BRADLEY HABERLAND, Applicant
DAVES SMALL ENGINE LLC, Employer
FEDERATED MUTUAL INS CO, Insurer
The applicant filed an application for hearing in October 2003 claiming he injured his left wrist while starting a lawn mower on September 2, 2003. An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development heard the matter on May 11, 2004. Before the hearing, the employer and its insurer (collectively, the respondent) conceded that the accident actually occurred about the time alleged and that the employer was insured under the worker's compensation laws, but denied jurisdictional facts and that the applicant sustained any disability.
The primary issue, then, is whether an employment relationship existed between the applicant and the employer. If an employment relationship is established, ancillary issues include whether the applicant sustained an injury arising out of his employment while performing services growing out of and incidental to that employment, the nature and extent of disability from the injury, the respondent's liability for medical expenses, and the applicant's average weekly wage.
On June 1, 2004, the ALJ issued his decision finding that the applicant was not an employee of the employer at the time of the injury. The applicant appealed.
The commission has considered the petition and the positions of the parties, discussed witness credibility and demeanor with the presiding ALJ, and reviewed the evidence submitted to the ALJ. Based on its review, the commission makes the following:
1. Employment relationship
The primary issue in this case is whether the applicant was an "employee" of the employer as defined under Wis. Stat. § 102.07 at the time of his injury. The applicant contends that he was an "employee," hired by the employer to fix small engines, and was injured while repairing his very first lawn mower. The respondent contends the applicant was not working under a contract of hire when injured, but was instead engaged in a trial period in which his performance was evaluated. The applicant's performance was found unsatisfactory, the respondent continues, and he was never actually hired.
a. The applicant's version.
According to the applicant's version of events, he was looking for work in August 2003. An acquaintance suggested he submit his resume to the employer. The applicant dropped his resume and a cover letter off with the employer and thereafter followed-up by calling the employer's owner, Dave Rohan. Mr. Rohan told the applicant he would get back to him, and in a subsequent conversation, told the applicant to come in to discuss the resume.
The applicant then returned to the employer's shop on August 22, and met with Mr. Rohan and Carly, who worked in the employer's parts department. Mr. Rohan told the applicant that Carly was thinking of going to college and that her job might become available, but asked the applicant if meanwhile he was interested in work in the shop to help out the employer's mechanic, Mike Thyssen. The applicant expressed interest, but the interview ended without Mr. Rohan actually offering work.
Mr. Rohan instead told the applicant he would get back to him. In fact, Mr. Rohan called the applicant the following week to arrange to have the applicant meet with Mr. Thyssen. Mr. Rohan told the applicant if Mr. Thyssen felt comfortable with him, he would be hired adding that he should wear work clothes in case he started right away.
The applicant met with Mr. Thyssen and Mr. Rohan on September 2. Mr. Rohan told the applicant that he was creating a job for him because Mr. Thyssen was being overloaded. He told the applicant he would start on simple customer repairs, and could expect to work weekends. The men discussed pay, and agreed on $24,000 per year. The men then discussed sundry details, such as that applicant could buy parts at cost, could work on side jobs with the employer's facilities, and could use the employer's tools until he bought his own.
His employment arranged, the applicant left with Mr. Thyssen who assigned him work on a lawnmower. Mr. Thyssen told the applicant a few procedural details, and suggested he start the lawn mower to see how it sounded. The applicant did, and the lawn mower backfired. Mr. Thyssen told the applicant he thought the problem was a loose blade.
The applicant checked and the blade was loose. Mr. Thyssen told him to get a wrench from the cabinet where Mr. Rohan kept his tools, and the applicant tightened the blade. The applicant started the lawn mower again, it backfired again, and this time the knob on the starter cable struck the applicant's hand causing it to bleed.
Mr. Rohan told him the applicant should go to the hospital and not to worry because the employer had worker's compensation insurance. Mr. Rohan gave the applicant insurance information to give the medical providers, and the applicant obtained treatment which included x-rays and a cast. The x-rays were negative. Declining to rule out an occult fracture, the treating doctor stated his diagnostic impression as left navicular pain.
The applicant returned to the employer, and dropped off the information he got from the hospital, which included a release to right handed work only and instruction to follow in 10 to 14 days for a recheck. Mr. Rohan was not there, but in a later conversation the men agreed the applicant should return to work on September 17.
The applicant returned on September 17, and was given work on some abandoned equipment never reclaimed by customers, and on two repairs for customers. The applicant's testimony indicates he worked a full day on the 17th, then returned on the 18th and did two more repairs to customer's lawn mowers. The applicant was sent home early on that day because Mr. Thyssen went hunting.
He next reported for work at 8:00 a.m. on September 22. At about 8:20 a.m., Mr. Thyssen came over and told the applicant he had spoken with Mr. Rohan on the telephone. Mr. Thyssen then told the applicant he felt: "you don't have what it takes to work with me, we don't need you." Transcript, page 48. The applicant understood he was being terminated.
Later on September 22, the applicant called Mr. Rohan, who told him that he valued Mr. Thyssen more than the applicant. The applicant told Mr. Rohan he understood, and asked about pay. Mr. Rohan said he'd pay the applicant for the hours worked. The applicant, however, asked about the hours he could not work because of the work injury. Mr. Rohan said he would pay the applicant $7 or $8 an hour, because that was all someone with the applicant's experience was worth, and that needed to find out from Mr. Thyssen how many hours he put in. Transcript, pages 51-52. However, the applicant was never actually paid.
b. The respondent's version.
The respondent's version of what transpired is considerably different. Mr. Rohan testified that the applicant walked in during working hours and dropped off a resume. The applicant returned to the shop sometime later and asked to talk about a job. Mr. Rohan and the applicant then sat down and talked about opportunities with the employer.
The applicant told Mr. Rohan he was willing to do any job, though Mr. Rohan noted his experience in a small engine shop was "very light." The applicant, however, struck Mr. Rohan as confident, and he told Mr. Rohan he felt he could do anything.
The men had a second meeting thereafter, and Mr. Rohan mentioned the possibility that Carly, the employer's parts counter worker, might be going to college, so that her job might open. Mr. Rohan testified he took the applicant around the shop and introduced him to Mr. Thyssen. The applicant said he wanted to make about $12 per hour, which Mr. Rohan told him was only a possibility for good, experienced workers, and that $10 was a more realistic starting range.
Mr. Rohan told the applicant he had to do some checking and thinking before he would hire the applicant. The applicant pressed him, saying he could prove that he could do the job. Consequently, Mr. Rohan told the applicant he could "try out for the job." Transcript, page 9. Mr. Rohan then asked Mr. Thyssen, who was present, to pull a machine and have the applicant show Mr. Thyssen what he could do.
At this point, Mr. Rohan got pulled away to talk to a customer. The next thing Mr. Rohan heard, the applicant had been hurt and needed medical attention. Mr. Rohan asked if he needed a ride, and the applicant said no. Mr. Rohan and his bookkeeper were unsure how to handle the injury, and gave the applicant some insurance information to take to the doctor.
After the applicant left, Mr. Rohan looked at the lawnmower the applicant had been working on. There was no blade adapter--a part that is connected to the shaft and centers the blade and keeps it from spinning. This, Mr. Rohan thought, caused the injury. He also thought the applicant was not someone he wanted as an employee. Transcript, page 14.
Mr. Rohan spoke with the applicant again by phone, and told him things were not going to work out. The applicant insisted he had not had a fair chance. Transcript, page 16. Mr. Rohan testified that was that last he heard from the applicant. Transcript, page 17.
The applicant's attorney then pointed out there were invoices showing the applicant had worked for the employer on September 17 and 18, 2003, as well. Transcript, page 17. Mr. Rohan then testified that, as the applicant had only worked about 15 minutes before being injured on September 2, he gave the applicant a second chance on September 17 and 18. Transcript, pages 18, 68, 72.
On these dates, Mr. Rohan testified, the applicant worked on abandoned machines that the employer hoped to refurbish and resell. Transcript, page 19. Mr. Rohan acknowledged that the applicant worked on at least one machine that a customer had brought in for repair, and Mr. Rohan charged the customer for the applicant's labor. Transcript, page 22. However, Mr. Thyssen told Mr. Rohan on September 18 that the applicant was not going to work out, and the applicant was told to leave. Transcript, pages 19, 72-73.
Mr. Rohan also testified that, contrary to what the applicant said, he did not let his workers do side jobs. He also said he would not have discussed work on Saturdays, as the shop was closed on that day. Transcript, page 66.
Mr. Thyssen also testified. He said he was present and overheard the meeting on September 2, and that Mr. Rohan never offered a job to the applicant. Only a try-out was discussed. Transcript, pages 26, 75.
Mr. Thyssen also blamed the September 2, 2003 injury on the applicant trying to start the mower without the adapter. Mr. Thyssen added that the applicant had put the blades on upside down on two of the five mowers he worked on September 17-18. Mr. Thyssen also testified Mr. Rohan did not allow workers to do side jobs. He did not recall Mr. Rohan telling the applicant he could use his tools, and could not recall if the applicant had his own tools. He did testify, however, that he was the only one allowed into Mr. Rohan's toolbox. Transcript, page 34.
There was testimony from the employer's bookkeeper, Gail Salm, and her son, Ben, who also works for the employer. The younger Salm, who suffered a disabling injury as a teenager, also underwent a trial period prior to employment. Further, Ben testified that he overheard the conversation between the applicant and Mr. Rohan, and that Mr. Rohan mentioned only a trial period.
c. Other facts.
Some other relevant and undisputed points: The employer was not advertising for workers on September 2. The applicant never filled out a W-4 form for tax withholding. Exhibit H contains the documents the employer retained concerning the applicant, and his experience with small engines is only mentioned in the cover letter.
There also was limited prehearing discovery in this case. By letter dated February 18, 2004, ALJ Thomas Landowski directed the respondent to
... provide the applicant with the names and addresses of all individuals since August 22, 2001 who applied for a job with Dave's Small Engine and went through a trial period of employment.
Exhibit I. Mr. Rohan initially responded by letter dated March 2, 2004, indicating "no one went through a trial period." Exhibit H. However, this response was followed by a letter from the respondent's attorney stating:
I have also learned that Ben Salm ... originally worked without pay for about a month to a month and a half to determine his abilities. He actually started officially on the payroll on September 8, 2003. Prior to that, his services were unpaid.
Exhibit I, March 24, 2004 letter from Larson.
d. Discussion.
The commission finds the applicant's version of events more credible, and therefore finds that the applicant was an employee of the employer as defined in Wis. Stat. § 102.07(4). Specifically, the applicant was injured while in the service of Dave's Small Engine, LLC, under a contract of hire agreed upon by the applicant and Mr. Rohan, and under which the applicant was to be paid $24,000 per year.
The commission does not accept Mr. Rohan's testimony that the applicant was not performing services for pay as an employee, but instead had agreed to work in an unpaid "try-out" arrangement, when injured. On this point, the commission observes that at hearing Mr. Rohan first indicated that the applicant only worked one day, September 2, 2003, the day he was injured. However, upon further examination, Mr. Rohan acknowledged that the applicant worked two more days, September 17 and part of September 18.
Further, in response to ALJ Landowski's inquiry, Mr. Rohan initially recalled that no one else had worked in an unpaid try-out status. Later, however, the respondent introduced evidence that Ben Salm had been working in such a status for one to one-half months at the very time the applicant was injured.
The commission also notes that, as the applicant pointed out in its brief, while the applicant said he was told he could use Mr. Rohan's tools, Mr. Thyssen testified that no one but he and Mr. Rohan were allowed to use Mr. Rohan's tools. Yet the applicant testified he had no tools, which is consistent with his relative lack of experience, and he clearly did work with tools on the lawnmowers on the days in question.
Further, while Mr. Thyssen and Mr. Salm testified they heard something about a "tryout" or "trial period," neither admitted to any detail as to the agreement between the applicant and Mr. Rohan and both were relatively reluctant witnesses on the point. (1) In any event, an employer telling a new employee he was being "tried out" or in kind of trial period is not necessarily inconsistent with an employment relationship. Mr. Rohan acknowledged that he started at least one other worker out in a "probationary period" as opposed to an unpaid trial period. See Rohan's March 2, 2004, letter in Exhibit H. The key distinction for the purposes of determining whether the applicant was working under a contract of hire in this case turns on whether or not the parties agreed the applicant would be paid. (2) Neither Mr. Thyssen nor Mr. Salm testified they heard the parties agree that the applicant would work for no wage.
Finally, even under Mr. Rohan's version of events, the applicant was never expressly told he would not be paid, but rather that he was provided with a test on September 2 and not a job. The applicant, of course, has the burden of proving the existence of an employment relationship,(3) but based on his credible testimony -- including his testimony that he would earn a $24,000 per year salary -- the commission is satisfied he has met that burden here.
2. Compensation; award
The applicant has provided expert medical opinion from Brian Harrison, M.D. dated March 8, 2004 indicating that the applicant sustained a ligament injury from the work injury on September 2, 2003, that surgery is scheduled to treat the condition, that the applicant may work subject to temporary restrictions limiting lifting, pushing and pulling and prohibiting wrist movement, and that a permanent disability rating was premature. See exhibit B. The respondent provides no countering medical opinion and the ALJ noted that "there is no particular challenge to the claim for temporary disability and the treatment expense except that the respondent claims the applicant was not an employee under a contract of hire." Transcript, page 2.
The commission therefore finds that the applicant sustained an injury arising out his employment with the employer, while performing services growing out of and incidental to that employment. As a result of his injury, the applicant was temporarily totally disabled for the periods he claimed, from September 2 through September 16, 2003, a period of 2 weeks, and from September 22, 2003, through the date of hearing, May 11, 2004, a period of 33 weeks, 1 day.
No wage has been conceded. The commission, again, credits the applicant's testimony that Mr. Rohan and he agreed to a wage of $24,000 per year, or $461.54 per week and $11.5385 per hour. Under Wis. Stat. § 102.11(1), then, the applicant's average weekly earnings are set at $461.54 per hour. The applicant's compensation rate for temporary total disability is thus $307.69, or two-thirds his average weekly wage.
The applicant is thus entitled to temporary total disability compensation for periods specified above in the amount of $10,820.55. An attorney fee set under Wis. Stat. § 102.26 at twenty percent of the award for disability compensation, or $2,164.11, shall be deducted and paid the applicant's attorney within 30 days. The remainder, $8,656.44, shall be paid to the applicant within thirty days.
The applicant incurred reasonable and necessary medical expense to cure and relieve the effects of the work injury, documented in exhibit G as follows: from Appleton Emergency Services, $100, all of which is outstanding; from Appleton Medical Center, $727.10, all of which is outstanding; from NE WI Hand Surgery, $551, of which the applicant has paid $50 and $501 is outstanding; from Radiology Associates/Appleton, $44, all of which is outstanding; and from ThedaCare at Work, $3,132.50, all of which is outstanding. In addition, the applicant has incurred $73.78 in reimbursable medical mileage.
Because the applicant was still in a healing period as of the date of the hearing, jurisdiction is reserved to permit orders and awards for additional periods of temporary disability, for permanent disability if necessary, and for additional medical expense.
NOW, THEREFORE, the Labor and Industry Review Commission makes this
The findings and order of the administrative law judge are reversed.
Within thirty days, the employer and its insurer shall pay all of the following:
1. To the applicant, Bradley Haberland, Eight thousand six hundred fifty-six dollars and forty-four cents ($8,656.44) in disability compensation.
2. To the applicant's attorney, John Edmondson, Two thousand one hundred sixty-four dollars and eleven cents ($2,164.11) in fees
3. To Appleton Emergency Services, One hundred dollars ($100) in medical treatment expenses.
4. To Appleton Medical Center, Seven hundred twenty-seven dollars and ten cents ($727.10) in medical treatment expenses.
5. To NE WI Hand Surgery, Five hundred and one dollars ($501) in medical treatment expenses.
6. To ThedaCare at Work, Three thousand one hundred thirty-two dollars and fifty cents ($3,132.50) in medical treatment expenses.
7. To Radiology Associates/Appleton, Forty-four dollars ($44) in medical treatment expenses.
8. To the applicant, the sum of Fifty dollars ($50) in out-of-pocket medical expense and ($73.78) in medical mileage.
Dated and mailed December 9, 2004
haberla . wrr : 101 : 1 ND § 2.11
/s/ James T. Flynn, Chairman
/s/ David B. Falstad, Commissioner
/s/ Robert Glaser, Commissioner
The commission conferred with he presiding ALJ concerning witness credibility and demeanor. The ALJ found Mr. Rohan to be very credible, noting he answered questions using colloquial language and did not become argumentative with applicant's attorney, who began his case by examining Mr. Rohan adversely. In contrast, the ALJ stated the applicant used stilted, formal language in his testimony. The ALJ also believed the applicant's testimony seemed both rehearsed, and fumbling and contradictory.
The ALJ further believed that Mr. Rohan's story hung together given the fact that the applicant came into Mr. Rohan's shop "out of the blue," and not in response to any advertisement. The ALJ was struck, too, by the testimony of Gail Salm, who was credible in her gratitude to Mr. Rohan for providing her son with the try-out period. This led the ALJ to believe that Mr. Rohan was the type of man who gives workers chances, even second chances.
Addressing the contradiction in Mr. Rohan's testimony about the number of days the applicant worked for the employer and the inconsistency about whether any one else had worked in an unpaid tryout status, the ALJ described these as good faith failures in memory on facts that did not seem particularly important when they happened. The ALJ reiterated that it seemed unlikely Mr. Rohan would have let the applicant return on September 17 and 18 if it intended to act in bad faith regarding the applicant's worker's compensation claim.
However, the number of days the applicant worked in the alleged "tryout" status and whether other workers were employed in such a status are facts that are quite significant in this case. Mr. Rohan's lapses in memory on these points raise some question about his ability to remember the details of his conversation with the applicant on September 2, 2003. Further, the fact that Mr. Rohan allowed the applicant to work on September 17 and 18 simply is more consistent with the understanding of a traditional, for-pay employment relationship than a continuing, unpaid tryout period of indefinite duration. In addition, while the ALJ questioned the applicant's credibility because he documented his conversations with the employer, the applicant only began doing so with the September 22, 2003 conversation following his discharge in which he was trying to find out when he was going to be paid. Exhibit J, transcript, pages 92 et seq. Taking notes under such circumstances does not strike the commission as unusual. For these reasons and those given in the body of this decision, and having given careful consideration to the ALJ's demeanor observations, the commission does not share the ALJ's impressions of witness credibility.
cc:
Attorney John B. Edmondson
Attorney David N. Larson
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