2011 Workers’ Comp judicial and governmental action offer insights for employers in 2012

OSHA and Workers’ Comp insurers

While the loss control efforts of Workers’ Compensation insurers align with OSHA’s overall goal of improving employee safety, typically their actions are separate. Workers’ Comp insurers have a fiduciary responsibility to the employer and if there is an OSHA investigation the information possessed by the insurance carrier could be used against the employer.

However, in a 2011 case, Hilda L. Solis v. Grinnell Mutual Reinsurance Co., a federal court upheld a subpoena issued by OSHA requesting documents and testimony from Grinnell Mutual Resinsurance Co. concerning inspection and reports prepared for Haasbach, LLC, following the death of two teenage workers at a Mt. Carroll, IL, grain elevator. Grinnell had objected to the subpoena, arguing in part that loss control inspection reports created by an insurer are privileged documents that could end up in the hands of plaintiffs’ lawyers or other outside parties if turned over to OSHA.

While OSHA routinely does not request such reports, it has the legal ability to do so. Employers should carefully consider insurers’ inspections and recommendations and document all efforts to respond to problem areas. Also, employers should ask to be notified of any subpoena received by OSHA or other third party before a response is made and ask for a copy of any information provided.


Although the rules of the game can be murky and ill defined, the government’s arsenal of weapons targeting misclassification has strengthened. The Department of Labor and the Internal Revenue Service have agreed to share information and coordinate enforcement and states, such as California, have passed laws that provide for fining employers that classify employees as independent contractors.

All this means heightened scrutiny at the federal and state levels. Employers should expect more questions and rigorously assess whether their independent contractors are properly classified.

The consequences of misclassification-whether intentional or not-are significant and a Workers’ Comp issue can be the trigger for a dispute. An employer is liable for back wages and federal and state employment taxes, and may also have to pay retroactive benefits to the employee that he or she would otherwise have received. The IRS can impose penalties even for unintentional mistakes.

FMLA, ADAAA, GINA and Workers’ Comp

2011 saw changes that added to the already complex web of these overlapping leave laws, including the new ADAAA regulations, GINA’s safe harbor rules, DOL’s interpretation of the in loco parentis rule, and several court cases interpreting the FMLA and related issues. Of particular significance to Workers’ Comp are the EEOC cases that address an employer’s obligations to provide additional leave as a reasonable accommodation under the ADA even though the employee has exhausted leave under FMLA and/or Workers’ Compensation. The only exceptions are if there is another effective accommodation that would return the employee to work or granting additional leave would cause the employer an undue hardship.

There is little doubt that there is increased crossover between ADA-protected disabilities, FMLA-protected serious health conditions and Workers’ Compensation. Each case is unique and understanding the interplay of the three laws is crucial to compliance. Employers are well advised to take a close look at all their leave of absence policies as well as their procedures for administering and enforcing them.


While the definition of “course and scope of employment” has never been cut and dry, it takes on new challenges as telecommuting continues to take root in the workforce. Although there is little case law on this matter, there were two cases in 2011 that clearly demonstrate the exposure to employers and the importance of having policies that specifically deal with telecommuting.
The Court of Appeals in Oregon overturned the Oregon Workers’ Compensation Board and awarded a J.C. Penney salesperson benefits for a broken wrist from tripping over her dog when carrying fabric samples from her car to her home. In New Jersey, the husband of an obese woman who died of a blood clot after working long hours in her home office was awarded Workers’ Compensation survivor benefits in a specific and fact-based decision.

In addition, telecommuting is increasingly being requested as an ADA accommodation. Not having a telework program is not sufficient grounds for denying the request.

Employers that have or may have employees who telecommute would be wise to establish a telecommute policy that defines work areas, ergonometric conditions, safety expectations, and work hours as well as allows for work site inspections.

Carl Zeutzius has 20 years of experience helping businesses address their risk management needs.  He’s a Certified Work Comp Advisor and UNICO is the only agency in the State with that Designation. For more information about UNICO Group, Inc., please visit us online at www.Unicogroup.com.