MENTAL DISABILITY CLAIM DENIED DUE TO EMPLOYEE’S INTENTIONAL AND WILLFUL MISCONDUCT The Michigan Supreme Court, in a 4 to 3 decision, recently held that a mental disability arising out of discipline administered for the employee’s refusal to attend an employer-mandated event constituted “intentional and willful misconduct”, barring recovery of workers’ disability compensation benefits. Brackett, v Focus Hope, Inc., ___Mich___; ___NW2d___ (Case # 135375, July 30, 2008). MCL 418.305 provides that, “[i]f the employee is injured by reason of his intentional and willful misconduct, he shall not receive compensation under the provisions of this act.” When plaintiff was hired by the defendant employer, she was advised that the mission of Focus Hope was to seek racial equality and reconciliation. Plaintiff was advised that attendance at the annual Martin Luther King, Jr., Birthday Celebration, was mandatory. Plaintiff advised her supervisor that she would not attend the King Day event because it was being held in a city (Dearborn) where she and her family had had bad experiences as African Americans and because she believed the history of race relations in that city was not in keeping with Dr. King’s aspirations. Following the event, plaintiff was docked for two days’ pay and, later, some of her job responsibilities were taken away. Plaintiff subsequently met with the Chief Executive Officer (CEO). The CEO expressed her disappointment in plaintiff and said that plaintiff did not deserve to receive a paycheck from Focus Hope. When plaintiff asked if she was being fired, the CEO shrugged her shoulders and let plaintiff out of the office. The CEO testified that she remained calm and that she did not yell or threaten to fire plaintiff. Plaintiff alleged that the CEO’s comments traumatized her. Plaintiff left work and never returned. Plaintiff’s psychologist opined that plaintiff suffered a major depression precipitated by work events and that she was unable to work. At trial, the magistrate awarded plaintiff benefits, rejecting the defense argument that plaintiff’s misconduct barred her recovery of benefits under MCL 418.305. The Workers’ Compensation Appellate Commission and Court of Appeals affirmed the magistrate’s award of benefits. The Supreme Court reversed the judgment of the Court of Appeals, denying benefits. The Michigan Supreme Court cited its prior decision in Daniel v Dep’t of Corrections 468 Mich 34; 658 NW2nd 144 (2003). The Court held that the plaintiff’s refusal to attend the King Day event constituted intentional and willful misconduct. Because plaintiff's alleged mental disability flowed directly from the discipline for her misconduct, the Court held that plaintiff’s injury arose out of her intentional and willful misconduct, barring her recovery of benefits.

NEW BILL PROTECTS ILLEGAL ALIENS’ RIGHT TO WORKERS’ COMPENSATION On December 11, 2007, majority floor leader, Steve Tobocman (D-Detroit) and Senator Hansen Clarke (D-Detroit) introduced legislation apparently intended to nullify the Court of Appeals’ decision in Sanchez v Eagle Alloy, Inc., 254 Mich App 651, 658 NW2d 510, appeal granted, 469 Mich 955, 671 NW2d 874 (2003), vacated, application denied, 471 Mich 851, 684 NW2d 342 (2004) The bill proposes to amend §361 of the Workers’ Disability Compensation Act (MCL 418.361), adding the following language at the end of subsection (1): ""As used in this subsection, “commission of a crime” does not include an alien’s working without employment authorization or an alien’s use of false documents to obtain employment or to seek work."" In Sanchez, the Michigan Court of Appeals held that, once it was discovered that the employee was an undocumented, illegal alien, and the employer could no longer employ him, he was no longer entitled to weekly wage loss benefits. The Court reasoned that, by working without proper legal authorization, the employee was committing a crime under a federal law, the Immigration Reform and Control Act (IRCA), and was, therefore, barred from receiving wage loss benefits under MCL 418.361(1). Although initially granting leave to appeal the decision of the Court of Appeals, the Michigan Supreme Court later vacated the grant of leave to appeal, leaving the opinion of the Court of Appeals as the binding precedent on the illegal alien issue. The press release issued by the sponsoring legislators seems to include a misunderstanding that “all workers in Michigan . . . pay into the workers’ compensation fund” and have their wages taxed to provide workers’ compensation coverage. There is no state operated workers’ compensation fund in Michigan. Workers’ compensation coverage in Michigan is funded by employers, not employees. We shall follow the progress of this bill and keep you apprised of any significant developments. 1-4-08

STOKES v CHRYSLER - PROOF OF DISABILITY - DECIDED BY MICHIGAN SUPREME COURT The Michigan Supreme Court released its decision in Stokes v Chrysler LLC on June 12, 2008 (Case No. 132648). In a 4-3 decision, the court reversed the decision of the Court of Appeals (Stokes v Daimler Chrysler Corp., 272 Mich App 571 (2006)). The Court of Appeals had held that, once an employee had proved inability, due to a work related injury and impairment, to perform jobs the employee had previously performed, the employee had satisfied his burden to prove a baseline case of compensability and the burden then shifted to the employer to show that the employee was not disabled by proving that there were other jobs suitable to the employee’s training and qualifications which paid the maximum wages that the employee had previously earned. The Supreme Court held that an employee must show more than a mere inability to perform a previous job in order to shift the burden of proof to the employer. The Court held that the employee must prove that he is disabled from all jobs he is qualified to perform within the same salary or pay range as his maximum earning capacity at the time of injury. The employer would then have the opportunity to prove the existence of jobs paying the employee’s maximum wage within his qualifications and training, and prove that the employee is not disabled. The Court also required the employee to disclose all of his education, experience, skills, training and qualifications, whether or not relevant to the job the claimant was performing at the time of the injury. The Court, in overruling the Court of Appeals, held that the employer has the right to “discovery” regarding the employee’s transferable skills. The Court held that an employer had the right to retain a vocational expert to interview the employee and perform a transferable skills analysis. In summary, the Court clarified what the employee has to prove, and what information the employer has access to, in determining whether an employee is disabled within the meaning of the Court’s prior decision in Sington v Chrysler Corp, 467 Mich 144; 648 NW2d 624 (2002). It is important to remember that an employee only needs to prove inability to perform jobs within his or her maximum salary or pay range.STOKES v CHRYSLER - PROOF OF DISABILITY - DECIDED BY MICHIGAN SUPREME COURT The Michigan Supreme Court released its decision in Stokes v Chrysler LLC on June 12, 2008 (Case No. 132648). In a 4-3 decision, the court reversed the decision of the Court of Appeals (Stokes v Daimler Chrysler Corp., 272 Mich App 571 (2006)). The Court of Appeals had held that, once an employee had proved inability, due to a work related injury and impairment, to perform jobs the employee had previously performed, the employee had satisfied his burden to prove a baseline case of compensability and the burden then shifted to the employer to show that the employee was not disabled by proving that there were other jobs suitable to the employee’s training and qualifications which paid the maximum wages that the employee had previously earned. The Supreme Court held that an employee must show more than a mere inability to perform a previous job in order to shift the burden of proof to the employer. The Court held that the employee must prove that he is disabled from all jobs he is qualified to perform within the same salary or pay range as his maximum earning capacity at the time of injury. The employer would then have the opportunity to prove the existence of jobs paying the employee’s maximum wage within his qualifications and training, and prove that the employee is not disabled. The Court also required the employee to disclose all of his education, experience, skills, training and qualifications, whether or not relevant to the job the claimant was performing at the time of the injury. The Court, in overruling the Court of Appeals, held that the employer has the right to “discovery” regarding the employee’s transferable skills. The Court held that an employer had the right to retain a vocational expert to interview the employee and perform a transferable skills analysis. In summary, the Court clarified what the employee has to prove, and what information the employer has access to, in determining whether an employee is disabled within the meaning of the Court’s prior decision in Sington v Chrysler Corp, 467 Mich 144; 648 NW2d 624 (2002). It is important to remember that an employee only needs to prove inability to perform jobs within his or her maximum salary or pay range.

WHAT THE STOKES DECISION MEANS TO EMPLOYERS By: Leonard M. Hickey, Hickey Combs PLC On June 12, 2008, the Michigan Supreme Court issued its opinion in Stokes v Chrysler LLC. In a 4 to 3 decision, the Court provided clarification and guidance (mostly to lawyers) on what was required to prove disability under its prior decision in Sington v Chrysler Corp., 467 Mich 144; 648 NW2d 624 (2002), and the threshold of proof required of the plaintiff. Stokes does not change the definition of disability. It is important to keep in mind that Stokes does not change the definition of disability. The definition of disability was established in Sington v Chrysler Corp. In Sington, the court held that an employee’s disability is not measured against a single job, but is measured against the universe of jobs which are suitable to the employee’s qualifications and training, and which would pay the employee’s maximum reasonable wage. The Supreme Court read the prior opinions of the Workers’ Compensation Appellate Commission and Court of Appeals as holding that all the employee had to prove was inability to do the job by which he or she was injured, thereby shifting the burden of proof to the employer to show that the employee was not disabled by proving the existence of jobs suitable to the employee’s qualifications and training, within the employee’s medical restrictions, which would pay as much or more than the employee was earning at the time of the injury. The Supreme Court held that was an improper shifting of the burden of proof from the employee to the employer. The prior appellate opinions also held that the employer was not entitled to conduct any “discovery” to determine the extent and nature of the employee’s qualifications and training. Specifically, the employer was denied the opportunity to have the employee undergo a vocational assessment and transferable skills analysis by a qualified vocational rehabilitation counselor. The Supreme Court disagreed with the prior appellate opinions. The court held that the employee’s burden of proof is to show more than just inability to perform the job he was performing at the time of injury. The court stated it this way: The claimant must simply demonstrate in light of his injury that there are no reasonable employment options for avoiding a diminution in wages. If there are such options, a claimant’s wage earning capacity has obviously not been “limited” and he is not entitled to benefits; if there are not such options,then the claimant’s wage-earning capacity has equally obviously been limited, and he is entitled to benefits. Slip opinion at 24 (emphasis in original). The following excerpt from the conclusion in the Court’s opinion succinctly outlines its holding: The claimant bears the burden of proving a disability by a preponderance of the evidence under MCL 418.301(4), and the burden of persuasion never shifts to the employer. The claimant must show more than a mere inability to perform a previous job. Rather, to establish a disability, the claimant must prove a work related injury and that such injury caused a reduction of his maximum wage earning capacity in work suitable to the claimant’s qualifications and training. To establish the latter element, the claimant must follow these steps: 1. The claimant must disclose all of his qualifications and training; 2. The claimant must consider other jobs that pay his maximum pre-injury wage to which the claimant’s qualifications and training translate; 3. The claimant must show that the work-related injury prevents him from performing any of the jobs identified as within his qualifications and training; and 4. If the claimant is capable of performing some or all of those jobs, the claimant must show that he cannot obtain any of these jobs. If the claimant establishes all of these factors, then he has made a prima facie showing of disability satisfying MCL 418.301(4), and the burden of producing competing evidence then shifts to the employer. The employer is entitled to discovery before the hearing to enable the employer to meet this production burden. While the precise sequence of the presentation of proofs is not rigid, all these steps must be followed. Slip Opinion at 31-32. Practical application: Most people strive to find the highest paying jobs within their relevant, geographic labor market. Therefore, there is a very high likelihood that a claimant in a workers’ compensation case is earning the highest level of wages and benefits at the time of injury that he or she has in his or her work life. In other words, the job of injury represents the employee’s maximum reasonable wage earning capacity under Sington. In those cases, it will be the job of injury that will be the benchmark against which wage loss is measured under Sington. In cases where the job of injury is the highest paying the employee has had, and the employee is medically disabled from performing that job due to a work related injury, the vocational assessment, transferable skills analysis, and job search are unlikely to find available jobs, suitable to the employee’s qualifications and training, within the employee’s medical restrictions, which will pay as much or more than the employee earned at the job of injury. In those cases, the employer may choose not to exercise its rights under Stokes to obtain a vocational assessment and transferable skills analysis. Many times, the cost of the involvement of the vocational rehabilitation expert may outweigh the benefits. Another type of employee where there may be limited benefit to exercising the employers right under Stokes to conduct a vocational assessment, transferable skills and job search is the employee is known to have a low level of qualifications, training, education, and transferable job skills. This type of employee may be characterized by failure to obtain a high school diploma or GED and a work history involving only unskilled, common labor. One type of employee where an employer may want to take advantage of the opportunity under Stokes to obtain a vocational assessment, transferable skills analysis, and job search, is the employee who is known to be working below his or her qualifications, training, education and/or experience. Often times, these employee’s are identified by reviewing their employment applications and resumes. Those documents may reveal that the employee has a history of educational attainment, higher skilled jobs, higher paying jobs, and/or jobs involving supervisory or leadership roles. Perhaps they are working in a less skilled and lower paying job because of a workforce reduction, economic conditions, relocation, family circumstances, etc. In those cases, the potential benefit of involving the services of a vocational expert may outweigh the cost. One benefit of the Stokes decision to employers is that it imposes an affirmative obligation on the employee to disclose information which may not have been requested or included on a job application or resume. Stokes imposes a burden on the employee to demonstrate his or her qualifications and training. The court interprets “qualifications and training” broadly, to include education, job history, job experience, military service and training, vocational training, job related licenses, certifications and registrations, aptitudes, and talents. Disclosure of that information by the employee in the course of workers’ compensation litigation should help the employer make a decision on whether to incur the cost of a vocational assessment, transferable skills analysis, and job search. Stokes empowers employers and their attorneys to pose written questions (interrogatories) to employees, specifically requesting the qualifications and training information noted above. Stokes empowers Magistrate’s to order employee’s to answer the questions and provide the relevant information to employers. An employee’s meaningful responses to interrogatories requesting information about qualifications and training, may also permit the employer, its claims person, and its lawyer, to make a more informed judgment about the benefits versus cost of obtaining a vocational expert to conduct a vocational assessment and transferable skills analysis. The written interrogatory answers also afford the opportunity for the employer to provide a vocational expert with preliminary information which could assist the vocational expert in deciding whether a further vocational assessment is warranted or may provide sufficient information for the vocational expert to conduct an initial vocational assessment and transferable skills analysis. Meaningful interrogatory answers could provide a more cost effective way to develop information about an employee’s transferable skills and job openings for which they might qualify. Standard Form Interrogatories The Executive Committee of the State Bar of Michigan Workers’ Compensation Section, the Director of the Workers’ Compensation Agency, and the Board of Magistrates are preparing a standard form of draft interrogatories (questions) to be submitted to plaintiff employees in litigated workers’ compensation claims. It is contemplated that the interrogatories will be printed on an official Agency form. The interrogatories are being developed with input from vocational rehabilitation professionals. The purpose of the interrogatories is to elicit from plaintiff employees information regarding their qualifications and training. Theoretically, the plaintiff employee’s answers to the interrogatories could be submitted to a vocational rehabilitation professional to determine whether further vocational assessment and job search are likely to be fruitful. Other observations: The following are some additional observations about the Supreme Court’s recent decision in Stokes v Chrysler LLC: · Employees have the burden of proof; it is not the employer’s burden of proof to show that an employee can work. · Employees do not have to use a vocational consultant to prove disability. · Employee’s can meet their burden of proving disability by proving that they went out and looked for jobs, applied for jobs, and could not obtain jobs within their qualifications and training, which would pay them as much or more than their maximum wage earning capacity, because of their work related medical restrictions. · Employers can do discovery and obtain interrogatory answers before deciding whether involvement of a vocational expert or a formal vocational assessment are warranted. · Employers can have vocational experts review interrogatory answers to recommend whether further vocational assessment, transferable skills analysis, and/or job search is warranted. · For employees with low qualifications and training, there may be no benefit to a vocational assessment. Types of employee’s where Stokes may help to disprove disability: The following are categories of employee’s where a vocational assessment, transferable skills analysis and/or job search may be beneficial in disproving disability: · Underemployed employee’s who are working below their qualifications and training; · Employee’s working in professional fields; · Employee’s with management or supervisory experience; · Employee’s with situation-specific (e.g., allergies) or person-specific (e.g., psychological claims involving a particular supervisor) disabilities; and · Part-time, low wage earning employees. Things to remember about Stokes: · It does not change or create a new definition of disability; · It increases the employee’s burden of proof; · It requires employee’s to disclose all qualifications and training; · It permits the employer to engage in discovery to obtain additional information about the employee’s qualifications and training; · It permits the employer to undertake a vocational assessment. · The employer can undertake a cost versus benefit analysis in deciding whether to involve a vocational expert.

On July 17, 2007, a panel of the Michigan Court of Appeals issued an unpublished opinion in the case of Raybon v DP Fox Football Holdings LLC (Case No. 268634, July, 17, 2007). The court held that a professional football player was not entitled to receive wage loss benefits during the off season. The court reasoned, under prior Michigan Supreme Court decisions in Haske, Sington, and Sweatt, that the football player's ""loss of wages must be attributable to his work-related injuries rather than to the end of the football season and that he cannot receive wage loss benefits for time in the off season when he would not otherwise be earning wages."" The magistrate had held that a football player should be treated no differently than other Michigan seasonal workers, such as school teachers, lifeguards, and restaurant workers in resort towns, and should be entitled to receive wage loss benefits during the off season. This case is important because it signals a possible change in the law. Also, it may apply to other types of seasonal workers, precluding them from receiving wage loss benefits during ""off seasons"" when work would not otherwise have been available. Full text of the opinion can be found at the following link: http://courtofappeals.mijud.net/documents/OPINIONS/FINAL/COA/20070717_C268634_51_268634.OPN.PDF