JACKLYN HADDIX V. NESCO, ET AL.Annotate this Case
RENDERED : MAY 19, 2011
TO BE PUBLISHED
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ON APPEAL FROM COURT OF APPEALS
CASE NOS . 2009-CA-001129-WC AND 2009-CA-001564-WC
WORKERS' COMPENSATION NO. 07-71953
HONORABLE JOSEPH JUSTICE,
ADMINISTRATIVE LAW JUDGE ; AND
WORKERS' COMPENSATION BOARD
ON APPEAL FROM COURT OF APPEALS
CASE NOS. 2009-CA-001129-WC AND 2009-CA-001564-WC
WORKERS' COMPENSATION NO . 07-71953
HONORABLE JOSEPH W. JUSTICE,
ADMINISTRATIVE LAW JUDGE ; AND
WORKERS' COMPENSATION BOARD
OPINION OF THE COURT
AFFIRMING IN PART AND REVERSING IN PART
An Administrative Law Judge (ALJ) found that the claimant's work for
the defendant-employer's temporary employment agency was sporadic but
failed to specify whether KRS 342 or (1) (e) was used to calculate her
average weekly wage . The Workers' Compensation Board reversed and
remanded the claim for further proceedings to include the taking of additional
proof and an analysis of the evidence under KRS 342 This appeal
and cross-appeal are taken from a decision by the Court of Appeals to affirm.
Appealing, the employer argues that which subsection of KRS 342.140(1)
applies is a factual determination to be made by the ALJ; that the ALJ
committed harmless error by failing to specify the subsection of KRS
342 .140(l) used in the average weekly wage calculation ; and that additional
proof should not be permitted on remand. The claimant defends the Court of
Appeals' decision but also argues in a cross-appeal that the record compels a
finding under KRS 342 .140(1)(e) that her average weekly wage was $320 .00 .
We affirm in part and reverse in part . Whether KRS 342 .140(1) (d) or
(1) (e) controls the facts as found is a legal question. The ALJ did not commit
harmless error by failing to specify the subsection relied upon and must
analyze the evidence under KRS 342 .140(1)(e) on remand. We reverse with
respect to the decision to reopen proof because the claimant has argued from
the outset that KRS 342 .140(1)(e) controls the calculation . The record contains
adequate evidence to apply the statute under the present circumstances and
does not compel the finding that either party seeks .
The claimant was born in 1960. She completed high school, after which
she worked for various employers and government programs as a food service
worker, nurse's aide, day care worker, and assembly line worker . Much of the
work was temporary . In 2005 she began working for Nesco, a staffing service .
Nesco placed her with several different businesses at which she performed
various types of work for various periods of time . The employment was not
continuous. Nesco placed her on "availability call" between assignments and
called her near the end of an assignment to inform her if another placement
was available . Sometimes she declined available jobs.
Nesco placed the claimant at Star Manufacturing on April 24, 2007 . She
worked there for about four weeks. Nesco then placed her at another business
briefly . She declined Nesco's next placement offer. On August 6, 2007 Nesco
sent her back to Star to perform the same work that she had done previously .
Two days later, on August 8, 2007, she slipped in some oil, fell, and injured her
neck. Nesco placed her on light duty for a while but eventually terminated her,
after which she sought workers' compensation benefits . She testified that she
was the only employee Star requested in August 2007 and later characterized
the position as being "temp-to-hire," which meant that Star would hire her as
its permanent employee when a position became available .
Julie Gammon, an area manager for Nesco, testified at the hearing that
the company placed individuals in jobs under various types of arrangements
such as temp-to-hire, temporary services, direct placements, and temporary
work. She stated that sometimes Nesco hires an individual directly; whereas,
sometimes it finds a worker for a business in exchange for 20% of the base
salary and the business takes the worker onto its payroll . She explained that
individuals sent to a business on a temp-to-hire basis have the potential to be
hired by the business if they meet its standards and a position is available .
She stated that she would have to check company records to determine
whether any position in which the claimant worked was temp-to-hire .
Gammon testified that Nesco did not pay workers when they were on
availability call between job placements and did not consider them to be
employees at such times.
Amy Ward, a staffing specialist at Nesco, testified at the hearing that the
claimant's position at Star was temporary rather than temp-to-hire . She stated
that all of the positions that Nesco filled for Star were temporary; that Star had
never hired an employee whom Nesco referred ; and that Star did not ask for a
replacement employee after the claimant's injury. She testified that the
position the claimant held at Star paid $8.00 per hour for a forty-hour week
and that it was temporary, i.e., for as long as Star needed her.
Kelly Rogers, the Nesco employee who recruited workers for Star, testified
that Star offered temporary jobs but no temp-to-hire jobs. She stated that the
jobs were of indefinite duration but that Star expressed no intent to put a
temporary employee on its payroll. To her knowledge no employee she placed
at Star was ever hired.
Nesco submitted the claimant's wage records for 2006 and 2007 . They
indicated that she worked continuously from January 1, 2006 through May 20,
2006 for between 8 and 48 .25 hours per week . The claimant testified that she
worked for another temporary employment agency for a while in October 2006.
She did not work for Nesco again until the week ending April 27, 2007, when
she was sent to Star for the first time. Nesco's records indicated that she
worked 20 hours that week ; 36 hours during the week ending May 4, 2007 ;
and 40 hours during the week ending May 11, 2007, for a total of $768 .00 or a
weekly average of $59 .08. In the 13-week period immediately preceding her
injury she worked 13 hours during the week ending May 18, 2007 ; 15 .3 hours
during the week ending June 15, 2007 ; and 24 hours during the week ending
August 10, 2007, for a total of $587 .40 or a weekly average of $45.18 .
The claimant maintained that she worked at Star in a temp-to-hire job of
indefinite duration . She had done so for only three days when injured. Thus,
her average weekly wage should be calculated using KRS 342 .140(1) (e) because
she had been employed for less than 13 weeks when the injury occurred . The
calculation she proposed yielded an average weekly wage of $320 .00 based on
working 40 hours per week at $8 .00 per hour. She offered no alternative
Nesco asserted that most of the claimant's work history consisted of
sporadic temporary employment. Moreover, although she worked for Nesco for
more than 13 weeks before the injury, the character of her work included
periods when she did not work and received no wages . It advocated calculating
her average weekly wage by averaging her earnings during the 13-week period
immediately preceding her injury under KRS 342 .140(1) (d), which yielded an
average weekly wage of $45 .18 . Though based on KRS 342 .140(1)(d), the
argument overlooked the fact that the claimant's earnings during the most
favorable 13-week period in the year before her injury yielded an average
weekly wage of $59 .08 .
Nesco argued in the alternative that the calculation should be made
under KRS 342 .140(1) (e) as in C 8a D Bulldozing v. Brock,' taking into
consideration the sporadic and temporary nature of the employment . Nesco
noted that the claimant offered no evidence concerning the earnings of
similarly-situated employees but also asserted that there was no similarlysituated employee . It concluded that $45.18, the average of her earnings over
the 13-week period immediately preceding her injury, was a more realistic
figure than the average of her earnings during the weeks that she worked .
Uncontradicted medical evidence indicated that the claimant's injury
produced a 17% permanent impairment rating, and the ALJ found that she did
not retain the physical capacity to return to lifting boxes of parts that weighed
50 pounds. The ALJ found the claimant's work placement with Nesco to be
"very sporadic" as reflected in her wage records . Noting that the prior period of
employment at Star only lasted for about four weeks, the ALJ found it
unrealistic to treat the subsequent job at Star as being permanent for the
purpose of the average weekly wage calculation . Accepting Nesco's position but
failing to specify whether under KRS 32 or (1) (e), the ALJ found the
claimant's average weekly wage to be $45 .18 per week but acknowledged that
she would receive very little compensation for what was a very serious injury.
1 820 S.W.2d 482 (Ky. 1991) .
The claimant's petition for reconsideration pointed out that she had
worked for Nesco for only three days when injured ; that her average weekly
wage must be determined under KRS 342 .140(1) (e) ; and that the statute did
not consider whether the employment was permanent . She asserted that
$320.00 per week was a more realistic estimation of what she would have
earned had she been employed by Nesco for the full 13-week period
immediately preceding her injury when work was available to other employees
in the same occupation . The petition was denied, after which she appealed .
I. ISSUE OF FACT OR LAW.
The employer asserts that the Court of Appeals erred by directing the
ALJ to apply KRS 342.140(1) (e) on remand because whether to apply KRS
342 or (1)(c) is a choice "dependent on findings of fact that are solely
the province of the ALJ ." We agree that factual findings are the ALJ's province,
but we do not agree that the Court of Appeals erred when it concluded that
KRS 342 .140(1)(e) governs these facts.
KRS 342 .140(1) provides, in pertinent part, as follows :
The average weekly wage of the injured employee at
the time of the injury or last injurious exposure shall
be determined as follows :
(1) If at the time of the injury which resulted in death
or disability or the last date of injurious exposure
preceding death or disability from an occupational
(d) The wages were fixed by the day, hour, or by the
output of the employee, the average weekly wage shall
be the wage most favorable to the employee computed
by dividing by thirteen (13) the wages (not including
overtime or premium pay) of said employee earned in
the employ of the employer in the first, second, third,
or fourth period of thirteen (13) consecutive calendar
weeks in the fifty-two (52) weeks immediately
preceding the injury.
(e) The employee had been in the employ of the
employer less than thirteen (13) calendar weeks
immediately preceding the injury, his average weekly
wage shall be computed under paragraph (d), taking
the wages (not including overtime or premium pay) for
that purpose to be the amount he would have earned
had he been so employed by the employer the full
thirteen (13) calendar weeks immediately preceding
the injury and had worked, when work was available
to other employees in a similar occupation .
Although KRS 342 .285 designates the ALJ as the finder of fact in
workers' compensation claims, it charges the Board with determining whether
the legal conclusions the ALJ draws from the facts conform to Chapter 342 .
KRS 342 .290 charges the Court of Appeals with reviewing all matters subject to
review by the Board as well as any legal errors that arise before the Board . The
Board and the Court of Appeals acted within the scope of their authority when
they determined that the claimant's average weekly wage must be calculated
under KRS 342 as construed in C & D Bulldozing v. Brock because
Nesco had employed her for less than 13 weeks when her injury occurred .
KRS 342.140(1)(d) clearly requires the employee to have worked for the
employer for at least one 13-week period when injured . KRS 342 .140(1) (e)
clearly does not. The court determined in C & D Bulldozing v. Brock that KRS
342 .140(1)(e) must be used to calculate the earning capacity of an employee
who worked when work was available ; received no wages when work was
unavailable ; agreed with his employer that he was not employed during those
periods ; and worked only seven weeks out of the 13 weeks immediately
preceding his injury. As calculated under that section, the average weekly
wage is based on evidence of what would have been earned if the worker was
employed by the employer for the full 13-week period immediately preceding
the injury and worked whenever work was available to other employees in a
similar occupation .
Applying KRS 342 .140(1) (e) to the facts, the court noted the absence of
any evidence that work was available at C 8s D to other employees in an
occupation similar to Brock's. Moreover, evidence showed seven weeks of
operating a bulldozer for C 8. D during a 13-week period to be a normal period
of service . The court determined that the calculation must be based on Brock's
actual earnings during the 13-week period immediately preceding his injury
and acknowledged that the calculation yielded the same average weekly wage
as under KRS 342 .140(1) (d) on the facts that were present. Noting that no
provision of KRS 342.140 was tailored narrowly to accommodate consistently
intermittent employment that is not seasonal, the court concluded that KRS
342 .140(1)(e) must be applied "as best we can" to the circumstances .2
The ALJ found reasonably in the present case that the claimant's
employment with Nesco was sporadic . The uncontradicted testimony of
Nesco's own witness, Julie Gammon, belied its argument that KRS
342 .140(1) (d) controls these facts . She stated that Nesco did not pay workers
2 820 S .W.2d at 486.
on availability call between assignments and nothing indicates that it provided
any other benefits during such periods . Such evidence compelled a conclusion
that each placement was a separate employment . KRS 342 .140(1)(e) controls
the average weekly wage calculation as a matter of law because the claimant's
injury occurred three days after Nesco re-employed her and placed her at Star.
Thus, she had been employed for less than 13 weeks when injured .
KRS 342 .140(1) (e) permits an ALJ to estimate what the worker would
reasonably have expected to earn in the occupation in which the injury
occurred by taking into account the availability of work to other employees in a
similar occupation during the full 13-week period immediately preceding the
injury. Huff v. Smith Trucking3 and C 8a D Bulldozing Co. v. Brock4 stand for the
principle that the ALJ must consider the unique circumstances in a case
involving an employment of less than 13 weeks and make a realistic estimate of
what the individual probably would have earned in a normal 13-week period of
11 . HARMLESS ERROR.
The claimant asserted that she would have been able to work at Star for
the full 13-week period that immediately preceded her injury and earned an
average wage of $320 .00 per week, a position the ALJ rejected as being
Although the ALJ accepted Nesco's position as to the correct
manner in which to calculate the average weekly wage, nothing indicates that
6 S.W.3d 819 (Ky. 1999) .
4 820 S.W.2d 482 .
the ALJ adopted Nesco's average weekly wage analysis under KRS 342 .140(1) (e)
rather than KRS 342 The claim must be remanded for further
consideration because the evidence would have supported but did not compel
an average weekly wage of $45 .18 when analyzed properly under KRS
342 .140(1)(e) .
Unlike KRS 342 .140(1)(d), which bases the average weekly wage
calculation on the most favorable 13-week period in the year immediately
preceding the worker's injury, KRS 342 .140(l)(e) bases the analysis for an
employment of less than 13 weeks on the 13-week period that ends with the
KRS 342 does not on its face consider that the parties may have
had a longstanding but sporadic employment relationship . It looks to the
earnings of other employees in a similar occupation in an attempt to estimate
the average weekly wage for a normal 13-week period of hire . As the court
noted in C & D Bulldozing v. Brock, KRS 342 .140(1)(e) is not ideally suited to
consistently intermittent employment and must be applied to varying
Unique to the present case are two facts . First, unlike the parties in C &
D Bulldozing v. Brock or in Huff v. Smith Trucking, Nesco and the claimant had
a sporadic employment relationship of nearly two years' duration. Second,
Nesco sometimes offered work that the claimant declined . A realistic estimate
of her probable earnings in a normal 13-week period must take both facts into
account . Thus, the calculation under KRS 342 .140(1) (e) may be based on
reasonable inferences drawn from the course of the parties' relationship as well
as evidence of what similarly-situated employees would have earned .
III. ADDITIONAL PROOF .
We are not convinced that the circumstances warrant the taking of
additional proof. An injured worker bears the burden of proof and risk of nonpersuasion before the fact-finder with regard to every element of a claim,
including her average weekly wage .5 This is not a case in which the claimant
was uncertain about which section of KRS 342 .140(1) applied to her claim .
She argued from the outset that KRS 342 .140(1)(e) governed the calculation
and had the burden to submit the necessary evidence within the time for
The claimant relied on KRS 342 .140(1) (e) and Huff v. Smith Trucking to
argue that she would have been able to work at Star for the 13 weeks
immediately preceding her injury, earning an average weekly wage of $320 .00 :
She offered no alternative argument . To permit additional proof under the
circumstances would amount to giving her a "second bite at the apple." That
said, we are convinced that the record contains sufficient evidence to permit a
proper analysis under KRS 342 .140(1)(e) but are not convinced that it compels
the ALJ to adopt the analysis that either party offered .
5 See Roark v. Alva Coal Corporation, 371 S.W.2d 856 (Ky. 1963); Wolf Creek Collieries
v. Crum, 673 S.W.2d 735 (Ky. App . 1984) ; Snawder v. Stice, 576 S.W.2d 276 (Ky.App.
The decision of the Court of Appeals is affirmed in part, reversed in part,
and this claim is remanded to the ALJ to. analyze the evidence under KRS
342 .140(1) (e) and decide the matter accordingly.
All sitting. All concur.
COUNSEL FOR APPELLANT/ CROSS-APPELLEE,
Hugh Brettelle Stonecipher
Tighe A. Estes
Ferreri 8s Fogle
300 East Main Street
Lexington, Ky 40507
COUNSEL FOR APPELLEE/ CROSS-APPELLANT,
JACKLYN HADDIX :
Daniel Edward Moriarty
705 West Main Street
Lexington, KY 40508