Workers’ compensation provides benefits to workers who are injured on the job or have a work-related illness. Benefits include medical treatment for work-related conditions and cash payments that partially replace lost wages. Temporary total disability benefits are paid while the worker recuperates away from work. If the condition has lasting consequences after the worker heals, permanent disability benefits may be paid. In the case of a fatality, the worker’s dependents receive survivor benefits.

Before workers’ compensation laws were enacted, an injured worker’s only legal remedy for a work-related injury was to bring a tort suit against the employer and prove that the employer’s negligence caused the injury. Under the tort system, workers often did not recover damages; those who did recover damages sometimes experienced delays or high costs in doing so. Although employers generally prevailed in court, they nonetheless were at risk for substantial and unpredictable losses if the workers’ suits were successful. Ultimately, both employers and employees favored legislation to ensure that a worker who sustained an occupational injury or disease arising out of and in the course of employment would receive predictable compensation without delay, irrespective of who was at fault. As a quid pro quo, the employer’s liability was limited. Under the exclusive remedy concept, the worker accepted workers’ compensation as payment in full and gave up the right to sue the employer.

Workers’ compensation programs are designed and administered by the states. The programs vary across states in terms of who is allowed to provide insurance, which injuries or illnesses are compensable, and the level of benefits. Generally, state laws require employers to obtain insurance or prove they have the financial ability to carry their own risk (that is, to self-insure).

Workers’ compensation is financed almost exclusively by employers, although economists point out that workers pay for a substantial portion of the costs of the program in the form of lower wages (Leigh and others 2000). The premiums paid by employers are based in part on the industry classifications of the employers and the occupational classifications of their workers. Many employers are also experience rated, which results in higher (or lower) premiums for employers whose past experience demonstrates that their workers are paid more (or fewer) benefits than workers for similar employers in the same insurance classification.

In 2002, workers’ compensation covered 125.6 million workers (Thompson Williams, Reno, and Burton 2004). Total wages of covered workers were $4.6 trillion and total workers’ compensation benefit payments were $53.4 billion, which amounted to $1.16 per $100 of covered wages. Employers’ costs for workers’ compensation—defined here as premiums written for policies in the calendar year, payments made under deductible arrangements, and the benefits and administrative costs of self-insurers—were $72.9 billion. Benefits and costs have declined from a peak in the early 1990s (Chart 1).

Chart 1. Workers’ compensation costs and benefits per $100 of payroll, 1989–2002

SOURCE: National Academy of Social Insurance estimates.

The difference between workers’ benefits and employers’ costs per $100 of covered wages is accounted for by expenses such as administrative and loss adjustment costs, taxes, and contributions for special funds, which can include the support of workers’ compensation agencies, and the insurers’ profits or losses.

Social Security Disability Insurance

Workers’ compensation in the United States is surpassed in size only by the federal Social Security Disability Insurance and Medicare programs in providing cash and medical benefits to disabled workers.

Although Social Security disability benefits and workers’ compensation are the nation’s two largest disability benefit programs, the two programs are quite different. Workers are eligible for workers’ compensation benefits from their first day of employment, but Social Security disability benefits are paid only to workers who have a substantial work history. Workers’ compensation provides benefits for both short-term and long-term disabilities and for partial as well as total disabilities. These benefits cover only disabilities arising out of and in the course of employment. In contrast, Social Security disability benefits are paid only to workers who have long-term impairments that preclude any gainful work, regardless of whether the disability arose on or off the job. By law, the benefits are paid only to workers who are unable to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment that is expected to last at least a year or result in death. The impairment has to be of such severity that the worker is not only unable to do his or her previous work but is also unable to do any other type of substantial gainful work. Social Security disability benefits begin after a 5-monthwaiting period.

The amount of benefits that Social Security paid in wage-replacement benefits to disabled workers and their dependents in 2002 was nearly twice the amount of cash benefits paid under workers’ compensation—$65.6 billion compared with $29.2 billion. Employer and employee each pay 5.3 percent of wages for Social Security’s Old-Age and Survivors Insurance and 0.9 percent for Disability Insurance. Thus, the total paid for Disability Insurance is 1.8 percent of taxable wages.

Trends in Social Security Disability Benefits and Workers’ Compensation

Social Security disability benefits and workers’ compensation had different trends in benefits paid relative to covered payroll. Social Security disability benefits grew rapidly in the early 1970s and then declined through the late 1980s, after policy changes in 1977 and 1980 reduced benefits and tightened eligibility rules. From 1989 to 1996, Social Security benefits again rose as claims and allowances increased during the economic recession of 1990–1991 (Chart 2). Since then, benefits relative to covered wages have been fairly stable (Board of Trustees 2004).

The trend in workers’ compensation benefits as a share of covered wages follows a very different pattern. Total workers’ compensation benefits (cash and medical combined) were less than Social Security disability benefits during the 1970s but grew steadily throughout the 1970s and surpassed Social Security disability benefits in the mid-1980s. While Social Security disability benefits were flattening out during the mid-1980s, workers’ compensation payments continued to grow at a rapid rate. Then, as workers’ compensation payments declined as a share of covered wages after 1992, Social Security disability benefits rose.

The opposite trends in workers’ compensation and Social Security disability benefits during much of the past 25 years raise the question of whether retrenchments in one program increase demands placed on the other, and vice versa. The substitutability of Social Security disability benefits and workers’ compensation for workers who have significant, long-term disabilities that are, at least arguably, work related, or might be exacerbated by the demands of work, has received little attention by researchers and is not well understood (Burton and Spieler 2001).

The Offsets

An offset for concurrent receipt of workers’ compensation was contained in the original 1956 Social Security disability program, eliminated in 1958, and reinstituted in 1965. The 1965 Social Security Amendments required that Disability Insurance benefits be reduced when the worker is also eligible for periodic or lump-sum workers’ compensation payments, so that the combined amount of workers’ compensation and Social Security disability benefits does not exceed 80 percent of the worker’s average current earnings. The combined payments after the reduction, however, will never be less than the amount of total Social Security disability benefits before the reduction. Average current earnings are defined as the highest of

• the average monthly wage on which the unindexed disability primary insurance amount is based,
• the average monthly earnings from covered employment and self-employment during the highest 5 consecutive years after 1950, or
• the average monthly earnings in the calendar year of highest earnings from covered employment during the 5 years ending with the year in which disability began.

Total earnings, including those above the Social Security taxable maximum, are used to determine average current earnings.

The intent of the offset provision is to ensure that the combined benefits from workers’ compensation and Social Security are not excessive. The offset of Disability Insurance benefits applies to disabled workers under the age of 65 and their families. Benefits for a worker’s spouse or dependent children are offset before the offset is applied to the worker’s benefit. Under the 1965 law, the Social Security disability benefit will not be reduced if the state workers’ compensation law or plan provided for a reverse offset (a reduction of the workers’ compensation benefit of a worker also receiving Disability Insurance).

The Omnibus Budget Reconciliation Act of 1981 (Public Law 97-35) ended the option for additional states to adopt reverse offsets. It also extended the Social Security disability offset to apply to certain public disability benefits paid by federal, state, or local governments. In particular, it applies to disability benefits that are earned in employment that is not covered by Social Security—for example, in jobs that are covered by the California Public Employees’ Retirement System and not by Social Security. At the time of the 1981 legislation, 16 states and Puerto Rico had reverse offset statutes, which remain today.

When a workers’ compensation law provides for periodic payments but permits a lump-sum settlement that discharges the liability of the insurer or the employer, the settlement is subject to the offset. In this case, the lump sum is prorated to reflect the monthly rate that would have been paid had the lump-sum award not been made. Medical and legal expenses incurred by the worker in connection with workers’ compensation may be excluded when computing the offset.

Specifically excluded from these offset provisions are all Department of Veterans Affairs’ benefits; needs-based benefits; federal, state, or local disability benefits that are based on employment that was covered by Social Security; and private pension or private insurance benefits.

In December 2003, about 7.6 million beneficiaries (workers and dependents) received Social Security Disability Insurance benefits. Of those beneficiaries, about 1.3 million, or about 17 percent, had some connection to workers’ compensation or public disability benefits.¹ That connection includes those who

received workers’ compensation or public disability benefits,

had received workers’ compensation or public disability benefits in the past,

received a lump-sum settlement in lieu of periodic benefits, or

had claims pending for workers’ compensation or public disability benefits.

Of those with a connection to workers’ compensation or public disability benefits,

about 1 million were disabled workers, and about 240,000 were dependents;

about three-fourths were connected to workers’ compensation and one-fourth to other public disability benefits;² and

53 percent of disabled workers had a pending connection or claim, and 47 percent had a prior connection.

The percentage of Social Security Disability Insurance beneficiaries with a connection to workers’ compensation or public disability benefits varies by state of residence, in part because workers’ compensation programs vary, as do rules for coverage of public employees under Social Security and alternative public disability benefits. Jurisdictions with the highest percentages of workers with a connection to workers’ compensation or public disability benefits are California, Puerto Rico, Rhode Island, and West Virginia.

Jurisdictions with the lowest percentages include the District of Columbia (just 5 percent), Indiana (7 percent), Wisconsin (about 8 percent), and North Carolina (9 percent).

As a result of the accident, our client suffered neck and back sprains/strains, and also suffered from a shoulder injury which did not respond to either physical therapy or injections. Our client was diagnosed as suffering from Subacromial Impingement Syndrome and required an arthroscopic subacromial decompression of the left shoulder. Following the surgery and a long course of physical therapy, our client recovered from his injuries and was released back to work without any restrictions.  Following a long negotiation with the Workers Compensation Insurance Carrier, this claim settled for $45,000.

Case No. 909090MH – 2009 Virginia Workers’ Compensation Claim

Below are a list of the most popular types of cases that are handled by the Barrera Law Firm in Virginia and the statutes of limitations pertaining to them:

Wrongful Death – a wrongful death claim must be filed within two years of the date of death.

Personal Injury – a personal injury lawsuit must be filed within two years of the date of injury.

Medical Malpractice – lawsuits against health-care providers must be filed within two years of the date of the act that gave rise to the claimed injury. If a minor is victim to medical malpractice and is under the age of 8, he has until his 10^th birthday to file suit.

Product Liability – lawsuits must be filed within two years after the victim suffers the injury.

Minors under the age of 18 are a special case and sometimes the statute of limitations apply in unique ways that can only be understood and put to use by a skilled legal representative.

It would be a shame and perhaps a grave error to miss out on filing a case before its statute of limitations ends. If you are unsure whether your case has potential to be tried due to the statute of limitations, do not hesitate to contact the Barrera Law Firm today – we can get your case filed and tried in a timely manner so that you can receive the compensation you deserve.

For most states, paydays are either biweekly or semimonthly. Biweekly payroll involves paydays that occur 26 times per year, such as every other Friday. Semimonthly payroll refers to paydays that occur 24 times per year, such as paydays that occur on the 15th day and the last day of every month.

In the District of Columbia, employees are supposed to be paid semi-monthly

In Maryland employees are supposed to be paid biweekly.

In Virginia this law is complicated. Depending on their profession, employees may be paid monthly, biweekly, or semimonthly. Employees whose weekly wages total more than 150 percent of the average weekly wage of the Commonwealth may be paid monthly, only upon agreement of each affected employee. Executive, administrative, and professional personnel must be paid at least monthly. For most employees however, payday should occur at least 2 times a month, either every other Friday, or, the 15th and last day of every month.

If you are only being paid once a month, and you never signed anything allowing your employer to pay you so infrequently, you might be in need of legal assistance and workers compensation. Most importantly, you must know your rights they are your best tools against injustice. If you need a lawyer who is accomplished in workers compensation law in D.C., Maryland, and Virginia, do not hesitate to contact the Barrera law firm today.

Here are some facts to consider if you are a worker at risk for burn injury:

Did you know…

• The majority of people hospitalized for workplace scald and contact burns are involved in food preparation.
• Teenagers employed in fast food restaurants as fry cooks are at special risk for burn injuries. During busy periods, inexperience and the pressure of “keeping up” can result in burn injuries.
• In Deep Frying, hot oil can reach temperatures of 300° to 500°F, making this task a potential high risk for burns and personal injuries.

Burns usually occur when:

• Work site management has not enforced safety rules
• Workers or employers ignore safety rules
• Shortcuts are taken or workers are time-pressured
• Persons become too familiar with their job and take unnecessary risks
• Workers are ill, tired or compromised by drugs or alcohol and unable to concentrate.

Workplace burn injuries result from contact with:

• Hot liquids and steam
• Hot oil and grease
• Hot substances such as food or sauces
• Hot surfaces – stoves, grills, ovens
• Fires from hot grease or oil
• Exposed electrical wires or improperly maintained electrical appliances or equipment.

What can you do to protect yourself?

• Wear protective gloves or mitts when handling hot pots or cooking with hot deep-frying oil.
• Wear non-skid shoes to prevent slipping on wet or greasy tile floors.
• Extinguish hot oil/grease fires by sliding a lid over the top of the container. · Never carry or move oil containers when the oil is hot or on fire.
• Avoid reaching over or across hot surfaces and burners. Use barriers, guards or enclosures to prevent contact with hot surfaces.
• Read and follow directions for proper use of electrical appliances
  

(Source: Burn Foundation www.burnfoundation.org)

In addition to tremendous pain and suffering burn injuries can result in large losses of time and money put towards medical attention. Your job occupation should never involve routine risk or pain. If injured you should get treatment immediately. If your employer is unwilling to acknowledge or provide treatment for your injuries, you are in need of a lawyer who can make sure you receive adequate treatment and workers compensation. Every worker has the right to a safe workplace. Know and defend your rights, call our office today!

e potential to contain hazardous substances. It is the responsibility of your employer to insure that the building materials and tools used in construction are safe and do not put you, the worker, unnecessarily directly in harms way. If you work in Fairfax, Arlington, or Alexandria Virginia, or Maryland or DC and you think you might be injured as a result of hazardous or faulty building materials, you should immediately seek both medical and legal assistance. Here at the Barrera Law Firm we are always helping workers who are victim to exactly the types of employer carelessness listed below. You have the right to a safe, healthy work environment in Virginia, Maryland, and Washington DC – defend your rights, call us now!

AAJ: Drywall Manufacturers Should Register with CPSC; Have Strict Labeling Requirements
For Immediate Release: February 17, 2010

Washington, DC—Recent hazards associated with drywall show the need for greater labeling and registration requirements, according to comments submitted to the Consumer Product Safety Commission (CPSC) by the American Association for Justice (AAJ). The comments are in response to the agency’s notice seeking guidance regarding identifying labels for drywall.

“Mandating a set of uniform markings on all drywall would greatly assist homeowners and investigators in isolating the source of drywall problems,” according to AAJ’s submitted comments.

Drywall, especially drywall manufactured in China, has been identified by the CPSC as containing high levels of hydrogen sulfide, causing corrosion of metals in homes and contributing to numerous health-related problems. To date, the agency has not recalled any drywall or clearly identified any specific batches of the bad drywall, making the scope of the problem difficult to quantify. The agency is now moving to establish protocols to identify homes with the corrosive drywall and determine effective remediation procedures.

AAJ’s comments request the CPSC to:
Require labels to include enough information so that the drywall remains easily identifiable when installed, including manufacturer name, plant name and location, date of production, and batch or lot number.
Ensure the location of the labels be easily accessible, including labeling both sides of the drywall.
Require drywall manufacturers that import drywall into the U.S. to register with the CPSC, including plant locations and the names and descriptions of products.

“There is little doubt that the previous lack of oversight over drywall has contributed to the prolonged problems thousands of homeowners are experiencing,” said AAJ President Anthony Tarricone. “New guidelines will help aid in quickly identifying any problematic drywall in the future and make it easier to recall the product, if needed,” added Tarricone.

As of late January, the CPSC had reported receiving over 2800 incident reports related to drywall from 37 states and the District of Columbia.

On February 19, 2010, the U.S. District Court in New Orleans will begin an evidentiary hearing to hold Taishan Gypsum, a Chinese manufacturer of drywall, in default for failing to respond to a putative class action brought by builders that used the Chinese company’s drywall in homes. The Chinese drywall multidistrict litigation bellwether trial will begin on March 15, 2010.

Source: American Association for Justice, http://www.atlanet.org/cps/rde/xchg/justice/hs.xsl/11693.htm

IN THE WORKERS COMPENSATION COMMISSION

FRANCISCO GABRIEL RAMIREZ-GUTIERREZ, Claimant

Opinion by DUDLEY

Commissioner

v.                                                                                                                               VWC File No. 227-72-99

CLEAN SCAPE, INC., Employer

- NO RECORD OF INSURANCE -

Daniel P. Barrera, Esquire

The Chandler Law Group

1650 King Street

Suite 505

Alexandria, VA  22314

for the Claimant.

Arturo H. Hernandez, Esquire

Arturo H. Hernandez, P.C.

2915 Hunter Mill Road

Suite 18

Vienna, VA  22124-1716

for the Employer.

Douglas A. Seymour, Esquire

Siciliano, Ellis, Dyer and Boccarosse, P.L.C.

10521 Judicial Drive

Suite 300

Fairfax, VA  22030

for the Uninsured Employers’ Fund.

REVIEW on the record by Commissioner Tarr, Commissioner Diamond, and Commissioner Dudley at Richmond, Virginia.

This case is before the Commission on the employer’s request for Review of the Deputy Commissioner’s November 9, 2006, Opinion.  The employer assigns error to the findings that the claimant sustained a compensable injury by accident and that it had more than three employees and failed to obtain workers’ compensation insurance.  The Uninsured Employers’ Fund asserts that the Deputy Commissioner erred in finding ongoing disability.  Finding no error, we affirm.

The facts of this case are not in dispute.  The Deputy Commissioner accurately summarized the evidence, and we will repeat it only as necessary in this Opinion.  Initially, we note that all parties agree that the claimant is an undocumented alien.

The evidence shows that on January 12, 2006, the claimant was working at a private residence on an incomplete deck.  He stepped on a board that was not attached, and it swung up and hit him in the back of his head.  The claimant fell from the deck onto the concrete below, sustaining injuries to his head, shoulder, chest, hip, and hand.  He was taken to the emergency room, and received stitches and initial treatment for his other injuries.  The claimant was referred to Dr. Christopher L. Hess, orthopedic surgeon, for his hand injury.

On March 9, 2006, Dr. Hess performed surgery on the claimant, and recommended another surgery, which has not been performed.  The doctor last treated him on September 29, 2006, and he has not worked since January 12, 2006.  The claimant admitted at the Hearing that he was physically capable of some types of work, but that he was an undocumented alien without a vehicle or driver’s license.

The claimant testified that he worked for the employer in 2003, and then again in 2005, and that Gerardo Gutierrez-Oriza, the owner, agreed to pay him $10 per hour to work 50 hours per week.  He wore a red t-shirt like the other employees wore, which bore the company name, and Gutierrez-Oriza provided the tools and sent him to the worksites.  The claimant listed the following workers:  Gerardo Gutierrez-Oriza, Carlos Dolesky (his supervisor), Angela Gutierrez, Gregorio Mesa, Florencio Romero, Lilan Matamoros, and Isabel Avellaneda.  The claimant also stated that the company provided cleaning services to an elementary school and used approximately ten other employees for that location.

Angela Gutierrez, secretary, testified that the employer had less than three full-time employees, and that Dolesky was an independent contractor.  Gutierrez stated that most of the other individuals identified by the claimant were either day laborers that would come and go, or part-time employees.  She said that she and her husband were officers of the corporation, and that this information was consistent with the Answers to Interrogatories and information from the Insurance Department of the Virginia Workers’ Compensation Commission printed from the State Corporation Commission database.

After careful Review, we find no error and affirm the Deputy Commissioner’s decision.  The evidence is uncontroverted that the claimant was working and performing the tasks of his employment at the time of his injury.

To recover benefits, the claimant must establish by a preponderance of the evidence that he suffered an injury by accident arising out of and in the course of [his] employment, Code 65.2-101, and that the conditions of the workplace . . . caused the injury.  Plumb Rite Plumbing Serv. v. Barbour, 8 Va. App. 482, 484, 382 S.E.2d 305, 306 (1989).

Falls Church Const. Corp. v. Valle, 21 Va. App. 351, 359-60, 464 S.E.2d 517, 522 (1995).  Accordingly, we find that on January 12, 2006, the claimant sustained a compensable injury by accident to his head, shoulder, chest, hip, and hand.

Next, we agree that the employer clearly had three or more employees, and is subject to the provisions of the Virginia Workers’ Compensation Act (Act).

[W]hen an employer defends a claim on the ground that it is not subject to the provisions of the Act, the commission must make two distinct inquiries.  First, the commission must determine whether the employer carried its burden of proving, by a preponderance of the evidence, that, at the time of the alleged incident, it had regularly in service fewer than three employees in Virginia.  Second, if the employer sustains this burden of proof, the commission must then determine whether, at the time of the alleged incident, the employer’s established mode of performing business regularly required three or more employees. If so, the employer will be deemed subject to the provisions of the Act even though it had fewer than three employees on the date of the alleged incident.

Perry v. Delisle, 46 Va. App. 57, 65, 615 S.E.2d 492, 496 (2005).

Here, the employer failed the first prong of the test.  Corporate officers are employees, whether they are paid or not.  The record shows that, in addition to Gerardo Gutierrez-Oriza and Angela Gutierrez, Carl Pfeifer and Janaan Manternach were also listed as officers.  The claimant was an employee, as well as several of his co-workers and the workers employed to clean the elementary school.  The employer failed to prove that these individuals were not its employees, and it also failed to obtain workers’ compensation insurance as required by Virginia Code 65.2-801, Code  65.2-802, and  65.2-804.

Virginia Code  65.2-805 provides that if any employer fails to comply with the provisions of Code  65.2-800 or  65.2-804, it shall be assessed a civil penalty of not less than $500, nor more than $5,000.  The Deputy Commissioner assessed a penalty of $5,000 for the employer’s failure to comply, and we find that to be a reasonable penalty.

Finally, a review of the available medical evidence shows that Dr. Hess provided the claimant with an out-of-work slip on September 29, 2006.  The doctor recommended a second surgery and stated that he was currently unable to work.  There is no further medical information in the file.  The claimant has been unable to obtain further treatment due to a lack of funds and other health insurance.  We agree that disability does not continue indefinitely without ongoing medical treatment.

There is no presumption in the law that once a disability has been established, a claimant will be assumed to remain disabled for an indefinite period of time.  To the contrary, a party seeking compensation bears the burden of proving his disability and the periods of that disability.  Marshall Erdman & Assocs., Inc. v. Loehr, 24 Va. App. 670, 679, 485 S.E.2d 145, 149 (1997).

Uninsured Employer’s Fund v. Clark, 26 Va. App. 277, 285-86, 494 S.E.2d 474, 478 (1998).  However, in the instant case, the treating physician has recommended surgery, which due to litigation, has not been approved.  The claimant may think that he can perform some types of work, but there is no medical support for his belief.  Without medical evidence that he can perform the work that he thinks he can perform, we decline to agree that he can work.  Further, we decline to penalize the claimant for his inability to obtain surgery that may place him on the road to a return to work.

Accordingly, the Opinion of the Deputy Commissioner is AFFIRMED.

Interest is payable on the award pursuant to Virginia Code  65.2-707.

The attorney’s fee to be deducted from accrued compensation and paid to Daniel P. Barrera, Esquire, for legal services rendered the claimant, is hereby increased to a total of $2,500.

This matter is removed from the Review docket.

APPEAL

This Opinion shall be final unless appealed to the Virginia Court of Appeals within 30 days of receipt.

cc: Mr. Francisco Gabriel Ramirez-Gutierrez

7212 Normandy Lane

Falls Church, VA  22042

Clean Scape, Inc.

7535 Lisle Avenue

Falls Church, VA  22043

CMI Octagon, Inc.

P.O. Box 85631

Richmond, VA  23285

There are various things you can do help you receive all that you deserve in your Virginia Workers Compensation Case. One of the most important is to develop and nuture your relationship with your treating physician. I have seen many clients who are needlessly suspicious of their doctor because the doctor is “working” for the Workers’ Compensation insurance carrier. Good or bad, it is a fact of life that your doctor will be paid by workers compensation insurance. If that makes him biased against you, then that doctor must be biased against all patients. On the other hand I have seen clients who have a good working relationship with their physician.

I can honestly state that those clients who got along well with their doctor, generally did better than those who did not. This seems to be morte a matter of human nature than anything. You tend to want to help people who you like and may not be so willing to help those who you do not get along with.

If at all possible, try to develop a good working relationship with your physician. The treating physician will likely be evaluating your permanent partial disability at some point, so why not try to make sure you get as high a rating as you can.

IN THE WORKERS’ COMPENSATION COMMISSION

Published at 79 O.W.C. 24

RAFAEL FLORES, Claimant

Opinion by the

• • • • • • • • COMMISSION

v.                                         V.W.C. File No. 193-57-99

D B & A GENERAL CONTRACTORS, INC., Employer

MONTGOMERY MUTUAL INSURANCE COMPANY, Insurer

Daniel P. Barrera, Esquire

for the Claimant.

Lisa A. Cay, Esquire

for the Defendants.

REVIEW on the record before Commissioner Diamond, Commissioner Dudley, and Deputy Commissioner Dely at Richmond, Virginia.

Flores requests review of the October 27, 1999 Opinion of the Deputy Commissioner, who concluded that the Commission had no jurisdiction over this foreign injury claim.  We Reverse.

Flores alleged that he was employed by D B & A General Contractor, and that he injured his right hand and fingers while attempting to unclog a lawnmower on September 27, 1998.  D B & A General Contractor stipulated that there was an injury by accident on that day, but the employer denied that Flores was an employee of D B & A, or that the claimant was working for the employer at the time of the accident, or that the claimant’s alleged period of disability was supported by the evidence.  It also disputed that the claimant was contemporaneously employed in similar employment, which would serve to augment the claimant’s statutory average weekly wage.  The employer also denied that the Commission had jurisdiction over the accident, which occurred in the District of Columbia.

The Deputy Commissioner addressed only the issue of jurisdiction in her Opinion, and we limit our review to that issue.  In other words, we do not at this stage in the proceedings decide whether or not the claimant was an employee in fact, or whether he was an employee at the time of the accident, or whether he was an independent contractor.  We decide only that the Commission has subject matter jurisdiction to consider such facts.

Va. Code Ann. 65.2-508 provides, in pertinent part, that,

A. When an accident happens while the employee is employed elsewhere than in this Commonwealth which would entitle him or his dependents to compensation if it had happened in this Commonwealth, the employee or his dependents shall be entitled to compensation, if:

1. The Contract of employment was made in this Commonwealth; and

2. The employer’s place of business is in this Commonwealth; and provided the contract of employment was not expressly for service exclusively outside the Commonwealth.

In order to establish our jurisdiction, the claimant has the burden to prove that he satisfies all these factual prerequisites.

The claimant had worked for D B & A General Contractors at an earlier time, and he was working in early 1998 for another employer.  The uncontradicted evidence establishes that Carl Bernstein, the corporate president of D B & A, telephoned the claimant at his [the claimant's] home in Alexandria, Virginia in January or February 1998 to request that Flores return to work with D B & A on weekends.  The claimant accepted.

Flores testified that he understood that he was to work for D B & A at various locations in Virginia, and also in the District of Columbia.  Bernstein testified that the claimant worked for D B & A only in Virginia, and that the work Flores performed in the District was work performed for him [Bernstein] personally.  The claimant suffered his injury while performing work for Bernstein in the District.  Flores testified that approximately 80% of his work was performed in Virginia, and the rest in the District, while Bernstein estimated that 70 – 80% of the work was performed in the District.

The Deputy Commissioner held that the Commission lacked jurisdiction for this foreign injury, because “the majority of the work done by the claimant was in D.C.”  This implicitly acknowledged the undisputed fact, even if the testimony of the employer was accepted without question, and even if the documentary evidence produced by the employer pursuant to discovery was incomplete, that at least some of the work was to be performed in Virginia.  The pertinent language of Code 65.2-508(A)(2) clearly instructs that jurisdiction lies if “the contract of employment was not expressly for service exclusively outside of the Commonwealth.”  In other words, where the employee is assigned to perform any work in the Commonwealth, however deminimis, we have jurisdiction.  Here, the employer himself testified that the contract of employment was for work to be performed in Virginia, so we certainly have jurisdiction.  Jurisdiction would still lie if the employee is assigned work outside Virginia, pursuant to his contract of employment.  The Deputy on Remand will have to make that determination.

We note here that the Deputy Commissioner in her Opinion did not address the other elements of Code 65.2-508.  In the interests of judicial economy, and because the evidence presented at the evidentiary hearing was clearly dispositive as to these questions, we will rule on them on Review.

We first consider whether the contract of employment was made in Virginia:

Under familiar principles of conflicts law, when the acts “which constitute offer and acceptance are scattered over more than one state . . . [t]he authorities are reasonably clear that, in this event, the contract is made at the same time and place “where the last act necessary to the completion of the contract was done – that is, where the contract first creates a legal obligation.”  American Conflicts Law, Robert A. Leflar, et al., @ 145, at 408-09 (4th ed. 1986) (citing 1 A. Corbin, Contracts @ 55 et seq. (1963); 1 S. Williston, Contracts @ 97 (W. Jaeger 3d ed. 1957); Restatement of Contracts @ 74 (1932)).

Tummino v. Fleet Transit, Inc., VWC File No. 186-97-73 (April 23, 1999).  An oral contract of hire made in Virginia is effective for the purposes of Code 65.2-508.  Whitley v. Cardinal Freight Carriers, Inc.,  VWC File No. 166-03-27 (November 9, 1994), citing Locastro v. Power Specialists, Inc., VWC File No. 136-32-58 (September 6, 1989).  Here, where the employer effectively came to Flores’ home, in this case by telephone, and made a job offer, the acceptance by Flores at that time constituted the completion of the contract of employment.  Thus, we find that the early 1998 contract of employment with Flores was made in the Commonwealth.

No ore tenus evidence was presented to establish that the employer had a place of business in Virginia.  However, the claimant filed W-2 Tax Forms, time logs, and cancelled checks from the employer as evidentiary exhibits, which established that D B & A had places of business in McLean and in Manassas Park, Virginia.  Even if these were established for bookkeeping and administrative purposes only, it sufficiently satisfies the requirements of Code 65.2-508.  See CLC Construction, Inc. v. Lopez, 20 Va. App. 258, 456 S.E.2d 155 (1995).

Accordingly, upon consideration of these facts, we REVERSE the October 27, 1999 Opinion of the Deputy Commissioner.  We hold that the Commission does have jurisdiction under Va. Code Ann. 65.2-508 to determine whether Flores was an employee of D B & A General Contractors at the time of his accident on September 27, 1998, and to decide to what extent he is entitled to benefits under the Virginia Workers’ Compensation Act.  This case is therefore REMANDED to the Deputy Commissioner for an expedited opinion on the merits of this claim and all other questions that remain undecided.¹

This case is REMOVED from the Review Docket.

¹ This is an interlocutory opinion only, since we have decided only the jurisdictional issue and have Remanded the case for a determination on the merits of Flores’ Claim For Benefits.  See Uninsured Employer’s Fund v. Harper, 26 Va. App. 522, 495 S.E.2d 540 (1998).

IN THE WORKERS’ COMPENSATION COMMISSION

JUAN A.  HERNANDEZ,  Claimant

Opinion by TARR

Commissioner

v.                                                                                                                            Claim No.   194-63-68

C D CARPENTRY, INC.,  Employer

CINCINNATI CASUALTY COMPANY,  Insurer

Daniel P. Barrera, Esquire

for the claimant

William E. Glover, Esquire

for the defendants

REVIEW on the record before Commissioner Tarr, Commissioner Diamond and Commissioner Dudley at Richmond, Virginia.

The employer requests Review of the Deputy Commissioner’s September 3, 1999, Penalty Order assessing a 20 percent penalty pursuant to Code 65.2-524, for compensation not paid within two weeks after it became due commencing on June 9, 1999.  The employer argues that because the claimant returned to work at his pre-injury average weekly wage on June 10, 1999, it was entitled to cease payments under the claimant’s open Award.  We VACATE.

On February 23, 1999, the claimant filed an application for benefits alleging an injury by accident on January 28, 1999, and seeking continuing temporary total disability benefits and medical benefits.  On March 31, 1999, the parties submitted a Memorandum of Agreement stating that the claimant was entitled to continuing temporary total disability benefits commencing January 28, 1999, based on a pre-injury average weekly wage of $524.71.  On August 6, 1999, the Commission entered an Award Order based on the March 31, 1999, Memorandum of Agreement, for payment of continuing temporary total disability compensation and medical benefits beginning January 28, 1999.

The employer alleges that in the meantime, on June 10, 1999, the claimant returned to work at a wage equal to or greater than his average weekly wage.  The employer supports this claim with a September 22, 1999, affidavit from its office administrator.  The employer filed an application for a change in condition on September 24, 1999, alleging a return to work on June 10, 1999.  That application is still pending.

In a letter filed August 23, 1999, counsel for the claimant advised the Commission that despite the August 6, 1999, Award Order, “the carrier has not paid the claimant any compensation since approximately June 9, 1999.”  Claimant’s counsel requested an assessment of a 20 percent penalty on the unpaid compensation.  By Order of September 3, 1999, the Deputy Commissioner assessed a 20 percent penalty pursuant to Code 65.2-524 on all compensation more than two weeks in arrears.

In its written statement, the employer argues that during the period between June 9, 1999, and June 24, 1999, it attempted to obtain the claimant’s signature on an Agreed Statement of Fact terminating the existing open Award based on the claimant’s return to his pre-injury work.  The claimant did not sign the agreement.  The claimant’s counsel then informed the employer that the claimant was again temporarily totally disabled due to his work injury.  The employer blames its non-payment of benefits from June 10, 1999, to June 24, 1999, on the claimant’s failure to execute this agreement.¹

Code 65.2-524 provides that: “If any payment is not paid within two weeks after it becomes due, there shall be added to such unpaid compensation an amount equal to 20 percent thereof.”  The language of Code 65.2-524 is mandatory, and its application has been strictly applied.  The legislature has clearly and unambiguously provided for a 20 percent penalty when payment of benefits is not timely made, regardless of the fact that there may be a good excuse for the late payment.  See Sanderson v. Corrections Adult Services, VWC File No. 164-78-40 (May 30, 1996).

There are three ways to terminate an award:  (1) by the claimant’s execution of an Agreed Statement of Fact; (2) by the claimant’s execution of a Supplemental Memorandum of Agreement; or (3) by the employer’s filing of an appropriate application to terminate benefits.  Smith v. Earl Haines, Inc., 62 OIC 422 (1983).   Despite the employer’s alleged efforts, the claimant failed to execute the Agreed Statement of Fact.  Therefore, the employer needed to file an application to terminate benefits.  It did so, on September 24, 1999.  Commission Rule 1.4 C 1 requires payment to date of return to work.

The employer was not required to make any payments after June 9, 1999, because of the pending Application for Hearing.  If the Application is granted, then no further benefits or penalties are owed.

The employer voluntarily reinstated temporary total benefits on June 24 so the disputed period is June 10 to June 24, 1999.  It appears that this issue might be resolved without the necessity of either an evidentiary or an on the record hearing.

The Deputy Commissioner’s September 3, 1999,  Penalty Order is VACATED.  This case is referred to the Commission’s mediation section.

APPEAL

This Opinion shall be final unless appealed to the Virginia Court of Appeals within

thirty days from receipt of this Opinion.

¹ The employer also concedes that the claimant is entitled to temporary total disability benefits from June 24, 1999.  The employer has paid and continues to pay these benefits since September 1999.