CHRISTOPHER SANDMIRE, Applicant

ZIEGLER BUILDERS, Employer

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 August 9, 2005
sandmch . wsd : 175 : 4   ND § 7.22

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

The employer asserts in its petition for commission review the administrative law judge erred in determining the employer committed bad faith in violation of Wis. Stat. § 102.18(1)(bp) in failing to timely notify its insurer of the applicant's work injury claim, and in awarding the applicant a 200 percent penalty in the amount of $14,240.20. The employer states that this is not a situation where the employer's owner, Mr. Francis Ziegler, clearly knew that the applicant was injured while on the Ziegler Builder's jobsite, and then intentionally did not contact its insurer. The employer states that, while Mr. Ziegler's actions may have been unreasonable in not contacting the insurer, there was a lot of legitimate doubt in Mr. Ziegler's mind the applicant had any kind of covered worker's compensation injury for his work with the employer. The employer states that while Mr. Ziegler's actions may have been legally unreasonable, Mr. Ziegler honestly believed his actions were appropriate given his belief that no work-related injury had been presented to him arising out of the applicant's employment with the employer.

Under Wis. Stat. § 102.18(1)(bp), the department may include a penalty in an award to an employee if it determines that the employer's failure to report an injury resulted from malice or bad faith. In order to establish a claim for bad faith, the applicant must establish that the employer had a lack of a reasonable basis for refusing to report the work injury, and a reckless disregard for the lack of a reasonable basis.

Francis Ziegler was aware before the end of October, and within 10 days of the applicant's last day of work, that the applicant was alleging he had suffered a work-related injury. The applicant credibly testified he gave Mr. Ziegler a copy of one of his work restriction slips from his treating physician in October 2003, which clearly indicated the applicant was suffering from a work-related injury. Although the applicant may not have specifically stated to Mr. Ziegler the injury was caused by his work, he did provide Mr. Ziegler the documentation necessary to establish a work-related injury and informed the employer of the claim. In addition, the applicant asked Mr. Ziegler for the name of its worker's compensation insurer and for the form to submit to the insurer, and Mr. Ziegler refused to provide the applicant with the form and stated that it was not a worker's compensation problem. Further, Francis Ziegler admitted that he had talked with his son, Jeff Ziegler, a co-owner of the employer's business, about the applicant's work-related injury before November 20, 2003, and then received the applicant's updated physical restrictions in a letter dated November 20, 2003. Throughout this period of time, the employer refused to file a claim with its insurer.

After the applicant hired an attorney in late November 2003 due to his accumulating medical bills, the applicant's attorney wrote to the employer in December 2003 and received a response on December 18, 2003. The employer's response simply admitted that it was aware the applicant's physician had opined he suffered from carpal tunnel syndrome, and the employer interjected its own medical opinion that you can't contract carpal tunnel syndrome during five weeks of employment. The employer continued to refuse to report a work injury claim to its insurer throughout December 2003, and January and February 2004. Subsequently, the insurer set up the claim on its own, after receiving repeated requests from the applicant's attorney and receiving unpaid medical bills. The employer did not report the applicant's claim to its insurer.

The employer's refusal to file a claim with its insurer resulted in a hardship to the applicant, who testified he ran out of funds and had to borrow money to pay rent. The employer did not provide any reasonable explanation for its failure to at least file the applicant's claim with the insurer, even if it disagreed with the issue of causation. The employer has not provided any evidence of a reasonable basis for failing to at least file the applicant's claim and later dispute any and all issues related to causation. The employer clearly had notice of the applicant's claim as early as the last week of October 2003, but failed to act in accordance with the requirements of the statute. In fact, the evidence does not indicate the employer ever made an attempt to file the applicant's claim with its insurer. Under the circumstances, the commission agrees with the administrative law judge that the employer's failure to notify the insurer of the applicant's claim was a blatant example of bad faith. The evidence establishes that the employer had knowledge of a lack of reasonable basis to fail to notify its insurer of the applicant's claim, and a reckless disregard for the lack of such a reasonable basis. Therefore, the administrative law judge appropriately found the employer's refusal to comply with the worker's compensation law and notify its insurer was a violation of Wis. Stat. § 102.18(1)(bp), and appropriately awarded the applicant a penalty in the amount of $14,240.20.

cc:
Attorney Aaron Halstead
Attorney Christopher W. Duren

Appealed to Circuit Court.  Affirmed May 23, 2006.

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