SC Workers' Compensation: 2014 Update

2. SC Workers' Compensation:2014 Update RIMS Luncheon February 19, 2014

3. Vernon Dunbar Vernon.Dunbar@mgclaw.com (864) 239-6735 Bill Shaughnessy Bill.Shaughnessy@mgclaw.com (864) 239-6734 Brad Easterling Brad.Easterling@mgclaw.com (864) 239-6736 Shayne Williams Shayne.Williams@mgclaw.com (864) 239-6711

4. Legislative Update H. 3147 • A bill to amend § 42-1-160 to modify the requirements for an employee seeking workers’ comp benefits for a personal injury caused by stress, mental injury, or a mental illness • Under 42-1-160(b) a mental illness/injury is only compensable if (1) there are extraordinary and unusual conditions of employment and (2) there is medical causation between the stress, mental injury, or mental illness, and the stressful employment conditions. • This bill would make the rule under (b)(1) inapplicable to an employee employed as a law enforcement officer where the impairment causing the stress, mental injury, or mental illness arises from the law enforcement officer's direct involvement in, or subjection to, the use of deadly force in the line of duty. • This bill is a direct result of the Bentley v. Spartanburg County opinion, in which the Supreme Court held that the use of deadly force was within the normal scope and duties of a Spartanburg County deputy sheriff. • Bill passed House on January 16, 2014 and has now been sent to the Senate. Senate has referred it to Judiciary Committee and Subcommittee.

5. Legislative Update H. 3141 • A bill to amend § 42-3-20 so as to provide that the commissioners must be elected by the General Assembly rather than appointed by the Governor. • This would provide for election of the commissioners in the same manner as circuit court judges. The commissioners would serve terms of four years and the terms would be staggered. • The commission members would elect the chairman (rather than the Governor with the advice and consent of the Senate.) • This bill was referred to Committee on Labor, Commerce, and Industry on January 8, 2013.

6. Legislative Update H. 3369 • This bill (and identical version S. 229) would provide that an employee covered by the Federal Employers Liability Act, the Longshore and Harbor Workers’ Compensation Act, or the Jones Act is exempt from workers’ compensation laws. • House passed this bill on May 23, 2013. It was then sent to Senate and referred to subcommittee on January 31, 2014. H. 3632 (passed) • This bill relates to the maintenance tax imposed by the Workers’ Compensation Commission on self-insurers. It provides that the Commission shall retain a portion of the annual maintenance tax to pay the salaries and expenses of the Commission. It also provides that the Commission shall retain one half of the interest charged on delinquent maintenance tax for the same purpose. • Legislative history: House passed April 24, 2013. Senate passed June 4, 2013 and returned to House. House passed June 6, 2013. Signed by Governor June 13, 2013.

7. Case Law Update: Brain Injuries • South Carolina Supreme Court has heightened burden of proof for establishing “physical brain damage” and resulting entitlement to lifetime benefits: • Physical brain damage must be both permanent and severe

8. Sparks v. Palmetto Hardwood, Inc. • Claimant was struck in the head by a piece of metal, allegedly suffered from headaches and loss of cognitive ability • Commission found that Claimant sustained a compensable injury to his head, including a mild concussion, but had failed to establish physical brain damage.  • Ruled that Claimant should only receive 500 weeks of compensation plus causally related medical treatment • South Carolina Supreme Court agreed that Claimant was not entitled to lifetime benefits • Reasoning: because “physical brain damage” is included as an exception to the 500-week limitation along with paraplegia and quadriplegia, the General Assembly meant to require severe, permanent impairment of normal brain function in order for an injured worker to be deemed physically brain damaged under §42-9-10. 

9. Crisp v. SouthCo., Inc. • Claimant was injured when the bucket of a Bobcat earthmover fell on him.  • Commission found that the claimant sustained a head injury resulting in cognitive disorders but did not sustain a physical brain injury.  Claimant had not reached MMI. • Circuit Court reversed the Commission, finding the Commission’s Order internally inconsistent and holding that the only conclusion that could be reached was that the claimant sustained physical brain damage.  The Court of Appeals reversed the Circuit Court. • The Supreme Court remanded the action to the Commission for further consideration of whether the claimant sustained physical brain damage which would entitle him to lifetime benefits.  • The Court noted, as it did in Sparks, that the General Assembly intended to provide claimants with lifetime benefits only in the most serious brain injury cases.  • Permanency and physicality are requirements, but “severity of the permanent brain damage is the lynchpin of the analysis.”  • Inability to return to gainful employment is inherent in the severity requirement. 

10. Case Law Update: Temporary Disability Payments • Is the injured worker’s incapacity to earn wages due to or because of his/her injury?

11. Pollack v. Southern Wine & Spirits of America • Claimant suffered an admitted injury to his back while lifting a case of alcohol. Southern Wine & Spirits accommodated Claimant’s light duty restrictions and provided him with his full salary. • Two months later, Southern Wine & Spirits terminated Claimant for his failure to report a minor accident involving a company vehicle, a violation of company policy. • Claimant filed a Form 50 seeking TTD from the date of his termination. • Commission denied Claimant’s request for TTD benefits, finding that Claimant was not out of work due to his injury but rather for violating company policies that led to his termination. • The Supreme Court affirmed, holding that “[a]n injured worker will be entitled to TTD compensation when his incapacity to earn wages is due to or because of the injury.” • The Court noted that § 42-9-260 and accompanying regs provide that “the entitlement [to] TTD benefits is premised on a nexus between the work-related injury and the inability to earn wages.”

12. Compare to Davis v. UniHealth Post Acute Care • Claimant worked as a CNA and injured her lower back at work  • UniHealth admitted her injury and provided medical treatment. UniHealth  also placed Claimant on light duty employment in the laundry room and agreed to voluntarily begin paying TPD • Claimant’s supervisor caught her sleeping on the job. UniHealth terminated Claimant and stopped paying TPD • Commission concluded Claimant was entitled to have TPD reinstated, in addition to being paid TTD from the date of her termination • The Court of Appeals agreed, finding Claimant had not constructively refused employment by sleeping on the job • The Court further agreed that UniHealth was obligated to provide total disability compensation. 

13. Case Law: Arising Out of Employment Nicholson v. South Carolina Dep’t of Social Services • Claimant’s shoe scuffed the carpet as she was walking down the hallway of her office. She fell, injuring her neck, back, and left shoulder. • At the hearing, the claimant asserted that it was the friction from the carpet that caused her fall.  She testified that the floor was level and free from defects.  She further testified that she did not believe the files she was carrying caused her to fall.  • The Court held the claimant’s injuries, resulting from her shoe scuffing a carpet at work, did not arise out of her employment and were not compensable. • “The causative danger must be peculiar to the work and not common to the neighborhood.”  • The Court found the alleged causative danger, the carpet, was very common.  It was not a hazard, a special condition, or peculiar to the claimant’s employment.  The claimant even testified that her fall could have happened on any other level, carpeted surface outside her place of business.  The sole reason for her fall was her shoe scuffing the carpet. 

14. Case Law: Notice Hartzell v. Palmetto Collision, LLC • Claimant injured his lower back when he was cleaning up the auto body shop where he worked. • The next day, he mentioned to the owner of the company that his back was sore and he must have hurt himself.  He did not tell the owner he thought his back hurt because of the work he did the day before. • Claimant filed a Form 50 on May 10, 2010. This was the first time the employer heard of a workplace injury.  • The Court found the claimant did not provide timely notice of his injury. • For adequate notice, there must be some knowledge of accompanying facts connecting the injury or illness with the employment, and indicating to a reasonably conscientious manager that the case might involve a potential compensation claim. • The claimant testified he and the owner had discussed his back hurting, but there was no indication whether their conversations connected the claimant’s sore back with his work. While the facts may have established the claimant reported an injury to Palmetto Grading, the Court found the record did not establish a connection between the claimant’s injury and his work.

15. New S.C. Mediation Regulation • 67-1801 through 67-1809 • A Commissioner has the discretion to order mediation in any pending claim and select mediator. • Commissioner must retain jurisdiction but only for those issues being mediated. • Required Mediation • Admitted claims: • Permanent and total disability (including 42-9-30 (21)) • Occupational disease • Third-party lien reduction • Mental/mental injury • Federal Longshore & Harbor Workers’ Compensation Act • Other claims: • Contested death claim (still need Commissioner finding of good faith dependency investigation) • Claims where multiple employees allege injuries with the same employer

16. New S.C. Mediation Regulation: Forms • ☒Mediation • ☐a. Mediation is requested to be ordered pursuant to Reg. 67-1801 B. • ☐b. Mediation is required pursuant to Reg. 67-1802. • ☐c. Mediation is requested by consent of the Parties pursuant to Reg. 67-1803. • ☐d. Mediation has been conducted by a duly qualified mediator and resulted in an impasse. • Questions regarding mediation may be submitted to mediation@wcc.sc.gov. Form 21 Form 22 Form 50 Form 51 Form 52 Form 53 Form 70 – for mediator *Note that the Commission also has issued a new Form 14B

17. Mediation Basics • Time Deadlines • Select a mediator within 10 days of filing the Form 51 or Form 22 (response to Form 21) • Complete mediation within 60 days • Unless agreed to extend by all parties • This requires mediation to be considered early! • Other Mediation Basics • Costs usually split equally among parties • Parties mutually agree on a mediator, if they cannot, WCC will appoint one if mediation is mandatory or ordered by a Commissioner • Good faith required

18. General Questions, Answers, Discussions