WALKER v. STATE, 694 N.E.2d 258 (Ind. 1998)

694 N.E.2d 258

No. 93S02-9804-EX-216.Supreme Court of Indiana.
April 17, 1998.

Indiana Court of Appeals, No. 93A02-9602-EX-84

Appeal from the Worker’s Compensation Board of Indiana, Cause No. C121558.

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C. Richard Marshall, Shari E. Kinnaird, Columbus, for Appellant.

Jeffrey A. Modisett, Attorney General, Priscilla J. Fossum, Deputy Attorney General, Indianapolis, for Appellee.

ON PETITION TO TRANSFER
SELBY, Justice.

Stella I. Walker, plaintiff and appellant below (“plaintiff”), challenges the decision of the Worker’s Compensation Board (“Board”) which denied her application for total permanent disability payments.[1] The critical question before this Court is whether the seamstress position at the Muscatatuck State Development Center (“Center”), which the State offered to plaintiff under its partial disability program, constitutes “reasonable employment,” thereby defeating her claim for total permanent disability. Both the Board and the Court of Appeals concluded that the position offered plaintiff under the State’s disability program did constitute reasonable employment. We disagree. We conclude that such employment, as a matter of law, cannot constitute “reasonable employment” so as to defeat plaintiff’s claim for total permanent disability payments because the offered position was only temporary and was so highly accommodated[2] to plaintiff’s disability that, once the position would end, it would be extremely difficult if not impossible for her to find suitable employment in the general competitive labor market. We, therefore, reverse the decision below and remand for further proceedings not inconsistent with this opinion.

FACTS AND PROCEEDINGS BELOW
Plaintiff worked in the laundry facilities of the Muscatatuck State Development Center from 1988 to 1991. She is approaching sixty years of age, has only an eighth grade education, and reads at the level of a sixth or seventh grader. The parties stipulated that she was injured in an accident arising out of and during the course of her employment[3] with the Center on September 3, 1991. As she and another employee pulled apart large laundry baskets which were stuck together, she felt her lower back pop and experienced significant pain. Then, in December 1991, Dr. Thomas Marshall, a state-provided orthopedic surgeon, diagnosed her as having degenerative disk disease with a L5/S1 grade II spondylolisthesis, that is, the fifth lumbar vertebra had slipped forward and displaced more than 25% in relationship to the S1 vertebra. After conservative treatment was unsuccessful, Dr. Marshall performed spinal fusion surgery to fuse her L4, L5, and S1 vertebrae.

During 1991 through June 26, 1993, the State paid plaintiff medical benefits[4] and

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weekly temporary total disability benefits under its worker’s compensation program. Her average pre-injury weekly salary was $235.50, and her weekly disability rate was $157.01.[5]
The State paid plaintiff a total of $13,222.49 in temporary total disability benefits over the course of approximately eighty-four weeks. On June 26, 1993, however, the State ceased all worker’s compensation benefits.[6]

Plaintiff filed an Application for Adjustment of Claim with the Board and an amended Application on February 12, 1993 and September 3, 1993 respectively. By a letter dated November 14, 1994, more than three years after her injury and more than a year after plaintiff filed her amended Application, the State offered plaintiff a temporary, full-time position as a seamstress under the State’s partial disability program,[7] subject to plaintiff’s and Dr. Marshall’s approval. The position was temporary and would exist only until plaintiff “is released to work without restriction, or is released with restrictions in the third year of long term disability, or exhausts benefits under the plan” after approximately four years. (R. at 324). Plaintiff, after consulting with Dr. Marshall, declined to accept this position.

At the hearing on April 26, 1995, plaintiff presented Dr. Marshall who testified that plaintiff was disabled and unlikely to be able to return to her former employment at the Center’s laundry facility due to her physical limitations. He reported that she cannot perform work which requires repetitive bending or twisting and cannot do overhead work; that she is limited to lifting or carrying five to ten pounds occasionally but cannot perform either one of these activities for any duration; and that it is unlikely that she can perform either one of these activities for one hour per day.[8]

Regarding the possibility of sedentary work, Dr. Marshall reported that “it is unlikely that Stella Walker could maintain a sitting posture for two hours at one stretch,” and that “[s]he probably would be able to sit for one hour, but then would have to get up and move about.” (R. at 239-40.) He testified that it is unlikely that she could perform a job that would involve stooping or bending forward at the waist, given that she had only thirty degrees of forward flexion instead of seventy-five to ninety degrees. He specifically advised plaintiff that she could not perform the seamstress position offered to her by letter dated November 14, 1994. He made it clear that he regarded her condition as having stabilized and her limitations as being permanent. Specifically, he noted that “[s]he is unfit for any employment because she can’t do anything which requires her to do prolonged standing, sitting or any repetitive bending or twisting,” (R. at 290) and that she is “[u]nfit to return to employment permanently” (R. at 291). He evaluated her loss at 25% whole body impairment.

Plaintiff also presented the testimony of Archie Sanders, a vocational expert and certified rehabilitation counselor who interviewed and evaluated plaintiff to determine

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her employability. She told him that she had trouble urinating, dressing herself, making the bed, and running a vacuum cleaner. She stated that she could not stand for more than ten minutes without experiencing pain in her back and right leg, and could not sit for more than several minutes. She could not stoop, bend, or squat, and had difficulty climbing steps and lifting a gallon of milk weighing between eight and nine pounds. She also had experienced a depression that had improved since she went on medication.

In addition to interviewing plaintiff, Sanders reviewed her medical records to assist him in evaluating her exertional limitations and also considered nonexertional factors that could affect her employability, including her age, education level, mental status, intelligence, and prior training and work experience. Regarding her exertional limitations, Sanders noted that, although she has range of motion limitations due to her back problem, she also has a significant pain problem that is associated with her back and that limits her ability to function. According to Sanders, individuals experiencing such pain often have difficulties concentrating and persevering with a task, and this, in turn, translates into problems with production and employability.

Regarding her nonexertional limitations, Sanders noted that she was born on April 17, 1938, that is, she was fifty-seven years old at the time of the hearing; that some work attributes related to ability to physically exert oneself as well as to eye/hand coordination and to manual and finger dexterity, often decline as a person ages; and that, in addition, it is more difficult to find work when you are older. With regard to her education, she did not receive any schooling beyond the eighth grade, did not receive her GED, and did not receive any vocational training. Her previous positions all involved manual labor.[9]

Sanders concluded: “Mrs. Walker obviously has too many pain limitations to be able to perform any kind of work, even at a sedentary level, that I would know of in the economy. In my opinion, there’s [sic] no reasonable kinds of jobs that a person with her limitations could do.” (R. at 57.) He stated that she has no transferrable skills outside of her previous work, and that, in light of her exertional and nonexertional limitations, there are no categories of employment that she could do on a full-time or half-time basis, and there is no kind of job in the economy that he would recommend that she try. He opined that she could not perform as a seamstress on a full-time basis and could not perform that job four hours per day three days per week.

Plaintiff testified as to the pain she experiences when sitting or standing and explained that during the course of the day she needs to lie down five or six times for approximately forty-five minutes to an hour. She testified her legs and hands sometimes tingle or get numb, and that she has difficulty thinking because of the pain, but also has difficulty functioning when she takes the medication to relieve the pain. She also testified that she loved working, and that, but for the pain, would like to continue to work, but that she knows that she cannot work and particularly that she cannot work every day. She was familiar with the position of seamstress, because she did sewing while working at the laundry, and stated that the job required her to bend forward. She did not think that she could perform the job of seamstress.

In response to plaintiff’s evidence, the State presented a report by Dr. Lorber, a medical doctor who examined her once and opined that her fusion surgery was not successful in stabilizing her vertebrae, and that her prognosis was poor. He stated that it is unlikely that she could resume work in the laundry, and he concluded that she has a

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permanent partial impairment of 20%. The State also presented a functional capacity evaluation prepared by Roger Stephens, an occupational therapist. As a result of his examination and interview, he concluded that she has a legitimate back problem with a “possible psychological overlay influencing Ms. Walker’s perception of her functional impairment.” (R. at 276.) He stated that, although she is not totally functionally impaired and could perform sedentary work, “locating gainful employment within the limitations she demonstrated during this evaluation would be very difficult.” (R. at 275-76.) He recommended that she seek counseling in chronic pain management to improve her perception of function and therefore her employability and also suggested that she apply to the Office of Vocational Rehabilitation to assist her in locating employment within her functional limitations. Id.[10]

Ralph Hunter, the State’s personnel officer for the Center, testified that they would tailor the seamstress position previously offered to plaintiff as a full-time position, to suit her disability. In light of the testimony and evidence, Hunter testified that she could work four hours per day three days per week rather than full-time or even half-time. He stated they would accommodate her need to stand and sit only for short periods of time and would provide a couch or cot so that she could lie down as needed. He stated that there would be no production standard for her, and that she could take off extra time for medical appointments. He confirmed that this position was being offered pursuant to the State’s partial disability program and was temporary.

Finally, the State’s vocational expert, Thomas Roundtree, who interviewed plaintiff and reviewed her medical records, reported and testified that the State’s offered seamstress position would be consistent with the restrictions emanating from her work-related impairments. He agreed that it was a position highly accommodated to plaintiff’s needs, and explained, in fact, that he had concluded that she could perform the job based on the State’s representation that it would tailor the position to accommodate her special needs. He did not disagree with Sanders’ conclusions that plaintiff had difficulty sitting and standing, or that it may be difficult for her to find employment in the local labor market.

On September 7, 1995, the hearing judge prepared findings that stated, among other things, that Dr. Marshall gave work restrictions of no repetitive bending, twisting, no overhead work, and limited plaintiff to twenty-five pounds of lifting;[11] that the functional capacity test indicated that plaintiff could do sedentary work with occasional lifting of ten pounds and could occasionally sit, stand, bend, and reach; that Roundtree concluded that plaintiff could perform the job offered to her; that plaintiff testified that she would like to return to work;[12] that the State offered plaintiff a job in which all of her restrictions will be honored, including allowing a change in position every ten minutes; that Dr. Marshall issued a 25% permanent partial impairment rating; and that plaintiff has been paid, pursuant to stipulation, $10,000 for a lesser permanent partial impairment rating based upon Dr. Lorber’s report.

The hearing judge then concluded that plaintiff’s level of impairment is 25%; that the State is obligated to pay or reimburse

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plaintiff for all statutory medical expenses up to and including May 27, 1993, the date upon which the hearing judge found she had reached maximum medical improvement; that, although plaintiff has limiting work restrictions due to her injury, these restrictions do not make her unable to resume reasonable types of employment such as those which were offered by the State and which are within her work restrictions;[13] and that plaintiff is not totally and permanently disabled. The judge then ordered the State to pay an additional $2,500 to plaintiff to compensate her for the full 25% impairment, and that the State pay plaintiff for all medical expenses incurred up to and including May 27, 1993.

On January 19, 1996, the Board adopted and affirmed the hearing judge’s decision with one member dissenting. The Court of Appeals affirmed the Board’s decision in an unpublished memorandum opinion on September 16, 1996.

DISCUSSION
Plaintiff argues that she has met her burden of establishing that, in light of her work-related impairment and other factors, there is no “reasonable employment” that she could regularly and continuously pursue, and that therefore she is totally and permanently disabled. The State responds that the job which the Center offered her as a seamstress constitutes reasonable employment as a matter of law. The critical question before this Court, then, is whether the temporary and highly accommodated position as a seamstress at the Center, which the State offered to plaintiff under its partial disability program, constitutes “reasonable employment,” thereby defeating her claim for total permanent disability.[14]

After first reviewing the burden of proof and standard of review applicable in worker’s compensation cases, we then analyze the concept of “reasonable employment” in the context of this case and explain why, contrary to the conclusions of the Board and the Court of Appeals, the employment offered plaintiff, as a matter of law, cannot constitute “reasonable employment” so as to defeat her claim for total permanent disability benefits.

I. Burden of Proof and Standard of Review
In a worker’s compensation case, the claimant who seeks total permanent disability benefits bears the burden of persuasion. To carry her burden, an injured claimant generally must establish her “disability,” and the total and permanent (as opposed to partial and temporary) nature of that disability. See K-Mart Corp. v. Morrison, 609 N.E.2d 17, 29 (Ind. Ct. App. 1993). The term “impairment”[15] refers to the injured employee’s loss of physical function(s); whereas the term “disability” refers to the injured employee’s inability to work. See Hill v. Woodmark Corp., 651 N.E.2d 785, 786 n.1 (Ind. 1995); Talas v. Correct Piping Co., 435 N.E.2d 22, 26 (Ind. 1982). To establish a “permanent total disability,” it is not necessary that the claimant prove her impairment or loss of bodily function is, or approaches, 100%, because an injured worker may experience a partial impairment and at the same

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time be unable to engage in reasonable forms of work activities Talas, 435 N.E.2d at 27; Rockwell Int’l v. Byrd, 498 N.E.2d 1033, 1039 (Ind. Ct. App. 1986). Rather, the injured worker must simply establish that she cannot obtain or perform “reasonable” types of employment Perez v. United States Steel Corp., 428 N.E.2d 212, 215-16 (Ind. 1981)(on petition to transfer after second remand); Perez v. United States Steel Corp., 426 N.E.2d 29, 31 (Ind. 1981)(on petition to transfer after first remand).

In determining whether a claimant is entitled to “total permanent disability” and whether the claimant can obtain and perform “reasonable” types of employment, this Court has employed the definitions set out by Ben F. Small in his treatise Workmen’s Compensation Law of Indiana (1950 Supp. 1976). Professor Small has emphasized that, while a “total disability to be permanent must be one which so destroys or shatters a workman’s wage earning capacities as to leave him unable to resume reasonable types of employment for the remainder of his life,” it is not necessary for a claimant to prove “an utter inability to do anything with the remains of his body” for the “believe-it-or-nots demonstrate that even the most hopeless human wrecks have on occasion developed obscure means for obtaining livelihood.” Id. § 9.4, at 244, cited in Perez v. United States Steel Corp., 172 Ind. App. 242, 245-46, 359 N.E.2d 925, 927-28 (1977).[16] Rather, it is sufficient that the worker show that he cannot carry on reasonable types of employment, with the “reasonableness” of the worker’s opportunities to be “measured by his physical and mental fitness for them and by their availability.” Id.; Perez, 428 N.E.2d at 215-16; Perez, 426 N.E.2d at 31. See also Rockwell Int’l v. Byrd, 498 N.E.2d at 1039.

Once plaintiff has established the degree of obvious physical impairment, coupled with other facts such as the claimant’s capacity, education, training, or age, and has established that she has attempted unsuccessfully to find work or that it would be futile to search for work in light of her impairment and other characteristics,[17] the burden of producing evidence that reasonable employment is regularly and continuously available then rests on the employer.[18] See generally 4 Arthur Larson, Larson’s Workers’ Compensation Law
§ 57.51, at 10-283 to -378, § 57.61(c), at 10-405 to -439 (1997)(discussing

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the “odd-lot” category of employees)[hereinafter Larson]. See Rockwell Int’l v. Byrd, 498 N.E.2d at 1039-40, cited in
Larson, § 57.51(c), at 10-341 (affirming award of total permanent disability where partially impaired, uneducated, and unskilled claimant must lie down at regular intervals to obtain relief from pain after a back injury and therefore was unable to carry on reasonable types of employment, as measured by his physical and mental fitness for available job opportunities). Shifting the burden of production to the employer under these circumstances is justified because it is much easier for the employer, by virtue of its contact with the labor market, to prove the claimant’s employability than it is for the employee to attempt to prove the universal negative of being totally unemployable. E.R. Moore Co. v. Indus. Comm’n, 376 N.E.2d 206, 210 (Ill. 1978).

On appeal, we review the decision of the Board, not to re-weigh the evidence or judge the credibility of witnesses, but only to determine whether substantial evidence, together with any reasonable inferences that flow from such evidence, support the Board’s findings and conclusions. Perez, 428 N.E.2d at 216 cited in Hill v. Worldmark Corp., 651 N.E.2d at 786. Where the question before this Court, however, is primarily a legal question, we do not grant the same degree of deference to the Board’s decision, for law is the province of the judiciary and our constitutional system empowers the courts to draw legal conclusions. See Board of Trustees of the Public Employees’ Retirement Fund v. Miller, 519 N.E.2d 732, 733 (Ind. 1988). Moreover, in performing a legal analysis and in interpreting the provisions of the Worker’s Compensation Act,[19] we construe the Act and resolve doubts in the application of terms in favor of the employee so as to effectuate the Act’s humanitarian purpose to provide injured workers with an expeditious and adequate remedy. See Talas, 435 N.E.2d at 28 Frampton v. Central Indiana Gas Co., 260 Ind. 249, 251, 297 N.E.2d 425, 427 (1973); Kancs v. Walker, 557 N.E.2d 670, 672 (Ind. Ct. App. 1990).

II. Reasonable Employment Analysis
While what constitutes reasonable employment is often a question of fact, at the outer perimeters, the question is one of law. Board of Trustees of the Public Employees’ Retirement Fund v. Miller, 519 N.E.2d at 733. In this case, there is no serious factual dispute.[20] The parties stipulated to the fact that, on September 3, 1991, plaintiff injured her lower back in an accident arising out of and in the course of her employment at the Center. Moreover, there is no dispute in the record on the following points: that she underwent surgery and suffered a significant permanent partial impairment of her back as a result; that she is unable to return to work in her previous position; that she is unable to do manual labor that requires lifting more than ten pounds; that her previous positions have all involved manual labor; that she is uneducated; that, because of her chronic pain, she cannot sit or stand for significant periods of time and must lie down off and on throughout the day to relieve the pain; that she is capable of neither full-time nor half-time work; that the seamstress position offered to plaintiff under the State’s partial disability program is for four hours per day three days per week and is a position highly accommodated to her needs; that the position is temporary and would not be available for more than approximately four years; and that it would be extremely difficult for someone with plaintiff’s limitations to find similar work in the general competitive labor market.

In light of these undisputed facts, the question before the Court is one of law, and we conclude, as a matter of law, that plaintiff has met her burden of establishing that, in light of her impairment, her age, her prior experience, and her lack of education, there are no general kinds of employment that would be suitable for her, and that it likely

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would be futile for her to seek employment in the general competitive labor market. Although the State did put forth evidence that it had offered her a position as a seamstress, that position cannot constitute “reasonable employment” for at least two reasons, either of which, standing alone, is sufficient to demonstrate that the offered employment is not reasonable employment as a matter of law.

First, the temporary nature of the employment is in itself sufficient reason to conclude that it cannot constitute reasonable employment such that it defeats a claim of total permanent disability. If the post-injury employment lacks permanence and if it can fairly be said that, should the claimant lose that job, the claimant would have a hard time getting new work of a regular and continuous nature, a finding of total permanent disability is in order. See generally Larson, § 57.35, at 10-247 to -251, § 57.51(c), at 10-331 to -336.[21] Here, it is not disputed that the work offered plaintiff was temporary, and, in fact, because it was offered under the State’s partial disability program, its duration is limited by regulation. See Ind. Admin. Code tit. 31, 3-1-12(a) (1996) (stating that long term disability benefit payments are limited to a maximum of four (4) years).

Second, work that is highly accommodated[22] to suit the needs and disabilities of a particular claimant cannot defeat a claim of total permanent disability where it is clear that the claimant could not find similar work under normally prevailing market conditions. “Wages paid an injured employee out of sympathy, or in consideration of his long service with the employer” do not reflect his actual earning capacity under normal market conditions and are to be discounted for the purposes of determining permanent disability. See Larson, § 57.34, at 10-239. “The same is true if the injured man’s friends help him to hold his job by doing much of his work for him, or if he manages to continue only by delegating his more onerous tasks to a helper, or if the work for which claimant is paid is `made work’ or `sheltered work.'” Id. § 57.34, at 10-239 to -245. Similarly, an employer cannot avoid deliberately its duty to pay worker’s compensation benefits simply by offering the employee work that is so highly accommodated to the employee’s needs that it would not ordinarily be available under normally prevailing market conditions. See Peoples v. Cone Mills Corp., 342 S.E.2d 798, 806 (N.C. 1986).

Here, there is no question that the offered position was “highly accommodated.” Ralph Hunter, the State’s personnel officer, essentially testified that he would design the position around plaintiff’s special needs, that they would permit her to work four hours a day three days per week, and that they would even provide her with a cot to lie down on as needed, and Thomas Roundtree, the State’s vocational expert, agreed that the offered position was “highly accommodated” to plaintiff’s needs. (R. at 437.) Moreover, plaintiff’s vocational expert Archie Sanders testified that there were no categories of employment that plaintiff could perform on a full-time or half-time basis, and that there was no kind of job in the economy that he would recommend that she try. The State did not present contrary evidence. In fact, the functional capacity evaluation which it introduced stated in essence that, while in theory she could perform some sedentary work, in reality, “locating gainful employment with the limitations she demonstrated . . . would be very difficult.” (R. at 275-76.) Thus, if we accept the Board’s conclusion that plaintiff could perform the offered seamstress position four hours per day three days per week, as we do in this opinion, it is clear

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that, once the position ended as it certainly would given that it was temporary by design, it would be very difficult if not impossible for plaintiff to find other suitable work in the general competitive labor market. Even putting aside Sanders’ testimony and the State’s functional evaluation report, it is hard to imagine another position where a person with significant back problems, limited education, and experienced only in manual labor, would be hired to work only four hours per day three days per week and then be permitted to take breaks and lie down on a couch whenever her back bothered her and to meet no performance standards.[23]

Thus, because the offered employment was temporary and so highly accommodated to plaintiff’s needs that, once the position would end, plaintiff would not likely be able to find other suitable employment in the general competitive labor market, the offered position is not reasonable employment and cannot defeat her claim for total permanent disability benefits.

We are constrained to make one final observation. While we applaud the State’s effort to accommodate the disabled and to place those capable of working in accommodated positions under the State’s partial disability program, the State cannot use this program to defeat an otherwise valid claim for total permanent disability under the worker’s compensation laws. The worker’s compensation scheme reflects a compromise struck by employers and injured workers. An employer is obligated to provide limited compensation to workers whose injuries and illnesses arise out of and in the course of their employment, regardless of fault, see Frampton, 297 N.E.2d at 427, and workers who were previously precluded from recovery under common law theories are thus guaranteed compensation. In exchange, an injured worker relinquishes the right to sue his employer for negligence, and an employer’s liability is thereby reduced. Id. Stated another way, the worker’s compensation scheme becomes the worker’s exclusive remedy. Ind. Code § 22-3-2-6 (1993). The scheme is designed to “shift the economic burden for employment related injuries from the employee to the employer and consumers of its products.”Collins v. Day, 604 N.E.2d 647, 648 (Ind. Ct. App. 1992) aff’d on other grounds, 644 N.E.2d 72 (Ind. 1994). See also Frampton, 297 N.E.2d at 427.[24] In light of the exclusive nature of the worker’s compensation remedy and the humanitarian purpose of the statutory scheme, it is particularly important that, as stated above, we construe the statute liberally in favor of the employee to effectuate its humanitarian purposes. Id.

The State does not assert that its partial disability program is a substitute for the worker’s compensation scheme, and certainly nothing in Ind. Code § 5-10-8-7 (1993 Supp. 1997), the asserted statutory basis for the State’s program, see supra note 7, can be read to limit an employee’s entitlement to worker’s compensation benefits if the statutory prerequisites have been met. In fact, the only mention of the worker’s compensation benefits in § 5-10-8-7 is the subsection which provides that an employee’s state disability benefits “may be reduced, dollar for dollar” if the employee derives income from one of several enumerated sources, including social security and worker’s compensation. See Ind. Code § 5-10-8-7(d)(6)(A), (E); Ind. Admin. Code tit. 31, 3-1-22(a)(1), (6)(1996). Thus, while the State may, under the terms of the statute, reduce its award of disability benefits should an employee participate in its program while receiving worker’s compensation benefits, it may not, by offering an injured employee under its partial disability program a temporary and highly accommodated position of the sort that would

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be difficult if not impossible to find in the general competitive labor market, preclude that employee from receiving total permanent disability benefits to which the employee would otherwise be entitled under the worker’s compensation scheme.

CONCLUSION
Accordingly, contrary to the decision of the Board and the Court of Appeals, we conclude that the temporary and highly accommodated position offered to plaintiff under the State’s partial disability program as a matter of law cannot constitute reasonable employment which defeats her claim for total permanent disability. We, therefore, reverse the decision below and remand for further proceedings not inconsistent with this opinion.[25]

SHEPARD, C.J., and DICKSON and BOEHM, J.J., concur.

SULLIVAN, J., not participating.