Nay v. Cornerstone Staffing Solutions

• Decision Date: 11 February 2022
• Docket Number: No. 409PA20,409PA20
• Parties: Luon NAY, employee v. CORNERSTONE STAFFING SOLUTIONS, employer, and Starnet Insurance Company, carrier, (Key Risk Management Services, administrator)
• Court: North Carolina Supreme Court

867 S.E.2d 646

Luon NAY, employee

v.CORNERSTONE STAFFING SOLUTIONS, employer, and Starnet Insurance Company, carrier, (Key Risk Management Services, administrator)

No. 409PA20

Supreme Court of North Carolina.

Filed February 11, 2022

Law Offices of Kathleen G. Sumner, Greensboro, by Kathleen G. Sumner ; David P. Stewart ; and Jay Gervasi, P.A., Greensboro, by Jay A. Gervasi, for plaintiff-appellee.

Brewer Defense Group by Joy H. Brewer and Ginny P. Lanier, Cary, for defendant-appellants.

Dickie McCamey & Chilcote, P.C., Raleigh, by Michael W. Ballance ; Teague Campbell Dennis & Gorham, L.L.C., Raleigh, by Tracey L. Jones and Bruce Hamilton, for the North Carolina Association of Defense Attorneys and North Carolina Association of Self-Insurers, amici curiae.

Lennon, Camak & Bertics, PLLC, Raleigh, by Michael W. Bertics ; Poisson Poisson Bower, PLLC, Wilmington, by E. Stewart Poisson, for the North Carolina Advocates for Justice, amicus curiae.

ERVIN, Justice.

¶ 1 This case involves the issue of whether the Commission's decision concerning the method that should be utilized to calculate an injured worker's average weekly wages pursuant to N.C.G.S. § 97-2(5) and the Commission's determination concerning the extent to which the results obtained by a particular method for determining the injured employee's average weekly wages are "fair and just to both parties" so as to "most nearly approximate the amount which the injured employee would be earning were it not for the injury" are questions of law or questions of fact. After careful consideration of the relevant facts in light of the applicable law, we modify and affirm the Court of Appeals’ decision and remand this case to the Commission for further proceedings not inconsistent with this opinion, including the entry of a new order containing appropriate findings of fact and conclusions of law.

I. Factual and Procedural History

A. Substantive Factual Background

¶ 2 On 25 August 2015, plaintiff Luon Nay began working for defendant Cornerstone Staffing Solutions, a staffing agency owned and operated by Thomas Chandler. In the course of its business, Cornerstone places people seeking employment with companies in need of workers in the Charlotte-Mecklenburg and Rock Hill-York County regions. According to Mr. Chandler, Cornerstone often places workers in jobs with logistics and manufacturing companies that pay between ten and thirteen dollars per hour, with its employees being primarily people who are either unemployed and seeking full-time employment or are, while currently employed, seeking a better or higher-paying job. Mr. Chandler described many of the entities with whom Cornerstone places workers as "medium-size or small companies" that lack "broad Human Resources department[s]," with these entities having elected to use Cornerstone to hire their workers and take care of employment-related costs such as those involved in recruiting potential employees, performing drug tests and background checks, and the handling of "Medicare, Social Security, Workers’ Comp," and any other expenses that are typically involved in the hiring of new workers.

¶ 3 At least ninety-five percent of the workers that Cornerstone places with other entities occupy "temp-to-perm" positions which will, hopefully, lead the entity with whom the worker has been placed to hire that worker to fill a permanent position at the end of a successful trial period. During the trial period, which typically lasts until the worker has worked for 520 hours with the entity with whom he or she has been placed, the worker is still technically employed by Cornerstone. After the worker has worked with the entity with whom he or she has been placed for at least 520 hours, the worker is typically either given full-time employment by the entity with whom Cornerstone has contracted or the assignment ends, with there being no guarantee that the worker will receive full-time employment at the conclusion of the 520-hour trial period.

¶ 4 Cornerstone placed plaintiff in a temp-to-perm position with FieldBuilders, an entity that creates and updates athletic fields and performs other landscaping tasks, with plaintiff having worked at FieldBuilders during the interval between 25 August 2015 and 7 December 2015. According to Mr. Chandler, a worker's schedule with FieldBuilders could be affected by the "[h]olidays, weather, [or] season." In the course of a typical week, plaintiff worked with FieldBuilders for eight hours a day for four to five days each week and was compensated at the rate of eleven dollars per hour. On occasion, however, plaintiff worked as few as six hours or as many as ten hours each day.

¶ 5 On 24 November 2015, while working with FieldBuilders, plaintiff and another worker attempted to lift a heavy machine into a truck given their inability to load the machine using the truck's broken ramp. As plaintiff tried to raise the machine, he heard a noise and felt a pop on the right side of his lower back and immediately recognized that he had been injured. The lower back pain that plaintiff was experiencing gradually worsened throughout the day upon which he was injured and the day after that. Although plaintiff attempted to return to work on the following Monday, he was only able to work for about four hours before his lower back pain forced him to stop. On 1 December 2015, plaintiff sought medical treatment for his persistent back pain and was prescribed medication and physical therapy. After a treatment session on 22 December 2015, plaintiff stopped attending physical therapy due to increased lower back pain.

¶ 6 On 19 January 2016, Cornerstone filed a Form 19, which is titled "Employer's Report of Employee's Injury or Occupational Disease to the Industrial Commission," stating that plaintiff had worked with FieldBuilders for five days each week and that plaintiff had earned average weekly wages of $440.00. On 15 February 2016, Cornerstone filed Form 22, which is titled "Statement of Days Worked and Earnings of Injured Employee," reciting that plaintiff had worked for four days during the last week of August 2015, which was the first week during which he had been assigned to work with FieldBuilders; that plaintiff worked for five days each week during September 2015; that plaintiff worked for five days each week during October 2015; that plaintiff had worked for five days each week during three weeks in November 2015 and for four days during one week in November 2015; and that plaintiff had worked for three days during the first week of December 2015 and for one day during the second week of December, which was plaintiff's last day of work at FieldBuilders. Cornerstone's records indicated that plaintiff had earned a total of $5,805.25 during the sixteen weeks that he had been assigned to work at FieldBuilders.

¶ 7 On 8 March 2016, the Commission received a completed Form 18, which is titled "Notice of Accident to Employer and Claim of Employee, Representative, or Dependent," describing plaintiff's back injury. On 25 March 2016, Cornerstone filed a Form 63 with the Commission and began directing the medical care that plaintiff received and paying temporary total disability benefits to plaintiff. In June 2016, plaintiff returned to Cornerstone for the purpose of seeking another job placement and was placed with an entity known as JMS, at which plaintiff worked for eight hours per day cleaning and polishing metal. After plaintiff had worked with JMS for three weeks, he was told that there was no more work for him at that placement and that Cornerstone had been unable to find another entity with which to place him.

B. Procedural History

¶ 8 On 21 July 2017, plaintiff filed a Form 33, which is titled "Request That Claim Be Assigned for Hearing," in which he claimed that Cornerstone had unilaterally lowered the amount of temporary total disability benefits that he had been receiving with respect to his back injury and that the parties had been unable to reach agreement with respect to the amount of benefits that plaintiff was entitled to receive. On 9 February 2018, plaintiff's claim came on for hearing before Deputy Commissioner David Mark Hullender. At the hearing, plaintiff contended that his average weekly wage was $419.20, which yielded a compensation rate of $279.48, while Cornerstone and defendant Starnet Insurance Company contended that plaintiff's average weekly wage was $111.64, which yielded a compensation rate of $74.43. The parties stipulated that Cornerstone had paid benefits to plaintiff at the rate of $258.03 per week between 1 December 2015 and 5 July 2016 and that Cornerstone had lowered plaintiff's compensation rate to $74.43 per week after that point, with this figure having been derived by dividing the $5,805.25 in total earnings that plaintiff had received while working with FieldBuilders by fifty-two weeks. In an opinion and award filed on 7 June 2018, Deputy Commissioner Hullender found that the lower weekly compensation rate for which Cornerstone had advocated was the correct one. Plaintiff noted an appeal from Deputy Commissioner Hullender's order to the Commission.

¶ 9 On 22 February 2019, the Commission filed an opinion and award finding, in pertinent part, that "[d]efendants’ modification of [p]laintiff's average weekly wage and compensation rate to $111.64 and $74.43, respectively, ... was appropriate." In making this determination, the Commission reviewed the five methods for calculating an injured employee's average weekly wages set out in N.C.G.S. § 97-2(5), which states that

[Method 1:] "Average weekly wages" shall mean the earnings of the injured employee in the employment in which the employee was working at the time of the injury during the period of 52 weeks immediately preceding the date of the injury, ... divided by 52[.]

[Method 2:] [B]ut if the injured employee lost more than seven consecutive calendar days at one or more times during such period, although not in the same week, then the

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