Archive for June, 2013

Connecticut: The Hard Edge of Exclusive Remedy

Monday, June 24th, 2013

Connecticut is one of the highest cost states in the country, rising to #2 in the 2012 Oregon survey and a consistent source of pain to the state’s employers. So we might expect that it would prove flexible to the point of surrender in the contentious area of exclusive remedy. Not so. The state Supreme Court recently barred a factory worker from accessing tort liability in a case involving what appeared to be extreme employer misconduct.
Rajanikant Patel worked the night shift as a machine operator for Flexo Converters, a manufacturer of paper bags. He was injured while trying to remove a bag that was jammed in the machine he was operating. He claimed that the machine guard had been removed and that his supervisor ordered him to reach in and remove the bag. Patel further claimed that the supervisor would not allow him to shut off the machine and threatened to fire him if he fell short of his quota of 90 bags per minute. [I will think of Patel every time I am asked the inevitable question, “Paper or plastic?”] Patel did as he was ordered and suffered the consequences, although the court ruling does not specify the extent of his injuries.
Comp or Tort?
To pierce comp’s exclusive remedy shield, Patel must prove two distinct things: that his employer acted in full knowledge that he would be injured in carrying out the task and that his supervisor acted as an alter ego of the corporation. On the first point, the defense denied Patel’s version of the event, claiming that there was no substantial certainty that removing the stuck bag would injure Patel. On the second, and in this case more compelling point, there was no evidence that Patel’s supervisor was an “alter ego” of the corporation.
Here is the court’s summary of the alter ego issue, part of its approval of a lower court’s summary judgment in favor of Flexo:

In Jett v. Dunlap, supra, 179 Conn. 219, this court announced a narrow exception to the exclusivity of the act for intentional torts committed by an employer or a fellow employee ”identified as the alter ego of the corporation . . . .” The court expressly declined, however, to extend the exception to a supervisory employee’s intentional torts. The court reasoned that ”[t]he correct distinction to be drawn . . . is between a
supervisory employee and a person who can be characterized as the alter ego of the corporation. If the assailant is of such rank in the corporation that he may be deemed the alter ego of the corporation under the standards governing disregard of the corporate entity, then attribution of corporate responsibility for the actor’s conduct is appropriate. It is inappropriate where the actor is merely a foreman or supervisor.”

The alter ego test is stringent. The supervisory employee alleged to have intentionally injured the plaintiff must be the employer’s alter ego under the ”standards governing disregard of the corporate entity”; Jett v. Dunlap, supra, 179 Conn. 219; a test corresponding to the requirements for piercing the corporate veil. ”The
concept of piercing the corporate veil is equitable in nature. . . . No hard and fast rule . . . as to the conditions under which the entity may be disregarded can be stated as they vary according to the circumstances of each case.” (Citations omitted; internal quotation
marks omitted.) Naples v. Keystone Building & Development Corp., 295 Conn. 214, 233, 990 A.2d 326 (2010). The standard requires that the corporation, functionally
speaking, have no separate existence from the alter ego who controls and dominates the corporation’s affairs.

Connecticut has set a high standard for piercing the comp shield of exclusive remedy. This is not necessarily a bad thing, but it does raise a potential issue of fairness. Would the exclusion include egregious and potentially criminal acts by a supervisor: for example, a supervisor orders an employee to ignore standard safety procedures, using the threat of termination, and the employee is severely injured or even killed as a result. According to this ruling, as long as a “mere” supervisor directed the employee, and as long as the supervisor was not explicitly directed by company owners, the latter cannot be held accountable. Comp remains the only remedy for the injured worker.
Accountability in the Gray Zone
There may be enough ambiguity in Patel’s situation to justify the retention of the comp shield, but it is not difficult to imagine a situation where exclusive remedy shields a company from what should be the core responsibility of providing a workplace free from unusual risk of injury.
Patel may have been injured due to the wilful intent of his supervisor, but the court has ruled that his only recourse is comp. In Connecticut, “exclusive remedy” comes with a hard edge that basically cuts one way, in the direction of the state’s hard-pressed employers.

News roundup: Health wonks, aging issues, apps, ACA, women & more items of note

Thursday, June 20th, 2013

Health Wonkery – Sarah Sonies and Jennifer Salopek have posted Health Wonk Review: Rhetorical Question Edition at Wing of Zock, covering such topics as such topics as costs, insurance, policy, money, and more. Get your fix of health wonkery now – the next edition won’t be until mid-July.
Aging workforcePoor eyesight was the likely culprit in fatal 2012 train wreck. which claimed the lives of 3 Union Pacific crew members in Oklahoma. The driver – who repeatedly complained about his vision over the years – was one of the fatalities. Among his complaints: “… the engineer suffered from glaucoma and cataracts for much of his life, and in the three years leading up to the crash, he made about 50 visits to eye doctors and underwent about a dozen procedures. He had even complained about not being able to distinguish between the red and green stop and go signals that govern train traffic.” The National Transportation Safety Board determined that poor eyesight was the probable cause of the collision. “The board also proposed 16 safety recommendations for the railroad industry, unions and oversight agencies. Many of the recommendations deal with beefing up the frequency and quality of medical screenings for workers who have safety-sensitive positions. It also proposed implementing a workplace culture in which safety is placed above silence.”
There’s an App for That – NIOSH recently announced a new Ladder Safety smart phone app, saying that “This new app uses visual and audio signals to make it easier for workers using extension ladders to check the angle the ladder is positioned at, as well as access useful tips for using extension ladders safely.” it’s free and available for iPhone and Android devices.
Health Reform updates – For health reform updates with a slant to the impact on workers comp, you can’t do better for a guide than our friend Joe Paduda’s informed commentary on his blog, Managed Care Matters. His most recent post on the topic: Implementing health reform, random report 1. If this is an issue on your radar, check back with him often.
Health Care Innovation – We’re fans of Dr. Atul Gawande on this blog so we were pleased to learn that he is launching a health care innovation lab. If you are unfamiliar with Dr. Gawande, this excerpt from the link offers a bit of insight: “Gawande, a surgeon at Brigham and Women’s Hospital, has been named one of the world’s most influential thinkers. The surgical checklist he promotes has been gaining traction worldwide since 2008, when it’s use in a World Health Organization project reduced deaths during surgery by nearly 50 percent. The list is a set of questions everyone in an operating room answers, starting with: Do we have the correct patient? What operation are we performing? And is the site marked?” We look forward to developments. (Hat tip to Tinker Ready for the pointer – her Boston Health News blog is worth keeping an eye on.)
Women & comp – At CompTime, Roberto Ceniceros has a post on Working moms and workers compensation, citing a recent Pew Research Report on “Breadwinner Moms.” The implications of the report are significant, Ceniceros notes, because according to the National Institute for Occupational Safety and Health “women face different workplace health challenges than men.”
Massachusetts employers take note – Employment law attorneys Paul G Lannon and Matthew Mitchell post that Massachusetts employers may be liable to out-of-state employees misclassified as independent contractors on JDSupra Law News. They look at a decision issued May 17, 2013, Taylor v. Eastern Connecticut Operating, Inc.. They offer several lessons employers should take from this ruling – first and foremost being awareness that Massachusetts independent contractor and overtime pay statutes may apply to non-residents working outside the state.
Lead-poisoned workers – At The Pump Handle, Celeste Monforton provides accumulating evidence that thousands of workers are poioned by lead each year, and a preponderance of those who are sickened are hispanic workers. The exposure is highest in battery manufacturing, secondary smelting/refining non-ferrous metals, and painting. She cites recent related cases from OSHA inspections and violations as well as a recent report by the California Department of Public Health, along with the most recent national assessment.
More on Lab Safety – Following up on yesterday’s post about academic lab safety, we point to this article in Chemistry World on Laboratory Safety Goes Digital. The article talks more about the Dow Lab Safety Academy.
From the “Bad Idea” file – Reports from Japan say that some companies are using banishment rooms as an alternative to termination.
More news of note

NIOSH issues a video alert on counterfeit and altered respirators

More on the painful path to academic lab safety

Wednesday, June 19th, 2013

Later this month, UCLA’s chemistry professor Patrick Harran will face four felony charges in the laboratory death of his 23-year old research assistant Sheri Sangji. Harran is pleading not guilty to charges that revolve around his alleged failure to provide protective equipment and clothing, failure to provide training, and failure to correct unsafe working conditions. By way of background: In December 2008, Sheri Sangji was working with t-butyl lithium, a substance that ignites on contact with air. A drop spilled on her clothing causing an instant conflagration. She suffered second and third degree burns over 40% of her body, and died 18 days after the fire.
Our usual go-to source on this case is the blogger Chemjobber, who reported on some of the court proceedings leading up to these charges. He includes this statement from the trial judge

In court today, Judge Lisa B. Lench heard brief oral arguments from both sides, first on the issue to dismiss and then on the motion to reduce charges. She commented that the issues presented in the case were interesting and novel. She also said that Harran was unique compared with the usual defendants moving through the criminal justice system.

The judge is right in using the word “unique.” Employers rarely face criminal charges for worker deaths. Generally, in all but the most egregious circumstances (and even then…), workers comp is the exclusive remedy for employee grievances and OSHA is the usual path for safety violations. In this case, a fine was imposed on UCLA.
One of the other unique things about this case is the culture in which this accident occurred. There’s a strong “blame the victim” thread that runs through comments on stories, as well as protestations that the academic and/or the scientific arena is “different.” When we first read about and discussed the case,some criticism was directed at us for naivete, stating that health and safety personnel were unqualified to oversee “exotic” scientific protocols. (See our prior posts, More on the UCLA lab death of Sheri Sangji and Follow-up on the death of Sheri Sangji: a painful path to academic lab safety.)
Sheri Sangji’s death and the subsequent criminal proceedings against Harran have sparked a great deal of controversy in the academic scientific community – and on the more positive side, appear to have been a catalyst for a more serious look at university lab safety. Beryl Lieff Benderly of Science reports on a yearlong study of lab safety in nonindustrial institutions that was launched in May by the National Academies:

“An overriding theme at the meeting was the nature and size of the disparity between safety cultures and practices in industrial and academic settings. I have long heard from safety experts–and stated in my writing–that industry’s safety record far surpasses that of academe. Typical of this view is a letter by officials of three major industrial corporations, Dow, Corning, and DuPont, that was recently published in Chemical & Engineering News and was quoted at the May meeting. “The facts are unequivocal,” the letter asserts. “Occupational Safety & Health Administration statistics demonstrate that researchers are 11 times more likely to get hurt in an academic lab than in an industrial lab.”

Benderly goes on to explore many reasons why a safety gap exists in the academic environment – among them, a wide variation in or lack of standards, a high value on independence, the lack of a hierarchical structure to enforce accountability, and various cultural barriers and resistance:

“As a result, the report continues, “At academic research institutions, PIs may view laboratory inspections by an outside entity as infringing upon their academic freedom. … To combat cultural issues (such as fiefdoms) and bring a focus to safety within any given organization, it is important to ensure that the reporting structure allows for communication of safety information to those within the organizational hierarchy that have the authority and resources to implement safety change.”

The Harran trial will be watched closely by many in academia – it’s a painful situation all around. The best possible outcome of this tragic situation would be a heightened focus on lab worker safety – and it appears to be having some effect in prompting greater industry/education partnerships to heighten safety. Case in point: the recently launched Dow Lab Safety Academy.

Health Wonkery, Cost Shifting, Profiteering, DBA, PEOs, Women in Risk Management & More

Thursday, June 6th, 2013

New Health Wonk Review – Jason Shafrin has posted Health Wonk Review: Jeopardy Edition at Healthcare Economist. Put your health wonkery to the test.
Cost shifting – A recent study by NIOSH researchers reports that many work-related injuries treated in emergency rooms aren’t being billed to workers comp. The figure approaches 40%, according to Celeste Monforton, who discusses this study in a post at The Pump Handle, Hefty portion of work-related injury costs not paid for by workers’ comp, others picking up the tab. “The analysis involves four years of data from the National Hospital Ambulatory Medical Care Survey (NHAMCS), a representative sample of U.S. emergency room visits. An estimated 458 million emergency department (ED) visits occurred between 2003-2006, based on the representative sample of 146,296 cases. The researchers specifically examined the subset of emergency room visits which were coded as a work-related injury or illness.” She notes that while not all workers are covered by workers comp, other may prefer private insurance out of fear of some disciplinary action. The impact of the study is enormous, both in terms of the economic cost-shifting implications and the accuracy or work-related injury data.
On the case – Joe Paduda looks at The next revenue-generator for work comp profiteers.
Healthcare hygiene“With drug-resistant superbugs on the rise, according to a recent report by the federal Centers for Disease Control and Prevention, and with hospital-acquired infections costing $30 billion and leading to nearly 100,000 patient deaths a year, hospitals are willing to try almost anything to reduce the risk of transmission.” Anemona Hartocollis of the New York Times writes about the lengths that hospitals are going to and the strategies they use to get workers to wash their hands. She notes that the incentives for action are strong because under new federal rules, hospitals stand to lose Medicare money when patients get preventable infections. In a related initiative, NIOSH is looking to improve poor compliance with respiratory protection requirements and proper use recommendations in healthcare settings. NIOSH issues an invitation to be part of formulating a solution: Improving Respirator Use and Compliance in Healthcare
NFL vs CA – Roberto Ceniceros of Business Insurance offers an update on the ongoing California-NFL court battles about work comp indemnity rights. “A California appellate court has given a temporary victory to 32 insurers that are battling the National Football League over defense and indemnity rights under 187 commercial general liability policies purchased over 45 years.”
The Modern Claims Adjuster – At Risk & Insurance, Peter Rousmaniere looks at the image myths vs reality of the modern claim’s adjuster, and in the process, offers some clues as to what a savvy TPA shopper should be looking for in measuring performance.
Patriot CoalTrouble ahead: What the Patriot Coal ruling means for the future of Southern West Virginia’s coalfields – Ken Ward talks about the recent federal bankruptcy judge ruling which approved Patriot Coal’s plan to dump its union contract and its retiree health-care plan. He looks at what this decision and other issues might signify about the viability of the industry.
Defense Base Act – “The final withdrawal of U.S. military forces from Iraq in December 2011 may have brought to a decisive conclusion an almost decade long conflict in the region, but much remains in question when it comes to how U.S. Government Contractors are protected from tort liability should their employees be injured, become ill or die in country while on company business. U.S. corporations should be aware of which form of workers’ compensation applies to their employees should a work-related incident occur.” Michal Gnatek of the Lockton Companies offers a whitepaper: After the Fire: Status of Defense Base Act in Postwar Iraq.
PEOs – In his post Surprise! PEOs Not As Bad As Thought, Dave DePaolo talks about the recent NCCI report on PEOs. Despite a few high profile bankruptcies, “…the NCCI report suggests that non-PEO employers might do better if they managed risks as well as PEOs do. / “The conventional but untested wisdom has been that PEOs are a problem,” NCCI Chief Economist Harry Shuford tells WorkCompCentral. “Our analysis suggests that this is not supported by the data.
The Most Dangerous Job in the World?How did 900 bus drivers end up dead in Guatemala City? – a riveting read about the mind-boggling dangers some workers face just to put bread on their family’s table.
Risky Women – When it comes to women in the senior ranks, Lori Widemer says that the United States is lagging far behind most other countries. “The proportion of women in senior management in the United States paled by comparison to countries such as Russia, with 36% of all senior execs being women, and Thailand, which topped Grant Thornton’s survey with 45% of senior managers being women.” She looks at the tea leaves, and makes the case for Why Women Should Lead Risk Management in Risk Management magazine.
Call for Evangelists – Annmarie Geddes Baribeau issues a call for more work comp evangelists to convert CEOs to the cause of worker’s comp. We agree – every organization’s priorities are set in the corner office and if you don’t have deep-rooted employer commitment to make comp a priority, it won’t be.
OSHA – OSHA introduces a new campaign for fall protection in construction
First RespondersThe Boston Marathon Bombings: Lessons Learned for Saving Lives – a video featuring first responders, sponsored by WBUR and Harvard in the Harvard School of Public Health’s Forum series.
Pro-tip to fraudsters – If you are going to commit fraud, it’s probably a good idea to avoid TV game show appearances. (hat tip to Hank at InsureBlog for the pointer.)
Brief Takes