Emerging Issues - Staffing Agencies and Suitable Employment
By: Melissa P. Woodard
It is well-settled that one of the purposes of the Workers’ Compensation Act is to return injured workers to employment once they are able. To that end, when revamping our current statutes in 2011, the North Carolina Legislature instituted two types of suitable employment to which an injured worker can return. Under N.C. Gen. Stat. § 97-2(22)(i), when an injured worker has not yet reached maximum medical improvement (“MMI”), employment is considered suitable when it is within the work restrictions, approved by the authorized treating provider(s), and “with the employer of injury[.]” Pre-MMI suitable employment can also be “rehabilitative or other noncompetitive employment[.]”
Generally, when the worker recovers to the point of receiving work restrictions “the employer of injury,” or the employer for whom plaintiff worked at the time of his/her injury, will coordinate a light-duty job if one is available. Defense counsel will then obtain a written job description and request the authorized physician’s approval of the job. Once the job is approved, the employer will formally offer the job to the injured worker. If the employee refuses the job and defendants believe this refusal is unjustified, they will file a Form 24 Application to suspend the injured worker’s indemnity benefits during the period of the refusal.
There are various methods attorneys for injured workers use to complicate the Form 24 process, but an issue we have recently encountered on behalf of our clients is ripe for litigation. As noted above, pre-MMI suitable employment must be “with the employer of injury” but “employer of injury” is not otherwise defined in the statute. As we know, there are many complex employment relationships in our state. We have seen the administrative forum of the Commission refuse to agree that a staffing agency’s placement of a pre-MMI plaintiff at a light duty job is “with the employer of injury” on a regular basis.
As employers, staffing agencies manage their employees’ placements in temporary positions outside of the agency itself. The agencies pay their employees directly, and they are responsible for human resources management of employees. The employee never works directly with the staffing agency, and the on-site supervisors generally work for the placement entity not the staffing agency. Employees in staffing agencies can obtain several different job placements at different sites during their tenure. This is where the crux of the issue lies in determining pre-MMI suitable employment: if the staffing agency secures a placement for an injured worker in a rehabilitative or noncompetitive placement that is not with the entity where the employee was placed during their injury, is the job with the “employer of injury”?
Despite the fact that the employee’s placement for light duty is no different than their placement prior to their injury, Form 24 Applications are generally not approved under these circumstances even when the injured worker does not formally contend that the job is not with the employer of injury. It is difficult to glean the Commission’s rationale primarily because the Commission does not have any issue determining the injured worker was the staffing agency’s employee for purposes of their liability in the claim, but it seems to take issue with a light duty placement that is made in the same fashion and under the same circumstances as the initial employment.
This issue has not yet been litigated beyond the administrative forum, but we anticipate that if the issues is litigated at the Deputy Commissioner level and the Full Commission, there could be a change in how the administrative forum handles this specific matter. Regardless, carriers who provide coverage to staffing agencies and staffing agency employers should be aware of this issue.
Practice Tip: Attempt to find light duty employment at the staffing agency’s office itself. There has generally not been an issue if that kind of work is available. Remember that for pre-MMI suitable employment the job can be make-work and noncompetitive, i.e. not otherwise available on the open job market. As always, if you have any questions or would like additional information or advice regarding these issues, please feel free to contact Lewis & Roberts.