Ohio amends its employment laws to limit joint employment for franchisors

As the debate over the meaning of "joint employer" continues to rage at both the NLRB and in the federal courts, Ohio has jumped into the debate by passing legislation to limit this definition under various Ohio employment laws.

Effective yesterday, franchisors will not be deemed joint employers with their franchisees unless:

• the franchisor agrees to assume that role in writing or a court of competent; or
• a court of competent jurisdiction determines that the franchisor exercises a type or degree of control over the franchisee or the franchisee's employees that is not customarily exercised by a franchisor for the purpose of protecting the franchisor's trademark, brand.

Ohio Supreme Court sides with workers’ comp fraud

Ohio has a specific statute that protects injured workers from retaliation after filing a workers’ compensation claim. O.R.C. 4123.90 states:

No employer shall discharge, demote, reassign, or take any punitive action against any employee because the employee filed a claim or instituted, pursued or testified in any proceedings under the workers’ compensation act for an injury or occupational disease which occurred in the course of and arising out of his employment with that employer. 

It would seem that for this statute to protect an employee, the employee’s alleged injury must be an actual workplace injury.

Not so fast.

When COBRA and workers’ comp collide

Every now and again I get a question from a client to which I don’t know the answer, or the answer surprises me. It doesn’t happen that often, and when it does I’m man enough to admit it.

Yesterday I received just such a question. Must an employer continue the health insurance of an employee out of work with a workers’ compensation injury?

Video killed the lawsuit star

If a picture tells a thousand words, then how many does a video tell?

Last week, the 6th Circuit affirmed the dismissal of a retaliation claim based on a video of an altercation that the plaintiff claimed she had not started.

The “duck” test for independent contractors

Earlier this week, FedEx announced that it would pay an astounding $228 million to settle claims that it had misclassified drivers as independent contractors. This news comes on the heals on the Department of Labor’s announcement of pending guidance on independent contractor status.

Meanwhile, on the same day as the FedEx settlement, the Ohio Supreme Court issued its decision in State ex rel. WFAL Construction [pdf], which decided that under the facts presented, individuals working under a construction contract were “employees” for workers’ compensation purposes.

As a technical matter, in Ohio, R.C. 4123.01(A)(1)(c) lists 20 factors to determine whether a person is an “employee” for purposes of workers’ compensation; if 10 of those criteria are met, the worker is an employee. In WFAL Construction, the workers met the following 10 criteria:

1. The individuals were required to comply with instruction from either the owner or an onsite lead carpenter.
2. The services provided by these workers are integrated into the regular functioning of this employer as they do all of the work.
3. The named persons on the various timesheets and logs performed the work personally.
4. The individuals were paid by the employer.
5. Records that were available to the auditor showed that the same workers performed work repeatedly for the employer.
6. The individuals were paid for the specific number of hours worked on a weekly basis.
7. As the employer had a supervisor or foreman on the worksite if he was not present himself, the Committee finds that the order of work was determined by the employer.
8. Given the hourly payments, the workers would not realize a profit or loss as a result of the services provided.
9. The employer has the right to discharge any of these individuals.
10. There is no indication that any of the individuals would incur liability if the relationship ended.

Despite these specific criteria, I have reached the conclusion that the best test to determine whether a worker is an employee or an independent contractor is the “duck” test—if it looks like an employee, acts like an employee, and is treated like an employee, then it’s an employee. I know this isn’t clear guidance, but, much like how Justice Potter Stewart years ago famously defined obscenity, I think you know an employee when you see one. 

So, Department of Labor, bring on your guidance. I doubt it will be any clearer or more workable than my “duck” standard.

Psych. Claims: Not the Dead Bang Loser You May Think

One of the benefits of my new firm is that it exposes me to new practice areas. Case-in-point, workers’ comp, which I could not previously offer. Today, I am introducing you to my partner, Steve Dlott, who heads the Workers’ Compensation Department at Meyers Roman, and is a Certified Specialist in Workers’ Compensation Law.

Steve was kind enough to author a guest post, discussing a tricky issue under Ohio’s workers’ comp laws, psych claims.

---

Having worked with several different TPA’s regarding psych. claims, there seems to be a general doomsday mindset about the inevitability of such claims. As I have been accustomed to hearing, “What’s the point in fighting them? They always get allowed.” Certainly, based on the IC’s history when it came to such claims, this reaction was entirely understandable. However, based on my own recent experience of taking a string of psych. claims to hearing, these claims are winnable. In fact, I have won the last 5 psych. claims that went to hearing. And, to reinforce this point, several of those claims were state funded claims where the BWC psychologist supported the C-86. That is not to say, of course, that every psych. claim is winnable, or that this streak will indefinitely continue. Certainly, it will not. The point is simply to dispel the commonly held notion, upon getting a C-86 for depression or PTSD, that success is hopeless-or dismal at best.

Two factors account for this new outlook-one, clarification of existing law, the other, good old fashioned detective work. First, in Armstrong v. Jurgensen, the Ohio Supreme Court reiterated the legal requirement for establishing a psych. condition. As the court noted, the psych. condition must result from the physical injuries in the claim and not simply relate to the injured worker’s involvement in the accident. In Armstrong, the injured worker (Armstrong) was slightly injured in an accident in which the other driver was killed. After Armstrong’s claim was allowed for soft tissue injuries, he sought to additionally allow his claim for PTSD. The IC allowed the PTSD and the employer appealed the disallowance to court. The employer ended up taking the case to trial. The judge overturned the IC’s decision, finding the claim not compensable because it did not arise from the allowed conditions. The case was ultimately appealed to the Ohio Supreme Court, which affirmed the trial court’s decision. While employers have always argued this was the law, as apparent from the IC’s decision, hearing officers did not always buy this argument. Now, with the Supreme Court’s decision, they must. 

Without question, Armstrong has changed the landscape in terms of giving employers a significant advantage in getting psych. claims denied, provided it can be shown-which happened in 3 of the 5 cases I won-that the psych. condition did not arise from the physical injuries.

The second step in successfully fighting psych. claims is simply good old fashioned detective work. In one claim, I discovered claimant had a previous history of psychological treatment. Claimant had denied this to both her psychologist and to the BWC psychologist. While this certainly is not unusual, through discovering a record buried in other documents in the injured worker’s file which led to my discovering claimant’s previous history of depression, I was able to discredit claimant at the hearing. Not surprisingly, hearing officers do not like liars, and, not just in this case, but in all of the cases I’ve won to date, the claimant’s credibility has been a major focus of the hearing. Because credibility is such a key component in psych. claims-more so than in any other claim because the condition is based almost entirely on the claimant’s subjective symptoms (“I’m depressed”, “I can’t sleep”, “I can’t concentrate”, etc.), a thorough investigative background is absolutely critical (and often overlooked) in making the difference between success and failure at the IC.

So, my advice to tpas and others is: Bring it on. Don’t assume that fighting that psych. claim that was just filed is a hopeless cause. With Armstrong at our side and good detective work of the injured worker’s background aggressively pursued, who knows, it may be a winner after all.

Ohio Supreme Court all but eliminates the intentional tort exception to workers’ comp claims

The history of the workplace intentional tort as an exception to the state workers’ compensation system has  a long and tortured history in the annals of Ohio jurisprudence. In Houdek v. ThyssenKrupp Materials N.A., Inc. (Ohio 12/6/12), the Ohio Supreme Court may have put the final nail in the coffin of this long misused claim.

Generally speaking, the state workers’ comp law providers immunity to employer from their employees’ workplace injuries. In Blankenship v. Cincinnati Milacron Chems., Inc. (1982), the Ohio Supreme Court recognized a cause of action for an employer’s intentional tort against its employee, holding that because intentional tort claims do not arise out of the employment relationship, the workers compensation laws do not provide immunity from suit.

Blankenship started at three-decade odyssey to define the meaning of “intention.” This odyssey included three different statutes, the first two of which the Court declared unconstitutional. The current statute (R.C. 2745.01), the constitutionality of which the Court in 2010 blessed twice, provides:

(A) In an action brought against an employer by an employee, or by the dependent survivors of a deceased employee, for damages resulting from an intentional tort committed by the employer during the course of employment, the employer shall not be liable unless the plaintiff proves that the employer committed the tortious act with the intent to injure another or with the belief that the injury was substantially certain to occur.

(B) As used in this section, “substantially certain” means that an employer acts with deliberate intent to cause an employee to suffer an injury, a disease, a condition, or death.

(C) Deliberate removal by an employer of an equipment safety guard or deliberate misrepresentation of a toxic or hazardous substance creates a rebuttable presumption that the removal or misrepresentation was committed with intent to injure another if an injury or an occupational disease or condition occurs as a direct result.

In Houdek, the plaintiff brought suit for an intentional tort under 2745.01 after being struck by a sideloader. He alleged that his employer deliberately intended to injure him by requiring him to work in a dimly lit aisle without a reflective vest and by failing to place orange safety cones or expandable gates to prevent machinery from entering aisles where employees were working.

The Court concluded that for an employee to prevail on an intentional tort claim, the employee must prove that that the employer deliberately intended to cause injury:

Absent a deliberate intent to injure another, an employer is not liable for a claim alleging an employer intentional tort, and the injured employee's exclusive remedy is within the workers' compensation system.

The Court made clear that the law differentiates between accidents and intentional injuries, and that 2745.01 provides a remedy only for the latter:

Here, Houdek’s injuries are the result of a tragic accident, and at most, the evidence shows that this accident may have been avoided had certain precautions been taken. However, because this evidence does not show that ThyssenKrupp deliberately intended to injure Houdek, pursuant to R.C. 2745.01, ThyssenKrupp is not liable for damages resulting from an intentional tort.

The lone dissenter, Justice Pfeifer, laments that the majority’s decision ends the workplace intentional tort claim under Ohio Law:

The court below … wrote what the consequences would be if my dire evaluation of the law was indeed correct: “As a cautionary note, if Justice Pfeifer is correct, Ohio employees who are sent in harm’s way and conduct themselves in accordance with the specific directives of their employers, if injured, may be discarded as if they were broken machinery to then become wards of the Workers’ Compensation Fund. Such a policy would spread the risk of such employer conduct to all of Ohio’s employers, those for whom worker safety is a paramount concern and those for whom it is not. So much for “personal responsibility” in the brave, new world of corporations are real persons.” More’s the pity.

Houdek is a huge victory for Ohio’s employers. “Deliberate intent” is a very high standard for injured employees to meet, and should protect employers  except in the most egregious of circumstances.

What cases will still prove problematic for employers under this statute? Because of presumption of deliberate intent created by 2745.01(C), those in which it is alleged that the employer deliberately removed an equipment safety guard or deliberately misrepresented a toxic or hazardous substance. How do you guard against these intentional tort cases?

• Train all of your employees about the importance of safety guards, and the dangers of toxic and hazardous substances.
• Inspect all equipment at the beginning and end of each shift to ensure that safety guards are in the proper place.

Firing an employee? Tell them! (don’t Milton the termination)

Office Space is one of the great movies about the modern workplace. One of its key plot lines involves sad sack employee Milton Waddams, who mumbles through the movie about his missing stapler and ever-moving desk. Amazingly, the company had laid off Milton years earlier without anyone telling him. When the company fixed a computer glitch that had accidentally kept him on the payroll, Milton finally cracked and burned down the office.

Lawrence v. Youngstown (9/21/12) [pdf], decided last week by the Ohio Supreme Court, gives employers a reason other than arson-avoidance to tell employees that they’ve been fired.

Ohio’s workers’ compensation retaliation statute (Revised Code 4123.90, for those counting) is an odd-duck. It has a two-part statute of limitations. First, the aggrieved employee must provide the employer “written notice of a claimed violation … within the 90 days immediately following the discharge, demotion, reassignment, or punitive action taken.” If the employee sends that written notice, he or she then has up to 180 days from the adverse action to file suit. The 90-day notice requirement is “mandatory and jurisdictional,” and no employee is permitted to file a workers’ compensation retaliation claim without sending the written notice.

In Lawrence, the Court answered a question of timing — does that 90-day period begin to run on the effective date of the discharge or when the employee receives notice of the discharge?

The facts of Lawrence illustrate the potential problem. On January 7, 2007, Youngstown suspended Lawrence without pay from his position with the city. Two days later, the city converted the suspension to a termination, and mailed, via regular mail a letter notifying him of the termination. Lawrence claimed he did not learn of his discharge until February 19, 2007. On April 17, 2007, Lawrence’s attorney sent the city a letter stating that Lawrence intended to bring a lawsuit claiming unlawful workers’ compensation retaliation. When he filed his lawsuit a few months later, the city sought, and obtained its dismissal on the basis that Lawrence’s letter was untimely based on his termination date.

The Ohio Supreme Court reversed. It held that normally the start of the 90-day period triggers from the actual discharge date. It also created an exception when the employee both did not know of the discharge and could not reasonably have learned of it:

A limited exception to the general rule that the 90-day period for employer notice … runs from the employee’s actual discharge…. The prerequisites for this exception are that an employee does not become aware of the fact of his discharge within a reasonable time after the discharge occurs and could not have learned of the discharge within a reasonable time in the exercise of due diligence. When those prerequisites are met, the 90-day time period for the employer to receive written notice … commences on the earlier of the date that the employee becomes aware of the discharge or the date the employee should have become aware of the discharge.

As the Court reminded us in the Lawrence opinion, “Usually, an employer will make a good-faith effort to communicate the fact of the employee’s discharge to the employee when it occurs…. The employer commonly will use a method like personal notification, hand delivery of notice, or a certified letter.” In other words, if you are going to fire an employee, don’t you owe it to him as a human being to at least tell him?

The FMLA and the honest belief rule: monitoring leave of absence abuse

Last week, I discussed the bounds of the “honest belief rule” as a defense to a discrimination claim. Yesterday, in Seeger v. Cincinnati Bell Telephone Co. [pdf], the 6th Circuit used that same defense to affirm the termination of an employee who claimed retaliation under the FMLA. This case, though, has wider implications for employer who use surveillance to monitor the legitimacy of their employees’ medical leaves.

Tom Seeger took an approved leave of absence under the FMLA for a herniated lumbar disc. Four days after Seeger’s doctor certified him as completely unable to work—including any light duty, which entitled him to receive paid disability leave under the employer’s policy—two of Seeger’s co-workers saw him walking, seemingly unimpaired, at the Cincinnati Oktoberfest. One of the employees, who knew Seeger was collecting paid disability leave, reported his sighting to CBT’s human resources manager.

CBT conducted an investigation, which consisted of obtaining sworn statements from the two employees who saw Seeger, reviewing Seeger’s medical records, disability file, and employment history, and consulting with CBT’s internal medical manager. Based on the inconsistency between Seeger’s reported medical condition and his reported behavior at Oktoberfest, CBT terminated Seeger for “disability fraud” (over-reporting his symptoms to avoid light-duty and continue collecting disability payments).

Relying on the “honest belief rule,” the 6th Circuit concluded that CBT’s termination decision did not violate the FMLA:

CBT made a “reasonably informed and considered decision” before it terminated him, and Seeger has failed to show that CBT’s decisionmaking process was “unworthy of credence.” … The determinative question is not whether Seeger actually committed fraud, but whether CBT reasonably and honestly believed that he did….

CBT never disputed that Seeger suffered from a herniated disc…. Seeger’s ability to walk unaided for ten blocks and remain at the crowded festival for ninety minutes understandably raised a red flag for CBT, giving it reason to suspect that Seeger was misrepresenting his medical condition in an attempt to defraud CBT’s paid-leave policy.

This case has wide implications. There are many laws that entitle employees to take time off from work: FMLA, ADA (disability), PDA (pregnancy), Title VII (religious accommodation), and state workers’ compensation laws, to name a few. Many companies use surveillance to curb leave of absence abuses. I am not suggesting that you surveil every employee who takes leave from your workplace. Without a good faith belief supporting the surveillance, a court could conclude that your actions are unlawful.

If, however, you have a good faith reason to test the legitimacy of an employee’s leave via surveillance or other monitoring, Seeger's invocation of the honest belief rule will offer you some protection if you misinterpret the results of your investigation.

Dealing drugs disqualifies an employee from collecting workers’ comp

Ever heard of the phrase “sustained remunerative employment?” In the world of workers’ compensation, it means that if you are earning money, or capable of earning money, you cannot be eligible for an award of PTD (permanent total disability) for a workplace injury. Seems like common sense, right? What, if, however, the evidence of sustained remunerative employment is illegal activity? Last week, the Ohio Supreme Court weighed-in with an answer.

Donald McNea was a police officer the city of Parma. In 2004, the state awarded him PTD compensation for alleged on-the-job injuries. As it turns out, at the same time McNea was receiving PTD payments, he was being investigated for the illegal sale of narcotics. Ultimately, he was arrested, indicted, pleaded guilty, and sentenced to three years in prison. The Industrial Commission terminated McNea’s PTD benefits as of the date of his incarceration. It also concluded that McNea’s side business selling narcotics was “sustained remunerative employment,” and as a result declared that all compensation paid after his first confirmed drug sale constituted an overpayment.

McNea appealed the determination of the overpayment all the way to the Ohio Supreme Court, where—in State ex rel. McNea v. Industrial Commission (3/29/12) [pdf]—common sense prevailed:

In this case, the evidence established an ongoing pattern of phone calls and other sales-related activity that culminated in the four recorded sales that McNea made between October and December 2005. The commission characterized this sales activity as sustained remunerative employment, and we decline to disturb that finding.

It is unlikely that you will ever face the situation of having to seek disqualification of an employee from collecting workers’ comp benefits because he’s dealing drugs. Nevertheless, this case holds an important lesson. Despite all of the laws technicalities and nuances, when you rip most cases down to their cores, ligation is a morality play. If you can show that an employee did something that offends our idea of what is right versus what is wrong (dealing drugs, stealing, other dishonesty, etc.), you will place yourself in a very good position to win your case.

Resolve this year to properly handle no-fault attendance policies

For the uninitiated, a no-fault attendance policy terminates an employee who accumulates a pre-designated number of absences, regardless of the reason. For employers with high-volume, high-turnover operations, these policies make a lot of sense as the best tool to manage employee attendance. They are not, however, without their risk. For example, no-fault attendance policies cannot penalize absences that fall under the protective umbrella of statutes such as the FMLA or the ADA. As some employers have discovered, disciplining or firing disabled employees under a no-fault policy can be a costly error.

What about employees on leave for a workers’ comp injury? Can an employer count those absence under a no-fault policy? According to one recent Ohio appellate decision—Scalia v. Aldi, Inc. (12/21/11) [pdf]—the answer is a decided maybe. The court concluded that it is not per se retaliatory for an employer to terminate an employee on workers compensation leave pursuant to a facially neutral attendance policy. The court remanded the case back to the trial court to consider the issue of whether the employer—through the application of its attendance policy— terminated the plaintiff retaliation for instituting, pursuing, or testifying in a workers’ compensation proceeding.

What does this mean? This means that the plaintiff cannot rely solely on the attendance policy to prove retaliation, but must prove that the employer’s reliance on the attendance policy was a pretext for retaliation. A uniformly applied attendance policy will go a long way to disproving this pretext. As mentioned above, however, employers cannot apply attendance policies to penalize employees on leave for FMLA or ADA reasons. Will this lack of uniformity hurt employers in defending against workers’ comp retaliation cases? Or, can an employer lawfully treat FMLA-related and ADA-related absences differently than workers’ comp-related absences. Another court will have to answer these questions in another case. As this case illustrates, employers must tread very carefully when disciplining or terminating an employee who is absent from work because of work-related injury.

Ohio Supreme Court to consider statute of limitations in workers comp retaliation cases

Ohio Revised Code section 4123.90 prohibits employers from taking any adverse action against an employee who files a claim, or institutes, pursues, or testifies in any proceeding under the workers’ compensation act. This statute is unique in that is has a two-stage statute of limitations:

1. Within 90 days “immediately following” the adverse action, the employer must receive written notice of a claimed violation from the employee; and
2. The lawsuit must be filed within 180 days “immediately following” the adverse action.

Both steps are required, and an employee’s failure to meet either deadline is fatal to a retaliation claim.

In Lawrence v. City of Youngstown (2/25/11), the Mahoning County Court of Appeals took up the issue of the meaning of “immediately following” in regards to the 90 and 180 day requirements. The court recognized an even split among Ohio’s appellate courts. Half of the courts that have considered the issue concluded that the 90 and 180 day requirements do not begin to run until the employee receives notice of the termination or other adverse action. The other half concluded that the effective date of the termination or other adverse action controls.

The Lawrence court sided with the latter, concluding:

This language clearly references the date of discharge, not notice of discharge. If the General Assembly had intended the time periods to begin to run upon notice of discharge, the statute could have easily been written to indicate as such. Accordingly, we find that the time limits begin to run on the effective date of discharge.

Last week, the Ohio Supreme Court agreed to hear this case [pdf] and resolve the split. Ohio employers should expect clarity on this important issue in the next 12 – 15 months.

---

Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Ohio recognizes public policy tort for workers compensation retaliation in limited circumstances

Ohio has a specific statute against workers’ compensation retaliation—R.C. 4123.90. It prohibits an employer from retaliating against an employee who files a claim, or institutes, pursues, or testifies in any proceeding under the workers’ compensation act.

In Bickers v. W. & S. Life Ins. Co. (2007), the Ohio Supreme Court concluded that an employee who is fired while receiving workers’ compensation benefits is limited to brining a retaliation claim under the statute, and cannot pursue a common law wrongful discharge cause of action. This distinction is significant, because the workers’ compensation retaliation statute has limited remedies—reinstatement, back pay, and reasonable attorneys fees. The remedies is a common law wrongful discharge claim, however, are unregulated, and include compensatory and punitive damages.

In Sutton v. Tomco Machining, Inc. (6/9/11) [pdf], the Ohio Supreme Court considered whether R.C. 4123.90 also precludes an injured employee who suffers retaliation before filing a workers’ compensation claim from filing a common law wrongful discharge claim.

The facts of the case are pretty remarkable. Within an hour of DeWayne Sutton’s report of a workplace back injury to Tomco’s president, and before he could file a workers’ compensation claim for the injury, the company fired him. The employer argued that Sutton did not have a remedy. It correctly argued that R.C. 4123.90 did not provide a remedy because he had not filed a workers’ compensation claim. It also argued that Bickers precluded the common law wrongful discharge claim.

The Court concluded that because Sutton did not have a remedy available under the statute, he could pursue his common law wrongful discharge claim:

We find that the General Assembly did not intend to leave a gap in protection during which time employers are permitted to retaliate against employees who might pursue workers’ compensation benefits…. The General Assembly certainly did not intend to create the footrace …, which would effectively authorize retaliatory employment action and render any purported protection under the antiretaliation provision wholly illusory. Therefore, it is not the public policy of Ohio to permit retaliatory employment action against injured employees in the time between injury and filing, instituting, or pursuing workers’ compensation claims.

The Court, however, did not permit Sutton to seek the full panoply of tort remedies. Instead, it balanced the limited remedies of the Workers’ Compensation Act against right of employees to be free from retaliation:

The compromise established by the General Assembly must govern the relief available to employees, like Sutton, who suffer retaliatory employment action after an injury and before they have filed, instituted, or pursued a workers’ compensation claim, just as it governs the relief for employees who suffer retaliatory employment action after they have filed, instituted, or pursued a workers’ compensation claim. Accordingly, we hold that Ohio’s public policy as established by the legislature is to limit remedies for retaliatory employment actions against injured employees to those listed in R.C. 4123.90.

This case strikes the right balance. Even the most ardent employer-side advocate would have a hard time arguing for a loophole that would preclude any remedy for an employee retaliated against. By limiting the remedies to those set forth in the statute, the Court is protecting the balance created by the workers’ compensation system into which employers are required to buy.

---

Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Employers need to beware retaliation landmines

In Baker v. Windsor Republic Doors (6th Cir. 3/8/11), the plaintiff claimed that his employer retaliated against him in violation of the ADA, which in an of itself is not all that unique. What’s different about the case, however, is the nature of the claimed retaliation. Baker, a forklift operator, claimed that Windsor retaliated against him by requiring him to waive any future workers’ compensation claims as a condition of his post-surgical return to work.

Baker took a medical leave for the implantation of a pacemaker and defibrillator. Baker’s doctor ultimately cleared him to return to work with restrictions, including avoiding contact with any electrical current or magnetic fields, and wearing an electromagnetic frequency alarm. Windsor made the requested accommodations, but uncomfortable that it could guarantee Baker’s safety, additionally asked him to waive his rights to workers’ compensation benefits for any aggravation of his heart condition. When Baker refused to agree to the waiver, Windsor refused to continue his employment. Baker sued, and a jury awarded him $113,500 for disability discrimination and retaliation.

Specifically as the retaliation claim, the 6th Circuit concluded that the workers’ compensation waiver constituted an adverse action:

[A] rational jury could conclude that the waiver request was indeed an adverse action. Trial testimony is clear that if Baker chose not to waive rights that no individual without a heart condition was required to waive, he would not be allowed to return to work for the defendant. In fact, Lawrence Land, the company's director of human resources, engaged in the following colloquy with Baker’s lawyer:

   Q Is it fair to say that as of June 2006, you did not give [Baker] the option of returning to work with the EMF alarm but without signing away his workers' compensation benefits?

   A Sir, that's absolutely correct.

   Q All right. And to this day, has he ever been given the option of returning to work with the EMF alarm but without signing away his workers' compensation benefits? …

   A Sir, I've not had any communication, so that would be correct.

Being forced to choose between forfeiting certain statutorily guaranteed rights or remaining on indefinite, unpaid leave-of-absence is indeed a dilemma that a rational finder-of-fact could conclude was adverse.

Employee medical leaves and returns to work confound employers. In this case, the employer tried to do everything right to protect both the employee and itself, but nevertheless exploded a retaliation landmine by asking for the waiver. The standard for what constitutes retaliation is so broad—any materially adverse action that might have dissuaded a reasonable worker from making or supporting a charge of discrimination—that something even as innocuous as asking for workers’ compensation waivers can qualify. Businesses not well versed in these issues (and even most that are) would be well served by seeking legal counsel in connection with employee leaves and returns to work to avoid making similar mistakes.

---

Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Ohio Supreme Court (finally) upholds the constitutionality of a workplace intentional tort statute

In two anticipated opinions, the Ohio Supreme Court has finally found an intentional tort statute that passes muster under Ohio’s constitution. The opinions – Stetter v. R.J. Corman Derailment Servs. and Kaminski v. Metal & Wire Prods. Co. – confirm the constitutionality of R.C. 2745.01. This statute provides:

(A) In an action brought against an employer by an employee, or by the dependent survivors of a deceased employee, for damages resulting from an intentional tort committed by the employer during the course of employment, the employer shall not be liable unless the plaintiff proves that the employer committed the tortious act with the intent to injure another or with the belief that the injury was substantially certain to occur.

(B) As used in this section, “substantially certain” means that an employer acts with deliberate intent to cause an employee to suffer an injury, a disease, a condition, or death.

(C) Deliberate removal by an employer of an equipment safety guard or deliberate misrepresentation of a toxic or hazardous substance creates a rebuttable presumption that the removal or misrepresentation was committed with intent to injure another if an injury or an occupational disease or condition occurs as a direct result.

To understand the importance to Ohio’s businesses of these decisions and the statute they uphold, we first need to take a little trip back in time to see where we’ve been. Workers’ compensation generally provides employers with immunity from civil lawsuits for workplace injuries. A limited exception exists for what is known as an “intentional tort.” The Ohio Supreme Court first recognized this exception in 1982 in Blankenship v. Cincinnati Milacron Chems., Inc. Supreme Court developed this theory over the years in in cases such as Jones v. VIP Dev. Co., Van Fossen v. Babock & Wilcox Co., and Fyffe v. Jeno’s, Inc.

Under these prior cases, to establish the requisite “intent” for a workplace intentional tort, one would have to show:

1. knowledge by the employer of the existence of a dangerous process, procedure, instrumentality or condition within its business operation;
2. knowledge by the employer that if the employee is subjected by his employment to such dangerous process, procedure, instrumentality or condition, then harm to the employee will be a substantial certainty; and
3. that the employer, under such circumstances, and with such knowledge, did act to require the employee to continue to perform the dangerous task.

As the Fyffe court further explained:

To establish an intentional tort of an employer, proof beyond that required to prove negligence and beyond that to prove recklessness must be established. Where the employer acts despite his knowledge of some risk, his conduct may be negligence. As the probability increases that particular consequences may follow, then the employer’s conduct may be characterized as recklessness. As the probability that the consequences will follow further increases, and the employer knows that injuries to employees are certain or substantially certain to result from the process, procedure or condition and he still proceeds, he is treated by the law as if he had in fact desired to produce the result. However, the mere knowledge and appreciation of a risk – something short of substantial certainty – is not intent.

On at least two occasions after Fyffe, the Ohio Supreme Court struck down as unconstitutional statutes that attempted to tighten the Van Fossen/Fyffe common law rules for workplace intentional torts. Thus, until the enactment in 2005 of the current R.C. 2745.01, courts often liberally applied the the Van Fossen and Fyffe decisions to remove a variety of workplace accidents and injuries from the workers’ compensation system and hold employers liable in tort.

This week’s decisions in Stetter and Kaminski upholding R.C. 2745.01 as constitutional are huge victories for employers. Van Fossen and Fyffe’s fuzzy “substantial certainty” standard, which courts liberally applied to the detriment of many employers, has been conclusively replaced with a much tighter statute. Now, all workplace injuries are covered by the workers’ compensation system unless the employer deliberately intended to injure the employee. The Ohio Supreme Court has reaffirmed that workers’ compensation really is supposed to be an employee’s exclusive remedy for workplace injuries in all but the most egregious of cases.

---

Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Refusal to take drug test bar workers’ comp retaliation claim

Many companies require employees to submit to drug tests after suffering a workplace injury. The rationale is simple – intoxication is one of the few complete defenses an employer has to a workers’ comp claim for a workplace injury.

What happens, though, if the injured employee refuses to take the drug test? That scenario presented itself to SanMar Corporation in late-2006. Thomas Ferguson left work complaining of a non-work-related backache. He told the ER nurse, however, that his pain was caused by an aerial harness he had to wear at work. Upon hearing the injury was work-related, the nurse asked Ferguson to submit to a drug test, which he did.

Ferguson returned to work the following week with light duty restrictions. SanMar’s HR department that he needed to submit for drug testing. Ferguson complained that he had already taken a test the prior week. SanMar, however, required a re-test because the earlier test did not comply with its policy for the employee to be transported to the testing facility. Ferguson went on his own, without SanMar even knowing he had suffered a workplace injury.

Because of Ferguson’s protests about the re-test, and his “nervous and fidgety” reaction, SanMar’s Assistant Manager required that the re-test be monitored. Upon learning that the drug test would be observed, Ferguson refused to be tested. SanMar subsequently terminated him for refusing to submit to a drug test in contravention of company policy.

Ferguson sued, claiming that SanMar terminated him in retaliation for his workers’ comp claim. In Ferguson v. SanMar (8/17/09), the Butler County (Ohio) Court of Appeals affirmed the trial court’s dismissal of Ferguson’s claim:

Kirk, as assistant facility manager, made that determination after noticing Ferguson’s “nervous and fidgety” reaction to being asked to resubmit to a drug test. Kirk’s decision was not punitive action against Ferguson because Ferguson filed a workers’ compensation claim. Instead, it was a management decision predicated on a suspicion that Ferguson was using drugs or alcohol in the workplace.

For Ferguson’s argument to succeed, the evidence would have to show that SanMar knew that requiring him to be transported to the hospital and observed while he submitted to the test would induce Ferguson’s refusal to be tested. There is no way that SanMar, or anyone for that matter, could have known that Ferguson would refuse to be tested…. It was Ferguson’s own refusal to submit to the test that motivated his discharge. That refusal, under the written policy, was likewise sufficient to result in Ferguson’s discharge.

Drug testing policies are complicated and very easy to get wrong. Indeed, while Ohio does not have a specific statute that governs such policies, other states do (Oklahoma comes to mind). If you are considering implementing a drug testing program for your workforce, experienced counsel should vet it before you put it into circulation. If you already have a policy in place, it should be reviewed periodically for compliance.

---

Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Workers' comp retaliation case shows importance of careful documentation

If you don't want it read by your spouse, seen by your boss, considered by a jury, or splashed on the front page of the newspaper, do not write it down or send it in an email.

Cunningham v. Steubenville Orothopedics & Sports Medicine, Inc., decided this week by Ohio's 7th Appellate District, illustrates the pitfalls that await companies that terminate employees in the midst of a workers' comp leave. It also shows that managers and supervisors must be vigilant in what they put in writing.

Marianne Cunningham was an x-ray technician for Steubenville Orthopedics. She injured her back at work and took a six-week leave of absence after filing a workers' comp claim for her injury. After informing Steubenville Orthopedics that she would be able to return to work the following week, she was laid off. Among the evidence that the court relied upon in reversing the trial court's dismissal of the retaliation claim was certain notes kept by her boss, Dr. Amin, in his desk:

• Notes that specifically mentioned a back injury Cunningham had suffered at a prior job.
• Dr. Amin gave excessive absenteeism as the reason for Cunningham's termination. His notes, however, documented that Cunningham was only absent 6 times in the 30 months prior to her injury, while the employee who replace her during her workers' comp leave missed 5 to 10 days of work during a shorter prior of time and was not terminated.

I've often written about the importance of documentation in employment cases. The Cunningham case illustrates that what you don't document is often as important as what you do document. Steubenville Orthopedics's case was sunk because Dr. Amin did not carefully vet his thoughts before committing them to paper. His notes gave the court the evidence it needed to find that a question of fact existed on the issue of Dr. Amin's motivation for the termination. Dr. Amin will now have to come up with some non-retaliatory explanation for his notes that passes the red-face test in front of a jury, an unenviable position.

Just say no -- Dealing crack is gainful employment, according to the Ohio Supreme Court

Every once in a while you come across a case that just makes you shake your head in disbelief. State ex re. Lynch v. Indus. Comm. is such a case.

In 1967, Henry Lynch suffered an injury at work, from which he was declared permanently and totally disabled and received a commensurate workers' compensation award. Thirty years later, a federal grand jury indicted Lynch for possession, sale, and distribution of crack cocaine, to which he pleaded guilty. It was alleged that from 1994 through 1997, he earned between $300 to $500 a week from selling crack. After he was incarcerated, the Bureau of Workers' Compensation moved to terminate Lynch's permanent total disability compensation. The commission found that Lynch's "criminal activities for profit ... constitute[d] sustained remunerative employment," and terminated his benefits retroactive to the date the federal indictment alleged he began selling crack.

The Ohio Supreme Court upheld that decision, holding that Lynch's ongoing crack-cocaine enterprise constituted sustained remunerative employment sufficient to terminate permanent total disability compensation. In the Court's words:

Lynch also claims that the commission cannot consider the activity he engaged in to be sustained remunerative employment, because the activity was illegal. We disagree. Lynch cannot use the illegality of his pursuits as a shield. Lynch exchanged labor for pay on a sustained basis. This constitutes sustained remunerative employment for purposes of permanent total disability.

So here are the questions of the day: If Lynch has 4 dealers working for him, does he have to abide by Ohio's employment discrimination laws? If he has 50 dealers working for him, does he have to grant them FMLA leave? Are his dealers eligible for workers' comp if they are injured on the job?

[Hat tip to the Evil HR Lady.]