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

CYNTHIA HOUSE, Applicant

PACKAGING CORP OF AMERICA, Employer

ZURICH AMERICAN INSURANCE COMPANY, Insurer

WORKER'S COMPENSATION DECISION
Claim No. 2001-046138


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, except that it makes the following modifications:

1. Delete paragraphs 6 and 7 of the ALJ's decision, and substitute:

"Further, the job offer statute, Wis. Stat. § 102.61(1g), does not apply in this case. As the applicant points out, the effective date for new Wis. Stat. § 102.61(1g) is January 1, 2002 (2001 Wis. Act 37, SECTION 55), and Wis. Stat. § 102.03(4) provides that 'the right to compensation and the amount of compensation shall in all cases be determined in accordance with the provisions of the law in effect as of the date of injury' with certain exceptions not here relevant. Thus, the applicant contends, new Wis. Stat. § 102.61(1g) was not yet in effect when she was injured in July 2001, so the subsequent job offers do not affect her eligibility under that section. Indeed, the labor and industry review commission has declined to apply Wis. Stat. § 102.61(1g) retroactively in a number of cases. (1)

"The respondent argues that the commission has applied two other provisions of 2001 Wis. Act 37 retroactively in cases involving dates of injury before January 1, 2002. One of decisions noted by the respondent, Paetow, involved the enactment of Wis. Stat. § 102.42(1m). In that case, the commission's decision explicitly referred to 2001 Wisconsin Act 37, SECTION 54(3) under which the enactment of Wis. Stat. § 102.42 (1m) first applies 'to treatment provided on January 1, 2002. [Italics supplied.]' In other words, 2001 Wis. Act 57 contained an express non-statutory, 'session law' providing that the change applied to treatment, not injuries, on or after January 1, 2002, Wis. Stat. § 102.03(4) notwithstanding. In the other cases cited by the respondent, McDuffy and Hartl -- which involve an amendment to Wis. Stat. § 102.18(1)(b) to permit orders prospectively directing the payment of treatment expenses -- the commission did not actually discuss why the statutory change was applied to injuries occurring before the Act's effective date, or even state whether that issue was raised. However, the amendment to Wis. Stat. § 102.18(1)(b) may reasonably be viewed as making procedural as opposed to substantive change in the law. In other words, the amendment changed the point in the worker's compensation process when the compensation for treatment expense may be awarded, rather than the actual right to compensation for treatment expense or the amount of such compensation per se, and is so not governed by Wis. Stat. § 102.03(4). That argument cannot be made with respect to the change to the worker's compensation benefits during vocational rehabilitation at issue here. Rather, the enactment of Wis. Stat. § 102.61(1g) to preclude the payment of compensation during vocational rehabilitation if the employer makes a qualifying job offer directly affects the 'right to and amount of compensation.'

"The respondent also asserts that the applicant is not entitled to benefits for retraining under Wis. Stat. § § 102.43(5) and 102.61 because the applicant's retraining program was the result of an abuse of administrative power by DVR and that highly material facts were intentionally withheld from DVR. The Supreme Court has held that:

'Unless it is shown before the commission that highly material facts were misrepresented to or withheld from the state board [DVR] or that the state board has applied an interpretation of the rehabilitation laws which is entirely outside the reasonable scope of interpretation and hence a clear abuse of administrative power, the Industrial Commission must find that any applicant who is receiving aid from the state board is also entitled to it.'

Massachusetts Bonding & Insurance Co. vs. Industrial Commission, 275 Wis. 505, 512 (1957).

"As to abuse of administrative power, the respondent contends DVR did not identify the applicant's earning capacity (which the insurer contends is necessary per language in a LIRC decision), that the IPE enhanced her earning capacity, that DVR let her take less than a 12-hour semester, and that DVR did not conduct a job search.

However, the respondent's allegations fail to show how DVR 'applied an interpretation of the rehabilitation laws which is entirely outside the reasonable scope of interpretation.' DVR policy no longer requires a worker to contact the time-of-injury employer about job offers or to conduct a job search, (2)   so an abuse of discretion can not be based on DVR's failure to contact the employer about job offers. Further, Wis. Admin. Codes DWD 80.49(3) -- which states that an ALJ or the commission may not award worker's compensation benefits after 80 weeks if the purpose of retraining is to enhance earning capacity -- is an administrative rule affecting workers compensation liability and does not govern DVR's decision to adopt a particular IPE under 'the rehabilitation laws.' Finally, the respondent identifies no rehabilitation law requiring a 12 credit-hour semester or under which DVR's interpretation is 'outside the reasonable scope of interpretation.' At most, the insurer points to factors that might lead another decision-maker to another, arguably more reasonable decision about certifying the applicant for retraining. This falls short, however, of the abuse of administrative power standard required under Massachusetts Bonding.

"As to misrepresentation, the insurer points to DVR's unawareness that the employer had offered the applicant work. Again, job offers are no longer relevant under DVR's new policy, and the insurer identifies no other applicable rehabilitation law or policy under which a job offer is relevant in this case. This, too, falls short of identifying a highly material fact that has been misrepresented to or withheld from DVR.

"The insurer also argues that, even if DVR's approval of the four-year degree coursework was not an abuse of administrative power, compensation for vocational retraining should be limited to 80 weeks because the plan enhances, rather than merely restores the applicant's earning capacity. In other words, while DVR approval of a vocational program that enhances pre-injury earning capacity may not be an abuse of administrative authority under the vocational rehabilitation laws, Wis. Admin. Code § DWD 80.49(3) provides:

'Extension of vocational rehabilitation benefits beyond 80 weeks may not be authorized pursuant to s. 102.61(1) or (1m), Stats., if the primary purpose is to improve upon preinjury earning capacity rather than restoring it.'

"Wisconsin Stat. § 102.43(5) similarly provides:

'. . . Except as provided in s. 102.61 (1g), temporary disability shall also include such period as the employee may be receiving instruction pursuant to s. 102.61 (1) or (1m). Temporary disability on account of receiving instruction of the latter nature, and not otherwise resulting from the injury, shall not be in excess of 80 weeks. Such 80- week limitation does not apply to temporary disability benefits under this section, travel or maintenance expense under s. 102.61 (1), or private rehabilitation counseling or rehabilitative training costs under s. 102.61 (1m) if the department determines that additional training is warranted. The necessity for additional training as authorized by the department for any employee shall be subject to periodic review and reevaluation. [Emphasis added.]'

"The fact that an injured worker undertakes retraining -- in a four year program or otherwise -- that may amount to higher wages than he or she had before the injury does not in and of itself establish either that the retraining is unwarranted under Wis. Stat. § 102.43(5) or that its primary purpose is to improve upon preinjury earning capacity rather than restoring it under Wis. Admin. Code § DWD 80.49(3). These questions necessarily depend on the facts involved.

"For example, in Beloit Corporation v. LIRC, 152 Wis. 2d 579, 590 (Ct. App., 1989), the court approved the commission's finding that virtually any retraining will result in some increase in earning capacity. The Beloit Corp. case dealt with DVR vocational rehabilitation training that sent a young laborer to college to become an engineer. The court concluded that while training increased the injured worker's earning capacity, that did not make it unreasonable. The court specifically noted that vocational retraining is undertaken to restore earning potential, as well as earning capacity. Beloit Corp., at 591. The court approved of the commission's finding that the purpose of the training was to use his ambition, intellect and remaining natural assets to restore his pre-injury capacity. It affirmed LIRC's finding of vocational rehabilitation benefits beyond the then applicable 40-week limit.

"However, in this case, DVR itself referred the applicant to an outside specialist, Laura Koritsoglou, who also recommended only a two-year associate's degree in medical lab technology or paralegal at MATC. See exhibit B, report of Koritsoglou dated June 6, 2002, page 10. Nonetheless in August 2002, DVR approved a four-year course as a medical technologist in an Individualized Plan for Employment.

"Further, at the time of her injury, the applicant was a factory worker making $13.11 per hour (using the average weekly wage of $524.40). She is retraining in a four-year medical technologist program which pays, by the estimate of the respondent's vocational expert, $21.77 per hour. DVR counselor Poffinbarger testified on behalf of the applicant that the low end for a starting medical technology graduate from the University of Wisconsin-Milwaukee was $26,000 per year ($12.50 per hour assuming a 2080 hour year), while the middle of the range was $31,000 ($14.90 per hour), and the high end was $35,000 ($16.83 per hour). In contrast, the respondent's vocational expert suggested a two-year associate degree in medical technology would be more appropriate -- that pays about $16.00 per hour. See exhibit 1, report of Schuyler. The outside specialist retained by DVR, Ms. Koritsoglou indicated a starting average wage for Medical Lab Technologist graduate from MATC at $14.13 per hour, with a statewide average annual wage in the job at $30,348 ($14.59 per hour) to $41,262 ($19.84 per hour). Exhibit B, Koritsoglou Vocational Evaluation Report, page 10.

"Thus, there is substantial evidence offered by both parties establishing that a two-year associate degree in medical technology would adequately restore the applicant's earning capacity. Further, the applicant was born in 1954 and will be in her fifties when university retraining is completed, unlike the young laborer in Beloit Corporation. Under the facts of this case, it is concluded retraining after eighty weeks is not warranted.

"In sum, the applicant is entitled to receive and has received compensation under Wis. Stat., ch. 102; has been found by DVR to be entitled to receive instruction under 29 USC 701 to 797b; and undertook her course of vocational retraining as soon as DVR provided her with an opportunity for her rehabilitation. See Wis. Stat. § 102.61(1) and (1r). No highly material facts were withheld from or misrepresented to DVR, nor has that agency applied an interpretation of the rehabilitation laws which is entirely outside the reasonable scope of interpretation and hence a clear abuse of administrative power. However, retraining after 80 weeks is not warranted. The applicant is therefore entitled to compensation for vocational retraining under Wis. Stat. § § 102.43(5) and 102.61, but only for the first eighty weeks of such retraining."

ORDER

The findings and order of the administrative law judge, as modified, are affirmed in part and reversed in part. Compensation shall be paid in accordance with the ALJ's decision as modified.

Dated and mailed June 10, 2004
houseci . wmd : 101 : 1 ND § 5.39  § 5.40 

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner



MEMORANDUM OPINION

The commission did not discuss witness credibility and demeanor with the presiding ALJ. Its decision to limit compensation was not based on crediting one vocational expert over another but on credible information from both the experts offered by both sides, including, particularly, Ms. Koritsoglou who did not actually testify before the ALJ.

Three arguments raised by the respondent on appeal remain to be addressed.

The first is that Massachusetts Bonding should be set aside or overturned due to changed circumstances. The commission assumes the respondent makes this argument only to preserve it for a possible appeal to the Supreme Court itself.

Second, the respondent contends the ALJ erroneously paid a parking expense claim of $590 over 23 weeks as "actual and necessary expenses of travel" under Wis. Stat. § 102.61(1) because the applicant did not provide receipts and sometimes parked for free on side streets. However, there is no legal authority requiring receipts (though obviously retaining receipts is the better practice), the ALJ evidently credited the applicant's testimony on that amount of the expense incurred, and the amounts claimed are not unreasonable.

Finally, as explained above, the existence or nonexistence of job offers do not affect the applicant's entitlement to compensation in this case, either under the not-yet-effective Wis. Stat. § 102.61(1g) or as evidence of abuse of discretion under DVR's no-longer-effective policy of requiring employer contact in worker's compensation cases. Thus, the ALJ did not err in refusing to permit certain testimony and exhibits regarding offers of employment.

cc: 
Attorney Israel Ramon
Attorney Stephen J. McManus


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Footnotes:

(1)( Back ) Robert Manske v. Rasch Construction and Engineering and Virginia Surety, WC Claim No. 1998-016330 (LIRC June 24, 2002); Lori Nieves v. Reynolds Metal Company and Pacific Employer's Insurance Company, WC Claim No. 1999-012552 (LIRC November 7, 2003); and Melodee Kane v. Fort James Operating Company, WC Claim no. 1998-035916 (LIRC, March 19, 2004).

(2)( Back ) The DVR's new "entry policy" is set forth in John Neal and Joseph Danas, Jr., Worker's Compensation Handbook (5th Ed. 2003), Appendix 4, p. 61:

"Assessment for Determination of Eligibility

"To be eligible for VR services, a consumer must: 

"It is presumed the consumer can benefit in terms of an employment outcome. Therefore, trial work experiences and extended evaluation are not used by DVR for the purpose of determining an individual's initial eligibility for VR services." 

See also, the DVR's handout entitled "Information For DVR Consumers with Worker's Compensation Claims," which explains that the DVR follows the Federal Rehabilitation Act, which is a separate law from the Wisconsin Worker's Compensation Act. Robert Manske v. Rasch Construction and Engineering and Virginia Surety, WC Claim No. 1998-016330 (LIRC June 24, 2002). The change in policy is also discussed in Lori Nieves v. Reynolds Metal Company and Pacific Employer's Insurance Company, WC Claim No. 1999-012552 (LIRC November 7, 2003); and Melodee Kane v. Fort James Operating Company, WC Claim no. 1998- 035916 (LIRC, March 19, 2004). 

DVR counselor Poffinbarger testified in this case that he did not contact the employer about the applicant's job status because she had been terminated, transcript, page 20, and did not do a job search because her restrictions made it difficult to find comparable employment, transcript page 22. Even assuming he may have been required to take either step the statements in the "Assessment for Determination of Eligibility" quoted above notwithstanding, his failure to do so in this case has been reasonably explained. 

 


uploaded 2004/06/16