STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

RICK G FRUTH, Applicant

TOWN OF WHEATLAND, Employer

WORKER'S COMPENSATION DECISION
Claim No. 2003-033619


An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and order in that decision as its own.

ORDER

The findings and order of the administrative law judge are affirmed.

Dated and mailed  June  2, 2006
fruthri . wsd : 101 : 8  ND § 7.33

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

MEMORANDUM OPINION

The applicant worked as highway patrolman who maintained the employer's roads. He hurt his leg at work in a fall from a ladder on July 28, 2003. He treated until March 25, 2005 when his doctor pronounced the wound fully healed. During this period, the applicant was taken off work on August 13, 2003, and a physician's status report dated February 11, 2004, released him to work on March 1, 2004, without restrictions.

While the applicant was off work, the applicant hired a replacement, Jonathan Fruth. The employer contends that when the applicant was able to come back to work in the spring of 2004, it wished to retain Jonathan Fruth -- who had been working full time since September 2003 and whose performance the employer felt was better than the applicant's -- and had no opening for the applicant.

The applicant sought compensation for an unreasonable refusal to hire under Wis. Stat. § 102.35(3). Wisconsin Stat. § 102.35(3), provides as follows:

102.35(3) Any employer who without reasonable cause refuses to rehire an employee who is injured in the course of employment, where suitable employment is available within the employee's physical and mental limitations, upon order of the department and in addition to other benefits, has exclusive liability to pay to the employee the wages lost during the period of such refusal, not exceeding one year's wages....

As stated in Dielectric Corp. v. LIRC, 111 Wis. 2d 270, 278 (Ct. App. 1983), 111 Wis.2d at 278:

Under [Wis. Stat. § 102.35(3)], once the employee has suffered a worker's compensation injury, the question initially becomes: does the employer have good cause not to rehire. If the employee is rehired, the rehiring cannot be a pro forma rehiring. Therefore, if there is an eventual discharge, the employer must show that there is no bad faith on its part to evade this statute and that the rehired employee was discharged with good cause.

This "very correct standard" set out by the court in Dielectric was adopted by the supreme court in West Bend v. LIRC, 149 Wis. 2d 110, 121 (1989). In that case, the supreme court stated that "after an employee shows that she has been injured in the course of employment and subsequently is denied rehire, it becomes the burden of the employer to show reasonable cause for not rehiring the employee." West Bend, at 149 Wis. 2d 123.

The ALJ, noting that the applicant had been replaced while in his healing period and that the employer had no duty to keep his job open, found no unreasonable refusal to rehire and dismissed the application.

The record establishes that that the employer hired Jonathan Furth to replace the applicant in September 2003, well before the applicant was released to work in early 2004. This case is one where the employer hired a replacement for an injured worker during a relatively long healing period, then declined to layoff the replacement and return injured worker to his old job. The commission has previously held that an employer is under no duty to keep a job open for an injured worker indefinitely, but if it has suitable work when he or she ends healing, that work should be provided to him or her. Synder v. Lakeshore Marine, WC Claim No. 95004097 (LIRC, January 30, 1998).

In other words, Wis. Stat. § 102.35(3) does not guarantee reemployment in every case. The statute itself uses a "reasonable cause" language, as reflected in the court of appeals holding in Ray Hutson Chevrolet, Inc., v. LIRC, 186 Wis. 2d 118, 123 (Ct. App. 1994) that:

A business decision to reduce costs can, by itself, establish the reasonableness of the decision. Reducing costs is a form of efficiency. Inefficient businesses risk their very survival and the jobs of all their employees. Nothing in § 102.35(3), Stats., reflects a legislative intent that an employer must perpetuate an unnecessary expense by rehiring an injured employee to fill a position the employer eliminated to save costs. We conclude that if an employer shows that it refused to rehire an injured employee because the employee's position has been eliminated to reduce costs and therefore to increase efficiency, the employer has shown reasonable cause under § 102.35(3).

The timing of the applicant's discharge in February 2004 would have been suspicious if the employer had not replaced the applicant with another full time worker in September 2003. In this case, however, the employer had reasonable cause for not rehiring the applicant.

cc:
Attorney Donald Robinson
Attorney Gary Monson



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