TRENDS IN WORKERS’ COMPENSATION

There have been many changes to New York’s Workers’ Compensation Law as we begin to see the full effects of the statutory changes that have been wrought by the 2007 legislation. However, one of the biggest changes that have taken place has resulted from “statutory” interpretation by the Workers’ Compensation Board and given weight by the Appellate Division. Voluntary withdrawal from the labor market is not a new concept. Instead it has evolved from very narrow beginnings into the bane of disabled claimants. It has become the favorite cudgel of the carriers and is raised as an issue in knee-jerk fashion. Despite the frequency of use as a carrier’s weapon, there appears to be a lack of understanding of the elements of the defense. In conjunction with the concept of voluntary withdrawal, it is necessary to analyze the concept of attachment to the labor market.


Attachment to the labor market continues to be refined through adjudication by the Board, with several intervening decisions entered by the Appellate Division, and a notable decision by the Court of Appeals. The decisions center upon the effort made by a partially disabled claimant to secure a position that is consistent with his/her physical limitations. This determination is obviously fraught with subjective factors, but this has not stopped the Board from issuing onerous requirements upon claimants that are exacerbated by high unemployment. Sufficient attachment presently requires a claimant to register with OneStop and make regular searches as well as partake in the vocational services offered by the Department of Labor, including workshops in resume drafting, interview techniques and the like. The Law Judge will review the claimant’s efforts and will subjectively consider whether or not a claimant’s efforts have been, for lack of a better word, sincere. There is no gold standard and requirements differ from hearing point to hearing point and judge to judge. A practitioner should advise his/her client to conduct an exhaustive search and be able to provide documentary evidence, which should include applications, names, dates and follow-up.


For the reasons stated the process is arbitrary, burdensome and quite frankly, illogical. The process is antithetical to any concept of vocational rehabilitation and undermines the Board’s lip service to vocational assessment. What is truly ponderous is not merely the roulette style of attachment adjudication. The question that must be objectively asked is how the Board can engage in vocational analysis when a claimant has not reached maximum medical improvement? In other words, how can the Board credibly require a claimant to achieve vocational rehabilitation when they have not been physically rehabilitated from his/her causally related injuries? The fact that we even need to address this issue is proof positive that the Board has no qualms about trampling on the remedial intent of this statute and that its sole intent is to assist carriers in their quest to limit indemnity payments.


The Social Security Administration has created a systematic and somewhat objective approach to vocational assessment. Although the SSA adjudicates cases on an all or none basis, it is still useful to review the basic process utilized by the SSA in its claims adjudication process. An applicant is expected to provide a work and educational history as part of the Application process. The SSA utilizes the DOT (Dictionary of Occupational Titles) to determine the nature of the past relevant work performed by the applicant. Education and training are considered along with the physical and skill-centered requirements of that work. The ultimate decision as to disability considers the applicant’s remaining physical capacity to perform a range of work skills and then determines whether or not the applicant has transferable skills to enable him/her to secure gainful employment in a type of job that he/she can physically perform. The SSA often utilizes the opinion of vocational expert in the adjudication process. The key, however, is that the SSA usually withholds a determination to permit a claimant to achieve maximum medical employment. In instances where recipients of benefits are younger individuals, the SSA will periodically review eligibility for continued benefits. It is not a perfect system by any means, but the standards are the same whether you are in Jericho or Topeka.


The Board does not provide neutral vocational evaluation. The Board requires a claimant to show attachment as soon as a finding of partial disability is made, even if the accident occurred two months prior. Often, a practitioner will attend numerous hearings on the issue of attachment before the issue of permanency is even explored. The issue has become a cottage industry for carrier’s counsel and regularly trumps the issue of treatment and FCRD. The Board will argue that treatment issues have been alleviated by the Medical Treatment Guidelines (they have simply been removed from a formal adjudicatory process) and that the claimant is directed to provide evidence of skills and education. Unfortunately, these factors are only considered at the time when permanency and loss of wage earning capacity are adjudicated. In the meantime, for at least the first two years of a claim, a claimant who is uncertain as to his/her permanent limitations is forced to look for employment in what is clearly an effort to mitigate the damages sustained by carriers.


The final injustice (not really – just for this article) is that the Board is permitting carriers to harass claimants who have been permanently disabled for years. Carriers are investigating the work search efforts of claimants who have been disabled for a decade or more. These individuals settled their cases well before these concepts existed and therefore, negotiated their rights under a different set of rules. It is an utter travesty that the Board is retroactively applying the concept of voluntary withdrawal to these individuals most of whom are advanced in years and who are unaware of these drastic changes. Nevertheless, these claimants must be advised of their new “obligations”.


Suffice it to say, be prepared! Tell your clients that they must do more than just enough as the standard of attachment is on the march.
Written by: Craig Tortora

CHALLENGES OF THE MEDICAL TREATMENT GUIDELINES

In an attempt to streamline the treatment approval process, the Workers’ Compensation Board enacted Medical Treatment Guidelines (MTGs), for causally related injuries to the neck, back, shoulders and knees.

The Workers’ Compensation Board maintains that the MTGs were created to help claimants obtain required treatment in an expedited fashion, although it is readily apparent that traditional forms of conservative management such as physical therapy and chiropractic treatment have been significantly limited. Irrespective of the board’s motivations for these limitations, there are unintended consequences that the practitioner must face that have made this system more challenging, and quite frankly, more frustrating, especially for those of us who represent injured workers. The following is a brief discussion of the difficulties facing claimants and their representatives attempting to navigate the MTG process.

In order to reach its goal of expediting the treatment process, regulations were promulgated that place strict requirements on treating physicians who wish to deviate from the MTGs. Called “variances,” these requests must be made upon a specific form (MG-2). The forms must be accompanied by treatment notes which are submitted to support the attending physician’s assertion that a variance from the guidelines are medically necessary and that he/she believes that this departure from the guidelines will bring about functional improvements. Physicians are encouraged to include additional medical authority in support of their opinions. Carriers are provided with five days to respond if requesting independent exams, 15 days for a final response if not (variance requests must still be reviewed by a medical professional), and 30 days for a final response if not requesting an IME. If denied, a claimant is provided with 21 days to request a review. Depositions of medical witnesses are often required.

The MTGs at first blush, appear to place a heavy burden upon insurance carriers, in terms of the strict time requirements. However, defenses to variance requests have been increasingly successful for a number of reasons. “Medical professionals” are usually in house and rejections are often boilerplate. Attending physicians frequently fail to properly complete the variance request forms or commit other ministerial errors resulting in technical denials by the board. Finally, a spate of recent Board Panel decisions have rejected variances previously granted by law judges, based upon the fact that the law judges did not strictly adhere to the requirements of the variance process.

Although it had become readily apparent that the timely delivery of appropriate treatment was a glaring deficiency within the Workers’ Compensation system, these new regulations are fraught with, what we can assume are unintended consequences. The Workers’ Compensation Board is presently swamped by the volume of requests that must be addressed within the strict time requirements, to the point where other non-treatment related issues have been supplanted on calendar by variance– related matters, not to mention the inordinate amount of time spent by board examiners processing the avalanche of supporting documentation. Quite frankly, many practitioners have commented that cases will appear on calendar for the consideration of a variance issue before they will be scheduled for the suspension of a claimant’s indemnity benefits.

A second deficiency is that treatment for chronic injuries is notably absent from the MTGs. Although other states have included such considerations in their regulations, New York has failed to do so. Therefore the question arises where claimants are denied treatment for therapeutic benefit where all other treatment modalities have been exhausted. Many individuals who were receiving such therapeutic intervention prior to the enactment of the MTGs are now being denied palliative care.

It should also be noted that although the board has been successful in expediting conservative treatment immediately following an accident, issues arise when surgery becomes a consideration. Although the MTGs explicitly permit certain surgical procedures without authorization, physicians are reluctant to proceed without explicit authorization from a carrier. Claimants are left waiting for authorization that is not required and which will not be forthcoming as the MTGs have made such requests a moot issue. The general lack of understanding and inherent distrust in the system has led to delays.

Finally, it should be noted that the burden of proof has been subtly shifted to the claimant, which is proving to be problematic given the vast resources available to insurance carriers to deny variance requests. Claimants are in no position to ensure that their attending physician’s competently complete the variance requests nor do they possess the sophistication required to translate the codes and diagnoses which are crucial to an application of the MTGs. Even claimant’s representatives are placed at a disadvantage as they are not compensated for prosecuting variance issues and instead hope to be compensated when indemnity issues are eventually adjudicated. Due process considerations must be examined.

The short-term result is that there is no consensus as to whether the delivery of treatment to the injured worker has improved enough, if at all, to justify the continued survival of these guidelines. Assuming, however, that they are here to stay, we can only hope that the board recognizes these inadequacies and addresses them in a manner consistent with the remedial intent of the Workers’ Compensation Law. Continued education is certainly a key to the success of this program.

Note: Craig J. Tortora is a founding member of Goldsmith & Tortora, which concentrates in the areas of Worker’s Compensation and Social Security Disability Benefits Laws. He is the Co- Chair of the WCL/SSDB Committee for the SCBA and is a past lecturer for the Suffolk Academy of Law. He is also an Advisory Board Member for the Long Island Occupational and Environmental Health Center (L.I.O.E.H.C.).

NO-INSURANCE CLAIMS

The purpose of this lecture is to provide an introduction to the pitfalls facing the practitioner who is involved in litigation where an employer has failed to procure a worker’s compensation insurance policy. Although many of the same conventions are in place, the resulting problems facing an injured worker as well as a putative uninsured employer are complex. Procedural devices exist to provide protection to the employer which, as we shall discuss below, create unique obstacles to claimants and their attorneys in the prosecution of their claims.

The extensive litigation involved in the average uninsured claim result from the statutory requirement that all employers in New York must provide workers’ compensation coverage for their employers. The procedural difficulties result from balancing the remedial nature of the statute and the constitutional rights of employers. These difficulties are further exacerbated by the rising cost of compensation insurance which has led many small employers to operate their businesses without insurance. Although the Workers’ Compensation Board has gone to great lengths to address the inequities faced by claimants involved in these claims, the delays encountered by claimants are often devastating, especially when the injuries sustained are severe and permanent.

We will attempt to provide a brief outline of the relevant statutory requirements which shall include practice tips for practitioners representing claimants as well uninsured employers. The balance of the lecture shall be dedicated to a discussion of the Uninsured Employer’s Fund’ including the enforcement and collection efforts that are conducted in an effort to reduce the damages caused by recalcitrant employers.

EMPLOYER/EMPLOYEE RELATIONSHIP

Workers’ Compensation Law Section 2: This section provides extensive description of what defines employers and employees within the meaning of the Workers’ Compensation Law. This becomes a complicated issue where an employer has failed to obtain insurance as it instantly becomes an issue that must be adjudicated before a finding of “no insurance” is made.

** Hazardous Employment

** Casual Employment – Section 2(4) defines casual employment which serves to primarily protect home owners from claims brought by individuals who perform tasks at their homes. This category includes part-time home health workers, repair men, etc. As will be discussed below, most home owner policies provide a casual emplohese sections provide coverage for workers specifically engaged in work as jockeys (and support workers including trainers) and black car operyment endorsement and will provide a defense.

** Corporate Officers – Generally speaking, executive officers of a corporation are covered by a standard w/c policy. Although you need not provide coverage for officers, an employer must specifically exclude officers to deny coverage. However, in a corporation which is solely comprised of one or two officers without employees, coverage need not be provided. (General partnerships.)

Workers’ Compensation Law Section 10: Requires every employer, as defined by Section 2, to provide insurance coverage.

Workers’ Compensation Law Section 17: Alien status does not relieve an employer from providing coverage for employees as ALL employees are protected.

Workers’ Compensation Law Section 14: Average weekly wage.

Workers’ Compensation Law Sections 18-a and 18-b: Tators. The circumstances created by these types of employment presented unique problems for employers and the Board. The creation of these funds have reduced litigation and provided coverage.

** PRACTICE TIPS – Proof of earnings

Corporate records

Contracts

Audits

EXCLUSIVITY OF REMEDY: EXCEPTIONS

Workers’ Compensation Law Section 11: Workers’ Compensation benefits are the exclusive remedy available to injured workers (assuming covered employment.) Even where an employer is uninsured, the WCL provides a mechanism for the adjudication of these claims. Nevertheless, where an employer fails to provide insurance coverage, a claimant is permitted to file a civil claim to recover based upon employer/employee relationship. An employer is barred from raising the affirmative defenses of assumption of risk, contributory negligence or fellow servant liability. The action can proceed simultaneously with an action before the Board in the UEF part.

** PRACTICE TIPS – Procedure/Retainer Statement

WCL Section 50 violation required

Statute of Limitations

` Election of Remedy – see Martin v. C.A. Prods. Co., 8 N.Y.2d 226 (1960).

Avoidance of penalties

Workers’ Compensation Law Section 29: This section provides relief for employers form third party tortfeasors. However, the practitioner must be aware of a WCL Section 11 defense. See Buchner v. Pines Hotel, Inc., 87 A.D.2d 691 (1982). (Joint venture)

THE UNINSURED EMPLOYERS FUND

Workers’ Compensation Law Section 26-a: This section is responsible for the creation of the Uninsured Employers’ Fund, which acts as a surety in instances where employers fail to provide insurance coverage as required by WCL Section 10. Upon the establishment of a claim, the UEF acts in the role of a carrier, paying medical costs and indemnity to injured claimants. It is operated through the Board and staffed by attorneys from the Office of General Counsel.

Workers’ Compensation Law Section 50: Security for payment of compensation. In conjunction with WCL Section10, Section 50 requires every employer to provide insurance either through the purchase of a policy or by complying with the requirements for self-insured status. In order for the UEF to pay an award, or for a civil action to proceed, the Board must determine that the putative employer violated this section.

Workers’ Compensation Law Section 52: There are attendant penalties as well as potential criminal charges, as an employer’s failure to provide coverage is a misdemeanor punishable by jail and/or fines. The Board also imposes civil penalties and requires indemnification from uninsured employers.

** PRACTICE TIPS – Corporate Liability

Avoidance of Penalties

Criminal prosecution

Coverage first = Significant delay

Litigation Costs

Workers’ Compensation Law Section 54: This section (54(5)) provides the procedure for the cancellation of a workers’ compensation policy. The most important concept to remember is that a carrier must strictly comply with the notice requirements contained within this section.

Workers’ Compensation Law Section 54-a: The Board can request security where coverage is an issue.

Workers’ Compensation Law Section 55: Acceptance of premium by carrier an estoppel.

Workers’ Compensation Law Section 56: This section provides for liability to be borne by general contractors where a subcontractor failed to obtain insurance coverage.

The policy was to force general contractors to hire subcontractors with the requisite insurance. The general contractor is provided with the remedy that it can seek indemnification from its subcontractor. Section 56 liability does not relieve a general contractor from third party liability. See Cutillo v. Emory Housing Corp., 190 N.Y.S.2d 502 (1959).

** PRACTICE TIPS – Agency. See Valverde v. N.Y.C. Housing Authority, 154 A.D.2d 756 (1989).

Broker Liability. See DelVecchio v. DelVecchio, 11 A.D.2d 574 (1960). Tavano v. Tavano Enterprises, 227 A.D.2d 836 (1996).

Improper Cancellation. Matter of Cruz v. New Millenium Construction & Restoration Corp., 17 A.D.3d 19 (2005).

Estoppel. See Winn v. Hudson Valley Equine Center, 215 A.D.2d 920 (1995).

Duty to Defend. See Sukup v. State, 19 N.Y.2d 519 (1967) – duty to defend on issue of coverage but not liable for litigation expenses. Great American Indemnity Co. v. Audlane Realty Corp., 296 N.Y.S. 655 (1937).

Jurisdiction.

Corporate Liabiltiy.

Premium audits.