New Minnesota Supreme Court Decision: Julie D. Halvorson v. B&F Fastener Supply, A16-0920 (Minn, September 20, 2017)

Julie D. Halvorson v. B&F Fastener Supply, A16-0920 (Minn, September 20, 2017)

The Minnesota Supreme Court affirmed a decision by the Workers’ Compensation Court of Appeals (WCCA) and held that an employer may only terminate an employee’s rehabilitation benefits where “good cause” is shown.

 

The facts of the case were undisputed.  Julie Halvorson (“Employee”) sustained a work-related injury to her right elbow and both knees working for B&F Fastener Supply.  A compensation judge awarded workers’ compensation benefits including rehabilitation services, which B&F and their workers’ compensation insurance carrier paid.  The Employee eventually found a part-time job with another employer, after which B&F filed a request with the Workers’ Compensation Division of the Department of Labor and Industry to terminate rehabilitation services.  The request stated that the Employee was no longer a “qualified employee” entitled to rehabilitation benefits as she had found “suitable gainful employment.”  The request was denied and a formal hearing before a compensation judge was requested.  The compensation judge granted the request to terminate rehabilitation benefits, noting that the Employee was no longer a “qualified employee” due to her part-time employment.

 

The Employee appealed to the WCCA, who reversed, but declined to specifically determine whether Employee had “suitable gainful employment” or if she continued to be a “qualified employee.”  Instead, the WCCA held that “every request to terminate rehabilitation services is subject to the ‘good cause’ standard in Minn. Stat § 176.102, subd. 8(a), and Minn. R. 5220.0510, subp.5.” Halvorson v. B&F Fastener Supply, No. WC15-5869, 2016 WL 321720 (Minn. WCCA May 9, 2016).  Due to the fact that the compensation judge improperly relied on the definitions in Minn. R. 5220.0100, subps. 22, 34, and B&F electing not to have their request to terminate rehabilitation benefits evaluated using the “good cause” standard, the WCCA determined that B&F had wrongfully terminated the Employee’s rehabilitation benefits.  The Employer and Insurer appealed to the Minnesota Supreme Court.

 

The Supreme Court affirmed the WCCA’s decision, holding that Minn. Stat. § 176.102, subd. 8(a) specifically requires “a showing of good cause” in addition to filing the request to suspend, terminate, or alter rehabilitation benefits.  There are five enumerated reasons considered “good cause” in the statute: (1) physical injury that prevents the employee from pursuing the rehabilitation plan; (2) employee’s performance indicates the rehabilitation plan will not be completed successfully; (3) the employee does not cooperate with the rehabilitation plan; (4) the plan or its administration is substantially inadequate to achieve the objectives of the plan; (5) the employee is unlikely to benefit from additional rehabilitation.  However, the Court also stated that these five reasons are not an exclusive list of ways to show “good cause”.

 

Going forward, this means that when an employer, insurer, employee, or the Commissioner of Labor and Industry request to suspend, terminate, or alter rehabilitation benefits, a showing of “good cause” must be included in the request.

 

The case is Julie D. Halvorson v. B&F Fastener Supply, A16-0920 which can be found Here.

The case review was completed by Scott G. Ferriss.