There are a few extra conditions that must be considered when utilizing this method of tendering light-duty employment.
You are assigned to manage the following claim:
The employee is a high-wage earner with a compensable injury who, after a period of total disability due to the injury, has just been released to light duty work restrictions by the authorized treating physician. You file a WC-104 to reduce him to TPD in 52 weeks. You would now like to get the claimant back to work in order to reduce the potential future exposure for TTD, with the goal of settling the claim. However, the employer either does not have light-duty work available, or does not want to offer light-duty to this employee. So, to settle now with the employee, you are facing the balance of 350 weeks in potential future exposure, plus a large PPD rating, plus closure of medical. What do you do?
The above scenario has played out daily for as long as workers’ compensation has existed.
Until a few years ago, such a claim usually often resulted in a big settlement, or no settlement, due to the high value of the claim. Because the employer/insurer’s only weapon is often the threat of light-duty work, in a scenario such as the one above, when the employer could not or would not offer light-duty, there were few options available.
However, in recent years, insurers have begun to use employment services, set up to handle just such a situation, to help bring about reasonable settlement. These services offer to locate, identify, and place the employee into a job assignment approved by the authorized treating physician, thereby allowing the insurer to suspend TTD, or reduce the income benefits to TPD in some cases, which typically leads to a quicker and less expensive settlement.
These services, and there are a number of them, have begun to be utilized more frequently in the last few years. When this concept first began to be used, there was a push-back from the claimant’s bar for any number of reasons, as you might expect. However, there were few attempts to litigate whether the employer/insurer was allowed to utilize this process for returning the employee to work, and now, the practice is generally more accepted by the claimant’s bar as acceptable, provided certain criteria are met.
First, the insurer essentially follows the provisions of O.C.G.A. § 34-9-240 and Board Rule 240, which requires that any job description sent to the authorized treating physician must be sent to the claimant and to claimant’s counsel. Before doing so, the insurer would have the employment service identify a specific job or jobs that fall within the employee’s restrictions. It is also a good practice to identify jobs within reasonable commute from the claimant’s residence. Once the job is identified, a WC-240a is prepared and sent to the authorized treating physician, and it is then tendered with at least ten (10) days’ notice of the start date. Also, all of this must occur within sixty (60) days of the applicable light duty release.
There are a few extra conditions that must be considered when utilizing this method of tendering light-duty employment.
First, the employer must be willing to cooperate, because it will be paying the employee’s wages after he returns to work. This fact alone may cause the employer to balk at participating, as you might guess. Thus, the insurer should go to great lengths to include the employer in on the idea of utilizing this method as soon as is practical. The benefits to the employer are several. While it will have to pay the wages, it will not be saddled with the burden of supervising the employee, or even seeing him at all. He will still be “out of sight, out of mind” for the employer, except for issuing him a paycheck. Second, the employer may choose to participate, but not to pay the pre-injury wages especially if it is high. This is acceptable, and it is not unusual to see the employer only offer to pay minimum wage. The insurer can still reduce its exposure to the applicable TPD rate, which is better than nothing. Lastly, many employers fear that the claim will affect their premium rates in the future, and by utilizing this process, the claim cost is almost certain to be reduced. Some employers will do not want to be involved, and such is life. However, we find that when the process is well-explained and the employer is kept in the loop and given options, that many are willing to cooperate. Another aspect of this that should be pointed out to the reluctant employer is that the process is only temporary, at best, and can be limited in its duration so that the reluctant employer can limit the time it pays wages, and to end the process if it sees fit to do so. It is the better practice to advise the employer that the process can take several months to bring about settlement, and to encourage patience.
For the actual job, most companies identify jobs with non-profits, such as Goodwill, the Salvation Army, the Red Cross, the Humane Society, or other similar organizations that have a need for volunteer workers. Many local charities that feed homeless people or otherwise provide services to the poor are also frequently used.
As stated above, the utilization of non-profits to tender light-duty work has become more commonplace and generally more accepted by the claimant’s bar. However, this does not mean they like it. The main reason is because the potential value of the claim for settlement purposes diminishes significantly when light-duty work is tendered. Thus, it is not uncommon for a claimant’s attorney who receives such a tender to fire off a letter to the non-profit, threatening to bring it into the claim, or to sue it in tort. The letter usually references the borrowed servant doctrine as the threatened theory for bringing the non-profit into the claim as a party.
The borrowed servant doctrine states that when an original employer (general master) loans an employee to another employer (special master), liability for compensation depends on whether the employee comes under the control and direction of the special master. If so, the employee is considered a borrowed servant. If he is deemed a borrowed servant, the special master will be held liable in the event of injury. For purpose of this article, the special master would be the non-profit. The fact that the original employer continues to pay the wages of the employee is not dispositive of whether the employee is seemed a borrowed servant. Instead, the main consideration is who has the right to hire and fire the employee. For purposes of our situation herein, the non-profit does not have the authority to hire and fire. While it does have the right to direct work, the original employer sets the hours it will pay and only it can decide to terminate the employee.
The non-profit may choose to end the assignment at its place of business if necessity dictates, but the employee can then be offered work elsewhere, but only the original employer can end his employment.
The insurer is well-advised to carefully review all documents sent to the employee when the job is tendered, to make sure that this fact is specifically spelled out. Likewise, for the same reasons, and despite the threats of the claimant’s attorney, the non-profit may not be sued in tort if the employee is re-injured. The exclusive remedy provision covers the non-profit just as it covers the employer.
The use of non-profit placement through an employment service is a growing and useful trend in the management of workers’ compensation claims. If used properly and with proper precautions and attention to detail, it can assist greatly in deflating the future value of a claim, and is a useful alternative in a situation where the employer cannot or will not offer light-duty work.