Monday, October 1, 2012

Work Comp Is Simple When Distilled to Basics

In most instances, the employer is synonymous with the insurance carrier when it comes to matters of workers' compensation, particularly when notice issues are involved.

An interesting case came down out of Florida the other day involving an injured worker who also happened to be an officer of the employer - in this instance the carrier tried to disassociate itself from the employer because the employer's notice of injury wasn't communicated to the carrier.

The 1st District Court of Appeals (DCA) didn't buy it.

Eugenio and Angela Gomez co-owned Gomez Lawn Service, which provided landscaping work to various condominium complexes in the Naples area.

The company had three employees, consisting of Eugenio Gomez, his wife, and his brother. Gomez and his brother performed the yard work services offered by the company and both were paid as employees of Gomez Lawn Service.

Eugenio Gomez also served as president of the company, and his wife was the chief operating officer and corporate secretary.

The company had a workers' compensation insurance policy with The Hartford, and Gomez did not exempt himself from coverage as a corporate officer, as was allowable under Florida law.

On July 13, 2010, Gomez was injured in a motor vehicle accident while traveling in a company-owned car from one job site to another. He informed his wife of the accident and she reported it to the company's motor vehicle insurance carrier.

By November of that year, as the cost of Gomez's treatment was approaching the $10,000 coverage limit of the company's motor vehicle policy, Angela Gomez consulted with a personal injury attorney, who advised her to report her husband's accident to The Hartford.

She did so, but The Hartford declined coverage, contending her notice of the accident had come too late under Section 440.185.

Section 440.185 requires that any employee with a work-related injury "advise his or her employer of the injury within 30 days after the date of or initial manifestation of the injury." The failure to do so will bar that worker from obtaining benefits. Failure of the employer to communicate the injury claim to the carrier in a timely manner subjects the employer to a $1,000 penalty.

The trial judge reasoned that Gomez and his company were effectively the same party, and that based upon the "nature, seriousness and probable compensable character" of Gomez's car accident, the failure of his company to provide notice to The Hartford until after 90 days had passed was not reasonable.

The DCA reversed stating that once Gomez informed his wife of his accident, Lewis said, he "fully satisfied the notice requirement imposed by Section 440.185" since the plain language of Section 440.185 "required (Gomez) to report his injury to his employer within 30 days of its occurrence, and nothing more."

Indeed - nothing more. The employer had notice of injury and that is all that is required under Florida law to provide benefits. The remedy against the employer is the penalty.

The DCA came to the correct conclusion in this case. Hartford had no reason to deny the claim based on the facts reported in the case. There was clear separation of employer and employee ... and carrier. Each has their duties under the law, and each has separate remedies under the law.

The Hartford tried to jump the distinction between employer and employee which would have afforded a bit of cost shifting - something that statisticians have reported to be on the increase and which I have been critical of in the past.

The facts of this case are very, very simple and if one distills this case to its basics the conclusion is quite obvious: An employer bought coverage. An employee got injured. Carrier pays.

That's how it's supposed to work.

The case is Gomez Lawn Service Inc. v. The Hartford, No. 1D12-0302.

1 comment:

  1. The Chamber feels that because a work accident does not currently have to be the sole proximate cause or even a primary cause of an injury to be compensable, too much of workers' compensation pays for issues that should be covered by general health insurance or the injured's own pocket.
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