Things Clients Want to Know:
Q: I want to buy a company, is it important to look at its workers’ compensation liability?
A: One would think that mergers and acquisitions would have no impact on workers’ compensation law, however while companies are engaging in due diligence, how many times are they also scrutinizing the workers’ compensation programs of their potential acquisition? Any time one employer succeeds another employer in the operation of a business in whole, or in part, it is the acquisition/merger or purchase/sale it’s the successor’s responsibility to:
1. Notify the BWC of the Succession
2. Preserve the predecessor employer’s payroll records for five years preceding the date of the succession.
It is within the sole discretion of the Ohio Bureau of Workers’ Compensation to adopt rules establishing “the rates to be applied where one employer takes over the occupations or industry of another or where an employer first makes application for state insurance. ” O.R.C. 4123.32(D). With the sole discretion of rate setting, given to the BWC, it is very difficult for an employer to assert control over adopting the better risk.
In addition, when a merger of a self-insured entity and a state fund entity takes place, the rules require the self-insured employer to “buy out” the State Fund insured liability of the merging entity. Without question, these costs can become very significant in the post-merger/ post-sale climate and need to be considered in the initial negotiations of any merger and acquisition.
Student to Lawyer Symposium Nov. 14, 2014
Lisa Patterson was nominated by the Ohio State Bar Association to attend the Supreme Court of Ohio Commission on Professionalism’s Student to Lawyer Symposium. This event will be held on Friday, November 14, 2014, at the OCLC Conference Center in Dublin, Ohio.
Entitled “Preparing the Leaders of Tomorrow’s Changing Legal Profession,” this year’s symposium will explore our rapidly changing profession and how to best prepare law school students and new lawyers for “the new normal” of legal practice. Just like past years, we will bring together law school deans, professors, experienced practitioners, judges, new lawyers, and law school students to join in the discussion.
Congratulations Lisa!
PTSD Must Flow from the Physical Injuries in the Claim
Armstrong v. John R. Jurgensen, Co., 136 Ohio St. 3d 58, 2013-Ohio-2237
Claimant was involved in a motor vehicle accident while operating a one-ton dump truck when he was struck from behind. He observed the other drive and suspected that he was dead. Claimant was treated and released, but was also informed that the other driver had died. Claimant later requested that his claim be amended to include post traumatic stress disorder and was successful administratively. The Court here specifically found that the Claimant’s PTSD was not caused by his physical injuries but, but by his involvement in a fatal accident.
Supreme Court Takes Yet Another Look at Retirement and Voluntary Abandonment
The State ex rel. Black v. Indus. Comm. Slip Opinion No. 2013-Ohio-4550
Claimant injured his back in 2000. His physician returned him to modified duty on December 13, 2000 and after one month to return to full duty. On December 11, 2000, the claimant notified his employer that he intended to retire on February 28, 2001. Medical near the time of his retirement indicated that he could still perform modified duty with an increased weight restriction which was related to non-allowed groin pain. He retired at age 55 with 38 years of service. Following his retirement he did not seek vocational training or seek other employment. On September 2001, he began receiving social security disability benefits. A Hearing Officer denied his application for permanent total disability in 2009, finding that there was no medical evidence that any physician had advised him to retire because of his allowed injuries and he had made no attempt to return to work. The Court of Appeals ruled that the case should be sent back to the Industrial Commission for an order properly determining the Claimant’s eligibility. The Supreme Court found that the Hearing Officer’s order contained some evidence supporting the decision, reversed the court of appeal and upheld the denial of the permanent total disability application.
Lesson Learned: For those dealing with permanent total disability and retirement/voluntary abandonment it is crucial to determine if there is medical evidence at or near the time of separation which specifically, states that the allowed conditions of the claim prevent a return to work.
Sixth Appellate District Takes on “Substantial Aggravation”
Lake v. Anne Grady Corp., 2013-Ohio-4740
Claimant in this case attempted to have her claim amended to include “substantial aggravation of pre-existing osteoarthritis left knee.” The request was approved throughout administratively. The employer was granted summary judgment based upon an Affidavit of the employer’s physician who indicated that there were no objective diagnostic findings, objective clinical findings or objective test results supporting the treating physician’s opinion that her osteoarthritis had been “aggravated.” “Merely stating that objective evidence exists is not in and of itself objective evidence.” The treating physician’s Affidavit failed to state how these unidentified x-rays and clinical findings support the conclusion that the condition has been substantially aggravated. The Court of Appeals affirmed the granting of summary judgment for the employer.
Lesson Learned: In evaluating these cases for substantial aggravation, employers must see documented clinical objective evidence, rather than just the magic words, the “substantial aggravation.”