Termination During Healing Period Requires Renewed TTD Payment Under Worker’s Compensation Law

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June 18, 2007

The Wisconsin Court of Appeals has ruled in favor of an employee’s claim for renewed workers’ compensation temporary total disability benefits (“TTD”) after he was fired for having violated a very important safety rule. The employee, Dennis Race, was an electrician for Emmpack Foods. Race suffered an on-the-job injury to his left hand. Race returned to work under light duty restrictions that consisted of one-handed work.
 
Before performing (one-handed) work on a machine, Race failed to lock out and tag out the machine. This was Race’s second such violation. Emmpack’s policy mandated termination for the repeat violation. Emmpack terminated Race’s employment.
 
Race sought renewed TTD in light of his termination. Emmpack and its insurer argued that the cause of Race’s renewed wage loss was his failure to abide by the company’s safety rules. But for the safety rule violation, Race would not have incurred a new wage loss, Emmpack argued. Moreover, Emmpack argued that Race had been terminated for a “good” reason.
 
The Court of Appeals interpreted the statute (Wis. Stat. 102.43(1) & (2)) that was in effect at the time of Race’s injury as not providing any exception to the requirement that TTD be paid during the healing period in the absence of return to restricted duty. The appellate court noted that Race had a continuing wage loss both as a result of his injury and on account of his termination that extended not merely to wages that he could have earned at Emmpack, but at other employment as well. The court observed that it was the will of the legislature to have TTD paid whether the termination was made for a good reason, a bad reason, or no reason at all.
 
The Court of Appeals further noted that in March 2006 the legislature amended the statute to create three exceptions. Under the 2005-06 version of Wis. Stat. 102.43(9), an employer or insurance carrier is not liable for renewed TTD upon termination during the healing period where:
 

the employer offers suitable work and the employee unreasonably refuses it;
the employee is charged with a crime and the termination is in connection with the alleged crime; or
the employee is discharged for violating a written company drug policy that is regularly enforced.

 
Those are the only exceptions; there is no exception under the amended statute for discharge due to violation of a safety rule, no matter how important that rule may be, which lock out/tag out certainly is.
 
For questions concerning workers’ compensation issues, call Russ Wilson, who prepared this article, or any of the attorneys in the Business Transactions Practice Group of Ruder Ware.

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