Hanba & Lazar | October 2019 HL Quarterly Update
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October 2019 HL Quarterly Update

October 2019 HL Quarterly Update

Changing Times  
   In July of 2018, we reported on a case that should have given many adjusters and insurance carriers cause for concern. At that time, the Worker’s Compensation Appellate Commission issued a ruling in the case of Fisher v. State of Michigan – Kalamazoo Regional Psychiatric Hospital, upholding the Worker’s Compensation Magistrate’s decision that even if a clerical error results in a plaintiff receiving an overpayment of benefits, such overpayments do not have to be reimbursed to the carrier absent fraud or misrepresentation.

     However, on September 10, 2019, the Michigan Court of Appeals heard an appeal from the Defendant State of Michigan in the Fisher case, and overturned the holding of the appellate commission. Within their opinion, the Michigan Court of Appeals explained that both the magistrate and appellate commission in Fisher relied on allegedly precedential case law from the appellate commission which dated back to the 1990s when imposing the fraud/misrepresentation requirement. Next, the Michigan Court of Appeals explicitly stated that those prior decisions “created the fraud requirement out of whole cloth”, meaning the appellate commission had quite literally invented this requirement without any statutory basis in the Worker’s Disability Compensation Act for doing so. Therefore, the Michigan Court of Appeals held that the line of case law supporting the fraud/misrepresentation requirement was an example of the appellate commission exceeding it’s statutory authority, and that even if the fraud/misrepresentation requirement is sound public policy, it can only be properly imposed by the legislature.
This opinion is set to be published by the Michigan Court of Appeals, and therefore it will have binding precedential value over all future worker’s compensation cases.
Source: Fisher v. Kalamazoo Reg’l Psychiatric Hosp., 2019 Mich. App. LEXIS 5341
  Fresh Faces
     As part of Governor Gretchen Whitmer’s ongoing restructuring of the Worker’s Compensation system, several important changes were recently made. Previously, appeals of a worker’s compensation magistrate’s decision were heard by the Worker’s Compensation Appellate Commission. That body has been renamed the Worker’s Disability Appeals Commission. Although no press release has been issued by Governor Whitmer confirming the appointments, we have reason to believe that the three-person WDAC panel will consist of Granner Ries, Daryl Royal, and Duncan McMillan. Given that all three of these individuals were in private practice before their appointment, it is possible that some appeals to the WDAC may create conflicts of interests as it pertains to the new WDAC members. If this occurs, Chief Magistrate Luke McMurray will step in as a member of the WDAC panel as necessary. It is also important to note that previously, the WCAC had the responsibility of handling both Worker’s Compensation and Unemployment appeals. This will no longer be the case, as the WDAC will only hear appeals of worker’s compensation cases. As of July 2019, there were over 40 pending appeals that the WDAC is tasked with deciding.
  FMLA Party
     Intermittent leave under the FMLA can be difficult for employers to work with. But in the case of the plaintiff in LaBelle v. Cleveland Cliffs, difficult doesn’t even begin to describe it. Plaintiff worked for almost a decade as a lab technician with Defendant’s mining operation in Michigan. After Plaintiff began taking intermittent FMLA leave based on severe shoulder pain, Defendant terminated his employment, alleging that he had abused his leave. Defendant alleged that Plaintiff repeatedly stacked FMLA leave on top of vacation leave, and that at least twice, Plaintiff went golfing while on FMLA leave.

     When the facts of the case were presented in the U.S. District Court for the Western District of Michigan, Plaintiff did not deny any of the allegations surrounding his behavior. Instead, Plaintiff simply argued that his conduct did not constitute “abuse” of the FMLA leave provisions, and he sought to proceed to trial. In order for Plaintiff’s case to continue however, he would have had to show that Defendant’s reason for terminating his employment was not based on the facts of the case, and was thus based on some other motive. Both the U.S. District Court, and the U.S. Court of Appeals for the 6th Circuit, who issued their opinion on September 13, 2019, sided with Defendant. It was clear from the Plaintiff’s own statements that he could not prove that Defendant’s decision to terminate his employment was based on anything other than the facts of the case. The decision of the 6th Circuit will not be published, and thus will not be binding precedent in Michigan, but the reasoning of these courts is clearly worth remembering.

Source: Labelle v. Cleveland Cliffs, Inc., 2019 U.S. App. LEXIS 27627  
Please send us your comments or questions, and if there is a topic you would like to see discussed in the next Quarterly, let us know. We can be reached at (810) 767-9400 and email about the Quarterly should be sent to Jonathan Rea at jrea@hanbalazar.com.     Visit our Website!

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