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Age Discrimination Claims in Workers’ Compensation Settlements?

Today’s post comes from guest author Anthony L. Lucas, from The Jernigan Law Firm.

When an employee settles a workers’ compensation claim, the employer often wants to terminate the employee and is cautious because of potential age discrimination. The Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621 et seq. (2015), prohibits companies with 20 or more employees from discriminating against a person (40 years of age or older) because of his or her age with respect to any term, condition, or privilege of employment, including hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training.

An individual who has been discriminated against because of his or her age may be entitled to back pay, reinstatement, hiring, promotion, front pay, liquidated damages, and court costs and attorney fees.

To avoid potential discrimination claims after a workers’ compensation settlement, the employer often seeks an ADEA waiver at the same time. For an ADEA waiver to be enforceable, it must:

  • Be in writing and understandable;

  • Specifically refer to ADEA rights or claims;

  • Not waive an individual’s future rights or claims;

  • Be in exchange for valuable consideration in addition to anything of value to which the individuals is already entitled;

  • Advise the individual to consult with an attorney before signing the waiver;

  • Provide the individual with a certain amount of time to consider the agreement:

    • 21 days for individual agreements

    • 45 days for group waiver agreements

    • A “reasonable” amount of time for settlements of ADEA claims

  • Provide a period of at least 7 days following the execution of the agreement, in which the agreement is not effective or enforceable, in which the individual may revoke the agreement.

Some termination agreements may not be enforceable, and the individual may have a valid claim to pursue under the ADEA.

States Will #RaiseTheWage for More Than 2 Million Workers

Today’s post comes from guest author Kit Case, from Causey Law Firm.

By  on November 10, 2016 – –

It has been almost four years since President Obama called on Congress to increase the federal minimum wage. While Congress has refused to take action, this hasn’t dissuaded states and localities from stepping up and giving American workers the raises they need and deserve. Election Day was no exception. Voters in Arizona, Colorado, Maine and Washington cast their ballots to ensure that hard work is rewarded with a fair wage.

The resounding win for minimum wage ballot initiatives in these states will collectively result in nearly 2.2 million workers getting a raise.*

  • In Arizona, the minimum wage will be raised to $12 by 2020, lifting the earnings of 779,000 workers. Flagstaff passed an even bigger raise − $15 by 2021.
  • In Colorado, the minimum wage will be raised to $12 by 2020, lifting the earnings of 477,000 workers.
  • In Maine, the minimum wage will be raised to $12 by 2020, lifting the earnings of 181,000 workers.
  • In Washington, the minimum wage will be raised to $13.50 by 2020, lifting the earnings of 730,000 workers.

The Election Day results are another reminder that for most Americans, raising the minimum wage isn’t a partisan issue but rather a commonsense decision. Twenty-nine states and the District of Columbia – home to 61 percent of all U.S. workers − have minimum wage rates above the federal rate of $7.25.

Voters and policymakers in these states understand what labor economists have spent decades researching and confirming: minimum wage increases have caused little to no significant job loss, but they have reduced employee turnover, strengthened families’ finances, and ultimately helped grow our economy. As our economy continues to recover from the greatest economic crisis in generations, we should all share in the prosperity we are building. And there is no easier way to do that than by raising the minimum wage.

By casting their ballots for a fair wage, the residents of Arizona, Colorado, Maine and Washington renewed President Obama’s call to take action. It’s time raise the minimum wage for all workers in America.

Dr. Heidi Shierholz is the department’s chief economist.

*Source: The Economic Policy Institute.

Note: In Arizona and Washington, the approved minimum wage ballot initiatives also require employers to provide paid sick leave to their employees. Expanding access to paid sick leavehas been another top priority of the Obama administration, and these ballot victories will help thousands more workers be able to address their health needs without putting their or their families’ economic security at risk.

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Finding A Way Forward: How I Am Greeting The New Year With Optimism

Today’s post comes from guest author Catherine Stanton, from Pasternack Tilker Ziegler Walsh Stanton & Romano.

I recently saw a quote that said “we are all just a car crash, a diagnosis, an unexpected phone call, a newfound love, or a broken heart away from becoming a completely different person. How beautifully fragile are we that so many things can take but a moment to alter who we are for forever”.   

During this holiday season, many of us will get together with our families and friends to celebrate our blessings but never expect that in the blink of an eye our lives can change dramatically. A very good friend of mine was celebrating Thanksgiving with her family when a pot of boiling water fell onto her and she suffered severe burns. After spending nine days in the Burn Center and in weeks of excruciating pain, she is living proof that there are no guarantees in life.  

A recent report by Fox News USA shows that unintentional shootings spike during the holidays and are more likely to occur than at any other time of the year due to a number of factors, including increased use of alcohol, holiday gifts of firearms, and children and teens being home from school with more free time. Many of us now rely on online shopping for our holiday gifts, which increases the amount of delivery vehicles on the road. Car crashes spike, as the December holiday season is one of the busiest travel times of the years. Factor in weather that does not always cooperate, and impaired drivers on the road as a result of holiday gatherings, and it is a recipe for disaster. Those who drive for a living are at an increased risk of injury or even death. 

Those who work in the retail industry are not immune from increased risk of injury either. Many of us won’t forget the Black Friday stampede in 2008 when a worker was trampled to death in a Long Island Walmart. In response to that tragedy, the company was fined, they agreed to adopt new crowd management techniques, and  the Occupational Safety and Health Administration (OSHA) issued Crowd Management Safety Guidelines for retailers. The stress of the holidays can cause depression, less sleep, and financial woes that can translate into violence. OSHA notes that workplace violence has remained among the top four causes of occupational death. 

But the promise of tomorrow brings optimism. As we embark on a brand new year, many of us will feel a sense of relief as 2016 was a year filled with turmoil. The presidential election was polarizing for many Americans. Friends became enemies and family members would not speak to one other. Many of us will look to the new year with a sense of a new beginning – a chance to have a fresh start, a renewal of sorts. Many of us will make resolutions to lose weight, to end a bad habit, to become a better parent, spouse or friend. Many will donate to charities. Despite our differences and shortcomings, Americans are among the most charitable nation in the world. According to Giving USA’s annual report in 2015, Americans gave an estimated $358 billion to charity the prior year. There are so many things we can do to improve our lives and the lives of those in our community and our nation. The list of possibilities is endless. For those of us who represent injured workers, we resolve to make workplaces safer and ensure that medical and indemnity benefits are available in the future. Wishing you all Peace, Love, and Good Health in the upcoming year.

 

Catherine M. Stanton is a senior partner in the law firm of Pasternack Tilker Ziegler Walsh Stanton & Romano, LLP. She focuses on the area of Workers’ Compensation, having helped thousands of injured workers navigate a highly complex system and obtain all the benefits to which they were entitled. Ms. Stanton has been honored as a New York Super Lawyer, is the past president of the New York Workers’ Compensation Bar Association, the immediate past president of the Workers’ Injury Law and Advocacy  Group, and is an officer in several organizations dedicated to injured workers and their families. She can be reached at 800.692.3717.

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Chemical Exposure in Chicken Plants

Today’s post comes from guest author Jon Rehm, from Rehm, Bennett & Moore.

Several members of Congress have written to Secretary of Labor Tom Perez, Secretary of Agriculture Tom Vilsack and Secretary of Health and Human Services Sylvia Burwell regarding the danger of the chemical PAA, which is used to sanitize chickens in poultry plants.

According to The Pump Handle blog written by occupational health expert Celeste Monforton, the increase in the use of PAA is linked to the Department of Agriculture’s “modernized inspection” system. Though meatpacking is well known for the prevalence of musculoskeletal injuries, chemical exposure is a less well-known, but similarly serious hazard, to meatpacking workers, which has been recognized by the Occupational Safety and Health Administration.

The hazards of chemical exposure are not limited to meat-processing workers. Chemical exposure fatalities are too common in rural America. Recently, a worker on an industrial cleaning crew in Beatrice, Nebraska, was killed from inhaling industrial cleaning chemicals. In October, a resident of northeast Nebraska was killed after inhaling chemicals from a leak in anhydrous ammonia pipeline. That same month, 125 residents of Atchison, Kansas, sought treatment for inhalation of chlorine gas from an explosion at a distiller.

While chemical exposure can often result in sudden death, ongoing exposure to chemicals can also create injuries that may not be apparent for years after the exposure. Unfortunately, Nebraska limits the ability of workers to recover for such injuries.

The letter about the hazards of PAA was written to outgoing cabinet members. The new Trump administration is expected to have a less-aggressive approach toward regulating the workplace. Hopefully the new administration will take the threat posed by hazardous chemicals in the workplace seriously.

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Federal “Takeover” of Work Comp?

Today’s post comes from guest author Charlie Domer, from The Domer Law Firm.

State workers’ compensation laws are facing increased scrutiny from the federal government.  As reported by NPR, the U.S. Labor Department is exploring the idea of further oversight of state-run workers’ compensation systems.  The full Labor Department report can be found here.

Traditionally, beginning with Wisconsin in 1911, individual states enacted, amended, and ran their own workers’ compensation system.  These systems certainly shared the similar overall framework of the “grand bargain” of work comp: an inability to sue an employer in exchange for defined benefits without proviing fault.  Within this framework, though, the state-led process allowed each state to tailor its approach in line with the industries of their state and particular legislative goals.

However, in the past decade or so, state legislative enactments around the country have significantly reduced (and in some cases, slashed) worker’s compensation benefits for injured workers.  A deep dive on the effect of these efforts was revealed in a series of stories by ProPublica and NPR.  The new Labor Department report echoes the refrain of these stories–indicating:

Despite the sizable cost of workers’ compensation, only a small portion of the costs of occupational injury and illness is borne by the employer. 

Costs are inappropriately shifted to the worker, their families, and the government (through other benefit programs).

Furthermore, with lowering costs on employers for workplace injuries, those employers–especially “high hazard employers”–have less incentives for safety or preventing injuries in the first place.  

As such, the Labor Department suggested the need to explore federal oversight or minimum federal standards for state workers’ compensation laws.  It even suggests the potential to reconvene a national commission–last seen in the 1970s–to study state workers’ compensation systems.  Any of these proposals would be major sea changes to the traditional state-led approach.

Whether any of these proposals will move forward is unknown, but one fact remains: based on legislative attempts to reduce injured workers’ benefits, the state-led workers’ compensation systems face increased scrutiny.   Pushed too far against workers, these laws face constitutional challenges–and ultimately the threat of federal oversight or takeover.

 

 

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2016 Top Ten Workers’ Compensation Fraud Cases

Today’s post comes from guest author Leonard Jernigan, from The Jernigan Law Firm.

  Number Value
Non-Employee Fraud Cases 10 $ 412,000,000
Employee Fraud Cases 0 $ 0
Total $ 412,000,000

Four of the top ten cases in 2016 are from perennial offender California, three from Florida, one each from Massachusetts and Texas, and one involving 20 different states. The misclassification of employees by employers continues to create dramatic financial fraud, with resulting cost shifting, lost tax revenues and hardship to inured employees. As we noted last year, while the “gig economy” pioneered by technology companies has lead to debate about new classifications for workers, these companies remain subject to our laws. We are starting to see widespread litigation and settlements like Uber’s $100 million payment to disgruntled drivers in California and Massachusetts. We’ll keep tracking these new developments in the context of the misclassification and fraud actions that we’ve been tracking for many years.

  1. (National) FedEx to Settle Driver Lawsuits in 20 States for $240 Million (6/16/16)
    FedEx Ground Systems, Inc. has agreed to pay $240 million to resolve claims by 12,000 FedEx drivers in 20 states. FedEx was labeling the drivers as independent contractors to avoid paying additional taxes, fringe benefits, health care costs, workers’ compensation insurance, and much more. The drivers were also not paid overtime or reimbursed for expenses.
  2. (California) Seven People Charged in $98 Million Workers’ Compensation Fraud Case (6/7/16)
    Seven in Riverside County charged with $98M medical fraud

    (Left): Payman Heidary Top row: Touba Pakdel Nabati, Jason Yang, Cary Abramowitz Bottom row: Quynam Nguyen, Ana Solis, Gladys Ross (Photo: Riverside County Sheriff’s Department)

    Seven people have been indicted with 107 felonies in a business scheme designed to commit workers’ compensation fraud. The ringleader, Peyman Heidary, owned or ran numerous businesses, including law firms and health clinics, and used other people to disguise his involvement and create an illegal ownership structure. The clinics were found to have inflated billings to insurance companies by exaggerating patient injuries and treatments. The businesses fraudulently billed more than $98 million to 18 insurance companies, resulting in the businesses receiving over $12.4 million in payments.
  3. (Texas) Labor Department “Mole” Helps Business Maintain $30 Million Workers’ Compensation Scam (6/28/16)
    Tshombe Anderson

    Tshombe Anderson

    Lydia Taylor worked at the U.S. Department of Labor in Dallas and used her position to give her family members information about federal workers’ compensation claims and warn them when suspicions arose about their fraudulent billing. Taylor’s uncle, Tshombe Anderson, was the ringleader of the group. Anderson and others formed several businesses that fraudulently billed the federal workers’ compensation program $30 million for unneeded and unrequested medical equipment for rehabilitation patients.
  4. (Florida) Fake Construction Company used to Process over $17.4 Million of Fraudulent Payroll (3/28/16) Orquidea Quezada set up Orquicely Construction LLC and used the company to process payroll for subcontractors who employed hundreds of people. In exchange for her services, Quezada kept a five percent fee. The scheme allowed the contractors to avoid paying payroll taxes, workers’ compensation insurance, and to conceal the employment of undocumented workers.
  5. (Florida) Fake Construction Company Used to Cash $7.4 Million in Undocumented Worker Payroll (7/7/16)
    Yamil Sanjurjo Cordero and Sandro Mendoza Alvarado

    Yamil Sanjurjo Cordero, 33, and Sandro Mendoza Alvarado, 35. (Sun Sentinel / Broward Sheriff’s Office Handout)

    Two men set up a shell company, Sunrise All Contractor Corp., to receive payments and cash checks for a fee on behalf of other companies that would then pay their undocumented workers. The scheme enabled employers to avoid workers’ compensation premiums and payroll taxes. These schemes are popular among employers of undocumented employees because these employees are less likely to blow the whistle on the fraud out of fear of exposing their undocumented status.
  6. (California) Insurance Company Agent Misappropriated $7.3 Million and Unable to Pay Workers’ Compensation Claims for California Indian Tribe (8/19/16) The operator of Management Resources Group California LLC, Gregory J. Chmielewski used more than $7.3 million from the company’s reserve accounts for his own personal investments. The company managed another company, Independent Management Resources, which sold workers’ compensation insurance to California Indian tribes. Chmielewski’s actions resulted in the company being unable to cover 117 claims.
  7. (California) Contractor Cheated Workers’ Compensation Insurer Out of More Than $5.4 million in Premiums(10/5/16) State of California Department of InsuranceMichael Harold Kreger, the owner of Michael Kreger Contracting was sentenced to 9 months in jail, 5 years of probation, 1500 hours of community service, and ordered to pay restitution of more than $5.4 million for underreporting his payroll and committing insurance fraud. Mr. Kreger cheated his company’s workers’ compensation insurer out of more than $5.4 million and his employees out of adequate protection for potential workplace injuries.
  8. (Massachusetts) Construction Companies Ordered to Pay $2.6 Million for Fraud in Misclassifying Workers (8/2/16) AB ConstructionForce Corporation, AB Construction Group, and employers Juliano Fernandes and Anderson Dos Santos were found by the U.S. Department of Labor to have misclassified the bulk of their employees to avoid paying overtime wages, workers compensation insurance, payroll taxes, and more. A consent judgment was entered requiring the companies and employers to pay more than $2.6 million in damages and penalties for their fraud.
  9. (California) Company Underreporting Payroll Defrauds Insurer of $2.1 Million (6/7/16)
    Alvin Shih Chen and Fiona Chen of Metro Worldwide, Inc.

    Alvin Shih Chen and Fiona Chen

    Co-owners Alvin Shih Chen and Fiona Chen of Metro Worldwide, Inc., a trucking company, underreported payroll by $4.7 million. The owners paid their truck drivers in cash to avoid reporting them to the insurer and to reduce their payroll obligation. While the company reported nearly $3 million in payroll to California’s State Compensation Insurance Fund, the actual payroll amount was $7.6 million. An estimated $2.1 million in premiums was lost.
  10. (Florida) Construction Company Defrauds Workers’ Compensation Insurer of $1.8 Million by Underreporting Payroll (4/6/16)
    Maira Chirinos, owner of Pompano Beach-based Tocoa Builders Inc.(Broward County Jail)

    Maira Chirinos, owner of Pompano Beach-based Tocoa Builders Inc.(Broward County Jail)

    Maira Chirinos, the owner of construction company Tocoa Builders, Inc. misrepresented information regarding the company’s operations, employees, and payroll when applying for a workers’ compensation policy. The misrepresentations enabled Chirinos to avoid paying at least $1.8 million in workers’ compensation premium payments. An investigation found Chrinos grossly underreported payroll to the insurance company. She reported a payroll of $76,000, but more than $11 million in payroll checks were cashed during the period covered by the policy.

For more information, contact: Leonard T. Jernigan, Jr. Adjunct Professor of Workers’ Compensation Law N.C. Central University School of Law The Jernigan Law Firm 3015 Glenwood Avenue, Suite 300 Raleigh, North Carolina 27612 (919) 833-0299 jes@jernlaw.com www.jernlaw.com Twitter: @jernlaw Blog: www.ncworkcompjournal.com

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Dollar Tree Store Cited and Fined for Willfully Exposing Workers to Safety Hazards

Today’s post comes from guest author Kit Case, from Causey Law Firm.

Note: A quick Google search led me to Glassdoor’s page covering Dollar Tree stores.  Many photos, mostly posted by managers and bemoaning their impossible working conditions, clearly show that the problem identified in Washington is widespread. The caption for the above photo reads “3,000 cartons in per week…” – kc

Dollar Tree Stores Inc., faces a $145,200 fine for workplace safety violations that knowingly put workers at risk.

The Department of Labor & Industries (L&I) recently cited the Virginia-based employer after an inspection at its Aberdeen store found serious, repeat safety hazards.

The company was cited for two willful safety violations, each with the maximum legal penalty of $70,000. Dollar Tree also received a $5,200 fine for a repeat-serious violation. The employer was previously cited for the same violations at its Chehalis location.

The first willful violation was for storing merchandise in a way that created a serious hazard. The inspection found the storage room was a crowded jumble of stacked boxes, bundles and containers that weren’t secured and could topple over at any moment. The haphazard stacks stood as high as nine feet, with heavy boxes piled on top of light ones. Some were leaning due to collapsed boxes or crushed corners.

Improperly stored merchandise can fall on employees causing serious injuries including contusions, broken bones, concussions or even death if the boxes cause an employee to fall and strike their head on the floor. Additionally, lifting heavy boxes into nine-foot stacks is likely to cause strains and sprains or serious back injuries.

The second willful violation cited was for not ensuring that exit routes were free of obstructions. At the time of the inspection, several aisles and passageways were blocked with merchandise. Employees did not have clear paths to emergency exits, and a doorway with two swinging doors couldn’t be exited because it was obstructed by stacks of merchandise or carts full of products.

In addition, there were hazardous products stored in the area, including helium cylinders that are explosive when heated, lighters, and plastic merchandise that would emit toxic fumes in a fire, increasing the danger to employees.

Dollar Tree was cited for a repeat-serious violation for not installing protective guarding or covers over light fixtures that could be struck and broken by the stacked merchandise. Breakage of overhead bulbs is likely to cause eye injuries or cuts from falling glass.

A serious violation exists in a workplace if there is a substantial probability that worker death or serious physical harm could result from a hazardous condition. A willful violation can be issued when L&I has evidence of plain indifference, a substitution of judgment or an intentional disregard to a hazard or rule.

The employer had 15 business days to appeal the citation.

Penalty money paid as a result of a citation is placed in the workers’ compensation supplemental pension fund, helping injured workers and families of those who have died on the job.

Photo credit: Glassdoor submission

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The High Cost of Fat

Today’s post comes from guest author Thomas Domer, from The Domer Law Firm.

We have reported regularly on the impact of obesity on workers’ compensation (see WFW October 2005 “Diabetes and Work Injuries” Alan B. King, M.D. and WFW Winter 2009 “The Rising Impact of Obesity on Workers’ Compensation” book review).

A recent study in the Journal of Occupational and Environmental Medicine, the official publication of the American College of Occupational and Environmental Medicine, in September 2016 reported that obese and overweight workers are more likely to result in higher costs related to workers’ compensation claims, especially for major injuries.

In a study analyzing 2,300 workers in Louisiana, Dr. Edward Bernacki of the University of Texas—Austin found that workers’ compensation costs and outcomes for obese workers (defined as a Body Mass Index of 30 or higher) incurred higher costs related to their workers’ compensation claim. This study noted that after three years about 10% of claims for significant injuries were still open, meaning the worker had not yet returned to work. Obesity and overweight did not play a role in the delayed return to work. However, for workers with major injuries, overweight was associated with higher workers’ compensation costs. In the group with the higher Body Mass Index, costs averaged about $470,000 for obese workers, $270,000 for overweight workers compared to $180,000 for normal weight workers (with a Body Mass Index between 25 and 30). The study made adjustments for other factors including the high cost of spinal surgeries and injections and, after making the adjustment for these factors, obese or overweight workers with major injuries were twice as likely to incur costs of $100,000 or more. Significantly, Body Mass Index had no effect at all on costs for closed claims or less severe injuries.

Previous studies (including a study in the Journal of Occupational and Environmental Medicine in 2015 linked obesity to a higher rate of workplace injuries and a longer time off. However, the cost effects were not studied until this recent assessment. The new results indicate obesity is a significant risk factor for higher costs in major workers’ compensation injuries.

One significant finding in the study was that more than three-fourths of the workers’ compensation claimants were overweight or obese. Further studies are planned. Previous studies include those from the National Council on Compensation Insurance, Inc. (NCCI) “How Obesity Increases the Risk of Disabling Workplace InjuriesEditor’s Note:  According to most studies, there is a strong correlation between Body Mass Index and injuries such as ankle fracture severity and increase risk of osteoarthritis. For workers’ compensation practitioners, one wonders whether these studies are a prelude to an assault on the “as is” doctrine. Each of us in our own practice can recognize some of the wide-ranging effects in costs of obesity, from special procedures for hospital treatment of obese patients such as open MRIs and more extensive surgical procedures to a reduced fuel economy in commercial vehicles due to fat drivers. Additionally, the cost of treatment for obese patients with work-related injuries increases the work-related injury potential to medical staff (lifting, transferring, etc.). Increasing admissions of severely obese patients leads to a corresponding increase in medical workplace injuries related to lifting and maneuvering obese patients. Workers’ compensation practitioners may see obesity as yet another “pre-existing condition” to surmount in future causation and extent of disability battles.