Return to Work Issues
by Joyce E. Davis, Esquire
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.
Copyright (c) 2002 Joyce E. Davis
All Rights Reserved
Introduction
Return-to-work issues impact the workers' compensation scheme in a number of ways. First, there is the question, frequently raised by both employees and employers, of if and when an injured worker can be terminated. Second, the interface between the Massachusetts workers' compensation statute and the anti-discrimination laws require employers in certain situations to provide reasonable accommodations to those injured workers who are able to continue performing the material aspects of their jobs. Third, from a practical vantage point, it makes good economic sense for employers to try to implement light-duty return to work programs for injured workers in order to minimize their workers' compensation costs. Finally, there is the issue of the tremendous impact that an employer's attitude can have - both positively and negatively - on the effectiveness of any return-to-work program.
In this seminar and the following materials, you will hear from a number of experts in the fields of workers' compensation law, employment law and occupational rehabilitation. Our goals are to increase your understanding of the substantive law, encourage you to implement effective return-to-work programs and work with your injured employees in a humane and understanding manner. Help your injured employees re-enter the workplace; you can truly make profound difference.
I. What Is A Light-Duty Return-to-Work Program - Some Basic Definitions
Light-duty, return-to-work programs are as various as the types of businesses covered by workers' compensation insurance. Obviously, not all companies can offer their injured employees light-duty jobs on a permanent basis. Nevertheless, even temporary, short-term programs can be effective in reducing an employer's liability for a particular injury.
The hallmark of any light-duty return-to-work program is the opportunity to bring an injured employee back to the workplace in a job designed to meet the restrictions set forth by his or her physician or the insurer's independent medical examiner. In general, modified positions are those light-duty jobs that can be made available on a permanent basis. The following are some examples taken from cases on which I have worked:
— A flooring installer injured his back and was permanently restricted from performing any job that required heavy lifting, bending or stooping. His employer not only offered this individual a sedentary position scheduling jobs, but also hired a vocational consultant to ease the employee's re-entry into the workplace. Following the recommendations of the consultant, the employer offered to purchase a special chair to allow the employee to recline and to provide opportunities for him to move about.
— Another employee, a driver for a dairy, also sustained a permanent impairment to his back that prevented him from returning to his former job. His employer created a sedentary job for this worker selling milk to retail customers. Again, the job was sedentary and provided ample opportunity for the employee to move around during the day.
— My client, a banquet server, injured her back, neck and shoulders. Initially, she returned to her regular job, but with restricted hours. After a third injury, however, her doctors advised her to switch jobs and she is now working as a switchboard operator. Unfortunately, she contends that she can only perform this work on a part-time basis because the constant sitting aggravates her back pain.
In contrast to permanent modified jobs, transitional light-duty jobs are temporary in nature and specifically designed to accommodate an employee's physical restrictions. Such jobs can also be progressive in nature. The following are two examples:
— The insured was a large chain of psychiatric hospitals that had an extensive return-to-work program. The first step in the program for those employees with serious injuries was to watch videos at home. They would then progress to part-time sedentary responsibilities for patients' charts. Exhibit “ A ” is a copy of this employer's transitional light-duty job program.
— The injured employee was a farm worker who spoke limited English and had little education. He injured his hand while working on a cranberry farm and was unable to perform his normal activities. The insured gave the employee a job weeding using only his non-injured hand.
II. An Overview of the Massachusetts Workers' Compensation System
A. Purpose
Prior to 1911 when Massachusetts became the first state to enact a workers' compensation statute, employees could only recover for their injuries by bringing an action in tort. There were many problems with this system for both employees and their employers. The civil litigation process is expensive and lengthy. An employee's claim could be defeated by the use of common law defenses such as contributory negligence or assumption of the risk. Employers also faced the specter of potential liability for high awards from sympathetic juries. And finally, there were the humanitarian considerations raised by denying medical treatment and income to those individuals who could no longer work due to a job-related injury. The workers' compensation system was therefore designed to offer prompt, predictable, albeit more limited relief, through a no-fault, insurance-based system that spreads the risk of injury over all employers in a particular industry. The overriding purpose of the Workers' Compensation Act is, however, to ensure that injured employees receive compensation for their lost earning potential. As the courts and Reviewing Board have often stated:
The Act must " be interpreted in the light of its purpose and so far as reasonable may be to promote the accomplishment of its beneficent design. "
Young v. Duncan, 218 Mass. 346, 349 (1914).
B. Benefit Structure - Differences Between Temporary Total, Temporary Partial And Permanent Total Disability Benefits
1. Temporary Total Disability Benefits
Under Section 34 of the Act, temporary total disability benefits are available to employees who become disabled from working at any meaningful job. Significantly, however, an individual who cannot work at his normal job, but can perform less strenuous work, will generally not be considered totally disabled. Temporary total disability benefits are available for a maximum of three years. The amount of temporary total disability benefits is equal to 60% of the employee's pre-injury average weekly wage up to a maximum amount set by the state.
2. Partial Disability Benefits
Section 35 of the Act provides for the payment of temporary partial disability benefits to those employees who cannot return to their normal jobs, but can perform some " non-trifling " work. Usually, partial disability benefits are available for a maximum of five years. There are, however, exceptions to this rule for employees who received more than two years of temporary total disability benefits or who have suffered a loss of 75% or more of any bodily function. The maximum partial disability benefit is 75% of the employee's total disability benefit. As with temporary total disability benefits, there is a maximum amount that an employee can receive in partial disability benefits.
3. Permanent Total Disability Benefits
Permanent total disability benefits are reserved for the (hopefully) small subset of injured employees deemed unable to return to work in any " non-trifling " occupation for the foreseeable future. Once an employee is found to be permanently and totally disabled, there is no limit on the length of time that he can continue to receive benefits. Permanent total disability benefits are calculated by taking 2/3 of the employee's pre-injury average weekly wage as opposed to 60% for temporary total disability benefits.
The long-standing rule used to be that an individual could only receive permanent total disability benefits if he had been paid the full three years of temporary total disability benefits. In 2002, however, the Appeals Court handed down its decision in Rainey Slater's Case, 55 Mass. App. Ct. 326, holding that an injured employee did not have to exhaust his temporary total benefits before receiving permanent total disability benefits. Rather, under the Appeals Court ruling, an injured employee is now eligible for permanent and total disability benefits so long as he has been on temporary total disability for some period of time and his situation has stabilized. Obviously, by making it easier for employees to file claims for permanent total disability benefits, the Court has dramatically increased the potential liability of an employer and its insurer.
C. Steps In The Litigation Of A Workers' Compensation Case
Litigation of a workers' compensation case begins when the employee files a claim for benefits or when the insurer files a request to discontinue or modify benefits. There are five major steps in the litigation of a workers' compensation case - the conciliation, conference, hearing, appeal to the Reviewing Board and judicial appeals.
1. Conciliation
About a week after the claim or request for discontinuance/modification is filed, the case is scheduled for a conciliation at the DIA office closest to where the employee lives. The conciliation is an informal meeting between the attorney for the insurance company and the employee and/or his attorney. The conciliator is not an attorney and cannot grant the employee's request for benefits or the insurer's request to modify benefits. Rather, the conciliator's job is to see if there is some way that the parties can reach an agreement. If an agreement cannot be reached, the conciliator will make sure that there is adequate medical documentation to support the claim/request for discontinuance or modification and will then forward the case to the division of Dispute Resolution.
2. Conference
The next step in the process is a conference before an administrative judge who will make a decision about the employee's claim or the insurer's request for discontinuance/modification. At the conference, the lawyers for the employee and the insurer submit medical documentation and other information to the administrative judge and make fairly brief presentations of about fifteen minutes each. Within a week or so, the administrative judge issues a conference order awarding or denying the employee's claim for benefits. It usually takes several months for a case to be scheduled for a conference after the conciliation, although there is a mechanism for employees to file for speedy conferences on the ground of hardship.
3. Hearing
If either side is unhappy with the judge's conference order, it can file an appeal. If the employee still claims to be disabled, he will usually need to be examined by an impartial physician appointed by the Department. Following this examination, the impartial physician will submit a report setting forth her opinion about the employee's disability. The case will then be scheduled for a hearing before the same judge who presided over the conference. The hearing is a formal proceeding, like a trial. The rules of evidence apply and witnesses testify under oath. After the hearing, the administrative judge again issues a decision awarding or denying the employee's claim for benefits. Unlike the conference order, however, a hearing decision is usually fairly long and includes detailed findings of fact. It generally takes at least six months between the close of evidence in the hearing and receipt of the judge's hearing decision. During this period, the terms of the conference order remain in place. The hearing is a procedure de novo so that in her decision, the judge can reverse her prior conference order. As a result, the insurance company may wind up owing the employee benefits retroactively. Conversely, the employee may turn out to have been overpaid, which will allow the insurance company to seek to recoup the excess payment.
4. Appeals
After the hearing decision is filed, the parties have thirty days to file an appeal to the Reviewing Board at the Department of Industrial Accidents. Such review is limited, however, to a determination as to whether the administrative judge abused her discretion. As a rule, an administrative judge's findings of facts will not be disturbed on appeal. Further appeals may be had to the Massachusetts Appeals Court and the Supreme Judicial Court.
III. The Economic Benefits of Having A Modified Duty Return-To-Work
Program
A. The Effect Of Injuries On An Employer's Workers' Compensation Premium
Workers' compensation premiums are calculated by multiplying an individual employer's premium by the rates for the classifications applicable to its operations. The more dangerous the industry, the higher the rate. For employers over a certain size the result is then either increased or decreased by the application of an experience modification factor. The experience modification factor incorporates the incurred losses of the employer over the previous four years. Thus, the higher a company's losses, the higher its premium; conversely, the lower the losses, the lower the premium. This calculation can be expressed by the following formula:
Premium = [(Payroll x rate per classification) x experience modification factor]
Reducing the costs of workplace injuries can affect a business' workers' compensation premium in two ways. First, on the macro level, the fewer the losses in a particular industry, the lower the rate for its classification. Second, and more important to an individual employer, containing losses can lead to a negative or reduced experience modification. This, in turn, will actually lower the size of the premium.
B. Reducing Your Exposure Through Effective Light-Duty Return-To-Work Programs
An effective light-duty return to work program can dramatically alter the effect of a particular injury on an employee's earning capacity. In determining the benefits to which an employee is entitled, the Department makes a distinction between the actual physical disability and the impairment of earning capacity. Thus, an employee " is not entitled to compensation for an industrial injury (other than injuries for which specific compensation is awarded under G.L.[c. 152, § 36,37] resulting in a physical disability if there is no impairment of earning capacity. " Atkin's Case, 302 Mass. 564 (1939). Moreover, courts recognize that “ [p]hysical handicaps have a different impact on earning capacity in different individuals. ” Scheffler's Case, 419 Mass. 251, 256 (1994). Thus, in evaluating the effect of an injury on an individual employee, the administrative judge will take into account a number of factors other than the physical or emotional injury itself. These include the employee's age, education, experience, seniority status, the attitudes of personnel managers and insurance companies, the business prospects of the employer, and the strength or weakness of the economy. Id.
Earning capacity determinations are governed by Section 35D of Chapter 152. The statute states in relevant part:
For purposes of sections thirty-four, thirty-four A and thirty-five, the weekly wage the employee is capable of earning, if any, after the injury, shall be the greatest of the following:
(1) The actual earnings of the employee during each week
(2) The earnings that the employee is capable of earning in the job the employee held at the time of injury . . .
(3) The earnings the employee is capable of earning in a particular suitable job; provided, however, that such job has been made available to the employee and he is capable of performing it. The employee's receipt of a written report that a specific suitable job is available to him together with a written report from the treating physician that the employee is capable of performing such job shall be prima facie evidence of an earnings capability under this clause.
The earnings the employee is capable of earning
Oftentimes, an employee who would otherwise be considered to be totally disabled on the open labor market will only be considered partially disabled or even not disabled at all if his employer can make a suitable light-duty job available. Such job offers are particularly helpful for individuals who do not speak English or have limited education or work experience. Even if the light-duty work is only temporary, it can be useful in demonstrating to the administrative judge that the employee has transferable skills. Thus, if a former truck driver can perform clerical work for several months in a light-duty job, the insurer can reasonably argue that he should be able to find similar work in the open labor market.
C. Examples Of The Economic Impact Of Reducing A Total Disability Claim To A Partial Disability Claim
The rather dramatic impact of a light-duty offer on the cost of a particular workers' compensation claim is best demonstrated by example. Assume therefore that an employee had a pre-injury average weekly wage of $500.00. Under Section 34, her temporary total disability benefits would be 60% of this amount, or $300.00. If, however, her employer can offer her a light-duty job paying $300.00 per week, her workers' compensation benefits will be reduced to $120.00 [($500.00-300.00) x .6].
The effect of light-duty work is most easily seen when computing an insurer's exposure for potential permanent total disability cases under Section 34A. For purposes of this illustration, assume that the employee is a 57-year-old former machinist with a pre-injury average weekly wage of $500.00 who sustained both cognitive and physical injuries. As a result, he can only perform one task at a time without time pressures. Given his age, education and background, without a light-duty offer on the table, this employee has a strong case that he is permanently and totally disabled. The insurer's exposure for such permanent and total disability benefits is calculated by figuring out the person's life expectancy, multiplying the number of weeks he is expected to live by his Section 34A rate and then using a reasonable interest rate assumption to find the present value. In our example, the numbers would be as follows:
Life Expectancy at 57 - 21.5 years or 1,122 weeks
Section 34A benefits = 66% of AWW - $333.33
Insurer's Exposure - $333.33 x 1,122 = $373,996.26
Present value using an interest rate of 6% - $210,038.69
The value of this case is altered significantly if we assume that the administrative judge will find the employee only partially disabled. Under Section 35, this employee's maximum partial disability rate is $225.00. Since, in most cases, the employee will only be able to receive partial disability benefits for five years, the insurer's exposure is reduced to $58,500.00. This calculation is set forth in the chart below:
Maximum Section 35 rate - (75% of AWW) x .6
($500.00 x .75) x .6 = $225.00
Total benefits under Section 35 - $58,500.00
In this scenario, the difference between the present value of the employee's permanent total disability benefits and the value of his temporary partial disability benefits comes to more than $151,000! Hence, if the employer can afford to accommodate this employee in a light-duty position, it will realize a real saving on its workers' compensation premiums for years to come.
IV. Convincing A Judge To Take A Light-Duty Return-To-Work Program Into Consideration
A. The Bona Fide Job Offer Requirement
In order for an administrative judge to consider a light-duty job offer in assigning an earning capacity, he must find that the offer is bona fide. This means that the job must be 1) available and 2) the employee must be able to do it. For example, the Reviewing Board reversed an administrative judge's decision to terminate an employee's benefits on the ground that light-duty work had been made available because the evidence showed that the job might only be available for six months out of the year. Keith v. Wequassett Inn, 11 Mass. Workers' Comp. Rep. ___(1997). In making the determination that the offer is bona fide, “ a judge must go beyond a mere statement that he has considered the employee's age, work and educational experience. He must analyze these factors in light of the employee's physical restrictions and the physical requirements of the job. ” Id. Thus, the judge must consider whether the employee is physically and mentally capable of the work, considering the injury and whether the job bears a reasonable relation to the employee's vocational capabilities.
The job offer need not be written in order to be considered bona fide. Nevertheless, it is a good practice to send the employee a written offer, outlining the requirements of the job, the hours he or she will be expected to work and the rate of pay. This will allow the employee to show the offer to his physician and may well convince a judge to take the employer's offer more seriously, especially at the conference level. Indeed, when representing employees, I have successfully persuaded administrative judges to ignore any job offer that was not formally reduced to writing.
B. The 28-Day Rule.
The twenty-eight day rule is found in Section 8 of the Act, dealing with the termination of the employee's benefits. The statute authorizes an insurer to terminate or modify an employee's benefits if and when he returns to work. There is, however, a caveat. Under Section 8 (2)(c), the insurer must reinstate the employee's benefits if he again leaves work within twenty-eight days of returning. There are three requirements for the twenty-eight day rule to apply: First, the employee must leave the job within twenty-eight calendar days after returning. Second, the employee must leave the job because she is incapable of performing it and not for any other reason. Third, the employee must send a certified letter to the employer and the insurer within twenty-one days of leaving work, notifying them that due to her injury, she cannot perform the work asked of her.
C. Prudent Practices: Written Return to Return-To-Work Policy, Written Job Offer, Point Person
In representing insurers and self-insurers, I make three standard recommendations with respect to light-duty job offers. First, it is helpful to have a written return-to-work policy because it establishes the employer's commitment to making light-duty jobs available to all qualifying employees. Second, for the reasons previously discussed, the better practice is to put the job offer in writing. (Indeed, in cases where the light-duty job offers are made orally, I will advise my employee clients to send a friendly email, thanking their employers for the offer and confirming its terms.) Finally, I strongly suggest appointing a designated individual to whom the employee can go if there are problems once he returns to light-duty.
One of the most frequent complaints made by employees who return to work on modified duty is that their employers are not respecting their restrictions. Often, this is due to a miscommunication down the chain of command. Thus, the personnel director may approve a light-duty offer, but the word may not have filtered down to the evening nursing supervisor. In other instances, an employee's co-workers, who are theoretically supposed to be taking over some of her duties like heavy lifting, may balk when asked to do so. Employees may also find themselves having to deal with emergencies that could require them to exceed their limits. It is extremely important in such situations that the employee know that there is a single person to whom he can go to have these problems addressed. The employee should feel that his employer recognizes that problems can occur and realizes that for the program to work, such problems must be addressed. Again, common sense dictates that a light-duty program is much more likely to be successful if you work with your employees and show them respect and concern.
D. The Importance Of Employer Attitudes
If there is one lesson that I hope you leave with, it is the realization of how important an employer's attitudes are to the success or failure of a light-duty return to work program. Research shows that employers and employees often have very different views of the aftermath of an industrial injury. Employers frequently feel that an individual out on workers' compensation will become lazy and try to milk his or her disability for all it is worth. Employees complain that after having worked hard for many years, after their industrial injuries, they are looked upon with distrust and disdain. Indeed, one of the problems that my employee clients express most often is the lack of respect with which they are treated by their employers, the insurance adjuster and/or the nurse case manager assigned to work with them.
It is extremely difficult to cope with having a serious injury at work. A person, who previously was independent and active, suddenly finds himself limited and perhaps even unable to perform certain activities of daily living. The process of obtaining medical treatment can be daunting, requiring employees to sometimes wait months for approval from the adjuster and/or utilization review agents. To an employee simply trying to get better, the denial or delay in treatment is frustrating and contributes to his sense of powerlessness.
The role of employer attitudes in light-duty return-to-work programs has been substantiated by research found in peer-reviewed journals. For example, the Liberty Mutual Center for Disability Research and the University of Massachusetts Medical School sponsored a study in which 108 supervisors at seven New Hampshire companies were given training designed by occupational rehabilitation specialists to improve their responses to employees with work-related injuries. Different sets of employees of these supervisors then responded to surveys both before and after their supervisors received the training. Medline provided the following summary of the results:
Employee responses before the intervention were compared with those collected from workers who reported injuries after the training. The postintervention results demonstrated significant decreases in supervisors (1) blaming employees for the injury, (2) not taking the conditions seriously; and (3) discouraging the worker from filing a claim. Positive trends in confidentiality of discussions, access to medical care, and accommodation and work modification were also noted.
Pransky, G., Shaw, W. and McLellan, R., “ Employer Attitudes, Training, and Return-to-Work Outcomes: A Pilot Study, ” Assistive Technology, Vol. 13(2) at 131-138 (2001).
These findings were confirmed by other studies. Thus, a study of published in the Social Security Bulletin noted:
The literature suggests that employer participation, a supportive work climate and cooperation between labour and management are crucial factors in facilitating return to work. Given the complexity of the disability management process and the numbers of individuals involved, it is essential that all workplace parties work together to achieve the goal of safe and early return to work.
Williams, RM and Westmorland, M., “ Perspectives on Workplace Disability Management: A Review of the Literature, ” Work, Vol. 19(1) at 87-93 (2003).
Sensitivity in dealing with injured employees can also avoid or lessen the emotional complications that can develop after an industrial injury. I am currently involved in three cases in which employees became profoundly disabled, not from the initial physical injury, but rather from its emotional aftermath. All three individuals have been diagnosed with post-traumatic stress disorder and all three experienced significant cognitive deficits attributable to their psychological illness. One particularly egregious case involves a college graduate from Haiti who speaks two languages and has four children, three of whom attended Boston Latin and two of whom went to Harvard. Neuropsychological testing revealed a post-injury IQ of 66. According to the impartial physician, a neurologist, these cognitive deficits are entirely due to the emotional fallout of the industrial injury. Significantly, the nurse case manager went behind the employee's back to his doctor and obtained a light-duty release, only two days after the physician told my client that he should remain out of work for another two weeks! The insurer then informed the employee that if he did not return to work immediately, he would be terminated. (A previous attempt at returning to work a month earlier had failed when my client's ankle swelled.). Two months later, my client was terminated. He has been receiving temporary total disability benefits since.
E. Light-Duty Return-To-Work Offers In The Litigation Context
Light-duty offers can play a role at each stage of the litigation process. At the conciliation level, a suitable offer may lead to resolution of the case, at least in the short-term. An insurer is usually more willing to pay disability benefits for a closed period with the understanding that the employee will attempt to return to work.
At the conference level, a written light-duty offer along with a medical report setting forth the restrictions underlying the offer can be included in the insurer's conference packet. Conversely, the employee can use a negative threatening letter to persuade the judge not to take the employer's offer seriously. An example of such a letter, along with my response on behalf of the employee, is included as Example 1 in Exhibit “ B. ” If the issue of a light-duty offer will be raised at the conference, it is advisable for the insurer to have the employer present. I first heard this suggestion from one of the administrative judges at the Department and it makes sense. The employer's presence evinces a commitment to making the employee's return to light-duty succeed. Additionally, it is usually useful to have the employer present to respond to any of the judge's questions or the concerns raised by the employee.
If the insurer wishes to raise a light-duty offer as a defense at the hearing, it will be necessary for a representative of the employer available to testify. An example of the questions I have asked on direct examination is included as Exhibit “ C. ” As you will note, it adds to an employer's credibility to have a written light-duty program in place and to be able to describe repeated overtures to the employee to return to work.
CONCLUSION
There is nothing magical or particularly complicated about implementing an effective light-duty return-to-work program. It merely involves being creative about how someone with an impairment can be useful in the operation of your company. Common sense as well as empirical research then dictate that treating employees with respect when making the offer and observing their limitations if and when they do return to work will go a long way in making the program effective. Success breeds success. If some employees feel that it has been worthwhile to return to work, it is likely that others will be more willing to accept subsequent light-duty offers. Remember, most employees do not enjoy sitting at home idle with their injuries. Work provides a social context and a feeling of importance in peoples' lives. Letting your employees know that you care about them and would like to have them back to work is a first step. I encourage you to take it.
For a free consultation, call 617-489-0006
