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The New Jersey Workers’ Comp Blog is published by John H. Geaney, Esq. and focuses on covering all aspects of Workers’ Compensation law in the state of New Jersey.
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Company Manager Did Not Violate ADA’s Confidentiality Provisions In Telling Prospective Employer About Former Employee’s Health Condition

Sometimes the cases with the most simple fact patterns make the best ones to understand bright lines in the law.  The case of EEOC v. Thrivent Financial for Lutherans, 2011 U.S.Dist. LEXIS 64042 (D. Wisc. 2011) provides some clear guidance on what employers can and cannot say about the health of employees. In this case, it was a comment about a former employee that was the principal issue.

Gary Messier worked for and was placed by Omni Resources, Inc., a technology consulting agency, with Thrivent Financial in Appleton, Wisconsin. Thomas Brey was Messier’s account manager at Omni, and John Schreiner was the manager of the Thrivent department where Messier was assigned to work.        

On November 1, 2006, Messier did not appear at work nor alert anyone that he would not be coming in.  Schreiner called Brey at Omni to inquire about Messier’s absence.  Eventually Messier was reached by email and sent a long responsive email to Brey and Schreiner.  In that email Messier revealed that he had suffered from debilitating migraine headaches for many years.  The headaches were so incapacitating that he could not even respond to anyone or call anyone due to the intensity of pain.  He said that if all went well, he would be in work the next day.   

One month later Messier quit his job with Omni and Thrivent and commenced looking for other employment.  He quickly deduced that Schreiner was providing a negative reference to his prospective employers.  Messier hired Reference Matters, Inc., a reference checking agency.  On January 10, 2011, Reference Matters called Schreiner and Schreiner indeed disclosed information about Messier’s migraine condition to the representative.

In his lawsuit Messier argued that Thrivent violated Section 102(d)(4) of the Americans with Disabilities Act.  That provision deals with confidentiality of medical information.  The District Court disagreed with the EEOC and said, “Under its plain meaning, Section 102(d)(4) protects only that information which an employer acquires through a medical inquiry or a medical examination.  The statute focuses on the employer’s active role in the disclosure and thus does not protect any disclosure of medical information to an employer no matter how it arises.”

The court reviewed the leading cases on breach of confidentiality under theADA.   They said that Mr. Brey and Mr. Schreiner did not specifically request or require that Messier disclose information about a medical condition, which is the key difference between some of the other federal court decisions where violations of confidentiality were found.  All they did was inquire why he had an unexcused absence from work.  They also did not ask Messier questions that were likely to elicit specific information about a medical condition.  As such, Messier’s disclosure about his migraine condition was entirely voluntary.  The court found that discussing a voluntary disclosure to a third party is not a violation of theADA’s provisions on confidentiality according to the court.

This case is extremely helpful to employers in understanding which discussions about health conditions of employees could violate confidentiality and which do not.  If an employer gains medical information by asking questions about health or asking someone to fill out an FMLA form, that information must be treated confidentially.  However, if an employee voluntarily discloses medical information as happened in this case, the subsequent disclosure of that information does not violate theADA.

Judge Of Compensation After Full Trial Finds Medical Provider Was Properly Compensated In Burn Claim

There are thousands of medical reimbursement claims filed by medical providers in the New Jersey Division of Workers’ Compensation. A comprehensive decision following a lengthy trial was recently handed down by the Honorable Virginia Dietrich, Administrative Supervisory Judge of Compensation. To this practitioner’s knowledge, this is the first fully tried decision in the Division involving multiple witnesses and experts on a medical reimbursement claim. (more…)

Appellate Division Holds That Division Of Workers’ Compensation Has Jurisdiction To Decide Coverage Issue

Robert Tutelais a member of Earthworks Limited Liability Company and also one of its employees.  Earthworks is in the business of landscape construction.  In 2008 Earthworks through Tutela filed an application with Sentinel Insurance Company for workers’ compensation coverage.  Representations were made that Earthworks hired independent contractors to perform tree work and that all of the Earthworks employees performed their work at ground level. Based on additional representations by Tutela, Sentinel issued a workers’ compensation policy to Earthworks.

In June 2008 Earthworks contracted with Daystar-USM Exterior Services to remove 50 dead oak trees from a building site inToms River.  Tutela himself was seriously injured on June 27, 2008, falling from a bucket truck while he was pruning trees 35 feet off the ground.

Tutela brought a workers’ compensation claim and Sentinel disclaimed coverage “due to material misrepresentations made by the claimant himself as a member of the insured entity.”  Sentinel then filed a declaratory judgment claim in civil court seeking rescission of the policy because Sentinel said it would never have issued the policy but for Tutela’s misrepresentations. 

Meanwhile in the workers’ compensation action, the judge of compensation ruled for Tutela and ordered Sentinel to pay medical and temporary disability benefits.  The judge said that Sentinel could reserve its rights for reimbursement in the civil action.  The Uninsured Employers’ Fund, which was also a party to this claim, brought a motion to dismiss the civil action on the ground that the judge of compensation could determine whether Sentinel had to provide coverage. 

On September 16, 2008, the judge of compensation ruled that the policy was valid under the Workers’ Compensation Act but also suggested that it did not have jurisdiction to void the policy on the basis of misrepresentations. 

The issue on appeal was simply whether a judge of compensation has the power to hear an issue regarding the validity of an insurance policy and the voiding of a policy.  Sentinel did not believe the judge of compensation had such power, while Tutela argued that the judge of compensation did have this power. The Appellate Division cited a 1968 New Jersey Supreme Court case which suggested that a judge of compensation had power to pass on issues of coverage.  The Appellate Division agreed with the reasoning of ProfessorArthurLarson, Larson’s Workers’ Compensation Law § 15004 (2010). 

The general rule appears to be that, when it is ancillary to the determination of the employee’s right, the compensation commission has authority to pass upon a question relating to the insurance policy, including fraud in procurement, mistake of the parties, reformation of the policy, cancellation, existence or validity of an insurance contract, coverage of the policy at the time of injury, and construction of extent of coverage.

Based on this analysis, the Appellate Division held that it was proper to transfer the issue of Sentinel’s right to rescission to the judge of compensation.  The court did not hold that the Law Division did not have such power but rather that it made more sense to vest both the compensation claim and coverage claim in one forum, namely the Division of Workers’ Compensation.  The court, therefore, reversed the judge of compensation’s ruling declining to consider the rescission issue. 

One of the key points in this case that the Appellate Division made was that Tutela was both a member of the Earthworks Limited Liability company and the injured employee.  On the subject of rescission based on misrepresentation, the court distinguished another case which involved a claimant who had no role whatsoever in obtaining the policy which was the subject of rescission. 

This is a reported case and is important because it takes an expansive view of the powers of judges of compensation.  The case makes sense because it promotes judicial economy and recognizes the expertise of judges of compensation.  The case can be found at Sentinel Insurance Company Ltd., v. Earthworks Landscape Construction, LLC and Robert Tutela, A-0748-10T1 (App. Div. August 16, 2011).

Calling In “Sick” Is Not Enough To Invoke The FMLA

Employers are somewhat behind the eight ball in the FMLA because the employee need not specifically invoke the “FMLA” in order to obtain protection under the law.  Nor does the employee have to give detailed information about health; rather, the employer has to consider whether the FMLA applies based on what the employee says is the reason for absence.  What if the employee only says “I’m out today because I am sick?” If that happens, the lesson in Collins v. NTN-Bower Corporation, 272 F.3d 1006 (7th Cir. 2001) is that this is not enough to trigger FMLA protection.

In the Collins case the plaintiff was fired when she called in sick for two days in March 1998.  She had had spotty attendance over time and her employer, therefore, took job action.  Plaintiff sued and said that her termination violated the FMLA.  She had FMLA time available to her, and she argued that her condition, namely depression, was covered under the FMLA.

There is no doubt that depression is a serious health condition under the FMLA.  The problem is that the employer had no idea that plaintiff had been treating for depression.  The court said, “Depression may meet this description, and we shall assume that Collins suffers from clinical depression, which certainly meets it– but Collins did not let her employer know the reason for her absence, and notice is essential even for emergencies. See 29 C.F.R. 825.303.  ‘Sick’ does not imply a ‘serious health condition.’”

The next issue in the case was how long plaintiff had to notify her employer that the reason for her absence was depression.  “The regulation allows notice to be delayed a day or two (an emergency may interfere with giving notice as well as with working), but Collins took much longer to let her employer know why she did not show up.”   The court said, “employers still are entitled to the sort of notice that will inform them not only that the FMLA may apply but also when a given employee will return to work.”

The analysis in this case makes sense.  The court said that the plaintiff’s depression had been chronic, developing for years.  “Once Collins knew she had a problem, she could predict that this would lead her to miss work on occasion and she could have given the notice contemplated by 825.302 long before March 1998.  Then when depression incapacitated her on a particular day she could have made clear the ‘serious’ nature of her condition by referring to knowledge already in the employer’s possession.”   Just telling an employer one is sick does not apprise the employer on the seriousness of the condition.  In this case, the plaintiff never really informed her employer of the serious health condition until the law suit was filed and that was obviously insufficient.

Appellate Division Allows Medical Reimbursement Claim To Proceed In Civil Court While Comp Case Is Pending

Legal actions for reimbursement by medical providers have become very common in the New Jersey Division of Workers’ Compensation. Now they are even more complex following the decision in The Valley Hospital v. LQ Management LLC, A-0831-10T1 (App. Div. August 8, 2011).

The facts are straightforward. An employee of LQ Management, LLC, was treated for work-related back injuries at Valley Hospital. The hospital billed $65,549 for its services and submitted the bill to Zurich American Insurance Company, which was the workers’ compensation carrier for LQ Management. Zurich utilized a claim administrator to review the bill, and the claim administrator issued an explanation of benefits stating that Zurich was paying the bill under the hospital’s contract with FOCUS – Aetna Workers’ Comp Access, LLC. Zurich paid $24,743, less than half the bill.

Valley Hospital sued in civil court alleging breach of contract. It said that under the terms of the Aetna contract, the hospital was entitled to 80% of its billed charges based on preferred provider rates. That would have been $52,456. LQ moved to dismiss the complaint, contending that this was a workers’ compensation issue and belonged in workers’ compensation court. Further, LQ noted that there was a pending workers’ compensation claim and argued that the question of payment of this bill must be transferred to workers’ compensation court.

On the face of it, LQ’s argument had appeal because of the decision in Univ. of Mass. Mem’l Med. Ctr., Inc. v. Christodoulou, 180 N.J. 334 (2004). In that case the New Jersey Supreme Court held that “while an employee’s claim for a work-related injury is pending in the Division, a medical provider’s action for unpaid services must be transferred from the Law Division to the Division of Workers’ Compensation.” Obviously it would be better for LQ to defend only one action and to have that action vested in the Division of Workers’ Compensation.

In this case, however, the Appellate Division found a reason to distinguish the rule in Christodoulou. It said that the Christodoulou case involved a claim against a patient/employee for payment or against the workers’ compensation carrier. In this case the “complaint states a common law contract claim against the insurance carrier under the alleged Aetna contract, as well as a common law claim of unjust enrichment related to that contract and its discounted rates.” As such, the court held, “Plaintiff’s claim under such a contract, however, is not a matter pertaining to compensable benefits under the Workers’ Compensation Act.”

This distinction is an unusual one and contrasts with most workers’ compensation medical provider claims where the only issue is whether the medical services were reasonable and necessary. Those cases are claims against employees or against the appropriate workers’ compensation carrier for reimbursement. This case involved more issues of contract law and as such the court was emphatic that the Division of Workers’ Compensation was not empowered to resolve contractual disputes. For this reason, the civil action was permitted to continue even while the petitioner pursued the workers’ compensation matter. The decision illustrates an important exception to the general rule that medical reimbursement claims should be transferred to pending workers’ compensation claims in the Division. When the issue is interpretation of a contract, that issue belongs in civil court according to this decision.

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Teacher Found Still In Employment When Injured After Picking Up Child At School Where Teacher Worked

Workers’ compensation issues often arise in the context of civil litigation. That is what happened in the case of High v. Rose, A-2539-09T1 (App. Div. July 26, 2011). (more…)

Employee’s Failure to Respond To Request for More Information Regarding Leave Request Doomed FMLA Claim

Employee’s Failure to Respond To Request for More Information Regarding Leave Request Doomed FMLA Claim

Robert Righi worked as a sales rep for SMC Corporation of America. On several occasions Righi would request vacation time to care for his mother. He would email his manager, Louis King, for prior approval. The company policy was to require employees to obtain prior approval from a supervisor before taking leave. The policy further provided that a failure to report for work for two consecutive days without notifying the supervisor is grounds for termination. (more…)

Federal Court Holds That Employee With Renal Cancer In Remission Is Covered Under The ADA

Federal Court Holds That Employee With Renal Cancer In Remission Is Covered Under The ADA

Michael Norton worked for Defendant ALC in May 2008. The company operated 200 facilities in twenty states involving assisted living services to the elderly. Plaintiff worked at the Sulphur Springs, Texas location as a “Residence Sales Manager.” (more…)

Disclosure By Employer Of Medical Information That Was Voluntarily Offered By Employee Does Not Violate ADA

Many employers struggle with situations that develop when an employee voluntarily reveals certain confidential medical information. In Watson v. C.R. England, Inc., 2011 U.S. App. LEXIS 8971, (10 th Cir. 2011), the plaintiff worked as a truck driver for C.R. England. In the course of his employment, he informed C.R. England’s Human Resources Director that he was HIV positive. He conveyed this information not in the context of any post-offer medical examination but because he thought another driver had already advised the company of this medical information.

Problems developed a few months after Watson had been working for the company. He decided to become a driver-trainer for the company and completed a five-day “Train-the Trainer” course in February 2003. The HR Director called Watson into her office to express concerns about his ability to become a trainer in light of his HIV-positive status. Several meetings occurred with legal counsel and eventually an idea was proposed that Watson would disclose his HIV-positive status to potential trainees. Watson agreed to use a form that could be given to potential trainees in which the trainees would acknowledge that they were fully informed of his HIV status.

On February 11, 2003 Watson began his first training assignment. Before he left, he requested “home time” beginning February 16, 2003. That request was denied because Watson had not given two weeks’ notice. On February 12, 2003 Watson and his trainee were dispatched on their first drive together to deliver a load to Omaha, Nebraska.

After they delivered the load, they were sent to pick up a second load in Omaha, but the second load was canceled. They were then assigned to pick up another load, but that too was canceled. The company then advised Watson and his trainee to pick up the first previously canceled load. Watson was stressed about these cancellation occurrences and demanded immediate “home time” stating that he could not wait the two-week notice period. The request was once again refused, whereupon Watson refused to pick up the previously canceled load and said he was “deadheading” (driving an empty truck) to his family home in Florida. His employment was shortly thereafter terminated.

Watson filed a charge with the EEOC stating that C.R. England discriminated against him and retaliated against him due to his illness. The EEOC issued a determination in Watson’s favor, leading to the present law suit. Watson argued that the company violated ADA § 102(d), 42 U.S.C. § 12112(d) because he disclosed medical information. The Court of Appeals rejected this argument.

On its face, § 102(d) does not apply to or protect information that is voluntarily disclosed by an employee unless it is elicited during an authorized employment-related medical examination or inquiry. . . In sum, if an employer disclosed medical information that was voluntarily offered by an employee – outside of the context of an authorized employment-related medical examination or inquiry – then the employer is not subject to liability under § 102(d).

The court held that since the disclosure of HIV status came directly from Watson to the HR Director and not as part of any sort of examination or inquiry, the information was not protected by the ADA.

Plaintiff also argued that the company discriminated against him by requiring potential trainees to sign an HIV-acknowledgement form before training would take place. The court held that C.R. England did not deny Watson the opportunity to be a trainer, demote him, or reassign him. It disagreed with the position of the EEOC that requiring the use of the form in itself was an adverse action. The court ruled that plaintiff did not prove that the use of the acknowledgement form had any meaningful impact on Watson’s employment opportunities. “Even though some might frown upon C.R. England’s actions in effectively allowing trainees to decline to work with Mr. Watson because he has HIV, ‘not every perceived indignity will rise to the level of an adverse employment action.'”

The case is important because it draws a clear distinction between the use of medical information obtained as part of a medical examination or inquiry and the use of medical information voluntarily disclosed by an employee outside of any such examination

Appellate Division Holds Truck Driver Sleeping On Dana Transport Property Was An Employee And Cannot Sue Dana Transport In Civil Action

The independent contractor defense in New Jersey is not generally a strong defense, but it can be sometimes advantageous to employers to invoke it when they are sued civilly.  The case of Fugatt v. Dennison Graine and Dana Transport, Inc., A-5353-09T3 (App. Div. July 5, 2011) presents a fascinating situation where the injured worker did not want to pursue his workers’ compensation rights but respondent conversely desired the workers’ compensation protection to invoke the exclusive remedy provision.

The facts are simple.  Michael Fugatt was a long-time truck driver who began working for Dana Transport in 2006.  He leased his 1998 Volvo truck to Dana and painted it a particular shade of green per company request.  He used it exclusively for Dana.

On January 10, 2007, Fugatt parked on the grounds of Dana in Avenel, New Jersey and went to sleep in the berth of his Volvo.  He had driven to the lot two hours earlier in order to sleep in compliance with federal regulations prior to trucking a load of goods.  In his deposition in the civil case, he testified that he had a loaded Dana trailer attached to the Volvo for delivery in Springfield, Massachusetts later that morning.

Meanwhile, co-defendant Graine (an employee of Dana Transport) was dropping off a tanker at Dana when his truck backed into Fugatt’s Volvo.  The accident led to serious injuries, and Fugatt was diagnosed with a herniated disc.

Dana completed an OSHA form 301 Injury and Illness Report listing Fugatt as an employee who was injured and stating that he was “under dispatch” at the time of the accident.  It submitted the paperwork to AIG, its workers’ compensation carrier.  Dana and AIG listed Fugatt as an employee for purposes of state and insurance requirements.

Fugatt through his counsel filed a claim petition in the Division of Workers’ Compensation.  However, Fugatt denied in his deposition any knowledge of filing this claim petition.  Instead, he sued Graine and Dana Transport in a civil action.   Dana Transport later filed a motion for summary judgment and contended that plaintiff could not maintain a civil action against his employer, nor against his co-employee.  The civil judge ruled for Dana Transport and Fugatt appealed.

The issue on appeal was simply whether the injury in this case arose from the employment even though Fugatt was asleep at the time of the injury.  The Appellate Division held, “The fact that an employee was ‘off the clock’ at the time of an accident does not automatically preclude compensability under the Act because ‘situs of the accident is a dispositive factor.’”  The Court pointed out that Fugatt was in the course of his employment in this situation even though he was sleeping and was not performing active work duties.

The Appellate Division took a larger view of the situation in this case. “[p]laintiff was paid for each load he transported and was required by the Federal Motor Carrier Safety Regulations for commercial drivers to sleep prior to driving this load from New Jersey to Massachusetts. . . The load destined for Massachusetts was hooked up to his Volvo tractor, and he was sleeping in the sleeping berth of the tractor on Dana’s property when the accident occurred.”   It found that his “duties as a truck driver are what led [him] to be sleeping in his tractor where and when the accident occurred.”

Based on this ruling, plaintiff’s suit against his co-employee and against his employer was barred by the exclusive remedy provision.  In the end, the only remedy which Mr. Fugatt had was in the Division of Workers’ Compensation, which was a remedy that the company favored but the plaintiff did not desire.

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