by Jeremy Berthon, JD
Imagine the following scenario: You are an LWCC policyholder and have an employee involved in a work-related accident who has been found by his treating physician to be at maximum medical improvement but has physician-assigned permanent work restrictions. The permanent work restrictions prevent the employee from returning to his job at which he was injured. The LWCC claims adjustor assigned to the file calls you to explain LWCC’s return-to-work program and asks you to offer the employee modified duty that meets the employee’s restrictions. What should you do?
The Workers’ Compensation Act provides that an employee who has suffered an injury that prevents earning wages equal to those earned prior to the injury is entitled to rehabilitation services. The vocational rehabilitation statute (La. R.S. 23:1226) enumerates a hierarchy of desired results for vocational rehabilitation of the injured worker. In order of preference, the employee...
- is returned to the same position;
- returns to a modified position with the same employer;
- returns to a related occupation suited to the employee?s education and marketable skills;
- is given on-the-job training;
- is given short-term re-training of less than 26 weeks;
- is given long-term re-training of more than 26 weeks but no more than one year.
The vast majority of claims in which a claimant is entitled to vocational rehabilitation falls within the second and third preferences.
In addition to the right to vocational rehabilitation, if an injured employee has work restrictions that prevent him from earning 90 percent of his pre-injury wages, the claimant is entitled to supplemental earnings benefits equal to two-thirds of the difference between the average monthly wages at the time of injury and the average monthly wages earned or which the employee is able to earn post-injury. In 1997, the Louisiana Supreme Court addressed the issue of what an employer must show to prove that the claimant is able to earn wages under 23:1221(3). In Banks v. Industrial Roofing and Sheet Metal Works, the court found that the employer must prove job availability on behalf of the employee, which means: 1) the existence of a suitable job within the claimant’s physical capabilities and within the claimant’s or the employer’s community or reasonable geographic region; 2) the amount of wages an employee with the claimant’s experience and training can be expected to earn in that job; and 3) an actual position available for that particular job at the time that the claimant received notification of the job?s existence.
Since the Banks decision, it has become increasingly clear that many courts are skeptical of employers’ and insurers’ attempts to show that an injured employee can return to a related occupation suited to his or her education and marketable skills. The attempt to do this is usually done through the use of a labor market survey. A vocational counselor is hired to work with the injured employee. Frequently, vocational testing and interest inventories are performed to try to determine from a vocational perspective what types of jobs the claimant can do and fall within the restrictions assigned by the treating physician. The counselor then surveys prospective employers in the geographical area where the employee lives to determine if there are any job openings that fit the claimant’s vocational background and work restrictions. If so, information on those jobs is forwarded to the employee.
Back to the prior scenario, your claims adjustor explains to you the concepts of vocational rehabilitation and supplemental earnings benefits and what will be involved in trying to establish a wage-earning capacity if you are unable to modify a position for your employee. Your employee is middle-aged, has a sixth-grade education, has performed manual labor most of his life, and has work restrictions that place him at a light-duty capacity. He was making $13.00 per hour, and your business and the employee are in a small community more than 30 miles from the nearest city. The claims adjustor tells you it will be extremely difficult to establish any wage-earning capacity on behalf of the injured employee, and, at best, vocational rehabilitation could possibly establish minimum wage jobs in convenience stores. As a result, the injured employee would be entitled to supplemental earnings benefits of two-thirds of the difference of $13.00 per hour and $5.15 per hour for a period of up to 520 weeks. If the injured employee were entitled to supplemental earnings benefits for the entire 520 weeks, $108,907.76 in benefits would be owed. The other option is to offer the injured employee a modified position with your company earning at least 90 percent of his pre-injury wages. In this case, the claimant would need to earn $11.70 per hour. If your company has work that needs to be done that falls within the restrictions assigned by the employee’s treating physician and is vocationally appropriate, your company will have the benefit of that necessary work being performed and the added benefit of not having to pay supplemental earnings benefits to the injured employee.
There also are a number of sound business reasons for employers to provide some type of modified duty for employees recovering from an injury. Efforts to retain employees in a modified capacity are important factors in maintaining good management-labor relations. Morale is higher and loyalty stronger where employees are secure in knowing they will be retained in some capacity after an injury, even if their working ability is substantially diminished. Offering a modified position to an employee can even enhance efficiency by relieving the employer of the necessity of hiring and breaking in a new worker.*
So, what should you do when you receive the claims adjustor’s phone call asking you to modify duty for an injured employee? You should work with your claims adjustor and rehabilitation counselor to modify a job to meet the restrictions assigned by the treating physician and then offer the modified position to the injured employee. If you have not already done so, you should establish a policy or goal of returning your employees to work following a work-related accident. By doing this, you will benefit by having reduced exposure for supplemental earnings benefits while fostering a stable and efficient work environment.
*Johnson and Malone, Louisiana Civil Law: Workers” Compensation, Volume 13, Section 279 (Fourth Edition, West 2002).