Employer Did Not Owe Temp Benefits To Employee Fired For Violation Of Company Drug Policy

John Gioia worked for Herr Foods as a delivery person. He injured his right ankle stepping from his delivery truck on November 23, 2007. He began authorized treatment right away and underwent an MRI one month later which revealed an avulsion fracture and sprain of the deltoid ligaments.

The accident occurred on the Friday after Thanksgiving Day. Gioia requested off the following Monday and Tuesday due to the accident. On Tuesday, November 27, 2007, he was seen at Kessler Memorial Hospital and was advised he could perform light-duty work starting the next day. On Wednesday, the next day, he was advised that his employment with the company had been terminated for violation of the company’s drug-free workplace policy. Gioia’s drug screen test had come back positive for cocaine on the date of the accident.

Herr did not provide Gioia with light-duty work nor pay any temporary disability benefits. Gioia, therefore, filed a motion for temporary disability benefits and a full trial ensued. The judge of compensation ruled that Gioia was entitled to temporary disability benefits because Herr did not actually offer him light-duty work. The judge entered an order requiring the company to pay temp benefits from November 28, 2007 to May 22, 2008. The judge also imposed a 25% penalty on the amount of temp benefits due plus reasonable counsel fees.

Herr appealed and contended that Gioia was out of work because he had been fired, not because of the work injury. The company argued that petitioner was, therefore, not entitled to temporary disability benefits. The Appellate Court relied on two cases, Cunningham v. Atl. States Cast Iron Pipe Co., 386 N.J. Super. 423 (App. Div.), certif. denied. 188 N.J. 492 (2006) and Outland v. Monmouth-Ocean Educ. Serv. Comm’n, 154 N.J. 531 (1998). It said:

Gioia has the burden of proving not only that he was available and willing to work, but that he would have been working if not for the disability. Here, the claimed temporary disability benefit was replacement for nothing more than the wages of a theoretical job, and there is nothing in the record to suggest that he had any promise or prospect of employment. As in Cunningham, Gioia ‘left his job (whether characterized as voluntarily or as a termination for cause in violation of a company policy he knew would result in termination), and, without new employment secured, he did so at his peril. His leaving was not related in any way to his disability.’ Id. at 434.”

The court remanded the case for further proceedings and held, “If Gioia can prove that he actually lost income on or after November 28, 2007, because of his disability, he is entitled to receive temporary disability benefits to that extent.”

This case constitutes an extension of the rule in Cunningham. In that case the petitioner’s doctor only took him out of work eight days after he had been fired. Petitioner ultimately was unable to prove entitlement to temporary disability benefits. In this case, the petitioner was already out of work from a work injury before he was fired. The case does not mention the rule in Harbatuk that an offer of light duty must be made if temporary disability benefits are to be terminated. Rather, the court seemed to focus on this: namely, that the reason petitioner was unable to return to work light duty is that he violated company policy justifying his termination. It does not seem to turn, however, on the fact that Gioia was considered able to return to work light duty.

In this writer’s opinion, the Gioia case is a rather surprising decision. It leaves petitioner with an extremely difficult burden of proof on remand. For practitioners, this case raises some questions. How far does Cunningham go? Does it create the potential that an employer may avoid the obligation of temporary disability benefits by terminating employment following an accident? Of course, it is important to note that the company’s blood test was done close in time to the accident pursuant to a drug free workplace policy. There is no question that in this case the firing was legitimate. No matter where readers come down, there is surely agreement that the Cunningham decision in 2006 is proving more elastic than initial evaluations of the decision.

This case can be found at Gioia v. Herr Foods, Inc., A-0667-10T4 (App. Div. October 11, 2011).

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