Tucker Law Group
Tucker Law Group

Peace of Mind and the Employer-Sponsored Athletic Event

Spring is finally here in Maine. After a long and snowy winter, many are ready to spend as much time as possible outdoors. Employers too are welcoming the season. Many are organizing company athletic teams and sporting events, in sports ranging from softball and golf to ultimate frisbee.

Some employers worry that by holding sporting events, they could be exposing themselves to liability under the Workers’ Compensation Act. Fortunately, that is not necessarily the case. The Workers’ Compensation Act specifically excludes voluntary participants in employer-sponsored athletic events from the definition of “employee.” That means that employers can organize voluntary sporting events without excessive worry about risking a costly workers’ compensation claim.

So, from all of us here at Tucker Law Group, play ball!

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Estate of Zeitman v. WW Osborne

In the recent case Estate of Ralph Zeitman v. WW Osborne, a widow whose petition for death benefits against five employers was dismissed on statute of limitations grounds prevailed on appeal to the Appellate Division of the Maine Workers’ Compensation Board. The widow, Ms. Zeitman, filed her petitions against the employers twelve years after the death of her husband. The employers filed a joint motion to dismiss, raising the two-year statute of limitations period on death claims. Because he was asked to decide the issue on a motion, rather than after a hearing, the hearing officer made every inference in favor of Ms. Zeitman, including assuming that she was operating under a mistake of fact as to the reason of Mr. Zeitman’s death until shortly prior to the filing of the petitions. Despite the assumption of a mistake of fact, the hearing officer found that twelve years was not a “reasonable time” within which to file petitions and granted the motion to dismiss.

The Appellate Division reversed, finding that, in the event of a mistake of fact as to the cause of death, the two year statute of limitations did not begin to run until the widow’s mistake of fact was cured. The case was remanded to the hearing officer for further proceedings consistent with the decision.

This case provides employers and insurers with some additional clarity regarding the mistake of fact exception to the statute of limitations defense. It is now clear that the limitations period does not begin to run until the mistake of fact is cured, effectively entitling the claimant to the full limitations period after she becomes aware that she has a viable claim.

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Pre-Settlement Questionnaires and Medical Exams

Have you ever settled a case for a substantial sum only to see the claimant’s obituary in the newspaper a few weeks later? What steps can you take to come up to speed on the claimant’s health status before you settle?

When settling a case involving injuries to a specific body part, it is often easy to focus on that body part exclusively without looking too deeply into the claimant’s overall health status. This could be a serious mistake. The parties’ expectations about the claimant’s life expectancy often dictate the value of a settlement. It is therefore wise to get detailed information to help estimate what that life expectancy may be.

One method an insurer might use is to refuse to settle unless the claimant fills out a pre-settlement questionnaire which would include questions about any conditions the employee is suffering from. They could take this a step further and demand the production of all primary care medical records to verify the claimant’s health status. Insurers could even require a full pre-settlement IME with lab work. Whichever method they chose, insurers should be aware that more information is better when it comes to settlement.

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Maine Business And Consumer Court: Non-Compete Agreements Must Be In Writing

Non-compete agreements must be in writing and signed. That may seem obvious to most business owners, but not to the owner of a Jefferson, Maine auto titling business, who recently sought an injunction against the business run by her former assistant on the basis of a non-compete agreement. Unfortunately for the plaintiff, the assistant never signed the agreement. The assistant filed a motion for summary judgement, and the Maine Business and Consumer Court granted it, ruling that “agreements not to compete are within the Statute of Frauds” and thus required to be in writing.

This plaintiff’s painful lesson is valuable to all business owners: if you want to hold your employees to contracts, especially after they no longer work for you, those contracts had better be in writing.

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Maine Worker’s Compensation Appellate Division Explains “Lent Employee” Doctrine

In a recent decision, the Appellate Division of the Maine Workers’ Compensation Board was asked to decide whether an employment relationship can exist between a “special” (or borrowing) employer and an employee where no employment relationship exists between the “general” (or lending) employer and that employee. Malpass v. Gibbons, et al. App. Div. 13-0043. In this case, a member of a framing crew asked an independent contractor at another job site for help with lifting a wall. During the lift, the wall fell, injuring the independent contractor. The Appellate Division found no employment relationship between the contractor and the supposed lending employer. Citing Torsey’s Case, 153 A. 807 (Me. 1931), the Appellate Division found that, where there is no employment relationship between a worker and his supposed lending employer, there can be no “transfer” of employment, and therefore no employment relationship can be created between the worker and the borrowing employer under the lent employee doctrine.

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Mixing Business with Vodka: Questioning the Sobriety of Witnesses

One of the most common questions lawyers ask at depositions is some form of the following: “Are you under the influence of alcohol or any other substance that would prevent you from testifying truthfully and accurately?”  Law schools teach us to ask this question to prevent witnesses from claiming later that their memory had been obscured by alcohol or drugs.  In many settings though, this question is not asked of witnesses.  What follows is a short (and true) story about what happened in one such instance.
 
An employee and his lawyer showed up to a workers’ compensation settlement hearing before a hearing officer.  The employee was to accept $50,000 from the employer to resolve his claim.  The hearing officer went through his standard set of questions, which all focused on making sure that the employee was aware that he was giving up all future claims against the employer by settling.  The employee answered all of the questions appropriately and the hearing officer approved the settlement.
 
The next day, the employee walked into a different lawyer’s office with a curious tale.  He claimed that he had been drunk at the prior day’s hearing, and would never had agreed to such a low settlement had he been sober.  He was even willing to produce a receipt from a liquor store where he had purchased a fifth of vodka a few hours before the hearing.  The new lawyer, curious to test the system, took the case and moved to annul the settlement.  It took months for another hearing officer to hear the case for annulling the settlement.  Fortunately for the employer, the hearing officer was not impressed by the employee’s argument and refused to annul, letting the settlement stand.
 
Though this saga must have been a hassle (and an unexpected expense) to the employer as well as the Workers’ Compensation Board, to this day many hearing officers do not ask employees about their sobriety at settlement hearings.  Should they?  And if they don’t, should employer counsel take steps to raise the issue of a claimant’s competency to testify at a settlement hearing?  We would appreciate your thoughts.
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Playing by the Rules Under Maine’s Independent Contractor Statute

For small business owners hiring both independent contractors and employees, it is important to fully understand the distinctions between the two to avoid complications from the Maine Workers’ Compensation Board (WCB). With everyone looking to cut costs and the WCB’s Abuse Investigation Unit cracking down on worker misclassification, we take a look at the definition of an independent contractor as laid out in the Workers’ Compensation Act, 39-A M.R.S.A. §102(13-A).

The Act requires that all of the following factors be true before an employer can designate a worker as an independent contractor:

  1. The employer does not control day-to-day work: the worker sets his/her own hours.
  2. The worker has “an independently established trade, occupation, profession or business.”
  3. The worker has a chance for profit and loss from the work, so should not be paid on a salaried or hourly wage basis.
  4. Any assistants to the worker must be hired, paid, and supervised by the worker.
  5. The worker can work for multiple companies, even if his right to do so is temporarily restricted by a work assignment.

If all five of the above factors apply to the worker, he/she can be designated an independent contractor if at least 3 of the below are also true:

  1. The worker uses his/her own tools and materials.
  2. The worker can work for multiple companies.
  3. The worker is contractually responsible for satisfactory completion of the work.
  4. There is a written contractor for independent contractor services.
  5. The worker is not paid hourly.
  6. The work is outside the usual course of business for which the service is performed.
  7. The IRS has determined that the worker is an independent contractor.

To make employers’ lives easier, the Board provides an Application for Predetermination of Independent Contractor Status, which can be filled out and submitted before work begins. It is important to remember that submitting the form does not make you audit-proof. However, by following the rules laid out above, employers can rest a little easier in the knowledge that they are likely properly designating their workers’ status.

For more information about this complicated issue, please contact the attorneys at Tucker Law Group.

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