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

JERRY W BOUNDS, Applicant

NORTHWEST AIRLINES INC, Employer

LIBERTY INSURANCE CORP, Insurer

WORKER'S COMPENSATION DECISION
, Claim No. 2004-028381


In January 2006, the applicant filed an application for hearing seeking compensation for an occupational low back injury with a March 8, 2004 last day of work. An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development heard the matter on January 24, 2007. Prior to the hearing, the employer and its insurer (collectively, the respondent) conceded jurisdictional facts and a compensable injury on or about March 8, 2004. Also prior to the hearing, the respondent had paid temporary total disability from March 17, 2004 through November 28, 2005, and had paid permanent disability at $15,141.31 toward permanent partial disability at 28 percent to the whole body. At issue was the applicant's claim for additional permanent disability, specifically permanent total disability, and medical expenses.

On March 29, 2007, the ALJ issued an interlocutory order paying permanent partial disability at 50 percent for loss of earning capacity, and the medical expenses claimed. The applicant has filed a timely petition for review.

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 makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The applicant was born in 1945. He has been a baggage handler for the employer and its predecessor airline since the early 1970s. The respondent has conceded a compensable low back injury caused by an appreciable period of workplace activity and exposure. As a result of his injury, the applicant has undergone a two-level laminectomy in August 2004, followed by a surgery to address a staph infection in September 2004, followed by a debridement procedure and L3-4 fusion surgery in December 2004.

In November 2005, the applicant's treating surgeon, David Coran, M.D., released the applicant to work with permanent restrictions identified on the WKC-16-B form practitioner's report as "10 lbs lifting, alternate sit or stand every 30 [minutes] as needed, no repetitive bending." Dr. Coran's practitioner's report also contains a "lumbosacral spine impairment medical assessment form" which indicates that the applicant could continuously sit 45 minutes before changing position to standing, and could continuously stand for 45 minutes before changing position to sitting. He also indicated the applicant would need two unscheduled 10-minutes breaks each day.

The employer offered him work by letter dated January 11, 2006, which the employer stated was within Dr. Coran's restrictions. See exhibit H. The applicant then contacted Dr. Coran. The doctor stated the applicant could return to work, but modified his restriction to permit alternate sitting or standing every 30 minutes as needed, and added a restriction to allow the applicant to lie down for 15 minutes to stretch his back when his pain level increased. Exhibit K, Coran "return to work" form dated January 13, 2006.

It is noteworthy that the medical expert retained by the respondent, Lawrence Frazin, M.D., set substantially similar restrictions in his report following an examination several months later in September 2006:

...in addition to a ten pound lifting/carrying restriction, would be no bending or twisting at the waist. He can work in a sitting position in a chair that has appropriate lumbar support. He needs to be able to change position, including lying down if needed, on an as-needed basis. He can stand or walk for fifteen minutes at a time before sitting down.

Exhibit 2, October 3, 2006 report of Frazin, page 5.

At any rate, Dr. Coran's modified restrictions of January 13, 2006 were provided to the employer. The employer informed the applicant that it would provide work within those revised limitations. See exhibits K and L.

The applicant returned to work on February 14, 2006. He worked a 40-hour week, scanning baggage tags, but did not actually have to lift baggage in this job. He had a 30-minute lunch break and two fifteen minute breaks though he sometimes worked through the last break. He could alternate between sitting and standing somewhat in this job, but he never reclined while working.

Indeed, the applicant testified that he did not believe the employer accommodated the doctor-imposed restriction that he be allowed to lie down. Specifically, the applicant testified that his supervisor never told him he could lie down as needed, and there was no place to lie in the baggage room. The applicant testified he mentioned to a lead person several times that he needed to lie down on occasion. However, he did not testify that any in authority ever specifically denied him permission to lie down at work.

The applicant did discuss his work restriction allowing him to lie down as needed with the head manager at the terminal, Tom Donovan, on one occasion. According to the applicant, Mr. Donovan asked the applicant if he had a mat that he could bring in. The applicant told Donovan he did not and "that was the end of it."

The applicant provided a little more detail on cross examination. The applicant explained that he and Mr. Donovan were discussing a one-week gap in pay in February 2006, shortly after he returned to work, when the applicant mentioned his restriction of being able to lie down. In that conversation, Mr. Donovan did not say the applicant could or could not lie down. The applicant added that he expected the employer would provide a mat, but did not ask the employer to do so.

The applicant added, however, that he never told his direct supervisor, Ann Nienas, that he had trouble doing his job. Apart from the conversation about the mat, the applicant never told Mr. Donovan that the employer was not accommodating his restrictions. He also testified he did not miss any time from work due to his back injury between February 14, 2006 (1) (when he returned) and May 31, 2006 (his last day).

The applicant handed in his resignation letter (exhibit M) to a lead worker on May 17, 2006. The letter states:

Due to the inability to accommodate my restrictions that I had when I came back to work I am notifying you of my retirement as of 31 May, 2006. I am hurting now more than ever before and cannot take the risk of more damage to my back.

The applicant did not discuss the retirement letter with Mr. Donovan or anyone else.

Mr. Donovan testified at the hearing. He said he discussed the applicant's restrictions with him, and testified he told the applicant that the employer would accommodate his restriction, including the restriction allowing the applicant to lie down as needed. Mr. Donovan testified he told the applicant the employer would accommodate a mat if that was needed.

Mr. Donovan testified that after this conversation, the applicant never said anything more about his restrictions. Mr. Donovan also testified the applicant never told him he "had" to lie down, only that he "may have" to lie down. Mr. Donovan stated that if the applicant had said he needed to lie down, the employer would have allowed it. Mr. Donovan added that the applicant could have lain on the floor in the break room, and that there was a couch in the break room and the supervisor's office.

The applicant's direct supervisor, Ann Nienas, also testified the applicant never told her he needed to lie down or that was why he was retiring. She added he was never absent for medical reasons. She added she knew of the "lie down restriction" and would have tried to accommodate it if had arisen.

The first question, whether the employer provided work within the applicant's restrictions, implicates Wis. Stat. § 102.44(6) which provides in relevant part:

102.44(6) (a) Where an injured employee claiming compensation for disability under sub. (2) or (3) has returned to work for the employer for whom he or she worked at the time of the injury, the permanent disability award shall be based upon the physical limitations resulting from the injury without regard to loss of earning capacity unless the actual wage loss in comparison with earnings at the time of injury equals or exceeds 15%.

(b) If, during the period set forth in s. 102.17 (4) the employment relationship is terminated by the employer at the time of the injury, or by the employee because his or her physical or mental limitations prevent his or her continuing in such employment, or if during such period a wage loss of 15% or more occurs the department may reopen any award and make a redetermination taking into account loss of earning capacity.

...

(f) Wage loss shall be determined on wages, as defined in s. 102.11. Percentage of wage loss shall be calculated on the basis of actual average wages over a period of at least 13 weeks.

(g) For purposes of this subsection, if the employer in good faith makes an offer of employment which is refused by the employee without reasonable cause, the employee is considered to have returned to work with the earnings the employee would have received had it not been for the refusal.

...

Like the ALJ, the commission concludes the employer was willing to accommodate the applicant's doctor-imposed work restrictions, even the restriction allowing him to recline periodically. Even the applicant's version of events does not amount to a refusal to accommodate his restrictions. Neither Mr. Donovan, Ms. Nievas, nor any other person in authority told the applicant he could not lie down or that he could not bring in a mat to do so. Moreover, the record suggests the employer would have permitted the applicant to lie on a mat or on a couch in the break room. Further, the applicant's work restriction as written by Dr. Coran was to recline when needed, so the fact the employer never told him to lie down--or set aside a set period for him to do so--does not prove a failure to provide work within the applicant's restrictions. The applicant did not ask Dr. Coran to further modify his restrictions, or to take him off work entirely. He never directly confronted the employer about his concern that his restrictions were not being accommodated. Simply mentioning the belief that his restrictions were not being accommodated in a resignation note is not enough to shift the onus back on the employer, particularly on this record.

In short, the commission concludes that the employer provided the applicant with work within his restrictions, but that the applicant subsequently terminated his employment and not "because his physical or mental limitations prevent his or her continuing in such employment." Wis. Stat. § 102.44(6)(b). Under Wis. Stat. § 102.44(6)(a), the applicant would not be entitled to a claim for loss of earning capacity under Wis. Stat. § 102.44(6)(a) unless, upon returning to work for the employer, the applicant's actual wage loss in comparison with earnings at the time of injury equals or exceeds 15%.

In this case, the applicant in fact suffered such a wage loss. Due to the employer's bankruptcy, it had reduced its employees' wages while the applicant was off work for his injury. Before his injury, the applicant earned over $20.00 per hour, but he returned in February 2006 at $16.36 per hour. This is a $3.64 per hour reduction, or an 18 percent loss on a $20.00 per pre-injury hour wage. According to the applicant, he lost overtime as well, thus increasing the actual wage loss.

The respondent does not dispute a $20.00 per hour pre-injury wage or $16.34 return-to-work wage. Rather, it points out that the wage loss was occasioned by the employer's bankruptcy, not the applicant's injury. However, Wis. Stat. § 102.44(6)(a) does not require that the work injury be the reason for the wage reduction. Indeed, a worker becomes eligible for compensation for loss of compensation if his employment is terminated by the employer for reasons other than his physical or mental restrictions, such as a layoff or plant closing. The respondent also points out that in the summer of 2006, or after the applicant left his job, the employer increased its employees' wage rates to result in only a 12 percent reduction from the pre-bankruptcy rate. However, by the time of the pay increase, the applicant was no longer working for the employer. In short, after retuning full time to work for the employer under his permanent restrictions, the applicant did not earn at least 85 percent of his pre-injury wage.

Regarding the extent of loss of earning capacity, the first question is whether the applicant is permanently and totally disabled under the odd-lot analysis. The Supreme Court adopted the odd lot doctrine in Balczewski v. DILHR, 76 Wis. 2d 487, 495 (1977), where the court held:

[W]here a claimant makes a prima facie case that he has been injured in an industrial accident and, because of his injury, age, education, and capacity, he is unable to secure any continuing and gainful employment, the burden of showing that the claimant is in fact employable and that jobs do exist for the injured claimant shifts to the employer.

The court recently reaffirmed its adherence to the odd lot doctrine in Beecher v. LIRC, 2004 WI 88, ¶¶ 58, 59, 273 Wis. 2d 136, describing the odd lot doctrine as a rule of evidence, and holding:

54 ... Under Balczewski, however, if the claimant brings forward the basic facts sufficient to satisfy the DWD that a prima facie odd-lot case has been made, the presumption is triggered and an obligation is imposed upon the party against whom the presumption runs-here, the employer. That obligation is the burden of proving that the non-existence of the presumed fact is more probable than its existence, or in other words, that it is more probable that the claimant is not permanently and totally incapable of earning a living. Balczewski holds that this burden requires the employer to show that there is an actual job that the claimant can do.

55 Accordingly, we conclude that the burden that shifts from the claimant to the employer under Balczewski is a burden of persuasion, but only as to the sub-issue of whether a job exists that the claimant can do. The burden of persuasion on the other aspects of the claimant's case for permanent total disability benefits remains, as always, with the claimant. The claimant must prove the industrial injury and medical aspects of his claim, and if the claimant makes a prima facie case for oddlot unemployability based upon his injury, age, education, training, and capacity, then it falls to the employer to show that there exists suitable employment for the claimant. The employer does this by bringing forward evidence of actual job availability, making it more probable than not that the claimant is able to earn a living. The claimant may respond with evidence of an actual, futile job search or rely on his expert evidence to defeat the employer's attempted rebuttal. The DWD then determines whether the prima facie odd-lot case under Balczewski has been successfully rebutted. The factors enumerated in DWD § 80.34 may come into play in the agency's ultimate determination of eligibility for benefits, to the extent that they overlap with the odd-lot doctrine, or in a broader sense to the extent that the odd-lot case fails and traditional eligibility rules prevail.

...57 ... Once a prima facie odd-lot case is made, it falls to the employer to prove that there is continuous and regular work available to the claimant in order to rebut the prima facie case of odd-lot unemployability. In making the ultimate determination of eligibility for benefits, the agency considers any factors enumerated in DWD § 80.34 that are consistent with the odd-lot doctrine, or more broadly if the agency concludes that the claimant is not prima facie odd-lot or the odd-lot prima facie case has been rebutted.

In this case, the applicant has not shown that he "is unable to secure any continuing and gainful employment." The commission acknowledges that even the respondent's vocational expert, Michael Campbell, opined the applicant would be relegated to odd lot status if he were trying to find work on the open market. However, in February 2006 the employer provided continuing and gainful employment to the applicant, and the applicant in fact performed that work, until the applicant himself terminated the employment. Even if the applicant were considered to have made a prima facie case shifting the burden to the employer, however, the job the employer provided to the applicant in February 2006 satisfies the employer's burden of showing that "there is continuous and regular work available to the [applicant]" and that "[he] is in fact employable and that jobs do exist for [him]."

The applicant argues that what the employer is providing is essentially made work or an "odd-lot job" which shows neither the availability of continuous and regular work nor that the applicant is in fact employable. The commission recognizes that an employed worker may still be totally and permanently disabled under certain
circumstances.(2)  However, the commission declines to find that the applicant is permanently and totally disabled despite working in this case. The respondent offered testimony establishing that the applicant's job was not made work. Indeed, the commission concludes from the record that it was productive work which the employer provided on a continuing basis even as it underwent bankruptcy. It was full time work which the applicant performed without needing to see a doctor--or directly asking to lie down as allowed in his restrictions--for several months.

The next question is how much loss of earning capacity should be awarded. In his report at exhibit 5, Mr. Campbell posits several measures of loss based on various assumptions about the applicant's wage loss in the job provided by the employer in February 2006 after the applicant reached an end of healing.

However, the applicant has sustained a significant loss of earning capacity beyond that reflected by the reduction in his hourly pay rate in the job provided by the employer in February 2006. While the commission is satisfied the applicant could have continued to perform that job within his physical and mental restrictions, having to recline periodically at work greatly reduces his access to other jobs in the labor market. Further, the applicant is older, has worked for most of his life as a baggage handler, and has few if any significant transferable skills. On the other hand, the applicant's decision to retire rather than continue working is relevant to the applicant's willingness to find suitable reemployment. The work the employer provided to the applicant in February does not operate as a complete bar to an award for loss of earning capacity because it paid less than 85 percent of the pre-injury wage, yet the job may still be considered in determining the amount of the loss of earning capacity award. Having considered and weighed the factors set out in Wis. Admin. Code § DWD 80.34, the commission concludes the applicant sustained permanent partial disability on a vocational basis for loss of earning capacity at 50 percent, into which Dr. Coran's rating for permanent partial disability on a functional basis is merged.

The applicant is therefore entitled to 500 weeks of compensation for permanent partial disability. At the weekly rate of $232 (the statutory maximum for injuries in 2004) this totals $116,000, accruing as of November 10, 2005. As of November 5, 2007, 103 weeks and 4 days (103.6667 weeks) amounting to $24,050.67 has accrued; 396 weeks and 2 days (396.3333) amounting to $91,949.33 remains unaccrued. As of the date of the hearing the respondent had paid $15,141.31 in disability compensation,(3) so that the additional amount awarded equals the $100,858.69 that was unpaid at the date of hearing.

The applicant approved an attorney fee set under Wis. Stat. § 102.26, at 20 percent of the additional amount awarded. The future value of the fee equals $20,171.74 (0.20 times $100,858.69). However, the fee is subject to an interest credit of $4,154.52 to reflect the advance payment of fee attributed to unaccrued permanent disability as of November 5, 2007. The present value fee is $16,206.22, which equals the accrued fee ($1,781.87)(4) plus the future value unaccrued fee ($18,389.87)(5), less the interest credit of $4,145.52. The present value fee, together with the costs of $825, shall be paid the applicant's attorney within 30 days.

The amount due the applicant within 30 days for accrued disability compensation to November 5, 2007, is $6,302.49, which equals the accrued award ($24,050.67), less the amount paid by the respondent to the hearing date ($15,141.31), less the accrued fee thereon ($1,781.87), less costs ($825.00). The amount remaining to be paid to the applicant as it accrues after November 5, 2007, is $73,559.47, which equals the unaccrued portion of the award ($91,949.33), less the future value of fee ($18,389.87) thereon. That amount shall be paid to the applicant in monthly installments of $1,005.33 per month, beginning on December 5, 2007.

In addition, the applicant has incurred reasonable and necessary medical expenses to cure and relieve the effect of the work injury as documented in exhibit G. These include $842.41 from Hanger Prosthesis & Orthotics, $20.00 from Infectious Disease Consultants, S.C., $1,955.00 from Covenant Medical Group, and $100 from Sports Medicine and Orthotics Center. In addition, the record indicates that another insurer, United Healthcare, paid $39,124.86 in applicant's medical expenses and it is entitled to reimbursement under Wis. Stat. § 102.30(7).(6) Finally, the applicant incurred $217.86 dollars in out-of-pocket medical expense for which he is entitled to payment.

Given the nature of the applicant's condition and treatment to date, as well as Dr. Coran's opinion that the applicant's prognosis is fair and that the applicant might require further treatment, this order shall be left interlocutory to permit additional orders and awards regarding further claims for compensation, including disability and medical expense, that may arise in the future.

NOW, THEREFORE, the Labor and Industry Review Commission makes this

INTERLOCUTORY ORDER

The findings and order of the administrative law judge are modified to conform to the foregoing and, as modified, are affirmed.

Within 30 days, the employer and the insurer shall pay all of the following:

(1)   To the applicant, the sum of Six thousand, three hundred two dollars and forty-nine cents ($6,302.49) in disability compensation and Two hundred seventeen dollars and eighty-six cents ($217.86) in out-of-pocket medical expenses.
(2)   To the applicant's attorney, Robert Ward, the sum of Sixteen thousand, twenty-six dollars and twenty-two cents ($16,026.22) in fees and Eight hundred twenty-five dollars and no cents ($825.00) in costs.
(3)   To Hanger Prosthesis & Orthotics, Eight hundred forty-two dollars and forty-one cents ($842.41) in medical treatment expense.
(4)   To Infectious Disease Consultants, S.C., Twenty dollars and no cents ($20.00) in medical treatment expense.
(4)   To Covenant Medical Group, One thousand nine hundred fifty-five dollars and no cents ($1,955.00) in medical treatment expense.
(5)   To Sports Medicine and Orthotics Center, One hundred dollars and no cents ($100.00) in medical treatment expense.
(6)   To United Healthcare, Thirty-nine thousand, one hundred twenty-four dollars and eighty-six cents ($39,124.86) in reimbursement under Wis. Stat. § 102.30.

Beginning on December 5, 2007, and continuing on the fifth day of each month thereafter, the employer and its insurer shall pay the applicant One thousand five dollars and thirty-three cents ($1,005.33) per month, until the additional amount of Seventy-three thousand five hundred fifty-nine dollars and forty-seven cents ($73,559.47) has been paid.

Jurisdiction is reserved for further orders and awards as are necessary and consistent with this decision.

Dated and mailed October 29, 2007
boundsj . wrr : 101 : 1 ND § 5.23, § 5.31

/s/ James T. Flynn, Chairman

/s/ Robert Glaser, Commissioner

/s/ Ann L. Crump, Commissioner

cc:
Attorney Robert T. Ward
Attorney Michael C. Frohman



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Footnotes:

(1)( Back ) The hearing synopsis has this as "May 14, 2006". However, the ALJ's handwritten notes (from which the synopses are usually dictated) has the date as "February 14, 2006."

(2)( Back ) In Rettke v. Bellin Memorial Hospital, WC claim no. 2001-004493 (LIRC, March 30, 2005), an x-ray technician originally sustained disability from an occupational back injury in the mid-1990s. He continued to work under gradually increasing restrictions, first subject to a 4-hour day with a 50-pound lifting maximum, then to a 2-hour day with a 20-pound lifting maximum. When the second, more limiting set of restrictions were set, the commission found Mr. Rettke permanently and totally disabled, even though Mr. Rettke continued to work for the employer under those restrictions, stating:

The Odd-Lot Doctrine contemplates an applicant may be employed but considered to be permanently and totally disabled on an odd-lot basis. As the Wisconsin Supreme Court noted in Balczewski v. ILHR Dept., 76 Wis. 2d 4[8]7, 493, total disability is not to be interpreted literally as utter helplessness. The court found that evidence the applicant has been able to earn occasional wages and perform certain kinds of gainful work does not necessarily rule out a finding of total disability nor require that it be reduced to partial disability. The court stated the task is to phrase a rule limiting the amount and character of work a man can be able to do without forfeiting his totally disabled status. The court found that to be classified as totally disabled an employee is so injured that he can perform no services other than those which are so limited in quality, dependability or quantity that a reasonably stable market for them does not exist.

(3)( Back ) The commission has recalculated the award to state the amount due as of the date of this decision. The respondent may take the appropriate credit for permanent disability compensation payments made since the hearing, so it does not pay any amounts twice.

(4)( Back ) This is 20 percent of $8,909.36, which is the difference between the accrued award ($24,050.67) and the PPD paid by the respondent as of the date of the hearing ($15,141.31).

(5)( Back ) This is 20 percent of the unaccrued PPD award of $91,949.33.

(6)( Back ) The ALJ did not order this amount paid. The commission concludes this was due to inadvertence, and orders the reimbursement even though the issue was not raised on appeal. See United Parcel Service, Inc. v. Lust, 208 Wis. 2d 306, 314 (1997) (the commission has the duty to find the facts and determine the compensation irrespective of the presentation of the case by the attorneys.)

 


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