Workers' Compensation - H. Michael Bagley, Daniel C. Kniffen, Katherine D. Dixon, and Marion Handley Martin

• Publication year: 1999

Workers' Compensationby H. Michael Bagley^*

Daniel C. Knifffen^**

Katherine D. Dixon^*** and

Marion Handley Martin^****

For the second year in a row, the survey period passed without dramatic legislative changes to Georgia's Workers' Compensation Act ("the Act").¹ Georgia's appellate courts, however, were active once again in examining the exclusive remedy doctrine and interpreting the Act's subrogation provisions.

I. Legislation

As it has virtually every year this decade, the 1999 Georgia General Assembly made a number of amendments to the Act. This legislation marks the sixth consecutive year that legislation was passed based upon a package drafted under the direction of the Chairman of the State Board of Workers Compensation ("the Board"), Judge Harrill Dawkins. The following changes in the Act became effective July 1, 1999:

A. Appeal of Decisions

Previously, the Act was silent regarding the right of a party to cross-appeal following an appeal by another party of a decision of an administrative law judge. This was clarified with a provision specifying that an appellee may institute a cross-appeal by filing notice of the action within thirty days of the notice of the award by the administrative law judge.²

B. Self-Insured Employers

Although the Board has been empowered to issue certificates relating to self-insurance for some time,³ the Act was silent on the issue of whether this included the right to review the self-insured status of an employer following merger or acquisition.⁴ This amendment allows the Board to review the status of a self-insured employer after its involvement in a merger or acquisition.⁵ The Board will determine whether the employer continues to meet the self-insurance requirements of the Official Code of Georgia Annotated ("O.C.G.A.") section 34-9-121.⁶

C. Appointment of Guardian for Minor or Incompetent Claimant

Until 1996 the Board was vested with broad authority to appoint guardians for minors and incompetents who were claimants in the workers' compensation system.⁷ The Board, however, was not vested with the authority or the funding for the necessary personnel to insure that these guardians performed their duties properly. In this setting the 1996 legislature removed all Board authority and referred all issues of guardianship under the Act to the probate court in the county of residence of the minor or legally incompetent person.⁸ This resulted in delays that were unacceptable in a system designed to react quickly. Therefore, this year the Board was again vested with the authority to appoint guardians for minors or legally incompetent persons, in limited circumstances and for periods of limited duration.⁹ The circumstances include the following: (1) the receipt and administration of income benefits for a period not to exceed fifty-two weeks; (2) the compromise and termination of any claim and the receipt of any sum paid in settlement where the net settlement amount approved by the Board does not exceed $25,000; and (3) in the event the minor or incompetent person does not have a duly appointed guardian, the Board may appoint a temporary guardian ad litem for a period not to exceed fifty-two weeks, to institute or defend an action under the Act.¹⁰ The fifty-two-week periods may be renewed or extended by order of the Board.¹¹

D. Claims for Reimbursement

The legislature clarified the Board's authority to order a reimbursement of an overpayment of indemnity benefits to a claimant.¹² The request for reimbursement must be made within two years from the date of the overpayment.¹³

E. Indemnity Benefits

The legislature increased the rate for temporary total disability ("TTD") benefits from a maximum of $325 a week to $350 a week.¹⁴ The minimum TTD benefit payable is now $35 a week.¹⁵ The maximum rate for temporary partial disability ("TPD") benefits was increased from $216.67 a week to $233.33 a week.¹⁶

F. Compensation for Work-Related Death

The provisions dealing with compensation in the event of a work-related death have needed clarification for some time. The legislature deleted the language referencing the payment of reasonable expenses for the employee's last sickness in a death case, as the payment of these benefits was required elsewhere in the Act.¹⁷ Arguably the language had created the unintended result of limiting the expenses related to the employee's last sickness to the maximum allowable for burial. The amount payable for burial expenses was increased from $5,000 to $7,500.¹⁸

II. Exclusive Remedy

The attack on the exclusive remedy provisions of the Act continued during this survey period, including two significant decisions from the Georgia Supreme Court. In Flint Electric Membership Corp. v. Ed Smith Construction Co.,¹⁹ a construction company employee who was injured when he came into contact with a high voltage line brought a negligence action against the power-line owner. The power-line owner sought indemnification from the injured worker's employer pursuant to the High Voltage Safety Act.²⁰ The employer successfully raised the exclusive remedy provision of the Act to obtain summary judgment in the indemnity action at the superior court level.²¹ On appeal, the supreme court reversed the lower court and all earlier decisions supporting the lower court.²² The court found that the indemnity action was not barred by the exclusive remedy provision of the Act because it was not an action by an injured employee "on account of a work-related injury, but rather a contractual indemnity action.²³ This clearly creates a very limited exception to the exclusive remedy.

The Supreme Court of Georgia articulated a potentially broader exception to the exclusive remedy with its decision in Potts v. UAP-GA. AG CHEM., Inc.,²⁴ which once again creates the possibility of civil actions against employers and insurers based upon circumstances related to the handling of medical treatment in workers' compensation claims.²⁵

In Potts the employee became ill after cleaning chemicals for his employer. Treatment was initiated for suspected chemical poisoning, but one doctor discontinued the treatment stating that he had been reassured by a representative of the employer that the employee could not have possibly been exposed to any chemicals at work.²⁶ The employee eventually died, and his survivors filed a workers' compensation claim for dependency benefits asserting that the deceased employee "'was exposed to toxic and poisonous materials and died as a result of this exposure.'"²⁷ The survivors also brought a wrongful death action in the Superior Court of Fulton County against the employer and its branch manager, alleging fraud and intentional infliction of emotional distress based primarily upon the representations allegedly made to medical providers regarding the absence of any exposure to chemicals at work.²⁸

The superior court granted summary judgment in the civil action for the employer and branch manager based upon the finding that the exclusive remedy of the Act extends to intentional misconduct by the employer done off the work site and at times that the employer is not engaged in any work activity.²⁹ The court of appeals affirmed.³⁰ On certiorari, the supreme court reversed, finding that any damages resulting from fraud do not arise out of and in the course of employment if they result from intentional misconduct by the employer subsequent to the physical injuries that gave rise to the original workers' compensation claim.³¹ Thus, the specter of civil litigation spawned out of workers' compensation claims again raises its head and warrants a review of the doctrine of exclusive remedy.

A. Background

The exclusive remedy doctrine functions as the most fundamental premise of the workers' compensation system and precludes an employee injured by an accident arising out of and in the course of his employment from pursuing a civil liability claim against the employer or the employer's workers' compensation insurance carrier.³² The very origin of workers' compensation was based upon a quid pro quo: employers established a system providing employees with income benefits and medical care without issues of fault if employees relinquished the common law right to sue in tort for injuries on the job. The controlling factor for determining whether the exclusive remedy doctrine applies is whether the Act covers the parties and the event.

Historically, the judicially recognized exceptions to the exclusive remedy doctrine have been strictly limited to seven specific circumstances which are: (1) purely personal intentional acts;³³ (2) the "dual persona" doctrine;³⁴ (3) failure to provide workers' compensation insurance;³⁵ (4) property damage;³⁶ (5) negligent inspection;³⁷ (6) indemnity agreements;³⁸ and (7) fraud.³⁹ These exceptions to the exclusive remedy doctrine have developed to deal rationally and consistently with matters either outside of the workers' compensation system or to draw a distinct line for circumstances lying on the periphery.

The Georgia Supreme Court has specifically denied civil actions for delay in payment of medical benefits.⁴⁰ In Doss v. Food Lion, Inc.,⁴¹ the supreme court found that an independent cause of action in tort for the intentional delay of medical treatment in a workers' compensation claim was "inconsistent with the public policy behind the statutory scheme," thereby barring the viability of any tort action on that theory.⁴² Therefore, the supreme court specifically reversed Zurich

American Insurance Co. v. Dicks,⁴³ in which the court of appeals reached a contrary conclusion.⁴⁴ The court specifically addressed the issue of public policy and pointed out that the exclusive remedy provision was "the bedrock of the workers' compensation system" because it was the "quid pro quo for workers receiving a guaranty of prompt benefits for work-related injuries without regard to fault or common law defenses and without the delay inherent in tort litigation."⁴⁵ The court further...