Defenses that May Arise from Employee Misconduct
By: Brian R. Taylor
In most cases, an injured employee can recover benefits under the North Carolina Workers’ Compensation Act even when the injury occurred due to the employee’s own fault, but what about when the employee’s injury is caused by a blatant disregard of the employer’s established rules or direct orders? This blog post will discuss potential defenses that may arise from employee misconduct.
1. The employee’s injury does not arise out of the employment.
The foundational question that arises when an employee’s injury results from misconduct is whether the employee’s injury arose out of his employment. For an injury to arise out of the employment, there must be some causal connection between the employment and the injury. In claims involving misconduct, a common argument is that the employee’s actions were not undertaken for the benefit of the employer. These claims often involve what is commonly described as “thrill seeking.”
Employee actions such as horseplay or misuse of company property may be considered “thrill seeking.” The idea behind the thrill-seeking defense is that the employee’s conduct breaks the causal connection between his employment and the injury if the employee’s conduct is not in furtherance of the employer’s business. In other words, an injury does not arise out of the employee’s employment if the employee’s conduct is solely for the purposes of thrill-seeking.
However, if the employee’s actions can be tied to accomplishing his job, the claim will likely be compensable, even if the employee’s actions are against the employer’s established rules. For instance, in Rivera v. Trapp, the employee was injured while attempting to ride a forklift that was transporting building materials to the roof of a building. 135 N.C. App. 296. The forklift was not designed to transport humans. Id. The employee’s act of riding the forklift was unauthorized and against company policy; however, the employee’s claim was found compensable because the overall goal of his actions (getting to the roof with the building materials) was reasonably related to the accomplishment of the task for which he was hired. Id.
It is also important to remember that incidental activities are within the course of employment as long as they are reasonable and ordinary deviations. For instance, the North Carolina Court of Appeals considered the act of running to buy gum within an industrial plant to be an incident of employment. Spratt v. Duke Power Co., 65 N.C. App. 457, 465, 310 S.E.2d 38, 43 (1983). Interestingly, the Court of Appeals has even held that an employee sustained a compensable injury when a ceiling fan fell on him during a 45-minute unauthorized nap. See Dayal v. Provident Life and Acc. Ins. Co., 71 N.C. App. 131, 321 S.E.2d 452 (1984). Therefore, even if an employee is breaking the rules of the employer while pursuing an item for their own benefit, the claim may be deemed compensable as long as it is a reasonable incident of the employment.
2. The employee ignored the Instructions of a then present supervisor.
What about when the employee ignores the instructions of a then present supervisor? Is there any additional protection for the employer? The North Carolina Supreme Court addressed this issue in Hoyle v. Isenhour Brick & Tile Co., 306 N.C. 248, 293 S.E.2d 196 (1982). The Court held that “[d]isobedience of a direct and specific order by a then present supervisor breaks the causal connection between the employment and the resulting injury.” Id. The Court went on to state that “the employee’s subjective belief concerning the advisability of his course of action becomes irrelevant since there would be no room for doubt as how best to serve his employer’s interest in the face of the employer’s direct and immediate order.” Id.
We note that the then present supervisor defense requires that the employee actually hear and be aware of the command from the then present supervisor. If the employee’s knowledge of the command from the then present supervisor is not established, the court will likely analyze the claim to determine if the employee’s conduct was in furtherance of the employer’s business to any appreciable extent as described above.
3. The employee’s compensation should be reduced by 10% pursuant to N.C. Gen. Stat. § 97-12.
In some instances, the employer may seek a 10% reduction in compensation for willful disobedience of established employer rules. N.C. Gen. Stat. § 97-12 provides that the employee’s compensation shall be reduced ten percent (10%) if the employee’s injury or death is caused by a willful failure to use safety devices or the willful breach of any rule or regulation adopted by the employer and approved by the Commission and brought to the knowledge of the employee prior to the injury. Most notably, this defense requires the rule to be approved by the Industrial Commission. Therefore, even if the employee willfully disregards a written rule, defendants will not be able to seek a 10% reduction unless the employer has sought approval of the rule by the Industrial Commission.
4. The employee is not entitled to indemnity benefits because he was terminated for cause and his work restrictions could have been accommodated if not for same.
As a final note, even if there are no defenses to the compensability of the employee’s claim arising from his misconduct, there may be means to limit the employer’s indemnity exposure through termination for cause. We note that this would likely require that the employee violate a rule set forth by the employer for which termination is listed as a possible consequence. Terminating an employee for misconduct, even if the misconduct caused the plaintiff’s injuries, may limit indemnity exposure if the plaintiff’s work restrictions could have been accommodated by the employer but for the termination for misconduct.
If you have any questions regarding potential defenses in workers’ compensation claims that may arise from employee misconduct, please contact one of our experienced workers’ compensation attorneys.