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

KELLY L BROWN, Applicant

SCHULTZ SAV O STORE, Employer

RELIANCE INS CO, Insurer

WORKER'S COMPENSATION DECISION
Claim No. 93015833

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: March 5, 1998
brownke.wsd : 101 : 7 ND § 5.10

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The applicant, a meat-cutter, was injured in a lifting accident at work in April 1993. The employer and its insurer (collectively, the respondent) concedes he was temporarily disabled from April 1995 to August 26, 1996, when he returned to work. However, the respondent stopped paying his temporary disability on January 26, 1996, because it believed he was earning wages in self-employment.

If an applicant is able to work and earn wages while he is still healing from his work injury, the wages are applied against the applicant's temporary total disability rate according to a proportional formula. Wis. Stat. § 102.43 (2). In cases of self-employment, the commission usually bases the proportional reduction on pre-tax earnings (revenue minus expenses) from the self-employment. Van Mun v. Caregivers Home Health, WC Claim no. 96013487 (LIRC, November 6, 1997). (1)

In this case, the applicant had a business selling life insurance through an entity called WMA, which he has operated since 1994. The applicant's tax returns show his business operated at a substantial loss for 1995, with $2,250 in income off set by $4,400 in expenses. Exhibit 2. The issue here is how much, if anything, the applicant made from the business in the disputed period of temporary disability from January 26 to August 26, 1996.

The applicant testified he made nothing. This is borne out to a large extent by documents from WMA submitted by the respondent at Exhibit 4. These show a few instances of earned commissions of $35.93, all apparently related to the sale of a single insurance policy. However, the applicant testified he never received the money, either because he actually was not entitled to the commission under WMA's override scheme or because the commission was offset by expenses withheld by WMA. In fact, the documents show the applicant as owing money to WMA, and do not establish any payments were actually made to him.

The respondent specifically subpoenaed the applicant's business records, including expense records. The applicant did not bring records to prove his ongoing expenses in 1996, claiming he did not have expense records. The commission finds this credible testimony from a meat-cutter working part-time as an insurance salesman. In any event, however, the applicant's business expenses do not matter in this case, as the applicant received no actual income from his insurance sales business in 1996. In sum despite the failure to provide the subpoenaed expense documents, the commission cannot conclude that the applicant is playing a shell-game to hide income as the insurer alleges.

cc: ATTORNEY JOHN BECKER
BECKER FRENCH & DEMATTHEW

ATTORNEY MICHAEL FROHMAN
KASDORF LEWIS & SWIETLIK SC

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Footnotes:

(1)( Back ) An over-riding rule, however, is that wages from a part-time job with another employer which the injured worker held when injured are not used to reduce TTD benefits, unless the TTD benefits are based on an expanded wage. Wis. Stat. § 102.43 (6). That provision does not apply here as the applicant's self-employment began after the date of injury.