[Posted February 10, 2009] The Court of Appeals hands down three published opinions today, all in the field of Workers’ Compensation.

The first case is Augusta County School Board v. Humphreys, and settles the question of whether, for the purposes of the statute of limitations, payment of medical expenses is the equivalent of the payment of compensation. The court decides that it is.

Humphreys, a schoolteacher, got hurt at work and missed several days of classes to attend doctors’ appointments. She used her accumulated sick leave for the time off, and sought a Comp award to replace those days. The deputy commissioner agreed and ordered the school board to pay her those days.

But you can’t do that; at least, the commission thinks you can’t, and that counts. The board appealed, but before the commission could act, the parties reached a settlement by which the teacher would receive partial credit for the sick time. The case was remanded, and the deputy entered a modified award based on the agreement. Almost a year later, and about three years after the injury, the teacher filed an application asserting a change in condition. It wasn’t much, really; just a few more doctors’ appointments. But the board resisted, saying that this claim was barred by the two-year statute of limitations.

Ordinarily, when payment is only for medical expenses, an employee has to file a claim based on a change in condition within two years of the injury. That rule doesn’t apply when the original award is for benefits, but the parties’ agreement seemed to be only for sick leave, not actual compensation. The Court of Appeals resolves the matter today by affirming the full commission’s creative solution: It treats the award of “sick leave days” as one for comp benefits, so the later claim is timely.

This one might strike some of you as just a bit too creative, but it’s supported by the caselaw cited in the CAV’s opinion today.

The next case is Dominion Coal v. Bowman. Bowman was a methadone user. Worse, he basically defrauded his doctors in order to get the stuff, falsely claiming that he was addicted to narcotics in order to get the meth prescription. (Evidently the old tried-and-true method of buying the stuff illegally on the street from dope dealers didn’t appeal to his sense of integrity; he wanted a slightly less dishonest supply chain.)

When he got injured on the job by a falling machine, the employer defended on the grounds of willful misconduct, claiming that his illegal use of the drugs was a proximate cause of the injury. And there’s meat on that bone; the statutes give the employer a rebuttable presumption in the event of a positive drug test.

Trouble arrives for the employer, however, in the form of the employee’s doctor, who testified that the methadone was administered pursuant to a prescription (however improperly obtained), and the dose he received would not have impaired his motor function. The employer didn’t refute this testimony, figuring it could stick by the willful-misconduct defense.

The deputy and full commission ruled in favor of the employee, and today, the CAV affirms. The commission had ruled that the employer had filed its designation of defenses too late; and that may well be true. The appellate court assumes that the defense was timely, but affirms anyway, because the doctor’s testimony was unrefuted. There was credible evidence that rebutted the presumption, or at least showed that any methadone in the employee’s system didn’t cause the injury.

There is an easy practice tip here for both employers’ and employees’ counsel. The presence of a positive drug test isn’t the end of the case. In most such cases, the employee won’t have this magic-bullet testimony, but in any event, the employer can’t just sit on a drug report and assume that the rest of the case will try itself.

The final decision of the day, Shenandoah Motors v. Smith, made me think of Frank Stockton’s famous short story, “The Lady, or the Tiger?” It promises to resolve an important question on which it’s easy for the reader to start forming rooting interests, but at the end we’re left to wonder about the ultimate outcome. Here; walk with me a ways and let’s see what happened.

Smith worked for Shenandoah for some time before injuring her hip on the job. She missed about three weeks of work before being cleared to return. There’s a dispute in the record about whether that was with limitations; Smith claimed that she could do only light duty, but the doctor’s note just said she could return. From what I can tell, her job (selling cars) didn’t obviously present any heavy lifting; but there is no detailed listing in the opinion about what she had to do, so I’ll give her the benefit of that doubt.

Nearly three months after she returned, Shenandoah fired her. The reason given was her consistent failure to meet her monthly sales quota (if that’s a common cause for firing, then judging from the news out of Detroit, there are probably a whole lot of unemployed car salesmen right now). The employer also cited her for her “poor work habits.”

It’s worth jumping ahead in our story at this point, to find out what those habits were. According to the employer in the subsequent hearing, even before her injury she came to work late; slept or played solitaire in her office; left prospective customers to wander the lot without going to greet them; and was rude to those customers (there’s the occupational Kiss of Death for you) and her coworkers. It didn’t help that she averaged only about 65% of her quota (eight sales per month) over the course of the year. When she only sold five cars, total, over the last two months, that was the end; she was told to clean the playing cards out of her desk and move on.

In her own defense, Smith testified that she only slept during her lunch hour; that she only played solitaire when there were no customers around; that other salespeople ignored customers, too; and that her coworkers had essentially sabotaged her sales figures by “preventing her from approaching customers.” (How, I wonder? By handcuffing her to her desk?)

Six months after her termination, her doctor placed light-duty restrictions on her, for reasons stemming from her work injury. She got a light-duty job elsewhere, and filed a claim for temporary partial disability benefits from Shenandoah. The car dealer probably responded by asking, “Didn’t we fire this lady? And doesn’t she already have another job?” But that doesn’t end the inquiry. If she really is disabled as a result of her work, and if she really has lost income-earning capacity (however temporarily), then Shenandoah can, under certain circumstances, be on the hook. Today’s decision is about those circumstances.

At the hearing, Shenandoah’s manager testified that if he had known about her light-duty restrictions, he would have worked with her to accommodate them. Of course, that’s academic, since she wasn’t coming back to work there anyway, restrictions or no. But this distinction turns out to make a difference in this appeal. The deputy commissioner ruled in favor of the employer, finding that her unavailability to work was the result of her own misdeeds instead of her work injury. The full commission reversed, finding that her termination may have been for cause, but ruling that the employer had to show that it offered the employee suitable work, which she declined; since no such evidence existed, the commission awarded benefits.

On appeal, the CAV agrees with the deputy, sort of. It distinguishes a 2005 case that had affirmed benefits under similar circumstances (the key to that is the “we’d have worked with her” testimony, which wasn’t present in the 2005 case) and holds that the employer doesn’t have to make an “actual bona fide job offer” under these circumstances in order to defend on the ground of (take a deep breath here) constructive unjustified refusal of selective employment. The court reaffirms that the only things the employer has to establish in order to defend in this way are that (1) the wage loss is properly attributable to the employee’s wrongful act, and (2) the employee is responsible for that act. Since the employer established these two circumstances, it’s entitled to defend in this way.

But after reaching this conclusion, we abruptly come to the lady-or-tiger moment. Instead of just reversing and reinstating the deputy’s award, the court remands the case to the full commission to resolve two dangling issues. The first is the commission’s first finding: That the termination “may have been” for cause. We need more than that, the appellate court says, and directs the commission to make a definitive finding on whether it was for cause or not. It also remands for the commission to consider another argument raised by the employee that the commission had found it unnecessary to reach, relating to the employer’s bottom-of-the-ninth decision to raise the bar of this defense in the first place. So if you want to know who wins here, the answer is, “The employer, for now.” But that could change at any stop along the way.