Human Resources Update: Best Practices in Employment Law, HR & Risk Management

1. K&F KISSINGER & FELLMAN, P.C. Human Resources Update: Best Practices in Employment Law, HR & Risk Management Presented By: Paul D. Godec, Esq. Nancy C. Rodgers, Esq. Kissinger &Fellman, P.C. 3773 Cherry Creek North Drive Suite 900 Denver, CO 80209 Phone: 303.320.6100 Fax: 303.327.8601 KandF.com

2. K&F KISSINGER & FELLMAN, P.C. The Bermuda Triangle of Employment Law: ADA, FMLA, and Workers’ Compensation Presented by: Paul D. Godec, Esq. KandF.com

3. Various rules, requirements and guidelines apply to workers’ compensation claims: • The Workers’ Compensation Act; • The Division of Workers’ Compensation Rules of Procedure; • The Division of Administrative Hearings Rules; • Guidelines Provided by the Division on Claims Adjusting Procedures; and • ICAP, Court of Appeals, and Supreme Court opinions. Workers’ Compensation

4. “To assure the efficient delivery of disability and medical benefits to injured workers at a reasonable cost to employers, without the necessity of any litigation, recognizing that the workers’ compensation system in Colorado is based on a mutual renunciation of common law rights and defenses by employers and employees alike.” Workers’ Compensation Act Created: C.R.S. 8-40-102

5. Faster and quicker system for administering benefits to injured employees. • by dictating exact procedures and providing specific remedies and defenses by statute. • Created requirements regarding insurance for work-related injuries so that sufficient funds exist to provide reimbursement to injured employees. • Rules for quick adjudication of disputes. How has Workers’ Comp. Act performed? System has worked well, for the most part.

6. Cannot be sued or be found liable under any other statute or common law theory of liability other than Worker’s Compensation Act. If employer has complied with the Act . . .

7. Employer's insurance shall furnish medical, surgical, dental, nursing, and hospital treatment. • Employer’s insurance shall provide all reasonable medical, hospital, and surgical supplies, and other apparatus. • . . . Necessary to cure and relieve the employee from the effects of the injury. First Things First

8. Under Workers’ Compensation Act, employer has the right to select the physician who treats the injured worker. • However, in the absence of employer designation, ATP is any provider chosen by employee. Authorized Treating Physician (ATP) C.R.S. § 8-43-404(5) Rule 16-2(B)(1)

9. Employer’s insurer liable for emergency medical care even if not provided by ATP • But once emergency stabilized, the employee must give notice to the employer, and employer maintains your right to select the ATP. Sims v. ICAO, 797 P.2d 777 (Colo. App. 1987) Emergency Medical Care

10. Ways to squander our right of designation of the ATP • Failure to designate “forthwith”. • Case law indicates that designation must occur as soon as the employer has some knowledge of accompanying facts that would indicate to the reasonable conscientious manager that the case might involve a potential worker’s compensation claim. Forthwith - - - Right away without delay.

11. Squandered opportunity to designate ATP • Failure to designate ATP by acceptable method. • Verbal authorization of ATP is acceptable but not recommended. Amorelli v. Amorelli, W.C. No. 4-436-946 (September 26, 2001).

12. Employee Requirements • Employee must notify employer of injury in writing within 4 days of the occurrence . . . but if physically or mentally unable to provide notice, employee’s foreman, superintendent, manager, or supervisor who knows of the injury shall submit written notice. Any other person who knows of the injury also may report the injury to employer which relieves the claimant of his reporting obligations.

13. Employee Requirements Penalty for Employee’s failure to Report • If no written report within four days, employee “may” lose up to one day’s compensation for each day’s delay to report. • If employer has not provided necessary postings regarding reporting, penalty is tolled.

14. Employer/Insurer RequirementsNotices and Reports • Employer must keep record of all injuries that result in: • Fatality; • Permanent physical impairment; • Lost time of three shifts or calendar days. C.R.S. § 8-43-101 (1) and W.C.R.P. 5

15. Employer/Insurer RequirementsNotices and Reports Must make reports regarding occupational disease such as: • Chronic respiratory disease; • Cancer; • Coal worker’s lung, Asbestosis, Silicosis; • Nervous system diseases; • Blood borne infectious, contagious diseases. Rule 5-2(B)(2)

16. Employer/Insurer RequirementsNotices and Reports • Insurer or third party administrator may file the First Report of Injury on behalf of employer. • After July 1, 2006, first report of injury and notice of contest must be submitted by electronic format, but not by email. C.R.S. 8-43-101(2)

17. Employer/Insurer RequirementsNotices and Reports • Must be filed within 20 days after the first report of injury is filed. • Penalty for Failure to Timely Admit or Deny Either employer or insurer may be liable for a penalty of one day compensation for each day’s failure to notify. Admission of Liability or Notice of Contest C.R.S. § 8-43-203(1)(a) C.R.S § 8-43-203(2)(a)

18. Compensability and Defenses If subcontractor does not have workers’ compensation coverage for employees injured on job site, the general contractor is liable for that injury. C.R.S. § 8-41-401

19. Compensability and Defenses Independent contractors or sole proprietors are not considered employees and, thus, not covered under the Workers’ Compensation Act.

20. Compensability and Defenses Factors to consider: • Exclusive work for one employer? • Does employer establish quality standards, or provide instruction or oversight on how the work will be performed? General plans and specifications permissible. • Does worker receive payment on a salary or hourly basis instead of on a fixed or contract rate? • Can worker be terminated without terminating independent contract? Indepen-dent Con-tractor if: Free from control & direction in performance of service

21. Compensability and Defenses • Does worker receive more than minimal training? • Does worker provide tools (except materials and equipment)? • Does worker receive benefits (health coverage, vacation, sick days)? • Do employer dictate time of performance (beyond mutually agreeable work hours and time for completion)? • Does worker receive payment in individual name or in the name of the trade or business that they own? • Does employer combine business operations with the individual worker? Indepen-dent Con-tractor if:

22. Compensability and Defenses Course and Scope of Employment: • Was employee performing services arising out of and in the course of her employment? • If not, injury is not work-related and not compensable. • Considerations: • Was she on the clock? • Was she providing a benefit to Employer? • Was she outside of her job duties or outside of the normal place of performance? • Had she deviated from her job at time of injury?

23. Compensability and Defenses Lost wages recoverable at 2/3 of average weekly wage. Temporary Total Disability Benefits (TTD) Continue until: • Claimant reaches maximum medical improvement; • Claimant returns to regular or modified employment; • ATP gives claimant written release to return to full duty; • ATP gives claimant written release to return to modified duty and employer gives written return to work offer, but employee fails to show up. Lost Wages and Indemnity Benefits

24. Compensability and Defenses Brought back to work at reduced hours or lower pay? Claimant receives 2/3 of difference between her pre-injury average weekly wage and her modified income. Temporary Partial Disability (TPD) Lost Wages and Indemnity Benefits

25. Permanent Impairment Rating provided by ATP after claimant reaches MMI. • Directed by AMA Guides to Impairment. • Designed to compensate claimant for future and ongoing loss of earning potential. • Employer may challenge final disability rating through a Division IME but requires “clear and convincing evidence.”

26. Return to Work Considerations 1. Can claimant physically come back to previous job? If permanent restrictions permit performance of prior job, can return to that job. 2. Can claimant return to any job? If cannot return to any job in job market, may be permanently and totally disabled (PTD) and will receive 2/3 of average weekly wage for remainder of natural life. Three questions in workers’ compensation:

27. Return to Work Considerations 3. Does employer want claimant back? • Fear (legitimately or not) that claimant may re-injure and bring new claims for additional benefits? • Is claimant well enough to return? • Are there any safety or performance (e.g., prescribed medication) issues to consider? Three questions in workers’ compensation:

28. Offsets, Credits, Penalties • Willful failure of employee to use safety devices provided by employer. • Willful failure of employee to obey any reasonable rule adopted by employer. 50% Reduction in Compensation Benefits! Safety Rule “Willful” is something more than negligence.

29. Offsets, Credits, Penalties • If employee willfully misleads about physical ability to perform a job; and • Employee suffers subsequent injury resulting from that physical inability. 50% Reduction in Compensation Benefits! Willfully Misleads “Willful” is something more than negligence.

30. Offsets, Credits, Penalties Injury result from presence of non-prescribed drugs in workers’ system or blood alcohol level above 0.10% Proper policies and testing procedures? 50% Reduction in Compensation Benefits! Intoxication or drugs

31. Offsets, Credits, Penalties • Claimant admits to receiving benefits through fraud; • Civil judgment or Criminal conviction entered for obtaining benefits through fraud. Credit for Compensation Benefits paid! Fraud

32. Offsets, Credits, Penalties When temporarily disabled employee becomes responsible for termination, resulting wage loss not attributable to on-the-job-injury. • Reason for termination will be scrutinized to determine if reasonable or unrelated to injury. • If claimant’s restrictions increase after termination, temporary disability benefits will be restarted. Termination for Cause C.R.S. § 8-42-103(1)(G):

33. HorseplayWhile the boss is away . . . Horseplay in workplace that results in injury may not be compensable, because a deviation from employee’s job. Considerations: • Extent and seriousness of deviation; • Completeness of deviation (commingled with the work?); • Horseplay accepted practice in workplace?; • Whether type of employment expects to include some horseplay. • Lori’s Family Diner v. ICAO, 907 P.2d (Colo. App. 1995)

34. Workplace Assaults • Assaults that have an inherent connection with employment because of “enforced contacts” which result from duties of job. • Arguments over work performance • Arguments over work equipment • Delivery of paychecks Generally considered within the course and scope of the job and compensable. Three categories of assaults:

35. Workplace Assaults • Neutral Force type Assaults. • Stray bullets • Roving lunatics • Drunks • Mistaken or unexplainable attacks Analyzed with a “positional risk” or “but for” test but generally compensable. Three categories of assaults:

36. Workplace Assaults • Private disputes brought to workplace: • Example: Claimant shot at work because co-worker thought he was making obscene phone calls to spouse. Generally not compensable. Three categories of assaults:

37. Claim ClosureWhen is it over? • Division Order • Final admission of liability • May reopen up to six years after date of injury (or two years after last benefits payment). • Settlement on a full and final basis

38. Claim ClosureWhen is it over? • Statute of Limitations Right to compensation and benefits is barred, unless within 2 years after the injury or death, a notice claiming compensation is filed with the Division, Or 3 years with a good reason. Reopening is not an option once the statute of limitations has run. C.R.S. 8-43-103(2) Maybe before it ever began……

39. Claim ClosureWhen is it over? • Causation Limitations • If disability begins more than 5 years after the date of injury, it is conclusively presumed not to be due to the injury. • Except for certain exposures to radioactive materials, substances, or machines or to fissionable materials. C.R.S. § 8-41-206

40. Employer/Insurer Requirements • Death cases • Death after two years from injury shall be prima facie evidence that death unrelated to injury. • Except for certain exposures to radioactive materials, substances, or machines or to fissionable materials. C.R.S. § 8-41-207

41. Subrogation Defined Employer/Insurer “stands in the shoes” of Claimant and may pursue recovery of benefits paid when, and if, injuries and/or damages arose from act of negligent third party. At fault third-party should bear the financial burden for Injured Worker’s injuries and/or damages. An Equitable Assignment of a Claim or Right Subrogation:

42. Overview:Americans with Disabilities Act (“ADA”) • Designed to protect disabled individuals against discrimination in employment. • Provides that employers may not discriminate against “disabled” individuals either in hiring or employment. • Requires leave or other “reasonable accommodations” for the known disabilities of applicants and employees.

43. Americans with Disabilities Act (“ADA”) Generally, a private employer must comply with the ADA if it has at least 15 employees for 20 or more calendar weeks (which need not be consecutive) in the current or preceding calendar year.

44. Whom Does ADA Protect? For ADA protection, an individual must be a job applicant or an employee who satisfies two requirements: • She is disabled; and • She is qualified to perform the essential functions of the job (with or without reasonable accommodation).

45. Whom Does ADA Protect? An employee is “disabled” for ADA purposes if she satisfies any one of three conditions: • She has a physical or mental impairment that substantially limits one or more major life activities; • She has a record of an impairment; or • She is regarded or perceived as having an impairment. Disabled?

46. Substantial Limitations An impairment “substantially limits” a major life activity if an individual is: • Unable to perform a major life activity that someone in the general population can perform; or • Significantly restricted as to the condition, manner, or duration under which she can perform a major life activity compared to someone in the general population.

47. Determination of “Substantial Limitations” Consider three factors: • The impairment’s nature and severity; • How long the impairment will last or is expected to last; and • The actual or expected permanent or long-term impact of the impairment.

48. Note Regarding Limitations Temporary, non-chronic impairments of short duration such as broken limbs, sprained joints, concussions, appendicitis, are not ADA-protect disabilities.

49. Major Life Activities Include: • Caring for oneself • Performing manual tasks • Sitting • Standing • Lifting • Walking • Interacting with others • Seeing • Hearing • Speaking • Breathing • Learning • Concentrating • Working • Communicating

50. “Intellectual Disabilities” Include Under the ADAAA, “intellectual” disabilities could include: This expanded list of “per se” disabilities means no argument remains that persons with these conditions have become disabled for purposes of ADAAA. • Inability to learn • Bipolar disorder • Post-traumatic stress disorder • Obsessive compulsive disorder • Schizophrenia • Major depressive disorder • Attention Deficit Disorder (ADD) or Attention Deficit Hyperactivity Disorder (ADHD)