DAVID J. BORUSHKO, Applicant
REISS INDUSTRIES INC, Employer
ST PAUL FIRE & CASUALTY INSURANCE CO, Insurer
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.
The findings and order of the administrative law judge are affirmed.
Dated and mailed October 27, 2004
borusda . wsd : 101 : 1 ND § 5.23
/s/ James T. Flynn, Chairman
/s/ David B. Falstad, Commissioner
/s/ Robert Glaser, Commissioner
1. Background.
The employer and its insurer (collectively, the respondent) do not dispute that the applicant is entitled to permanent disability as result of occupational asthma due to isocyanate exposure. Nor does the respondent dispute that the applicant is restricted from further exposure, thus requiring the applicant to change jobs. At issue is whether the applicant is entitled to compensation for loss of earning capacity, and, if so, how much.
The applicant's vocational expert, Leslie Goldsmith, interviewed the applicant before he found reemployment. Nonetheless, Mr. Goldsmith accurately predicted the applicant would probably be able to find some type of management position, and thought a salary in the $50,000 to $60,000 range would be likely. Considering that then-hypothetical wage, as well as "significant loss of access to the job market and resulting career disruptions" from the permanent work restriction against isocyanate exposure, he rated loss of earning capacity at 30 to 35 percent.
The respondent's expert is Donald M. Modder, who also interviewed the applicant before he found reemployment. He stated that the applicant "voluntarily resigned" from "continuing employment within 90 percent of his former wage" and so was legally ineligible for loss of earning capacity. Assuming the applicant were eligible, however, Mr. Modder rated loss of earning capacity at 10 to 15 percent. This is based, apparently, on the assumption the applicant would be able to find work as an industrial production manager, and that the median pay for such jobs is $61,660.
The ALJ concluded the applicant was entitled to an award for loss of earning capacity, and awarded compensation at 30 percent. The respondent appeals, contending that the applicant is ineligible for an award for loss of earning capacity under Wis. Stat. § 102.44(6) based on the circumstances of his separation from employment with the employer. It also argues that the loss of earning capacity award should be 15 percent, not 30 percent, assuming one is paid.
2. Discussion.
a. Relevant statute.
Wisconsin Stat. § 102.44(6) 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.
. . .
(d) The determination of wage loss shall not take into account any period during which benefits are paid under ch. 108.
. . .
(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.
The department's interpretative footnote states:
Section 102.44(6) provides that in cases of non-scheduled injury, permanent partial disability is to be determined on the basis of the physical limitations without regard to loss of earning capacity where the employee has returned to work for the same employer as at the time of injury at a wage loss of less than 15 percent. A good faith offer of employment refused by the employee without reasonable basis has the same effect as actual reemployment. The claims subject to this section including those upon which an award is issued remain open for the period of the statute of limitations in the event that there is a termination of the employment or a wage loss of 15% or more occurs.
b. Is applicant's LOEC award barred by Wis. Stat. § 102.44(6)?
The respondent argues that the applicant cannot be found to have earned less than 85 percent while working reduced hours and receiving unemployment insurance, as those weeks would not be considered under Wis. Stat. § 102.44(6)(d). It also argues that when he quit on January 31, 2003 without having employment lined up, he did so without reasonable cause, and is so ineligible for loss of earning capacity under Wis. Stat. § 102.44(6)(g).
The commission cannot agree. The only reasonable view of the record is the one taken by the ALJ: the applicant is not barred from receiving an award for loss of earning capacity.
First, Wis. Stat. § 102.44(6)(a) requires a return to work with the "employer for whom [the injured] worked at the time of injury." Here the applicant did not return to Reiss Industries following his injury, but the separate company, R&I Tool and Die. (1) Thus, there is a substantial reason to believe, at least under the facts of this case, that the applicant did not return to work for his time of injury employer (Reiss Industries) following his injury, making moot the arguments about the facts of his separation from R&I Tool and Die.
Apart from that issue, the applicant's layoff was "indefinite," regardless of whether characterized as "temporary" or "permanent." Mr. Reiss testified the applicant would be (and was) called back when needed, but the applicant was never told or promised he would definitely return full time on any date.
An indefinite layoff has been considered to sever an employment relationship. Allen-Bradley Co. v. ILHR Dept., 58 Wis. 2d 1 (1973); A.O Smith v. ILHR Dept., 88 Wis. 2d 262 (1979). The standard consistently applied is that the employment relationship continues when there is credible assurance that work will be resumed at an ascertainable time in the not too distant future. See, for example, Powell v. Labor Ready, WC Claim no. 2002-006786 (LIRC, May 21, 2003) (where a temporary help worker had finished an assignment and was standing in line a few days later to get another assignment when injured, the commission held that the employment relationship continued for a "reasonable interval" following the completed assignment). Applying this standard, the commission cannot view the expectation of sporadic future assignments into the indefinite future until business picked up to establish a continuing employment relationship in any real sense. Thus, when the applicant subsequently separated from employment, the separation was not a voluntary termination or "quit" under the facts of this case.
Third, even if the applicant "quit" his employment, and even if R&I Tool and Die is considered the "time-of-injury-employer" for the purposes of Wis. Stat. § 102.44(6)(a) and (g), the applicant acted with reasonable cause. The applicant credibly testified his financial situation upon being laid off required him to "cash out" his vacation with Reiss Industries. The commission is not inclined to second guess that decision where, as here, R&I Tool and Die was not offering any definite hours or regular employment.
The applicant evidently no longer collected unemployment insurance at least by the time he started full time work with Federal Mogul. He credibly testified that Federal Mogul pays him $50,040 annually, which results in an actual wage loss in excess of 15 percent when compared to his pre-injury annual wage with Reiss Industries, Inc. ($70,000.) He is entitled to an award for loss of earning capacity under these facts.
b. How much LOEC?
The commission also agrees with administrative law judge's decision to award compensation for loss of earning capacity at 30 percent. The applicant's straight wage loss upon becoming re-employed is 28 percent. It may be the industry median for the kind of work he does is $62,000. However, the average production supervisor does not have an isocyanate restriction. In short, the commission believes the award is appropriate given the effect of having to "start over" and the lost access to jobs generally. Further, the commission credits Mr. Goldsmith's opinion that the lack of a college degree could prove detrimental to the applicant's ability to find work as a production manager. Although Mr. Goldsmith expected the applicant to locate lower-paying employment as he in fact did, the lack of education remains a factor suggests a relatively higher loss of earning capacity. See, generally, Wis. Admin. Code § 80.34(1).
cc:
Attorney John S. Minix
Attorney Helen L. Schott
Appealed to Circuit Court.
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