Workers’ Compensation Does Not Preclude A.D.A
- Posted By: Harvey Brown
- March 1, 1995
A United States District Court has ruled that an employee has rights under the Americans With Disabilities Act (“ADA”), in addition to those under the California workers’ compensation statutes.
The County of Alameda, the defendant in this case, tried to have a claim made by the plaintiff under the provisions of the Americans With Disabilities Act disallowed as being duplicative of benefits already available under the California Workers’ Compensation Act. The Defendant was asserting that ADA overlapped with the provisions of Labor Code Section 132 (a).
One of the major arguments that the defendants relied on was the exclusive remedy of the California Workers’ Compensation Act. This argument had previously been utilized with success in a Fair Employment and Housing Act (FEHA) case. In that decision, the court indicated that the exclusive remedy was applicable. The Court determined that the FEHA provisions for discrimination involving injuries was similar to the provisions of Labor Code Section 132 (a). Therefore, the Court felt that the exclusive remedy of workers’ compensation would apply so as not to duplicate benefits.
However, there is a difference in the type of case. The FEHA case was under state law. An ADA case comes under federal law. The defendant was arguing that in this instance state law-precluded relief under federal law. The County was trying to argue that the exclusive remedy under state law would preclude relief under federal law.
The Court specifically stated that the federal statute should not defer to any state remedy. The remedies in effect should be cumulative. Therefore, the applicant would have the benefit of both the state and federal laws. The Court looked as to Congress’ intent as whether the ADA statutes would defer to any state system and determined this was not the intent.
Once it was determined that the ADA did not by its terms defer to state law, it then had to determine whether federal preemption principles preclude giving effect to California’s exclusivity provisions. This analysis comes under the Supremacy Clause of The constitution. The question was whether the Workers’ Compensation Act conflicted with ADA. The Court found that the California Workers Compensation Act is preempted by the ADA.
Therefore, the District Court has determined that the applicant may have claims for discrimination under both Labor Code Section 132 (a) and ADA. The employer should be made aware of this potential.
- Posted In: Disability
Negligent Claims Handling Can Be Evidence Of Bad Faith
- Posted By: Harvey Brown
- February 1, 1995
These days one must be careful in how you adjust a workers’ compensation file. The appellate court in a number of recent rulings has determined the carrier or third party administrator adjusting the file can be liable for a ton of bad faith in poor claims handling, as well as, possible breach of contract.
This case involved an employer that was not satisfied with the claims handling they were receiving. They alleged that the carrier engaged in bad faith claims handling resulting in paying higher premiums and not receiving proper dividends.
The Court indicated that the employer might have a cause of action for negligent claims handling as evidence of bad faith and breach of contract actions.
The Court looked to their previous case Security Officers Service Inc VSCIF to conclude that you can breach the implied covenant of good faith and fair dealing You must conduct your claim resolution with good faith.
The case and its predecessors bring to the forefront that one has a responsibility and a duty to properly adjust and handle claims. This commences from the initial claim of injury all the way to case closure. Employers are looking at how effectively the injury claim is handled and disposed of. Issues will not only be whether the disposition was fair to the applicant, but also whether the claim was handled properly.
The Court is indicating that in the future causes of action the) may take into consideration the evidence of negligent claims handling This will be pertinent when it effects the employers premium in the future and any dividend policy. Competent performance by the adjuster at a reasonable cost is to be expected of the adjuster. The Court, therefore concluded, that a workers* compensation policy of insurance requires that the conduct of defending, investigating, reserving and settling claims be done in good faith.
The previous decisions have also indicated that these type of actions may be entitled to punitive damages if the employer is meritorious.
With the advent of the employers bill of rights, the employer is going to have greater access to material in the claims file. Although the concepts in the employers bill of rights have not been the subject of judicial review, they become extremely important: If the employer wished to vehemently fight a specific claim one must take great credence in the employers wishes. The employer not only has the legislative bill of rights, but may also have both contract and tort causes of action. In doing discovery in those causes of action they can second guess your claims handling.
Proper claims handling should be a plan. Systematic review on a timely basis is a necessity for every file. Proper investigation, denial if needed, and prompt payment will be closely scrutinized in the future.
- Posted In: Uncategorized
Written Denial Need Not Be Sent in 90 Days
- Posted By: Harvey Brown
- January 1, 1995
A recent appellate opinion has given new meaning to the 90-day denial notice. Most people were under the impression the applicant had to receive written denial of the claim by the 90th day of notice.
The case deals with the interpretation of Labor Code Section 5402. This section states in part:
“If liability is not rejected within 90 days… the injury shall be presumed compensable…. The presumption is rebuttable only by evidence discovered subsequent to the 90-day period.” The Court was concerned with what the “…employer must do in order for the liability to be ‘rejected’ within the meaning of Section 5402.”
In this case the denial notice was dated on the 89th day, but not received by the applicant’s attorney until the 96th day. period.
What the Court neglects to inform us in this decision is what will be considered a proper rejection. Whether a simple phone call denying the claim to the applicant or the applicant’s attorney will be left to future decisions. Whether the employer telling the claimant that the injury was not reported and therefore denied, will also be a subject of future decisions. When a medical indicates that there was no industrial injury will be a question of sufficient rejection for the Court to analyze. There are a myriad of possibilities that the imagination can come up with.
The safest course of action is to make sure the denial is timely sent and received. However, if it is not timely, do not automatically give up and presume there is a presumption. Gather the facts. When was there a rejection. Can you prove that a rejection was made within the 90-day period. The Court revised the decision on December 15,1994. They added in Footnote 4 a board panel decision as authority for the present decision.
The Judge at the trial level ruled the applicant had not sustained an injury. The applicant, on appeal, contended that the claim was not rejected within 90 days, so the Board should have admitted only evidence discovered subsequent to the 90 day period. The applicant, further contended, “that all the evidence admitted at trial against him was discovered prior to the expiration of the 90- day period and should have been excluded.” The Court focused its’ decision on the distinction between the rejection of a claim and the giving of notice (emphasis added) to the claimant that there has been a rejection.
The Court stated”…its the rejection which must occur within the 90-day period, not the notice of that rejection.” The court further clarifies that notice of the rejection does not have to be sent within 90 days, even if this is dictum.
What does all this mean? The Court specifically states that the wise practitioner will still take all steps necessary to ensure that the claimant is notified of the rejection of the claim of injury within the 90-day period. However, if one fails to give written notice to the claimant within that time frame, all hope is not lost. One still may be able to prove that a proper rejection was made within the 90-day period.
The Court revised the decision on December 15,1994. They added in Footnote 4 a board panel decision as authority for the present decision.
- Posted In: Work InjuryTags: Written Denial