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November 2006 - Vol. 8, No. 11
The Employer E-Letter: Labor and Employment Law News from the Duluth, Minnesota law firm of
Hanft Fride, A Professional Association.
Editor, Kathleen S. Bray, ksb@hanftlaw.com or 218.529.2427.
Please feel free to forward this e-mail or share it with others. If there are other topics of interest to you or any other suggestions concerning this newsletter, please let us know.
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THIS MONTH'S TOPICS:
- NATIONAL METHAMPHETAMINE AWARENESS DAY, NOVEMBER 30, 2006
- DELAY OF WORKERS COMPENSATION PAYMENT MAY SUPPORT MINN. STAT. §176.82 CLAIM
- SINGLE-INCIDENT EXCEPTION TO MINNESOTA MISCONDUCT FOR UNEMPLOYMENT BENEFITS
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NATIONAL METHAMPHETAMINE AWARENESS DAY, NOVEMBER 30, 2006
A recent Department of Justice press release announced that it will sponsor National Methamphetamine Awareness Day on November 30, 2006, in order to generate awareness about the damaging effects of meth abuse on individuals, families and American communities. Education and public outreach are at the heart of the national drug control strategy, and National Methamphetamine Awareness Day will play an important role in highlighting the nationwide efforts to increase awareness and decrease demand of this highly addictive and dangerous drug.
As part of National Methamphetamine Awareness Day, Attorney General Alberto R. Gonzales will host a national event with federal, state, local and community leaders to discuss the broader impact that meth production and use is having on communities. Across the nation, U.S. Attorneys, along with state and local leaders, will coordinate a variety of educational events targeting their specific communities.
National Methamphetamine Awareness Day is a coordinated effort not only to reach potential meth users with a message of prevention, but also to educate current users about the programs available to them. In order to increase the impact of this message, the Department is partnering with a number of federal, state and local governments, as well as with private sector and non-profit entities, including: the U.S. Department of Labor; U.S. Department of Health and Human Services; U.S. Department of Interior; Office of National Drug Control Policy; the Drug Enforcement Administration; the Partnership for a Drug-Free America; Boys & Girls Clubs of America; Community Anti-Drug Coalitions of America; Fraternal Order of Police; National District Attorneys Association; National Association of Attorneys General; Inter-Association Task Force on Alcohol and Other Substance Abuse Issues; American Council on Education; National Association of Student Personnel Administrators; American College Health Association; Association of Fraternity Advisors; and the National Panhellenic Conference.
As part of their ongoing effort to combat meth use, the Department of Justice created a model methamphetamine educational presentation that is available to the public to be used by law enforcement, community groups and local leaders in addressing meth use in their communities. The educational presentation is posted on the Department's new meth Awareness Web site: www.usdoj.gov/methawareness.
For more information about National Methamphetamine Awareness Day and how to get involved in your community, contact the U.S. Department of Justice Office of Public Affairs at 202-514-2007 or visit www.usdoj.gov/methawareness.
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DELAY OF WORKERS COMPENSATION PAYMENT MAY SUPPORT MINN. STAT. §176.82 CLAIM
In an Order filed October 6, 2006, Judge Donovan Frank, Judge of United States District Court, District of Minnesota, determined that a fact dispute was presented by the employee's claim against the workers' compensation insurer under Minn. Stat. § 176.82, and therefore, the Court denied the insurer's Motion for Summary Judgment. Schumacker v. Liberty Mut. Ins. Co. , Civ. No. 05-530 (D. Minn. 10/6/06). The employee's claim that the workers' compensation insurer intentionally obstructed his receipt of workers' compensation benefits was allowed to proceed to trial.
The claim was brought by the employee pursuant to Minn. Stat. §176.82, subd. 1, which provides in relevant part:
- Any person . . . in any manner intentionally obstructing an employee seeking workers' compensation benefits is liable in a civil action for damages incurred by the employee including any diminution in workers' compensation benefits caused by a violation of this section including costs and reasonable attorney fees, and for punitive damages not to exceed three times the amount of any compensation benefit to which the employee is entitled. Damages awarded under this section shall not be offset by any workers' compensation benefits to which the employee is entitled.
Minn. Stat. § 176.82, subd. 1. This statute is in addition to the penalty provisions of the Minnesota Workers' Compensation Act.
An employee must prove a §176.82 claim by the higher standard of "clear and convincing evidence," and show that the insurer or employer (or any third party) obstructed or hindered, "whether by deliberate action or inaction, the receipt of benefits due the injured worker and does so in a manner that is outrageous and extreme . . . or egregiously cruel and venal." Bergeson v. United States Fidelity and Guaranty Co. , 414 N.W.2d 724, 727 (Minn. 1987), Kaluza v. Home Ins. Co. , 403 N.W.2d 230, 233-34 (Minn. 1987).
The facts supporting the Judge's decision to deny the insurer's Motion for Summary Judgment (while strongly encouraging the parties to discuss settlement in the concluding section of his Order) were as follows:
Employee claimed a work injury involving his low back in 2001. The injury was denied by the insurer based on evidence of prior injury with a different employer. Two years later, the employee filed a Claim Petition for benefits arising out of the 2001 injury. An independent medical examination was obtained by the insurer, with the doctor finding in a November 15, 2003 report that the 2001 injury was work-related and compensable. The insurer apparently did not take steps to appeal or clarify the IME doctor's findings, and at the time of the report owed approximately $65,000.00 for permanent partial disability, temporary total disability, and temporary partial disability benefits, and another approximately $38,000.00 for medical expenses.
The insurer then wrote to the employee on December 5, 2003 and asked him to discuss settlement, soliciting a settlement demand for a full, final workers' compensation settlement, leaving open only future medical benefits. An Amended Claim Petition was filed on January 14, 2004 seeking penalties for unreasonable delay in paying benefits, and settlement negotiations continued with no benefits paid to the employee in the meantime. Finally, on May 25, 2004, the insurer paid the employee's claim calculated owing through November 2003, except for certain items that were lacking in documentation.
A couple months later an administrative hearing was held on the penalty claim under §176.225, and an additional 30% penalty of all benefits paid to the employee through the date of hearing was ordered. Delays on additional benefits continued, and ultimately in February 2005, the employee filed a complaint in Minnesota state court asserting his §176.82 claim. The insurer removed the claim to federal court and, in May 2005, the insurer made final payment of all claims outstanding. A full, final settlement followed shortly thereafter, but the §176.82 claim was not released.
The insurer attempted to argue that their ultimate payment of all outstanding claims for workers' compensation benefits barred a §176.82 claim, but the Court found delay as opposed to total denial of benefits can support a §176.82 claim. The court concluded that the insurer's "tactics of seeking a settlement on money already owing to [the employee]" was sufficient to create a fact dispute that could proceed to trial.
Questions concerning this case or other workers' compensation matters? Contact Kathy Bray at 218.529.2427 or ksb@hanftlaw.com.
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SINGLE-INCIDENT EXCEPTION TO MINNESOTA MISCONDUCT FOR UNEMPLOYMENT BENEFITS
Is a single violation of an employer's cash-register policy sufficient to disqualify an employee from receiving unemployment benefits based on misconduct? A recent Minnesota Court of Appeals decision said "no" under the circumstances presented. Pierce v. DiMa Corp. , File No. A05-2470 (Minn. Ct. App., 10/3/06).
The employee was terminated from employment because he opened a cash register "in an improper manner" in violation of the employer's cash-register policy. The employee was supposed to open the cash register by pressing the cash-total key or the no-sale key, but the employee in this case used the emergency switch. The employer discovered the transgression while reviewing a security video during an investigation of another incident (unrelated to the terminated employee) involving a missing credit-card receipt. The employee who was terminated did not take any money from the cash register.
The Court of Appeals agreed with the Unemployment Review Judge and continued the employee's unemployment benefits. An employee discharged from employment for reasons of "misconduct" may be disqualified from receiving unemployment benefits. The definition of "misconduct" includes a clause excluding "single incidents" as follows:
- Inefficiency, inadvertence, simply unsatisfactory conduct, a single incident that does not have a significant adverse impact on the employer, conduct an average reasonable employee would have engaged in under the circumstances, poor performance because of inability or incapacity, good faith errors in judgment if judgment was required, or absence because of illness or injury with proper notice to the employer, are not employment misconduct.
Minn. Stat. § 268.095, subd. 6 (2004) (emphasis added).
The Court cited the "single incident" rule in affirming the unemployment decision to award benefits, holding that the employee's single violation of the cash-register policy did not involve theft or mishandling of money, and did not have a significant adverse effect on the employer.
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Hanft Fride's business and trial lawyers are located at 1000 U.S. Bank Place, in Duluth Minnesota. Visit our our website at www.hanftlaw.com. In addition to general information on the firm and our attorneys, you can find past issues of this newsletter. Keep checking back for new information, and let us know if there is anything you would like to see added to the site that would help you and your organization.
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The information provided in this E-letter is general in nature and should not be used as a substitute for professional services and advice. The communication and receipt of this information is not intended to create an attorney-client relationship. Readers should consult with their legal counsel before taking any action on matters covered in this E-letter.
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To subscribe or unsubscribe to Employment Express, e-mail your request to Kathleen S. Bray, ksb@hanftlaw.com or call 218-722-4766.
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Copyright 2006 by Hanft Fride, P.A. All rights reserved. Hanft Fride, A Professional Association, 1000 U.S. Bank Place, 130 W. Superior Street, Duluth, MN 55802. Phone 218-722-4766; fax 218-529-2401.
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