Yearby, Reginald v. Armstrong Relocation

FILED Aug 23, 2019 02:48 PM(ET) TENNESSEE COURT OF WORKERS' COMPENSATION CLAIMS

TENNESSEE BUREAU OF WORKERS' COMPENSATION IN THE COURT OF WORKERS' COMPENSATION CLAIMS AT CHATTANOOGA

Reginald Yearby, ) Docket No.: 2018-01-0224 Employee, ) v. ) Armstrong Relocation, ) State File No.: 68327-2017 Employer, ) And ) Travelers, ) Judge Audrey A. Headrick Carrier. )

EXPEDITED HEARING ORDER FOR TEMPORARY DISABILITY BENEFITS

The Court conducted an Expedited Hearing on August 16, 2019. The only issue is whether Mr. Yearby is likely to establish at a hearing on the merits that he is entitled to past temporary disability benefits at the maximum compensation rate of $992.20. If not, then Armstrong seeks a $22,462.01 credit for overpayment of temporary benefits. For the reasons below, the Court holds Mr. Yearby is not entitled to payment of benefits at the maximum compensation rate.

History of Claim

In February 2019, the Court ordered Armstrong to provide Mr. Yearby with medical treatment, including surgery, from Dr. Jason Rogers for a September 14, 2017 injury. The Court denied his request for temporary disability benefits at that time.

However, following his surgery, Armstrong voluntarily paid Mr. Yearby temporary disability benefits from September 5, 2017, through May 17, 2018, at the maximum compensation rate of $992.20, a total of $36,002.69. It based its payment at the maximum rate upon Mr. Yearby's deposition testimony regarding his earnings. However, after further discovery, Armstrong obtained Mr. Yearby's tax returns and

discovered his taxable earnings were substantially less than the earnings he represented in his deposition testimony. 1

Mr. Yearby's hearing testimony focused on his 2016 and 2017 tax returns. His 2016 tax return reflected gross business income of $321,900, business expenses of $290,333, and taxable income of$31,567. His 2017 tax return listed gross business income of$262,726, business expenses of$235,257, and taxable income of$27,469. Mr. Yearby testified his expenses included wages for any employees he hired, payment for workers' compensation insurance, and equipment. Although the parties disputed Mr. Yearby's correct compensation rate, no one disputed that he is entitled to temporary disability benefits from Aprill, 2019, through July 23,2019.

Findings of Fact and Conclusions of Law

Standard Applied

To prevail at an expedited hearing, Mr. Yearby must provide sufficient evidence to show the likelihood of prevailing at a hearing on the merits in establishing entitlement to the maximum compensation rate of $992.20 for temporary disability benefits. See Tenn. Code Ann. § 50-6-239(d)(l) (2018). The Court holds he did not.

Average Weekly Wage

Tennessee Code Annotated 50-6-102(3)(A) defines "average weekly wage" as "the earnings of the injured employee in the employment in which the injured employee was working at the time of the injury during the period of fifty-two (52) weeks immediately preceding the date of the injury divided by fifty-two (52)." The statute is silent regarding the method of determining an employee's average weekly wage when an employer contractually treats an independent contractor as an employee.

Here, Mr. Yearby relied upon Am. Mut. Liability Ins. Co. v. Bradshaw, 568 S.W.2d 97 (Tenn. 1978), regarding his entitlement to the maximum weekly compensation rate. However, the trial court in Bradshaw relied on a liberal construction of the Workers' Compensation Law and the material evidence standard in reaching its conclusion, and the Supreme Court affirmed it. Regardless, Bradshaw is distinguishable because the evidence there was speculative regarding the employee's actual expenses, and the Court used the earnings of a worker employed in the same type of work to calculate the employee's average weekly wage.

1 A written contract between the parties required Mr. Yearby, an independent contractor, to pay Armstrong for workers' compensation coverage. Although Mr. Yearby is an independent contractor, the parties agreed that he is an employee for purposes of this workers' compensation claim.

Even under a liberal construction, the Court refused to broaden the definition of average weekly wage to include the value of fringe benefits, finding "[i]t would be inappropriate for this Court to judicially legislate what would amount to a large increase in compensation costs never contemplated by employers, carriers or the Legislature." Pollard v. Knox Co., 886 S.W.2d 759, 760 (Tenn. 1994). Similarly, this Court finds it inappropriate to treat Mr. Yearby's business expenses from which he paid other employees, workers' compensation insurance, and equipment as earnings from which he realized an economic gain.

Unlike Bradshaw, the Court here has evidence of Mr. Yearby's expenses for the fifty-two weeks before his injury. After deducting those expenses, the Court determines that Mr. Yearby's actual earnings from which he realized an economic gain were $31,567 for 2016 and $27,469 for 2017. Using the weekly average from each of those years, (specifically, thirty-six weeks at $528.25 in 2016 and sixteen weeks at $607.06 in 2017), Mr. Yearby's average weekly wage equates to $552.50 with a resulting compensation rate of $368.35. Therefore, Mr. Yearby's request for temporary disability benefits at the maximum compensation rate from April 4, 2019, through June 26, 2019, is denied; however, he is entitled to the stipulated benefits at the rate of$368.35.

IT IS, THEREFORE, ORDERED as follows:

1. Mr. Yearby's request for temporary disability benefits at the maximum compensation rate is denied. His correct average weekly wage is $552.50 with a resulting compensation rate of $368.35 and, as stipulated by the parties, he is entitled to temporary disability benefits from April 4, 2019, through June 26, 2019. After using the correct compensation rate, Armstrong is entitled to a credit for any overpayment of past temporary disability benefits from September 5, 2017, through May 17, 2018.

2. This case is set for a Status Hearing on Thursday, October 17, 2019, at 10:00 a.m. Eastern Time. You must call 423-634-0164 or toll-free at 855-383-0001 to participate. Failure to call might result in a determination of the issues without your participation.

ENTERED August 23,2019.

~ ocVJ:.QJA Judge AU<ireY drlck Court of Workers' Compensation Claims

APPENDIX

Exhibits: 1. Affidavit of Reginald Yearby 2. May 29, 2019 letter signed by Dr. Jason Rogers 3. Wage Statement (For Identification Only) 4. Medical records of Dr. Rogers 5. 2016 Tax Return 6. 2017 Tax Return 7. Independent Contractor Operating Agreement

Technical record: 1. Expedited Hearing Order 2. Order Resetting Status Hearing 3. Motion for Payment of Temporary Disability Benefits 4. Order Setting Expedited Hearing 5. Request for Expedited Hearing 6. Employee's Prehearing Brief 7. Notice ofFiling 8. Motion for Leave to File Late-Filed Exhibit 9. Employer's Prehearing Brief 10. Employer's Witness and Exhibit List 11. Order Granting Motion for Leave to File Late-Filed Exhibit

CERTIFICATE OF SERVICE

I certify that a copy of this Expedited Hearing Order was sent as indicated on August 23, 2019.

Name Certified Email Service sent to: Mail Wilson C. von Kessler, II, X wvonkessler@markelfirm.com Employee Attorney Richard R. Clark, Jr., X rclark@eraclides.com Employer Attorney

Pent~b ~tpr~~ Court of Workers' Compensation Claims WC.CourtClerk@tn.gov