact of pre-employment screening is on recoveries from the Trust Fund for second injuries to employees with pre-existing conditions. The purpose of creating such a reimbursement mechanism, which has existed since 1919, is to “encourage employers to hire handicapped workers . . .” Shelby Mutual Insurance Co. v. Commonwealth, 420 Mass. 251 (1995).  The 1991 amendments to the workers’ compensation statute restricted such reimbursements to instances where the employer “had personal knowledge of the existence of such pre-existing physical impairment within thirty days of the date of employment or retention of the employee by such employer from either a physical examination, employment application questionnaire, or statement from the employee.”  M.G.L. c. 152, §37. For post-December 23, 1991 injuries, reimbursement for disabilities subsequent to a physical impairment is only available in permanent and total disability cases. Since permanent and total benefits are available to an employee for the remainder of his life, they can represent a substantial exposure for both the insurer and the employer. Accordingly, the ability to mitigate such losses through Section 37 recoveries can have a sizable impact.

Employees who have been the victims of job discrimination frequently have viable workers’ compensation claims for benefits for emotional and physical injuries and penalties for serious and willful misconduct.  Moreover, injured employees are protected from retaliation, discrimination under Chapter 151B and waiver of their rights. They are also entitled to a rehiring preference.  Employers are entitled to find out when a prospective hire has a pre-existing condition that will prevent him from performing the essential elements of the job and is also likely to result in a subsequent injury. Given the overlap between workers’ compensation and employment law, it can be useful for workers’ compensation and employment attorneys to begin the collaborative process earlier, rather than later, even if a client will not immediately file a claim for workers’ compensation benefits.  Accordingly, when meeting with a client for an initial evaluation, consider whether the discriminatory conduct of his employer has resulted in a disability or a need for medical treatment, whether that employee might be able to return to work with an accommodation and whether he may be entitled to penalties under M.G.L. 152, §28.