This case involves a claim for workers' compensation benefits by William Bailey, Jr. After incurring a work-related injury, Bailey received temporary total disability benefits from November 1980 until July 1981. In April 1982, he received a $6000 lump-sum payment for permanent partial disability. Bailey now maintains that he was entitled to continue receiving temporary total disability compensation between July 1981 and May 1982. He also claims the Workers' Compensation Board (Board) erred in calculating his permanent partial disability award and in refusing to award him attorney's fees and costs.
I. FACTUAL BACKGROUND
Appellant Bailey is fifty-one years old and has been a pipefitter for the last twenty-eight years. He injured his back on August 14, 1980, while leaning over a pipe to pick up a tool box and a transmitter. At the time, he was working for Appellee Litwin Corporation (Litwin), on a construction project at the Tesoro plant in Kenai, Alaska.
After his injury, Bailey was examined by several doctors and chiropractors, who formed differing assessments of his condition. In August 1980, Dr. Bruce W. Teague, a chiropractor, examined Bailey and released him for work. Bailey immediately resumed work for Litwin as a pipefitter. Dr. William West, another chiropractor, examined Bailey the following September and October and released him for regular work on September 29, 1980. Bailey was laid off November 4, 1980 when Litwin reduced its workforce. On the same day, a third chiropractor, Dr. Gene Kremer, examined Bailey and took him off work through January 1981. Dr. Michael Newman, an orthopedic specialist, treated Bailey and released him for work, without restrictions, effective April 21, 1981.
Bailey resumed work as a hydro-tester with National-NANA on the North Slope from July 13 to August 16, 1981, when he was terminated due to a reduction in force. On October 1, 1981, he began work on the North Slope in "instrumentation"
Christopher W.M. Horton, M.D., conducted an independent medical examination of Bailey on November 25, 1981, and recommended that Bailey continue his work without any restrictions. He evaluated Bailey as medically stationary and rated him as having a ten percent whole body permanent physical impairment.
Ross Brudenell, M.D., an orthopedic surgeon, examined Bailey on February 23, 1982, and determined that he was not medically stationary and did not release him for work. Later, Dr. Brudenell stated that Bailey's condition was medically stationary as of March 3, 1982, but that he "will probably risk increasing symptoms if he tries to do heavy, manual labor ... [and that] his working activity which related to instrument controls, was much more appropriate than any attempts to try to get back his original occupation."
On March 8, 1982, Bailey returned to the North Slope to work for the F.J. Early Company, primarily in hydro-testing and instrumentation. He was terminated April 26, due to a reduction in forces, but hoped to be recalled.
Dr. Newman examined Bailey again on May 18, 1982, and considered his condition medically stationary and unchanged since April, 1981.
In sum, during the ten-month period from July 7, 1981 through May 7, 1982, Bailey worked a total of 1170 hours and earned $36,807.85 (approximately $876 per week). In 1977 his average weekly wage was also $876. In 1978 and 1979 Bailey worked approximately 1138 and 1227 hours, with average weekly wages of $517.88 and $523.68, respectively. His average weekly wage in 1980 before he was injured was $832.94.
Bailey received temporary total disability benefits from November 10, 1980, through July 6, 1981. While the payment date is unclear from the record, it is undisputed that the insurance carrier, Travelers Insurance Company (Travelers), awarded Bailey a lump sum payment of $6,000, based on a ten percent loss of earning capacity and Dr. Horton's impairment rating.
In February 1982, Bailey filed a petition for adjustment of claim with the Workers' Compensation Board. In its second decision and order,
II. TEMPORARY TOTAL DISABILITY
The Board found that by July 16, 1981, both Dr. Newman and Dr. Kremer had released Bailey for work without restriction, and that he had in fact returned to work on July 13. In the Board's opinion, these facts overcame any presumption that Bailey continued to be temporarily totally disabled; thus, the Board concluded that Litwin and Travelers properly terminated his temporary benefits. The Board found also that any periods of unemployment Bailey experienced between July 1981 and May 1982 were "due to the economy and construction cycles and not to the employee's injury."
Bailey argues that he is entitled to temporary total disability benefits from July 1981 through May 1982 because he was not medically stable as of July 1981, his medical condition prevented him from working full-time, and he was being retrained in instrumentation.
The Alaska Workers' Compensation Act (Act), AS 23.30.005-.270, creates a presumption of compensability. AS 23.30.120(1). If, however, substantial evidence
In reviewing the Board's decision, our task is to determine if its findings of fact and conclusions of law are supported by "substantial evidence in light of the whole record." Delaney v. Alaska Airlines, 693 P.2d 859, 863 (Alaska 1985); Beauchamp v. Employers Liability Assurance Corp., 477 P.2d 993, 997 (Alaska 1970). Under this standard, we may not reweigh the evidence or choose between competing reasonable inferences. Delaney, 693 P.2d at 863; Beauchamp, 477 P.2d at 997.
A. The Test for Termination of Temporary Disability
Bailey claims that he is entitled to additional temporary benefits after July 1981 because he was not considered medically stable until after November 1981. In concluding that his temporary benefits were properly discontinued in July 1981, the Board made no express findings of fact regarding Bailey's medical stability.
The Act defines "disability" generally as "incapacity because of injury to earn the wages which the employee was receiving at the time of injury in the same or any other employment." AS 23.30.265(10). The Alaska territorial court defined temporary total disability as "the healing period or the time during which the workman is wholly disabled and unable by reason of his injury to work." Phillips Petroleum Co. v. Alaska Industrial Board, 17 Alaska 658, 665 (D. Alaska 1958) (quoting Gorman v. Atlantic Gulf & Pacific Co., 178 Md. 71, 12 A.2d 525, 529 (1940)). The Phillips court explained:
17 Alaska at 666 (citations omitted) (emphasis added).
We reiterated this emphasis on earning capacity in Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264 (Alaska 1974), by stating:
524 P.2d at 266 (footnote omitted); see also Ketchikan Gateway Borough v. Saling, 604 P.2d 590, 594 (Alaska 1979).
Our previous cases stress the claimant's ability to return to work and indicate that medical stability is not necessarily the point at which temporary disability ceases. We hold, therefore, that the Board did not err in focusing on Bailey's employment and
B. Substantial Evidence in the Record
The Board found that both Dr. Newman and Dr. Kremer released Bailey for work without restrictions by July 16, 1981. Even though both doctors subsequently retracted these releases, the fact that Bailey returned to work on July 13, 1981, is sufficient evidence to rebut the presumption of continuing compensability for temporary total
Bailey argues that his medical impairment prevented him from working fulltime; thus, he was entitled to additional temporary compensation during the gaps in his employment between July 1981 and May 1982. The record supports the Board's finding that Bailey's periods of unemployment
Bailey claims the gaps in employment were due to his disability. He states that he turned down a pipeline repair job in January or February 1982 because he was physically unable to perform the work. However, while the job did involve heavy work, there were other reasons presented for Bailey's decision to not take the job, including uncomfortable working conditions, the short duration of the work, and the possibility of losing a favorable position on the union employment list. Bailey also indicated that he asked the foreman at PCI to give him a termination on a reduction in force because he did not want to continue the job when it changed from instrumentation to heavier haylon system pipe installation. However, Mr. Cable, the project superintendent for PCI, testified that Bailey was hired specifically to do instrumentation work, and he had no intention of hiring him as part of the haylon system.
We conclude that the Board's finding that Bailey's gaps in employment were due to the economy and construction cycles, and not the result of his physical impairment, is supported by substantial evidence in light of the whole record. Moreover, we hold that Bailey suffered no actual wage loss during the ten-month period and was, therefore, not entitled to temporary partial disability benefits, much less compensation for temporary total impairment.
We affirm the Board's determination that Bailey's temporary total disability benefits were properly terminated in July 1981. Even though he may not have been medically stationary, there is substantial evidence in the record that he was capable of earning wages.
III. PERMANENT PARTIAL DISABILITY
The Board found, and the parties do not dispute, that Bailey has a "loss of earning capacity because he has a permanent impairment, [that] his post-injury earnings are less than this pre-injury average weekly wage and [that] he cannot perform all phases of pipefitting."
Litwin and Travelers voluntarily paid Bailey $6000 on April 29, 1982, as an advance on permanent partial disability. The Board determined that no further payments were due. Bailey contends that the Board incorrectly calculated loss of earning capacity and that the Board erred in limiting his benefits to $6000.
A. Loss of Wage Earning Capacity
Ultimately, the Board based its determination on the average number of days Bailey worked per month in 1978 and 1979, compared with the number he worked during the ten-month period between his return to work and the Board's hearing (July 13, 1981 to May 27, 1982). The Board
While the Board's computations may not reflect precisely Bailey's lost earning capacity, we believe that they fairly represent his future losses. AS 23.30.210 allows the Board in the interests of justice to utilize factors other than actual earnings to fix a wage earning capacity.
We affirm the Board's calculation that Bailey's wage earning capacity is ten percent impaired for purposes of determining permanent partial disability.
B. Limitation on Amount of Permanent Disability Compensation
The Board calculated Bailey's weekly benefits to be $57.27,
644 P.2d at 223-24.
Absher, is directly on point. At issue in Absher was the method of computing a lump sum award for an unscheduled permanent partial disability. We upheld an award of $3,400 calculated by multiplying the twenty percent loss of earning capacity by $17,000, the maximum amount payable at the time. We explained:
500 P.2d at 1006 (emphasis added). However, our recent decision in Providence Washington Insurance Co. v. Grant, 693 P.2d 872 (Alaska 1985), places considerable doubt on the continuing viability of Absher.
In Providence Washington, the Board awarded lump sum benefits for Mr. Grant's injuries by multiplying the percentage impairments to his knee and foot by the maximum amounts allowed for a knee and foot injury under AS 23.30.190(a)(2) and (4), respectively. The board chose this method over a weekly award, which would have resulted in greater total benefits. The board based its action on Cesar v. Alaska Workmen's Compensation Board, 383 P.2d 805 (Alaska 1963), where we approved compensating Cesar's loss of half a thumb by multiplying the maximum allowable recovery by fifty percent impairment. In Providence Washington we overruled Cesar and stated:
693 P.2d at 877-78.
Under Absher, the Board acted reasonably in basing Bailey's lump sum award on the relationship between impaired earning capacity and the statutory maximum for unscheduled injuries. Providence Washington, however, forbids the identical method for scheduled injuries. The same reasons that lead us to overrule Cesar in the area of scheduled injuries compel us to overrule Absher in the case of unscheduled injuries.
The result demanded by Absher is "contrary to the plain meaning and policies behind AS 23.30.190." See Providence Washington, 693 P.2d at 877. While AS 23.30.190(a)-(20) states that a lump sum may be awarded in the "interests of justice," the "plain language of [the] provision does not require that the maximum amount recoverable be multiplied by the percentage impairment to the body member or function." Id. AS 23.30.190(b) states that $60,000 is the maximum recoverable under (a)(20) "without referring to the percentage impairment." Id. As we stated in London v. Fairbanks Municipal Utilities, 473 P.2d 639 (Alaska 1970):
473 P.2d at 642.
Overruling Absher is "consistent with the policies behind the Worker's Compensation
Furthermore, we now hold it to be improper for the Board to reduce the benefits of an employee with an unscheduled injury so that he will not receive more than an employee with a more serious scheduled injury, as we suggested might be reasonable in Absher, 500 P.2d at 1006, and in Foster, 644 P.2d at 224. See London, 473 P.2d 639, 642 (Alaska 1970) (improper for the Board to limit a partially disabled worker's recovery to the amount afforded someone totally disabled).
Ordinarily, compensation is paid on unscheduled injuries according to the formula set forth in AS 23.30.190(a)(20) until the $60,000 maximum is paid. Where, as here, the employee requests a lump sum, we hold that the Board should first determine whether it is in the interest of justice that a lump sum be paid. Should that determination be made, the Board should project the employee's total future loss, up to the $60,000 limit. The employee can then receive the present value of his total future loss in a lump sum. We reverse the Board's lump sum award of $6000 to Bailey, and remand for redetermination of whether a lump sum is in the interest of justice in this case, and if so, for recalculation of the amount in light of this opinion.
IV. ATTORNEY'S FEES AND COSTS
The Board denied and dismissed Bailey's claim for costs and attorney's fees. Litwin and Travelers had already paid $6000 to Bailey.
The award of attorney's fees is governed by AS 23.30.145 which provides in part:
"[T]he award of the minimum statutory fees [under subsection (a)] applies only in cases where a claim has been controverted." Haile v. Pan American World Airways, 505 P.2d 838, 840 (Alaska 1973). An award for costs, including attorney's fees, is due under subsection (b) when the employer "resists the payment of compensation." Id.
AFFIRMED in part, REVERSED in part, and REMANDED for further proceedings consistent with this opinion.
MATTHEWS, Justice, joined by RABINOWITZ, Chief Justice, concurring.
I continue to believe that medical stabilization marks the end of temporary disability under the Alaska Worker's Compensation statute. Bignell v. Wise Mechanical Contractors, 651 P.2d 1163, 1169 (Alaska 1982) (Rabinowitz, J., with whom Matthews, J. joins, dissenting). In this case, the Board implicitly found that Bailey's medical condition had stabilized as the majority opinion has recognized. See supra at 252-53 n. 10. This implicit finding is supported by substantial evidence and therefore I agree that Bailey's temporary total disability payments were properly ended.
In all other respects, I concur with the majority opinion.
A recent amendment substitutes "80 percent" for "66 2/3 percent," and "spendable weekly wages" for "average weekly wages." It applies to injuries sustained on or after January 1984 only. Ch. 70, § 6, SLA 1983.
Id. at 10-17 to 10-18 (footnote omitted). Other jurisdictions, however, view restored earning capacity, rather than medical stability, as the end of temporary disability. The California Court of Appeals stated:
See supra note 5 regarding amendment to this statute.
The Board properly used Bailey's 1977 earnings because they were higher than his earnings in 1978 or 1979.
Compensation for Permanent Partial Disability.
See supra note 5 regarding amendment to this statute.
A recent amendment substitutes "spendable weekly wage" for "earnings" throughout the section. Ch. 70, § 9, SLA 1983.