I hope this finds you doing well. I have received many inquiries over the last couple of weeks on when temporary disability benefits are owed. I think that the confusion comes from the mislabeling of the benefits. There is a difference between TTD and TPD benefits, even though the amount may be the same. TTD is paid when the employee is ordered completely off of work. If there is a compensable claim, benefits are owed regardless of other factors. For instance, if the employee is ordered completely off work, and is unable to work because he is in jail, you’d still owe TTD benefits. The reason for this is that the standard for whether any benefit is owed is whether the work injury is and remains a major contributing cause to the benefit sought. If the employee is ordered completely off work, the employee being in jail makes no difference as he couldn’t work whether he is in jail or not as the doctor has taken him off of work.

The analysis changes once employee has been released to work by the doctor, even if the employee has not actually returned to work. Let’s take our employee who is in jail. When he was ordered completely off of work, his incarceration did not matter as he wouldn’t be able to work even if he was a law- abiding citizen. Once he is released to work, you would ask whether the work injury is and remains a major contributing cause to his inability to work. If the employer could accommodate the restrictions, you would stop paying benefits because the reason the employee cannot work is not related to his work injury, but, instead, from the fact that he is incarcerated. However, let’s say the employer cannot accommodate the restrictions when the employee is released to work, then what? You would still pay TPD in that situation because whether he is in jail or not makes no difference as he would not be working anyway. You would continue paying benefits until the employee is released to work full duty, receives an impairment, or the employer is able to accommodate the restrictions.

If confused, just ask yourself whether the work injury is a major contributing cause to the inability to work. If the employee is ordered off of work by the doctor because of the work injury, the answer is yes and you would owe TTD benefits. If the employee has been released to work but is not working, ask yourself “Why isn’t he working? Is it related to his injury?”

TTD and TPD are often interchanged, however the distinction is important because TPD benefits have defenses available. Always look to the doctor’s restrictions – not whether the employee is actually working. The proper question does not begin with the work status. Instead, the proper question is whether the employee has been released to work. If you have questions on this or any other issue, please contact Boyce Law Firm at 605-336-2424.

South Dakota is a rural, expansive state with many smaller towns throughout. There are very few major health care providers within the state. There are also very few doctors that will perform independent medical examinations within the state. On occasion, we are forced to ask a claimant to travel outside his community to have the IME performed. The question then becomes what time and (more importantly) place are “reasonably convenient for the employee” to attend the IME. Unfortunately, there is no hard and fast rule and each claim must be reviewed independently.
SDCL 62-7-1 allows for compulsory medical examinations (a/k/a IMEs) at employer’s/insurer’s request. However, the IME must occur “at a time and place reasonably convenient for the employee.” Sometimes it will be necessary for a claimant to travel several hours or several hundred miles to attend the IME due to the location of the IME doctor. On occasion, a claimant will claim the distance is not “reasonably convenient” due to being in pain from sitting for long periods of time or simply unable to travel due to finances. The South Dakota Supreme Court has not interpreted what “reasonably convenient” means. However, the South Dakota Department of Labor has taken into consideration a Claimant’s pain when traveling for an IME and determined that sometimes traveling is the best of a bad situation. See, Dale L. Dobson vs. Homestake Mining Company, 1995 WL 529827, HF No. 87, 1994/95 (SD Dept. Labor). In these situations, it is best to calculate the approximate costs the claimant will incur to attend the IME (mileage, hotel, meals) and prepay those amounts. Sometimes it is worth allowing the claimant several days to travel to and from the IME in order to reduce the amount of time in a car or bus. On other occasions, it may be best to fly the claimant to the IME instead of making them drive. If these considerations are given to the employee, you have the best chance of convincing the Department of Labor the IME was at a time and place reasonably convenient to the employee if the claimant refuses to attend the IME.
As mentioned above, each claim is a different so determining what is reasonably convenient for the employee depends on that particular set of circumstances. If you have any questions on this topic, feel free to contact us.

There can be little doubt as to the popularity and effectiveness of alternative dispute resolution (ADR) when dealing with workers’ compensation claims. The uncertainty, expense, and time involved necessitates that most claims get resolved through mediation outside of an administrative hearing and likely appeal through the court system.

Through my years of practice, I have discovered that one seldom used form of ADR is mediation followed by arbitration of issues on which the parties are deadlocked. Med-Arb, as it is referred to in the ADR world, can be a very effective tool for many claims.

Because the Department of Labor (DOL) must approve all workers’ compensation resolutions, the parties must first agree that the decision of the arbitrator will be binding, and the decision will be submitted to the DOL for adoption and approval. Such an agreement is then presented to the DOL, followed by an order entered by the DOL agreeing to adopt, as its own, the arbitrator’s decision, findings and conclusion. The parties then proceed to attempt mediation of the case. If a settlement is reached on all issues, a settlement agreement is prepared, signed and submitted for DOL approval. If the parties are deadlocked on some, or all issues, the mediation is then converted to an arbitration and submitted to the arbitrator for decision and later adoption by the DOL.

While theoretically any claim could utilize Med-Arb as an ADR tool, the claims that stand to benefit the most are those where medical causation is in dispute on some portion of the claim, and entitlement to future medical expenses is an issue. In those situations, my experience has proven that often the underlying claim is more easily resolved if the medical dispute can be resolved as well.

Med-Arb deserves your consideration on many claims. If there are questions, please do not hesitate to let me know.

By now, those of you reading this blog know that in order for an injury to be compensable in South Dakota, the injury must arise out of and be in the course of the employment. Pretty straight forward, right?

Not so much.

While South Dakota adopts the “coming and going rule, establishing that an employee is not covered for purposes of workers’ compensation while coming from and going to work, the law has also established a ‘gray area’ regarding what is, and what is not. covered. Three seminole cases in South Dakota address this topic: Norton v. Deuel Sch. Dist. 2004 S.D 6; Fair v. Nash Finch Co., 2007 S.D. 16; and Terveen v. South Dakota Dept. of Transp. 2015 S.D. 10. These cases make it clear that a fact investigation into a workers’ compensation claim must include an analysis of minute details of the claim.

In Norton, the SD Supreme Court found that personal activities involving self-care, such as eating, resting, smoking, or using bathroom facilities should be considered in the course of employment. In Fair, the Court found that an employee’s deviation from work duties does not ‘automatically constitute departures from employment, but may … be found insubstantial.’” Fair was injured while she was exiting Family Thrift after a brief deviation from her usual direct route to her vehicle. The Court found that while it was reasonable to expect employees to exit the premises after work, it was also reasonable to expect Fair to engage in personal shopping after her shift had ended. Thus, the Court found that mere fact that an employee deviates from their work does not preclude a finding that the injuries are compensable.

Insubstantial deviations have been defined as those “largely the kind of momentary diversions which, if undertaken by an inside employee working under fixed time and place limitations, would be compensable under the personal comfort doctrine.” Arthur Larson, Larson Workers’ Compensation § 17.06[3] (2014). If someone engaged in an act for personal comfort, they do not leave the course of employment unless the extent of the departure is so great that an intent to abandon the job temporarily can be inferred. Id. at §21. In Terveen, the Court adopted the majority rule around the nation, finding that an employee who has made a personal side-trip has to ‘get back on the beam’ before being deemed to have resumed the business trip. Id. § 17.03[5]. Additionally, the Court noted that the deviation cannot be substantial.

Now you are probably wondering, what information you need to find out during an investigation. Some information you need to know will include finding out what the employee was doing at the time of the injury; did the employer authorize, expressly or impliedly, that running personal errands was acceptable; was the employee on their typical route home, did they get lost, or, perhaps, were they stopping for food? These cases are very fact specific so be sure to take the time to gather all the facts you need to make a determination.

As always, we are here and happy to help. Give us a call anytime.

 

Have you ever had a Claimant allege that he or she is entitled to permanent total disability benefits and move to a new community before any determination can be made? If so, you are probably wondering whether to use the community where the Claimant was injured or the new community when determining potential job opportunities that would allow the Claimant to get back into the workforce. The job search question gets more difficult when the Claimant moves from a populated area to a rural area with less work opportunities.

The short answer is that you use the Claimant’s current community when determining potential available jobs the Claimant could perform.  In Reede v. State Dept. of Transp., 2000 S.D. 157, 620 N.W.2d 372, the claimant lived and worked in the Black Hills at the time she was injured. After her injury, the claimant did not seek additional employment, instead choosing to home school her daughter. Prior to hearing, the claimant moved several times, either to follow her family or to find work, and she eventually followed her sister to Montana, where she lived with her sister. The claimant was able to show that, while in Montana, she unsuccessfully attempted to obtain employment. The main question for the Court was whether the claimant’s Montana residence should be used for the purposes of determining whether there was available employment within her community such that she could secure more than sporadic employment. The Court held that, because the Department of Labor had found that the claimant’s move was not specifically intended to withdraw herself from the workforce or to aid in obtaining benefits, but instead was a good faith move based on financial necessity, the Montana residence should be used as the claimant’s “community” for the purposes of determining her eligibility for workers compensation benefits.

So, unless there is a showing that the Claimant moved for purposes of withdrawing from the workforce in order to obtain aid in obtaining benefits, you must look to the Claimant’s current community when determining whether jobs are available. As always, if you have any questions, please don’t hesitate to contact us.

The issue of independent contractor versus employer has been litigated in South Dakota. There is a presumption that the worker was an employee and it is the employer’s burden to establish the worker is an independent contractor. The Department of Labor and the South Dakota Supreme Court have provided a set of factors to consider when determining whether a worker is an independent contractor or an employee.

The following factors have been used by the Department of Labor as considerations when determining whether a worker is an independent contractor or employee:

1. The extent of control which, by the agreement, the master may exercise over the details of the work;

1. One must look at whether the employer has the ability to hire, fire, and lay off the worker. It is also important how much control the master has over the workers’ functions.

2. Whether the one employee is engaged in a distinct occupation or business.

1. Here it is important to see whether the worker operated a separate business or under a separate trade name. It is also important whether the worker worked solely for this master, on a full time basis.

3. The kind of occupation with reference to, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision.

4. The skill required for that particular occupation.

5. Whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;

1. Here, “when the employer furnishes valuable equipment, the relationship is almost invariably that of employment.” SeeLarson on Worker’s Compensation §44.43(a).

6. The length of time for which the person is employed.

7. The method of payment, whether by the job or by the hour.

8. Whether the work is part of the regular business of the employer.

9. Whether the parties believe they are creating the relationship of master and servant.

The South Dakota Supreme Court has essentially adopted these factors although it has grouped certain factors into a two-part test. InEgemo v. Flores, 470 NW2d 817 (SD 1991) the employer argued the servant was an independent contractor. The court noted there was an important distinction as an independent contractor is not covered by workers’ compensation. The court stated there is a two factor test: (1) whether the individual has been and will continue to be free from control or direction over the performance of the services, both under contract or service and fact, and (2) whether the individual is customarily engaged in an independently established trade, occupation, profession or business.

In evaluating the “right of control test” the important considerations include direct evidence of the right of control, the method of payment, furnishing major items of equipment, and the right to terminate the employment relationship at will and without liability. In Egemo, the court noted the employer did not exercise control or supervision over the method or manner in which the servant completed his task. Furthermore, the master did not direct the hours of work, breaks, or even the days off. The court also noted the servant did not withhold any amounts for income tax, social security, or unemployment insurance. The employer also filed a Form 1099 as a non-employee compensation form. The court noted the servant was required to supply all of his own tools, and his own maintenance and transportation to the work sites. Furthermore, the employment relationship could not be terminated without liability.

The significant considerations in the test of “independently established trade” are that:

The requirement that the employee’s occupation be independently established and that he be customarily engaged and it calls for an enterprise created and existing separate and apart from the relationship with the particular employer; an enterprise that will survive the determination of that relationship. The individual must have a proprietary interest in the enterprise to the extent that he can operate without hindrance from any other individual.

However, it is not skill alone which determines whether an individual is established in a trade or business, but whether that individual by reason of such skill engages himself in an economic enterprise such that he bears the risk of his own unemployment. Whether or not he is unemployed is solely a function of market forces and a demand for skills, not the response of his master to similar economic realities.

The South Dakota legislature has also addressed this issue and stated the difference between an employer and an independent contractor in SDCL 61-1-11. That statute states “service performed by an individual for wages is employment subject to this title unless and until it is shown to the satisfaction of the Department of Labor that: (1) the individual has and will continue to be free from control or direction over the performance of the service, both under his contract of service and in fact; and (2) the individual is customarily engaged in an independently established trade, occupation, profession, or business. The South Dakota legislature defined employee in SDCL 62-1-3 for the purposes of worker’s compensation. The definition is roughly the same as that set forth above.

The moment all of you have been waiting for….
The fifth prong of the five-part test provides: The employee must actually pursue the reasonable program of rehabilitation.
This part likely seems pretty self-explanatory, and, frankly, it is. If the Claimant can satisfy all of the other elements of the retraining benefits test, then he/she needs to actually pursue the reasonable program of rehabilitation in order to receive the benefits. How the retraining benefits work is that the Claimant is given their workers’ compensation indemnity benefit payment during the period of time that they are in the rehabilitation program. Accordingly, it seems quite clear that they need to actually pursue that program. SDCL 62–4–5.1 specifically allows rehabilitation benefits while a claimant is “engaged in a program of rehabilitation which is reasonably necessary to restore the employee to suitable, substantial and gainful employment.” This statute allows rehabilitation benefits while the claimant is engaged in a “program” of rehabilitation, not simply a “period” of rehabilitation. Chiolis v. Lage Development Co., 512 N.W.2d 158, 160 (SD 1994).
The rehabilitation program may be a two-year program or a four-year program, depending on what is determined to be a “reasonable means of rehabilitation” and a four-year program although more rare, can be reasonable in certain situations. See A. Larson, The Law of Worker’s Compensation § 61.22 (1992). The fifth part of the rehabilitation test is not complicated, but it is necessary in order for the Claimant to be entitled to the benefits. A Claimant cannot simply find a suitable rehabilitation program and receive the rehabilitation benefits without actually pursuing the program.
I imagine that all of you will undergo a brief grieving process now that this 5-part series is over, but rest assured that we will continue to provide everyone with up-to-date information on the changes you need to know about in South Dakota workers’ compensation and employment law. Until next time.

Part four of the five-part test states that an employee must file a claim with his employer requesting the benefits in order to be entitled to the same. The South Dakota Supreme Court, in Chiolis v. Lage Dev. Co., 512 N.W.2d 158, 161-162 (S.D. 1994), stated:

“Even recognizing that the primary purpose of rehabilitation benefits is to restore the injured employee to substantial and gainful employment, the worker may not unilaterally decide what training he or she may want to pursue and proceed to do so at the employer’s expense. To approve such an independent approach to rehabilitation training by a claimant would result in untold administrative and economic chaos and a total breakdown of the legislatively intended benefits to the injured worker of rehabilitation training. While such self-improvement is highly laudable, particularly in view of the claimant’s independent quest for it, unaided by the employer or carrier, it is outside the range of benefits provided by South Dakota law. To approve a procedure which allows an injured employee to select a rehabilitation program before petitioning Department or reaching an agreement with the employer would be putting the cart before the horse.”

The Court in Chilois denied retraining benefits, in part, due to the claimant’s unilateral decision to enter into a rehabilitation program.

The Department addressed a similar factual scenario in Shellie Holvig v. Rent-a-Center and Specialty Risk Services, HF No. 130, 2004/05, when the claimant therein moved to Phoenix and began her retraining program without alerting her employer and insurer of the same. The Department held that the acts of the claimant deprived her employer and insurer or a reasonable opportunity to evaluate her vocational situation properly and demonstrate the necessity of element four of the retraining test. Id. at 6. The Department also noted that the claimant had decided long before the denial to assume financial responsibility for her bachelor’s degree, and that there was no evidence that employer and insurer therein led the claimant to believe she would receive benefits for the program and she took no actions to her detriment based on any actions of the employer and insurer. Id.

All seemed pretty clear on this issue until Koval v. City of Aberdeen and SDML Workers’ Compensation Fund, HF No. 142, 2014/15. In Koval, the claimant had completed his claimed retraining program before petitioning or otherwise requesting retraining benefits from the Employer/Provider. On a motion for summary judgment, the Department stated:

“However, there is nothing in SDCL 62-4-5.1 or the five part test established by the Supreme Court which dictates when such a claim must be made. It is merely required that a claim be made. That such a claim could later be denied is merely a risk the Claimant makes by not getting preapproval. “A claimant may enroll in a rehabilitation program without the consent of employer, but he does so at his own risk; that is, rehabilitation benefits will not be guaranteed for a particular program simply because the program is one the claimant wishes to pursue.” Kurtenbach v. Frito-Lay, 1997 S.D. 66, ¶ 23, 563 N.W. 2d 869, 875. “It is [claimant’s] right to seek a college education, but [employer] cannot be compelled to pay for such a program if it is not necessary.” Chiolis v. Large Dev. Co., 512 N.W.2d 158, 161 (S.D. 1994) (emphasis added) (quoting Cozine v. Midwest Coast Transport Inc., 454 N.W.2d 548, 554 (S.D. 1990)).

Pursuing a rehabilitation program without first filing a claim and receiving approval does not guarantee the receipt of benefits. However, not seeking preapproval does not preclude the application of the rest of the test to establish if claimant is entitled to the rehabilitation benefits. Therefore, since Claimant’s claim satisfactorily fulfills step four of the test, and Claimant and Employer disagree on his fulfillment of the rest of the five-part test requirements, issues of material fact remain regarding Claimant’s petition for retraining benefits.”

The Koval decision was settled before hearing and consequently there have been no appeals from this curious decision that clearly allows a claimant, contrary to Chiolis, to “…put the cart before the horse”.

Summer is upon us and the 4th of July is just around the corner. Almost as exciting as fireworks is the third prong of the five-part rehabilitation test for South Dakota workers’ compensation claims. As Laura mentioned in last week’s blog post, I have the honor of discussing the third prong and what it means to you in evaluating your work comp claim. The third prong of the five-part test provides: The program of rehabilitation must be a reasonable means of restoring the employee to employment.

When determining whether a rehabilitation program is reasonable, the South Dakota Supreme Court has declared that the Claimant bears the burden of establishing the reasonableness of the program. Chiolis v. Lage Development Co., 512 N.W.2d 158, 161 (SD 1994). In considering an appropriate rehabilitation program, the Department “must not lose sight of the fact the employer has a stake in the case” and “the employer is required to ‘underwrite’ the expenses of rehabilitation.” Id. An injured worker cannot insist upon a college education if other suitable employment opportunities exist that do not require college training. Id. at 160, (quoting Barkdull v. Homestake Mining Co., 411 N.W.2d 408, 410 (S.D. 1987).

When reviewing requests for rehabilitation, the parties must look at the claimant’s underlying career and wages to determine the reasonableness of the requested/suggested rehabilitation program. For instance, it is probably unreasonable for a forty-five year old, over-the-road truck driver (who has been driving truck since he was 18), with a high school education, to get a four-year accounting degree when a two-year vocational program for bookkeeping would provide sufficient income to restore him to employment. As with the other prongs of the rehabilitation test, use of a vocational expert to address the third prong is a valuable tool to help determine whether the rehabilitation program is a reasonable means of restoring the employee to employment. The vocational expert will be able to analyze the job market, identify the average income for a variety of positions, and provide invaluable insight to evaluate the claim properly.

Stay tuned for further discussion of a rehabilitation claim in South Dakota in next week’s blog post, and the riveting discussion by Mike about the fourth prong of the five-part test. As always, feel free to contact us if you have any questions.