This document provides an overview of Utah's workers' compensation system. It discusses that workers' compensation is a no-fault insurance system that pays medical expenses and lost wages for work-related injuries. It also covers what types of employers and employees are covered, benefits provided, reporting obligations, disputes over fault for injuries, retaliation protections, and return to work processes.

1. WORKERS’ COMPENSATION
IN UTAH
Susan Baird Motschiedler
June 12, 2014
Lorman Education Seminar, Salt Lake City
parsonsbehle.com

2. 2
 Workers’ compensation is a no-fault
insurance system established in Utah in
1917.
 Pays medical expenses and helps offset
lost wages for employees with work-
related injuries or illnesses.
What is Workers’
Compensation?

3. 3
 Public purpose – take care of injured
workers so they don’t become wards of
the state and can return to self sufficiency
 Trade off for compulsory employer
participation:
– No fault
– Employee cannot bring lawsuit against
employer for injury
• Exception for intentional injury
What is Workers’
Compensation?

4. 4
 WC does not cover intentional self-inflicted
injuries.
 Medical benefits will not be denied for injuries
involving alcohol, drugs, or failure to use safety
devices or follow safety rules.
 However, disability benefits maybe be denied
for injuries resulting from drug or alcohol abuse.
 Disability compensation can be reduced by
15% for willful failure to use safety devices or
follow safety rules.
Employee at Fault?

5. 5
 Employee has 180 days to report injury or illness
to employer.
 Employer has 7 days to submit a report to the
industrial accidents division and insurance
company.
 Employer or insurance company must provide
worker a copy of the report and a written
statement of the employer’s rights and
responsibilities under WC.
Reporting Injuries

6. 6
 Medical Expenses
– Medical care
– Surgical procedures
– Medications
– Chiropractic treatments
– Dental care
– Medical rehabilitation
 Mileage to medical care
 Wages
Workers’ Compensation Benefits

7. 7
 Compensation Benefits
– Temporary total disability
• No compensation paid for first 3 days, unless injury prevents
employee from working more than 14 days, total.
• Ends when employee returns to work or reaches medical
stability.
• Maximum duration of temporary total disability is 312 weeks.
– Temporary partial disability
• Paid during time employee is still recovering.
• Employee working fewer hours than normal or is on a light
duty job that pays less than regular job.
Workers’ Compensation Benefits

8. 8
 Upon permission from the Labor Commission,
temporary disability can be reduced or
terminated if employee is terminated from light-
duty work for
– Criminal conduct
– Violent conduct
– Violation of workplace health, safety, licensure, or
nondiscrimination rules
– Failing a drug or alcohol test
Reduction or Termination of Disability
Compensation

9. 9
– Permanent partial disability
• Paid if employee is left with permanent impairment
• Duration of compensation determined by “impairment rating”
from doctor
– Permanent total disability
• Paid if work-related injury left employee with a permanent
disability that prevents employee from returning to former
work or work that is reasonably available to employee.
• Employee potentially eligible for SSA disability
Workers’ Compensation Benefits

10. 10
 Vocational Rehabilitation
 Death/Survivor benefits
– Burial expenses
– Survivor Benefits
• Similar to deceased worker’s benefits, but includes
provisions for dependents
• 312 weeks; adjustable for reduction of dependents
• Assumption is that spouse will remarry
• After 312 weeks, yearly review and reduction of benefits
Workers’ Compensation Benefits

11. 11
 Utah administers its workers’ compensation system via
the Labor Commission – Industrial Accidents Division
 In Utah, workers' compensation is compulsory, and no
employee waivers are permitted and there is no
exemption for employers with small numbers of
employees.
– Employees cannot waive coverage
 State has affordable insurance available: Workers’
Compensation Fund (“WCF”)
 Private coverage also available
 Can be “self insured” with approval
Administration of Workers’
Compensation

12. 12
 The Labor Commission of Utah, Division of Industrial Accidents is
responsible for administering Workers' Compensation in Utah.
– http://www.laborcommission.utah.gov/IndustrialAccidents/index.h
tml
 Relevant Statutes and Rules:
– Utah Code Title 34A Chapter 2 – Worker’s Compensation Act
– Utah Code Title 34A Chapter 8a – Utah Injured Worker
Reemployment Act
– Utah Admin. Code R602-2 – Adjudication of Workers’
Compensation and Occupational Disease Claims
– Utah Admin. Code R612 – 100-500 – Workers’ Compensation
Rules
Utah Workers’ Compensation
Summary

13. 13
Covered Employers
1) Original employers
2) Statutory employers

14. 14
Covered Employers – Original
“Each person … who regularly employs
one or more workers or operatives in the
same business, or in or about the same
establishment, under any contract of hire,
express or implied, oral or written . . . .”

15. 15
Covered Employers – Statutory
Statutory employers are persons who
– procure any work to be done wholly or in part
for the employer,
– by a contractor over whose work the employer
retains supervision or control,
• Retention, not actual exercise of control
– when the work is a part or process in the
trade or business of the employer.

16. 16
Covered Employers – Statutory
When a person is a statutory employer, he
must secure workers’ compensation benefits
for
– the contractor,
– the contractor's employees,
– his subcontractors, and
– the subcontractors' employees.

17. 17
Covered Employers – Statutory
Exceptions to being a statutory employer:
1) Work on own residence,
2) Partner or sole proprietor, if reliance on
a) Certificate of insurance, or
b) Certificate of waiver for solo
3) Corporate officer or director excluded from WC
coverage
4) Contractor or subcontractor, if reliance on
a) Certificate of insurance, or
b) Certificate of waiver for solo

18. 18
 Key Inquiries:
 Where’s the contract?
 How completely has your company
surrendered the right to control how these
“workers” do their job?
 . . . And 33 other factors!
Independent Contractor Analysis

19. 19
 If he’s not an employee, we don’t need to pay for
workers’ compensation coverage – right?
 True, but what if you take him off workers’ comp
coverage, he gets hurt doing something in the
scope and course of employment. . .
 And then is determined to be a statutory
employee with no workers’ comp coverage?
The Biggest Risk from Improper “1099” Classifications
is NOT from the IRS. Would you Believe it’s likely
Workers’ Compensation?

20. 20
 This company is now looking at a very nasty surprise:
 34A-2-207 Noncompliance – Civil Action by employee
– Now, this employer is stripped of benefit of exclusive remedy provision
– Employer “shall be liable” in a civil action to the employee for damages
suffered because of personal injury
– Proof of the injury shall constitute prima facie evidence of employer’s
negligence and burden shall be upon employer to show freedom from
negligence
 Employer may not try to defend with:
– Employee’s contributory negligence
– Employee’s assumption of risk
– Fellow servant rule
 Employer shall pay employee’s attorney’s fees
. . . About that “worker” you
1099’d . . .

21. 21
 The company-and every officer of the
company are guilty of a class B
misdemeanor
 Labor Division can, on five days written
notice ask the District Court to issue an
injunction, without bond, restraining further
operation of the business
. . . And that’s not all

22. 22
Covered Employers –
Exclusive Remedy
The exclusive remedy provision:
"The right to recover compensation pursuant to this
chapter for injuries sustained by an employee,
whether resulting in death or not, shall be the
exclusive remedy against the employer and shall be
the exclusive remedy against any officer, agent, or
employee of the employer ... on account of any
accident or injury or death, in any way contracted,
sustained, aggravated, or incurred by the employee in
the course of or because of or arising out of the
employee’s employment …."
Utah Code Ann. §34A-2-105

23. 23
Covered Employers –
Exclusive Remedy
Workers’ compensation benefits:
“… shall be in place of any and all other civil liability
whatsoever, at common law or otherwise, to the
employee or to the employee's spouse, widow,
children, parents, dependents, next of kin, heirs,
personal representatives, guardian, or any other
person … and no action at law may be maintained
against an employer or against any officer, agent, or
employee of the employer based upon any accident,
injury, or death of an employee."
Utah Code Ann. §34A-2-105

24. 24
Intentional Injury = Potential Lawsuit
 Exclusive remedy does not apply in case of
“intentional injury”
 Helf v. Chevron, 2009 UT 11: Utah Supreme
Court held employee could bring lawsuit against
employer for injury as result of exposure to toxic
gases. Employee need not show motive to
injure. Need only show injury resulted from an
act that actor knew or expected would cause
injury.

25. 25
Intentional Injury = Potential Lawsuit
 Employee must show that employer had actual
knowledge of the dangerous condition and
consequences were virtually certain to result
 Employer must know that specific employee will
be injured by a specific task
 Employee stated case where noxious fumes
were released earlier in day, other employees
became ill, no safety measures were taken, and
employer directed employee to perform task that
caused earlier release of fumes

26. 26
Covered Employers –
Eligible Employer
A person who is eligible to take advantage of the
exclusive remedy provision in certain
circumstances is an “eligible employer.” To be
eligible, he:
 Must be an employer, and
 Must have procured the work to be done wholly or in part
by a contractor (and his employees, subcontractors, and
subcontractors’ employees).

27. 27
Covered Employers –
Eligible Employer
He can take advantage of the exclusive remedy
provision in 3 circumstances:
1) If he is liable for and pays workers’ compensation
benefits as an original employer due to the contractor or
subcontractors failure to maintain insurance;

28. 28
Covered Employers –
Eligible Employer
3 circumstances (continued):
2) If he
a) secures the payment of workers’ compensation
benefits for the contractor or subcontractor, and
b) procures work to be done that is part or process of
the eligible employer’s trade or business, and
c) adopts, posts, and enforces a workplace accident
and injury reduction program that meets certain
statutory requirements;

29. 29
Covered Employers –
Eligible Employer
3 circumstances (continued):
3) If he
a) has obtained a valid certification, or policy or proof of
coverage from the contractor, and
b) is liable as a statutory employer for the payment of
workers’ compensation benefits if the contractor or
subcontractor fails to provide them, and
c) procures work to be done that is part or process of the
eligible employer’s trade or business, and
d) adopts, posts, and enforces a workplace accident and
injury reduction program that meets certain statutory
requirements.

30. 30
Covered Employees
Public employees:
 Elective and appointive officers, and other persons in the
service of, serving, or hired by the state, or any county,
city, town, or school district, or while in the National
Guard.

31. 31
Covered Employees
Private employees:
 A person in the service of any employer who employs
one or more workers or operatives regularly in the same
business, or in or about the same establishment under
any contract of hire, express or implied, and oral or
written.
 Minors and illegal workers are included.
 Casual employees working outside the usual course of
the trade, business or occupation of the employer are
not.

32. 32
Covered Employees
Partners and sole proprietors:
 With appropriate written notice to the workers’
compensation insurance carrier, advising it of the desire
to be considered an employee covered by workers’
compensation.

33. 33
Covered Employees
Corporate officers and directors:
 UNLESS they have given appropriate written notice to
the workers’ compensation insurance carrier, advising it
that they do not desire to be considered an employee
covered by workers’ compensation.
 Company can only obtain waiver for five officers and
directors.

34. 34
Covered Employees – Exceptions
Real estate agents and brokers:
 if substantially all of the worker’s income is from real
estate commissions, and
 the services are provided under a written contract that
states the broker is an independent contractor who is not
to be treated as an employee for federal income tax
purposes.

35. 35
Covered Employees – Exceptions
Criminal offenders:
 If they are performing labor as inmates for the
Corrections Department or under contracts that the
Corrections Department has with others.

36. 36
Covered Employees – Exceptions
Insurance company workers:
 If they solicit, negotiate, place or procure insurance for
insurance producers, and
 Substantially all of their income is from insurance
commissions, and
 Their services are provided under a written contract that
states they are an independent contractor who is not to
be treated as an employee for federal income tax
purposes, and
 If they can derive income from more than one insurance
company.

37. 37
Covered Employees – Exceptions
Domestic workers:
 Who are working for a person who receives or is eligible to
receive the work under a government program designed to
pay the costs of domestic work to prevent the person from
being placed in an institution or a more restrictive placement
than his residence
 If the worker is paid by a person designated by the Secretary
of the Treasury in accordance with IRS provisions as a
fiduciary, agent or other person that has the control, receipt,
custody, or disposal of, or pays the wages of the worker, and
 The worker has a written contract that tells him he is not an
employee for purposes of the Workers’ Compensation Act.

38. 38
Leave Entitlement
 No “leave” entitlement under WC
– Retaliation risks for denying leave
– Customary provision of leave
– Light duty assignments
– Leave entitlements under other laws or
policies
• ADA
• FMLA

39. 39
Basis for Leave
 Leave for injuries caused
– “by accident arising out of and in the course of the
employee’s employment, wherever such injury
occurred, if the accident was not purposely self-
inflicted ….”
 This may not include
– leave for physical, mental or emotional injuries related
to mental stress.
– leave in circumstances that would provide "good
cause" to fire.

40. 40
 What kind of medical information can you get?
– Medical report from employee’s doctor.
– Can request additional reports.
– Can work with employee’s doctor to determine what
their work limitations are as a result of the on-the-job
injury.
– Can request an IME.
 Note: Must store medical records separate from
personnel file
Medical Information Available

41. 41
 No anti-retaliation provision in the WC statute
 Case law provides that termination for exercising WC
rights violates public policy and provides a cause of
action for wrongful termination
 Constructive discharge also a violation of public policy
 However, mere harassment and discrimination, not rising
to the level of constructive discharge, not actionable
See Touchard v. La-Z-Boy, Inc., 148 P.3d 945 (Utah 2006).
Retaliation

42. 42
Benefits Continuation
 No benefits entitlement under WC
– Retaliation risks for constructive discharge
– Customary provision of benefits
– Light duty assignments
– Benefits entitlements under other laws or
policies

43. 43
Reinstatement Rights
 No reinstatement entitlement under WC
– Retaliation risks for denying reinstatement
– Customary reinstatement
– Light duty assignments
– Reinstatement entitlements under other laws
or policies

44. 44
 Goal: get employee back to work
 Many different issues – not all addressed by WC
– Light duty/intermittent leave/reduced schedule
– Has the job necessarily been filled by others?
– Capable of returning to full time work without further injury?
– Back on full time schedule, but medical condition persists and
prevents performance
– Excessive absenteeism
 Many of these issues are intersections among laws
 Remember: cannot use WC standards to make
determinations under other laws
Return to Work

45. 45
 Medical Provider must disclose
information to employer
– When employee can return to work
– What restrictions an employee is subject to
– Employer, Employee or Physician can initiate
Return to Work

46. 46
 Light Duty
– Not required under the statute
– Release to work light duty can be initiated by physician,
employee or employer
 Benefits of Light Duty
– The quicker employees are back to work, the quicker they are to
rehabilitate, and the less likely to seek medical care they are
– Maintaining contact with employee decreases recovery time
– Saves time and money on recruitment and training of new
employees
– If no light duty, employee entitled to continue receiving
temporary total disability until at medical stability or at 312 week
entitlement limit!
Return to Work

47. 47
 Can an employee refuse light duty?
– Not without a good reason
– Employee is required to accept the work or
risk losing temporary disability compensation
Return to Work

48. 48
 Karl works for A-1 Auto Service as a
mechanic. He is a difficult employee,
absent a lot. He reports to work at 6 a.m.
in the morning. At 1:00 p.m., he tells you
he feels lousy and is going home. He
doesn’t call in the next day, his sick leave
is exhausted, and you decide to fire him.
What do you do?

49. 49
 You are preparing a pink slip. Just then
Karl calls you and tells you he has been
“out of it” at home since he left work, has
called the doctor, and is going to the
hospital for tests. His doctor suspects
carbon monoxide poisoning.
What do you do?

50. 50
 Karl’s wife calls that afternoon and says
Karl was admitted to the hospital.
 You report the “injury” to OSHA, they do a
site inspection and find raised carbon
monoxide levels at the A-1 Auto Shop.
What do you do?

51. 51
 Medical report from employee’s doctor.
 Can request additional reports.
 You can work with employee’s doctor to
figure out what their work limitations are as
a result of the on-the-job injury.
 You can request IME.
What kind of medical information
can you get?

52. 52
 Karl’s wife says the doctor doesn’t know
how long Karl will be out, and they fear he
will have some lasting problems. It’s
summertime, business is busy. The
remaining two mechanics will be
overworked due to Karl’s absence in about
two weeks.
What do you do?

53. 53
 Wife suggests you go with Karl to his next
doctor’s appointment. You show up, Karl
says he doesn’t want you there, and he
won’t let you talk with his doctor.
What do you do?

54. 54
 The doctor tells you Karl has sustained a brain
injury. The doctor says Karl is currently able to
do simple mechanical tasks with direction, but
he cannot exercise independent judgment in
diagnosing problems or in recognizing dangers.
The doctor says brain injuries usually heal
slowly, but surprises can occur, and he does not
know yet if the brain injury will be permanent.
What do you do?

55. 55
That’s it!