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

STEPHEN P DAY, Applicant

MILLS FLEET FARM, Employer

HARTFORD ACCIDENT & INDEMNITY CO, Insurer

WORKER'S COMPENSATION DECISION
Claim No. 1994024731

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 makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The applicant worked for respondent as a truck driver. On March 18, 1994, he injured his low back when he slipped and fell on some ice while walking across a parking lot. As a result of this accident, the applicant sustained a large herniated disc on the left side at the L4-5 level which significantly compresses the L5 nerve root and the thecal sac. Because of this injury, the applicant continues to suffer significant low back pain with radicular symptoms down his left buttock, left posterior thigh, left calf and left foot. His current treatment consists of occasional visits to the chiropractor plus prescription muscle relaxers, pain killers, an anti- depressant, and sleep medication.

Although the parties agreed that the applicant sustained at least four percent permanent partial disability to the body as a whole as a result of the industrial accident, they disagreed as to his permanent restrictions. Dr. Strayer, the applicant's treating orthopedic surgeon, opined that the applicant should not drive a truck or lift more than 50 pounds. A functional capacity evaluation ordered by Dr. Strayer demonstrated that the applicant has the physical capacity for at least light level work. On the other hand, Dr. McDevitt, the independent medical examiner, opined that the applicant did not need any permanent work restrictions.

The commission, like the administrative law judge, rejects Dr. McDevitt's opinion. The applicant has a large herniated disc compressing his L5 nerve root, and the pain and symptoms associated with that injury. As Dr. Strayer noted, driving a semi truck is an occupation known to have a high risk for reoccurring back problems; this observation seems especially true where, as here, the driver must load and unload freight. Under the circumstances, Dr. Strayer reasonably opined permanent restrictions are necessary. The commission further accepts Dr. Strayer's opinion that the applicant is capable of performing light physical work and should be restricted from driving truck or lifting more than 50 pounds.

The next issue is the applicant's loss of earning capacity given Dr. Strayer's restrictions. At the time of his injury, the applicant worked for Fleet Farm, driving a truck throughout Minnesota and Wisconsin. His job required him to be away from home one or two nights per week. Though he earned $11.50 per hour, he estimated he would have made about $35,000 to $38,000 per year, based on his overtime earnings to the point of his injury. This is borne out by his conceded average weekly wage while working for Fleet Farm, $673.95 or $35,000 per year.

The applicant had only worked for Fleet Farm since January 1994, or about two months prior to his injury. Prior to that (from May 1990 to January 1994), the applicant had worked for Kimberly-Clark as an over-the-road driver. He drove cross-country for Kimberly-Clark, and was typically home only on the weekends. He earned about $48,000 ($55,000 less $7,000 in expenses) in 1993 with Kimberly-Clark, but resigned that job to take one that allowed him to spend more time at home. The applicant hoped eventually to increase his earnings at Fleet Farm to match those he had made at Kimberly-Clark.

After the injury, the applicant applied for and received services at the Division of Vocational Rehabilitation (DVR.) He was certified for training at a technical school. He began coursework, and was a good student, earning Dean's Honors. In 1997, he obtained an associate degree from Fox Valley Technical College (FVTC) in Banking and Finance. He would like to become a certified financial planner eventually, but that would require another two years of coursework.

The respondent paid vocational rehabilitation benefits under Wis. Stat. § § 102.43(5) and 102.61 for the applicant's coursework leading to the associate degree from FVTC. It does not appear the respondent intends to pay for continued retraining to become a financial planner. The applicant desires to take the course work to become a financial planner if he can afford it, but he has liquidated his stock options from Kimberly-Clark and was living with his sister at the time of the hearing to make ends meet.

In order to become a certified financial planner, the applicant must have some experience in insurance sales in addition to taking more classes. He also recently paid for and completed an $800 course allowing him to obtain a license to sell securities.

The applicant is now working as an insurance salesman for an agency, on a commission-only basis. His commissions from November 1997 to April 1998 have averaged well under $400 per month.

Both parties have submitted expert vocational opinions on the question of the applicant's lost earning capacity.

The applicant's expert is Jackie C. Roman; her report is at Exhibit A. Looking at the applicant's earnings from 1990-1994, which included primarily his employment with Kimberly-Clark, she estimated his pre-injury earning capacity to be $45,000 to $55,000 at the time of his injury in 1994. She reported that the starting wage for insurance salesman averaged $19,000 to $28,000, with mean earnings between $24,000 to $45,000, in 1995. She could not predict where the applicant would fall in this range, despite his strong motivation, assuming he was able to increase his monthly commissions to the point he could even continue. Comparing his pre-injury wage of $45,000 to $55,000 to the mean for insurance salesman, however, she rated loss of earning capacity at 20 to 30 percent.

If the applicant could not establish himself as an insurance salesman, but was forced to accept clerical work such as accounting clerk, accounts payable clerk, billing clerk, mortgage clerk, payroll clerk or collections clerk, Ms. Roman opined he would earn somewhere between $8 and $10 per hour, in 1995 wages. Accepting one of these jobs, which presumably would make little or no use of his retraining and associate degree, would result in a 55 to 65 percent loss of earning capacity.

The respondent's expert is Gerrold Odness. He does not report what he believes the applicant's pre-injury earning capacity as a truck driver to be, though he apparently considered it to be lower than the norm for over-the-road trucking, as the applicant refused such jobs in the past so he could spend more time at home. Working backward from the other figures in his report, it appears Mr. Oldness rated the applicant's pre-injury earning capacity to be $41,000 to $43,333 per year. (1)

Mr. Odness opines that, considering his education, training, and interest, the applicant should be able to find work as an insurance agent, financial institution manager, credit card operations manager. He also pointed out that with additional training, the applicant could work selling securities or as financial planner. He estimated earnings in these occupations to be about $39,000, based on 1997 figures. Accordingly, he rated a five to 10 percent loss of earning capacity.

The applicant's current earning capacity (his ability to earn a wage given his residual capacity, experience and training) should be based on his earning capacity as an insurance salesman. The applicant, by all accounts, is a bright, motivated, and hardworking man. The commission therefore concurs with the assumption of the applicant's expert, Ms. Roman, that the applicant would earn average wages as an insurance salesman.

Mr. Odness does not expressly state a wage approximating pre-injury capacity (though one would assume that if $39,000 represents a five to 10 percent loss, the pre-injury capacity would be $41,000 to $43,000.) In addition, Mr. Odness seems to include wages the applicant could earn as a financial planner or as a security salesman in estimating the $39,000 post-injury capacity. Based on the current record, however, the applicant does not qualify for those jobs.

The respondent's assertion that the applicant's pre-injury earning capacity was only $35,000 based on his wages with Fleet Farm must also be rejected. Loss of earning capacity is based on an estimate of earning capacity, not actual wages. The amount the applicant earned in his first few months of employment with Fleet Farm does not truly reflect the applicant's capacity prior to his injury. Again, as best as can be determined, the respondent's expert (Mr. Odness) estimated the applicant's pre-injury earning capacity to be in the $41,000 to $43,300 range.

After considering the factors set out in Wis. Admin. Code § DWD 80.34, the commission adopts Ms. Roman's estimate of loss of earning capacity at 30 percent. The applicant who was born in 1957, was 37 on the date of injury and was 41 at the time of the hearing. His relatively young age is a positive factor with respect to his post-injury earning capacity, as it provides opportunities that might not be available to an older worker, particularly with respect to investment in new job skills or education. Indeed, the applicant has taken advantage of retraining opportunities offered him, another positive factor in assessing his post-injury earning capacity. On the other hand, the applicant will likely be able to transfer few of his skills in his former job as a truck-driver to his new employment as an insurance salesman. Further, his present earnings are unquestionably low.

It is therefore found that the applicant has sustained a 30 percent loss of earning capacity, into which his award for functional disability is merged. The applicant's total award for permanent partial disability is equal to 300 weeks at $158 per week (the statutory maximum for injuries occurring in 1994), or $47,400.

As of June 12, 1999, 160 weeks equaling $25,280 have accrued; 140 weeks totaling $22,120 remain unaccrued. In addition, the respondent has previously conceded and paid $6,320, leaving the net amount of $41,080 due the applicant, and the net amount of $18,960 currently accrued.

The applicant approved an attorney's fee of 20 percent of additional amounts awarded under this order. The future value of the fee is thus $8,216 (20 percent of $41,080). However, as of the date of the order, only $3,792 of the fee has accrued, while $4,424 is unaccrued. The unaccrued fee is subject to an interest credit of $394.34, leaving a present value for advance payment of the fee of $4,029.66. That amount shall be deducted from the applicant's award and paid within 30 days.

The amount currently due the applicant, then, is $15,168, which equals the additional award accrued to June 12, 1999 ($18,960), less the attorney's fee thereon ($3,792). This amount shall be paid the applicant within 30 days.

The amount remaining to be paid as it accrues after June 12, 1999 equals $17,696, which is the unaccrued award ($22,120) less the attorney's fee thereon without deducting the interest credit ($4,424). This amount shall be paid to the applicant in monthly installments of $684.67, beginning on July 12, 1999.

Because Dr. Strayer's reports indicate the applicant may need further treatment (albeit with another doctor) and because surgery remains a treatment option, this order is left interlocutory to permit compensation for future medical expense and temporary disability, if any, as well as additional permanent disability.

INTERLOCUTORY ORDER

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

Within 30 days from the date of this Order, the employer and its insurer shall pay all of the following:

1. To the applicant, Steven Day, Fifteen thousand one hundred sixty- eight dollars ($15,168) in permanent disability compensation.

2. To the applicant's attorney, Steven Wilson, Seven thousand eight hundred twenty-one dollars and sixty-six cents ($7,821.66) in attorney fees.

Beginning on July 12, 1999, and continuing on the twelfth day of each month thereafter, the employer and its insurer shall pay the applicant Six hundred eighty-four dollars and sixty-seven cents ($684.67) per month until the total remaining amount of Seventeen thousand six hundred ninety-six dollars ($17,696) is paid.

Jurisdiction is reserved for such further findings, orders and awards as may be warranted consistent with this decision.

Dated and mailed June 9, 1999
dayst.wrr : 101 : 7 ND § 8.32

/s/ David B. Falstad, Chairman

Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

On appeal, the respondent first points out that the ALJ issued his decision after the 90-day deadline set out in Wis. Stat. § 102.18(1)(b). Accordingly, the respondent asks the commission to remand the case for another hearing before another ALJ.

However, the commission has uniformly held that the 90-day time limit is directory instead of mandatory, and has declined to take any action based on an ALJ's failure to comply. Marc Tutlewski v. Big Buck Building Supply, WC case no. 95027768 (LIRC, March 12, 1998) and cases cited therein. The commission's interpretation has been consistently upheld on judicial review. Fish v. LIRC, case no. 94-2831-FT (Wis. Ct. App., February 9, 1995); Big Buck Building Centers v. LIRC, case no. 98-CV-002542 (Wis. Cir. Ct. Milwaukee County, February 5, 1999).

In considering the "directory versus mandatory" question, the supreme court has indicated that two relevant considerations are the failure of the legislature to provide a penalty for noncompliance of the statute in question (indicating a directory interpretation) and the apparent intent of the statute. State v. Perry, 181 Wis. 2d 43, 53-54 (1993). See also T. H. v. La Crosse County, 147 Wis. 2d 22, 26 (Ct. App., 1988)(citing State v. Industrial Commission, 233 Wis. 461, 466 (1940). Here, no penalty is set for noncompliance with Wis. Stat. § 102.18(1)(b), and the apparent purpose of the 90-day rule (to hasten the issuance of decisions) is not served by delaying further with a remand.

The respondent's attorney acknowledges that "older cases such as Muskego- Norway Consolidated Schools Joint School District No. 9 v. WERB, 32 Wis. 2d 478-485b (1967) indicate that such a statute may be directory rather than mandatory." However, the respondent continues that "the Commission is not bound by precedent," as so is free to set aside the ALJ's order in this case as untimely.

It is true that a case dealing with a similar statute governing WERB procedure might, under appropriate circumstances, be distinguishable and therefore not controlling precedent. It is also true that the commission, like other administrative agencies, is not bound by its own precedent. Nick v. State Highway Commission, 21 Wis. 2d 489, 495 (1963) and Nelson Brothers v. Revenue Dept., 152 Wis. 2d 746, 756 (Ct. App., 1989). However, the commission is obviously bound by controlling supreme court precedent, and may appropriately view legal analyses set out in prior supreme court cases as controlling in its analysis on legal issues.

The respondent's attorney also contends that it that should not matter that Wis. Stat. § 102.18(1)(b) lacks an enforcement mechanism for an ALJ's failure to issue an order within 90 days. The attorney asserts that "the same argument could be made with respect to a petition for review under Wis. Stat. § 102.18(3)" and yet the commission routinely orders the dismissal of late petitions. However, Wis. Stat. § 102.18(3) expressly requires LIRC to dismiss late petitions. (2) Wis. Stat. § 102.18(1)(b) contains no similar provision requiring the commission to set aside and remand late ALJ orders.

The respondent also contends that the applicant has sustained only a minimal loss of earning capacity given his ability to work as an insurance salesman, not the 44 percent awarded by the ALJ. The extent of the applicant's loss of earning capacity is dealt with at length in the body of this decision.

Prior to deciding to reduce the loss of earning capacity award, the commission conferred with the presiding ALJ regarding the credibility and demeanor of the sole witness in this case, the applicant. Transamerica Ins. Co. v. ILHR Department, 54 Wis. 2d 272, 283-84 (1972). The ALJ told the commission that the applicant's demeanor was that of a pleasant, honest and sincere individual, who had made an impressive investment in his vocational future. However, the ALJ also believed the applicant was perhaps overly optimistic about future earning capacity.

The commission does not dispute any of these observations, despite reducing the loss of earning capacity award to a still significant 30 percent. The commission, however, felt that vocational expert Jackie Romans (who did not testify) best estimated the applicant's loss of earning capacity, as explained in the body of this decision.

cc: ATTORNEY STEVEN WILSON
SIGMAN JANSSEN STACK WENNING & WILSON

ATTORNEY PETER S NELSON
MENN NELSON SHARRATT TEETAERT & BEISENSTEIN LTD

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Footnotes:

(1)( Back ) $39,000 = 0.95x; $39,000 = 0.90x.

(2)( Back ) Except where the petition is late for a reason beyond the petitioner's control.