AXMANN CONVEYING SYSTEMS v. RICKY VANCE; HON. LLOYD R. EDENS, ADMINISTRATIVE LAW JUDGE; AND WORKERS' COMPENSATION BOARD
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RENDERED:
November 21, 2001; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
2001-CA-001478-WC
AXMANN CONVEYING SYSTEMS
APPELLANT
PETITION FOR REVIEW OF A DECISION
OF THE WORKERS' COMPENSATION BOARD
ACTION NO. WC-98-00858
v.
RICKY VANCE;
HON. LLOYD R. EDENS,
ADMINISTRATIVE LAW JUDGE; AND
WORKERS' COMPENSATION BOARD
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
GUDGEL, CHIEF JUDGE; GUIDUGLI AND HUDDLESTON, JUDGES.
GUIDUGLI, JUDGE.
Axmann Conveying Systems (ACS) appeals from an
opinion of the Workers’ Compensation Board (the Board) which
affirmed an opinion and award entered by Administrative Law Judge
Lloyd Edens (the ALJ)awarding benefits to Ricky Vance (Vance).
We affirm.
On March 6, 1998, Vance, who was employed by ACS,
sustained injuries to his neck and back as a result of a workrelated accident.
Despite being injured, Vance continued to work
until March 12, 1998.
The circumstances surrounding Vance’s
cessation of employment with ACS were hotly disputed.
Vance testified that on March 12, 1998, he went to
lunch off-site with two other employees, one of whom was his son.
When the three return to work, Vance’s supervisor, Bernd Huber
(Huber) called him into his office.
According to Vance, Huber
told him that someone told him that the two employees Vance went
to lunch with had smoked marijuana during lunch.
Vance testified
that Huber told him to tell him that his co-workers smoked
marijuana during lunch, quit, or be fired.
Vance stated that
when he told Huber that he did not see his co-workers smoke
marijuana, Huber left the office, fired the two employees, and
returned.
According to Vance, Huber then told him to go home,
think about the situation, and call him later about coming back
to work.
Vance decided not to return to work.
Vance believes
that this whole incident occurred because he and the other two
employees were trying to unionize ACS’s employees.
ACS’s version of these events is quite different.
Huber testified at his deposition that Vance and the two
employees smelled like marijuana and beer when they returned from
lunch.
Acting on information that the other two employees had
smoked marijuana during lunch, Huber fired them immediately.
Huber testified that Vance asked for permission to leave with the
two employees because he rode to work with them.
According to
Huber, Vance later called and stated that he would not be
returning to work because, among other reasons, he no longer had
a ride to work.
Huber denied Vance’s allegation that he was
fired for attempting to organize a union at ACS, and testified
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that to the best of his knowledge Vance was never involved in
union organization efforts.
Vance and the two other employees filed a complaint
with the National Labor Relations Board (NLRB) in which they
alleged that they had been fired as a result of their attempts to
organize a union at ACS.
action was settled.
All of the parties agree that the NLRB
Vance testified that he received $10,000 as
a result of the settlement, and that he was told that this amount
represented lost wages.
Vance also testified that he paid taxes
on the amount he received from the settlement.
Vance admitted
that the did not know what period of time the payment covered as
far as wage loss.
ACS provided affidavits from Huber and Rene’ Heck
(Heck).
In his affidavit, Huber stated that Vance “received back
wages in the amount of $10,500.00 as a compromise settlement of a
disputed claim with regard to the NLRB action.”
Heck’s affidavit
stated that “[i]n a compromise settlement of [the NLRB claim], we
agreed to pay lost wages in the amount of $10,500.00, to run from
March 12, 1998.
Counsel for ACS asked Vance to provide a copy of the
settlement agreement and he agreed to look for it and provide a
copy if he could find it.
Counsel for Vance also asked ACS to
provide a copy of the settlement.
Finally, Huber agreed to
provide a copy of the settlement agreement.
Despite all of these
agreements to provide copies of the settlement agreement, neither
party placed a copy of the settlement agreement in the record.
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In an opinion and award entered December 22, 2000, the
ALJ awarded benefits to Vance based on a 9% permanent disability
rating.
The ALJ noted that ACS had paid a total of $7,314.65 in
TTD benefits to Vance from March 3, 1998 to August 30, 1998, and
again from April 7, 1999, to May 18, 1999.
In response to ACS’s
argument that it was entitled to a credit equal to the amount
paid to settle the NLRB claim, the ALJ held:
The Petitioner received a settlement from the
Employer as a result of a proceeding brought
before the [NLRB]. The documents concerning
that proceeding have not been filed, and KRS
342.730 provides only for set off for
payments for employer funded disability or
sickness and accident plan [sic] pursuant to
KRS 342.730(6) or unemployment insurance
benefits pursuant to KRS 342.730(5).
Accordingly, the Employer shall not receive
credit for amounts paid pursuant to the
settlement of the claim brought before the
[NLRB].
The Board affirmed the ALJ’s opinion and award on June 13, 2001,
and this appeal followed.
ACS maintains that both the ALJ and the Board erred in
refusing to allow it a credit equal to the amount paid to Vance
in settlement of his NLRB claim.
ACS points to the fact that
everyone agrees the settlement was for lost wages, and maintains
that simple math shows that the settlement covers 26.38 weeks of
lost wages ($10,500.00 / $398.02 average weekly wage = 26.38
weeks).
ACS further contends that at a minimum it is entitled to
a credit equal to the amount of TTD paid after March 12, 1998,
and argues that to the extent a credit is not given, Vance has
received a double recovery.
It maintains that its position is
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supported by Hardaway Management Company v. Southerland, Ky., 977
S.W.2d 910 (1998).
We disagree.
Under KRS 342.730, employers are only entitled to a
credit against their workers’ compensation liability for:
payments made under an exclusively employerfunded disability or sickness and accident
plan which extends income benefits for the
same disability covered by this chapter[.]
KRS 342.730 (6).
The payments made by ACS to settle Vance’s NLRB
claim clearly do not fall under any of the provisions of KRS
342.730(6).
We also agree with the Board that Hardaway is not
controlling.
In that case, an employee who was fired after
sustaining a work-related back injury received both an award of
workers’ compensation benefits and a judgment in her favor
against Hardaway covering lost wages in a civil action she filed
for wrongful termination.
Having paid TTD benefits, Hardaway
argued that it was entitled “to a credit against the judgment for
the amount of workers’ compensation benefits paid[.]” Hardaway,
977 S.W.2d at 918.
Noting the strong public policy against
double recovery for the same elements of loss, the Kentucky
Supreme Court held:
Hardaway was entitled to credit against
Southerland’s judgment for the temporary
total disability benefits paid to her while
she was unable to work. Those benefits
represented compensation for wages lost
during an identical period for which the jury
awarded her damages for “back pay and income
lost.”
Id. at 919.
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Vance’s case is the reverse of the situation presented
in Hardaway in that it is seeking a credit against the workers’
compensation award as opposed to a judgment.
As we have noted,
the question of whether payments made by an employer to an
employee are subject to a credit in the employer’s favor against
an award of compensation benefits is answered by KRS 342.730(6),
and, as we have noted, the payment made by ACS is not covered by
that statute.
Had ACS refused to settle the NLRB claim it had
the opportunity to claim a credit for workers’ compensation
benefits paid to Vance against any judgment awarded in his favor
under Hardaway.
ACS chose to settle its claim, however, thus
foreclosing any change to receive the credit it now seeks.
Even if we were to find that ACS was entitled to a
credit under KRS 342.730 or Hardaway, we do not believe that the
evidence contained in the record is sufficient to support the
credit ACS seeks.
“Where an employer seeks a credit against
future workers’ compensation benefits, it has the burden of
proving by substantial evidence that the benefits for which the
credit is sought actually are duplicative of workers’
compensation benefits.”
(1995).
GAF Corp. v. Barnes, 906 S.W.2d 353, 355
The only evidence ACS presented in regard to the
settlement were the affidavits and testimony of Huber and Heck
that it paid Vance $10,500 in settlement of the NLRB claim and
that this payment represented lost wages from March 12, 1998
forward.
This was contrary to Vance’s testimony that the
settlement was $10,000.
We agree with the following portion of
the Board’s opinion and adopt it as our own:
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The settlement agreement . . . was not
contained in the record and therefore,
whether or not the last wages were for the
same period as Vance received TTD benefits
was not proven. While there may have been
some evidence in the record which would have
supported a contrary conclusion to that
reached by the ALJ, the fact-finder was not
compelled to rely on such evidence. See,
McCloud v. Beth-Elkhorn Corp., Ky., 514
S.W.2d 46 (1974).
Having considered the parties’ arguments on appeal, the
opinion of the Workers’ Compensation Board is affirmed.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Walter E. Harding
Louisville, KY
Wayne C. Daub
Louisville, KY
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