Cunningham v. Atlantic States

• Decision Date: 26 June 2006
• Citation: 386 N.J. Super. 423,901 A.2d 956
• Parties: Dennis CUNNINGHAM, Petitioner-Respondent, v. ATLANTIC STATES CAST IRON PIPE CO., Respondent-Appellant.
• Court: New Jersey Superior Court

Page 956

901 A.2d 956

386 N.J. Super. 423

Dennis CUNNINGHAM, Petitioner-Respondent, v. ATLANTIC STATES CAST IRON PIPE CO., Respondent-Appellant.

Superior Court of New Jersey, Appellate Division.

Argued March 28, 2006.

Decided June 26, 2006.

Wendy Johnson Lario, Florham Park, argued the cause for appellant (Pitney Hardin, attorneys; Ms. Lario and Frank A. Romano, on the brief).

Brian A. Roemersma, Phillipsburg, argued the cause for respondent (Winegar, Wilhelm, Glynn & Roemersma, attorneys; Mr. Roemersma, on the brief).

Before Judges COBURN, COLLESTER and LISA.

The opinion of the court is delivered by

LISA, J.A.D.

This is a workers' compensation case. The petitioner, Dennis Cunningham, suffered a compensable injury, returned to full duty work, and was later terminated for cause. Before he obtained other employment, his injury disabled him from the ability to work. The judge of compensation determined that temporary disability benefits were available because, notwithstanding his termination, Cunningham was incapacitated and had not taken himself out of the labor market. We agree that an employee is not precluded from receiving temporary disability benefits under these circumstances. However, because temporary disability benefits constitute replacement for actual wage loss, the employee must prove that but for the disability he would have been employed. The record is lacking in this regard. Therefore, we reverse and remand for further proceedings.

Cunningham worked as a machine operator for respondent, Atlantic States Cast Iron Pipe Co. (Atlantic States), since 2001. On October 21, 2003, he was injured at work. He suffered a torn medial meniscus to his left knee. Atlantic States' designated physician, Dr. Karl Helmold, treated Cunningham and performed an arthroscopic surgical repair on December 9, 2003.

An Atlantic States policy provided that an employee would be terminated who inexcusably failed to report to work for three consecutive days. In November 2003, Cunningham failed to report for three consecutive days due to incarceration. He was terminated pursuant to the company policy, but through the efforts of his union, he was reinstated under a "last chance" agreement. The agreement provided that he could keep his job if he had no unauthorized absences for one year. He returned to work under the agreement on January 5, 2004.

Initially, Cunningham was assigned light duty, but Helmold cleared him for full duty as of January 23, 2004. Working without restrictions, he successfully completed his last chance agreement on January 5, 2005. In mid-January 2005, because of an outstanding traffic warrant, Cunningham was again incarcerated. He called his employer from jail and was informed he would be terminated if he did not return to work within three days. He arrived at work on the third day between 11:00 a.m. and noon, but his scheduled shift was 7:00 a.m. to 3:00 p.m. Atlantic States deemed this a violation of the three-day policy and terminated him. He refused to leave, and the employer called the police to remove him.

The union negotiated another last chance agreement similar to the previous one, and Cunningham was scheduled to return to work on February 2, 2005. Because he had to make childcare arrangements, he requested and was given a one-day extension. He reported at 7:00 a.m. on February 3, 2005, but in less than an hour received a call, which he said was from the childcare provider advising that new arrangements needed to be made immediately. He said he had not paid the provider and there was a misunderstanding about payment arrangements. Cunningham testified that he asked Atlantic States' human resources manager, James Surca, for permission to leave temporarily so he could attempt to place the children in the care of a relative or friend. He said Surca told him if he left he would be terminated. He left work and was terminated. He made no further efforts to be reinstated.

Surca gave a different version of the discussion with Cunningham. He said Cunningham came into his office, informed him he could not live up to his agreement because of the childcare problem, said he was leaving, and left. Surca denied telling Cunningham he would be terminated if he left. The judge of compensation accepted Cunningham's version, a finding supported by the record and to which we defer. Close v. Kordulak Bros., 44 N.J. 589, 599 210 A.2d 753 (1965). For reasons we will discuss, the outcome would be the same under either scenario.

On February 11, 2005, just eight days after his termination, Cunningham went on his own accord to Helmold, who examined him and issued a note stating that he was unable to work because of his knee injury. Helmold estimated that Cunningham would not be able to return to work until August 1, 2005. On May 5, 2005, Cunningham filed a motion for temporary disability and medical benefits. Atlantic States did not contest the request for medical benefits, nor does it dispute that Cunningham is entitled to a permanent disability award, for which a claim is pending. Atlantic States' opposition to the claim for temporary disability was not medically grounded. Atlantic States did not dispute the opinion of its designated physician that Cunningham was unable to work because of the injury. Instead, Atlantic States argued that Cunningham suffered no wage loss because he had been performing full duty work and required no medical treatment for about a year, he voluntarily abandoned his employment, and he was unemployed.

The judge of compensation reasoned that Cunningham did not intend to remove himself from the labor market and, to the contrary, "he was extremely distressed at losing his employment and very much wanted to retain his job." She concluded:

Our statute requires respondents to pay temporary disability so long as petitioners are incapacitated due to work-related injury and have not reached maximum benefit of treatment. This obligation continues after they leave the employment irrespective of whether they left voluntarily. . . . I am aware of no authority requiring a petitioner to continue in a position to remain eligible for temporary disability benefits and no one has called any to my attention.

She therefore entered an order on July 21, 2005, directing Atlantic States to pay Cunningham temporary disability benefits "beginning as of February 11, 2005 and until such time as petitioner reaches maximum medical improvement or returns to work, whichever occurs first."¹ This appeal followed.

Temporary disability benefits are payable during the period of disability, not to exceed 400 weeks, N.J.S.A. 34:15-12a, from the day the employee is first unable to work because of the injury until the employee "is able to resume work and continue permanently thereat," N.J.S.A. 34:15-38. "Generally, temporary disability continues `until the employee is able to resume work and continue permanently thereat' or until he [or she] `is as far restored as the permanent character of the injuries will permit,' whichever happens first." Monaco v. Albert Maund, Inc., 17 N.J.Super. 425, 431, 86 A.2d 279 (App. Div.1952). Actual absence from work is a prerequisite to a temporary disability award. Calabria v. Liberty Mut. Ins. Co., 4 N.J. 64, 68, 71 A.2d 550 (1950). An injured worker who resumes work after a period of disability who later experiences a relapse may later recover for intermittent or recurrent intervals of temporary disability. Colbert v. Consol. Laundry, 31 N.J.Super. 588, 596, 107 A.2d 521 (App. Div.1954).

The purpose of temporary disability benefits is to provide an individual who suffers a work-related injury with a "partial substitute for loss of current wages." Ort v. Taylor-Wharton Co., 47 N.J. 198, 208, 219 A.2d 866 (1966). Application of this well-settled principle is at the heart of the dispute in this case. Atlantic States does not dispute that as of February 11, 2005, Cunningham was unable to work because of his work-related injury. Had Cunningham continued to be in its employ on that date (or, conversely, had he gone to Helmold two weeks earlier with the same result), a current wage loss would have resulted and a recurrent disability period would have plainly begun, during which temporary benefits would have been payable. But, because Cunningham was not employed when the new disability period began, Atlantic States argues there was no current wage loss and no entitlement to temporary disability benefits.

This brings us to the circumstances of Cunningham's separation from employment. In Electronic Associates, Inc. v. Heisinger, 111 N.J.Super. 15, 20, 266 A.2d 601 (App.Div.), certif. denied, 57 N.J. 139, 270 A.2d 42 (1970), we held that an employee who retired from employment because of her pregnancy was not entitled to a temporary disability award for an injury that occurred during her employment but did not manifest itself until after her retirement because "she suffered no current wage loss as a result of an ailment attributable to her occupation. Rather, her loss of wages was the direct result of the voluntary termination of her employment." The reason for her separation was totally unrelated to her employment. Ibid.

Atlantic States argues that Cunningham knowingly and voluntarily violated a condition of his employment, of which he was on notice, and therefore it was his own affirmative act that caused his separation. Thus, like the employee in Heisinger, Atlantic States argues that Cunningham is barred from recovery of temporary disability because, knowing that the consequences of leaving work on February 3, 2005, without authorization would be his termination, he, in effect, voluntarily chose to end the employment relationship. In further support of its argument, Atlantic States directs us to the rule laid down by the courts in Ohio. See State ex rel. La.-Pac. Corp. v. Indus. Comm'n of Ohio, 72 Ohio St.3d 401, 650 N.E.2d 469 (1995) (employee who violated three-day absence rule, which...