Jury Awards $70,000 to Injured Employee For Discrimination & Retaliation

A corrections officer in Hudson County NJ was awarded $70,000 by a jury for violation of her workers' compensation rights and discrimination charges flowing from her accident at work.

The employee, who had suffered an injury to her knee and subsequent surgical intervention, received a disciplinary notice from her employer alleging that she was "faking her injuries."

NJ law permits a common law action for wrongful discrimination based upon an alleged retaliatory firing attributed to the filing of a workers' compensation claim is also available to an employee. The judicial remedies include: loss of wages and reinstatement of employment, as well as other compensatory and punitive damages.

U.S. Department of Labor's OSHA cites NJ PSEG Power for workplace safety and health hazards

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) has cited PSEG Power LLC for alleged workplace safety and health violations found at a Hamilton, N.J., worksite, proposing $57,500 in penalties.

OSHA initiated its investigation on Jan. 21 after being notified of an employee accident. As a result of the investigation, the company has been cited with one willful violation with a penalty of $55,000 and one serious violation with a $2,500 penalty.

The willful violation is due to the company's failure to provide adequate lighting when employees were operating a bulldozer at night. OSHA defines a willful violation as one committed with intentional disregard of, or plain indifference to, the requirements of the Occupational Safety and Health Act.

The serious violation is due to the company's failure to ensure that employees were wearing a seat belt when operating a bulldozer. A serious citation is issued when there is substantial probability that death or serious physical harm could result and the employer knew, or should have known, of the hazard.

"PSEG is strongly encouraged to address the identified violations to ensure its workers are not at risk for future accidents," said Paula Dixon-Roderick, director of OSHA's Marlton, N.J., office. "By implementing an effective safety and health management system, the company can protect its workers from workplace hazards."

The company has 15 business days from receipt of the citations to comply, request an informal conference with the OSHA area director, or contest the citations and proposed penalties before the independent Occupational Safety and Health Review Commission. The investigation was conducted by OSHA's Marlton Area Office; telephone: 856-396-2594.

Under the Occupational Safety and Health Act of 1970, OSHA's role is to promote safe and healthful working conditions for America's working men and women by setting and enforcing standards, and providing training, outreach and education. More information about OSHA's recent enforcement activity is available on The Workers' Compensation Blog.

Injured Workers Assert Class Action Claiming Wal-Mart Violated RICO Act

Several injured Wal-Mart workers' have claimed that the company, in defending their workers' compensation claims, violated the Federal RICO Act. The employees of Wal-Mart have alleged that the company conspired with the insurance carrier and claims adjuster to "dictate, withhold, delay, deny and/or interfere with" the type and duration of their medical care.

The employees have filed a motion for class action certification in their Federal RICO claim against: Wal-Mart, Concentra Health Services, Claims Management, Inc. and Home Assurance Co. (the workers' compensation insurance carrier). The complaint alleges the defendants' activity violated the Colorado's Consumer Protection Act [Colo. Rev. Stat. Section 6-1-105(1)(b),(c),(e) and (u)], and that there were also violations of the federal Racketeer Influenced and Corrupt Organization Act [18 U.S.C. Sec. 1961-1968.] The Class Action Complaint was filed on March 24, 2009. Gianzero v Wal-Mart Stores, Inc. , et al., US DCT (D. Colorado) No. 09-cv-00656 REB BNB.

Wal-Mart's workers' compensation has been critically reviewed in the Seattle Weekly. The publication indicates that the Washington Department of Labor and Industries, in an Order, indicated that, .... “Over the last seven years, Wal-Mart has “repeatedly and unreasonably” delayed giving injured workers the benefits they were owed under workers’ compensation laws, and, in some cases, Wal-Mart employees were not allowed to file workers’ comp claims at all.”

The expansion of RICO actions arising out of workers' compensation claims is an issue to be addressed by the US Supreme Court should two pending Petitions for Certiorari be granted in other pending matters. See the Workers' Compensation Blog for additional articles on this topic.

Medical Provider Claims Viable RICO Action Against Insurance Company in Petition to US Supreme Court

A Petition for Certiorari has been filed to the US Supreme Court in a RICO claim involving a medical provider who claims an insurance company committed fraud in processing the provider's bills for services. George Schroedinger, MD has filed a Petition to seek review of a Eight Circuit decision that over turned a favorable RICO action against United Healthcare of the Midwest, Inc.

The medical provider alleges that United's computer system "often inappropriately grouped and down coded, improperly suspended claims, unnecessarily requested plaintiffs claims that United continued to classify" the medical provider.

This Petition follows a Petition for Certiorari has been filed in Brown v. Cassens Transport Co., 546 F.3d 347 (6th Cir. Oct 23, 2008) (NO. 05-2089), following the rehearing and rehearing en banc denied (Jan 05, 2009). Brown is a landmark decision of immense national significance, the US Sixth Circuit Court of Appeals ruled that a RICO claim brought by injured workers against their employer, insurance carrier and employer medical expert could proceed. The Brown case is scheduled for a Supreme Court conference on September 29, 2009.

George Schoedinger, et al., Petitioner v. United Healthcare of the Midwest, Inc, No. 09-80 (July 16, 2009)

NJ Proposes Informal Process for Medical Bill Disputes

The number of disputes concerning the payment/reimbursement of medical bills have increased in workers’ compensation claims in New Jersey. The State has proposed converting the Informal Hearing procedure into a new Informal Process to hear such disputes and other matters previously consider as an Informal Hearing.

In a published article, “ Clearing the Workers’ Compensation Benefit Highway of Medical Expense Land Mines ,” the difficulties of the issue were previously identified. “Medical expenses in contested workers’ compensation cases are now a significant and troublesome issue resulting in uncertainty, delay and potential future liability. The recent NJ Supreme Court decision, University of Mass. Memorial Hospital v. Christodoulou, 180 N.J. 334 (2004) has left the question of how to adjudicate medical benefits that were conditionally paid or paid in error. Presently there is no exclusively defined procedure to determine the allocation, apportionment of primary responsibility for unauthorized medical expenses and reimbursement.” “The new benefit highway that embraces a new paradigm which extends to a new
safety net and the existence of these collateral programs require a modification of the
Workers’ Compensation Act and/or Rules to safeguard the interests of the parties, while
remaining consistent with the social remedial intent of the legislation.”

Previously legislation was proposed that would have given the NJ Division of Workers Compensation exclusive jurisdiction over medical bills. A-2501 That legislation was never enacted.

The proposed process would allow medical providers, or their representatives, to appear, without the need of an attorney, to informally discuss their disputes with the parties in an effort to seek a consent agreement for resolution. The proposed rule also repeals the need for registration of party representative.

The proposed rules were published on Monday, July 20, 2009 (41 N.J.R. 2768(a) and a public hearing is scheduled on Monday, August 17, 2009 from 9:00 to 12:00 noon NJ Department of Labor and Workforce Development, Trenton, NJ.

Overseas Workers Not Covered by State Mandated Workers' Compensation Insurance

In a novel decision the New Jersey Appellate Division ruled that overseas employees are not entitled to coverage even though the workers' compensation act in New Jersey mandates compensation insurance for all employees. The court, utilizing the full faith and credit doctrine, rationalized that insufficient contacts existed between the State of New Jersey and the employees to require insurance.

The employer, a corporation headquartered in NJ, whose business was to employ volunteers to work overseas in an educational program, made an inquiry to the New Jersey Compensation Rating and Inspection Bureau (NJCRIB) for a determination as to whether or not coverage should be afforded to the employees who were based outside of New Jersey, not hired in New Jersey, and not actively engaged in the employment of the respondent in New Jersey. After the NJCRIB notified the employer that insurance was required, the employer sought a declaratory action and judicial interpretation.

International School Services, Inc. v. NJ Department of Labor and Workforce Development, ___ A2d _____ Docket No. A-5722-07T3 (App.Div. 2009). Approved for publicatoion July 10, 2009.

Declining Salaries and Unemployment Challenege Workers' Compensation

The decline of wages is yet another major factor in the determination of the health of the workers' compensation system. Recently released surveys reflect that the increase in salaries is the lowest in decades.

The US Department of Labor has reported that the average workers' salary has only increased 2.2% in last year. The demonstrates a fall of 3.2%.

Most workers' compensation systems are based upon the Sate Average Weekly Wage (SAWW). The SAAW establishes the limits for benefit payouts. Usually States mandate that both minimum and maximum payments are a percentage of the SAWW. Compounding that predicament is the fact that the recession has eliminated 6.5 million jobs since 2007.

Both higher levels of unemployment and a reduction in salary increases impact have a fiscal impact of the workers' compensation system. Wages are the basis for the calculation of premiums collected. Few employees and lower wages reflect in lower incomes for insurance companies.

Of course lower employer gives rise to declining claims and lower salaries give rise to lower rates. However, medical costs, the driving force in workers' compensation continue to rise. As the economy continues to decline and fewer businesses remain afloat, the challenge to keep the workers' compensation system afloat will become more acute.