Most workers’ compensation practitioners know that a voluntary abandonment from employment may be the basis for termination of temporary total disability compensation (“TTC”). Essentially, voluntary abandonment amounts to any action undertaken by the claimant, which results in his/her removal from the workforce, such as resignation, retirement, discharge, or incarceration, and which is unrelated to the work injury. TTC is payable when a claimant is unable to return to his former position of employment and suffers a loss of earnings because of his/her injury. However, if the loss of earnings is due to some reason unrelated to the work injury, then the chain of causation is broken and TTC is not payable. Consequently, it seems rudimentary that all forms of voluntary abandonment should abate the payment of TTC in all circumstances.
Unfortunately, such is not the case. Under a line of cases beginning with the Ohio Supreme Court’s decision in State ex rel. Pretty Products, Inc. v. Indus. Comm., a claimant remained entitled to TTC if he was disabled as a result of the work injury at the time of his termination. Curiously, this doctrine only applied to termination cases. In voluntary quit cases, the Court found Pretty Products had no application. Over the years, this dichotomy has led to confusing, if not inconsistent, decisions in the 10th District Court of Appeals and the Ohio Supreme Court alike. On September 27, 2018, the Ohio Supreme Court sought to mollify the inconsistency in its case law doctrine.
In State ex rel. Klein v. Precision Excavating & Grading Co., Case No. 2017-0589, 2018-Ohio-3890, a majority of the Court held the principles enunciated in Pretty Products are no longer good law. In Klein, the claimant’s attending physician issued a report stating the claimant was temporarily unable to work from the date of injury (November 5, 2014) to January 5, 2015. Prior to the injury, however, the claimant decided to quit his employment and move to Florida, and he gave notice to his employer, accordingly. The resignation was to become effective on November 20, 2014. After his injury, the claimant requested TTC through January 5, 2015, but, the Commission awarded compensation through November 19, 2014, reasoning the claimant’s voluntary resignation severed the chain of causation entitling him to compensation. The claimant filed a mandamus action in the 10th District Court of Appeals, which vacated the Commission’s order. The Court of Appeals ordered the Commission to reinstate TTC, citing Pretty Products, State ex rel. Reitter Stucco v. Indus. Comm. and State ex rel. OmniSource v. Indus. Comm. for the proposition that the claimant could not voluntarily abandon a job from which he already was disabled. Nevertheless, in so holding, the court of appeals admitted it was uncertain which precedent of the Ohio Supreme Court governed the outcome of its decision.
On appeal, the Ohio Supreme Court considered the proposition of law enunciated in Pretty Products and subsequently followed in Reitter Stucco and OmniSource. Ultimately, the Court overruled Reitter Stucco and OmniSource, holding the decisions were wrongly decided, defied practical workability, and abandoning them would not create an undue hardship for those who have relied upon them in the past. The Court reasoned that Reitter Stucco and OmniSource contradicted a fundamental tenet of TTC, which is the “injury must cause the workers’ loss of earnings.” When a claimant removes himself from employment for reasons unrelated to the injury, the abandonment from employment, not the injury, causes the loss of wages. The Court reasoned further that the exception created by Reitter Stucco and OmniSource immunized claimants from the consequences of their own voluntary conduct and authorized TTC in situations for which such compensation was not intended.
Interestingly, the Court did not overrule Pretty Products, which is the precedent underlying the holdings in Reitter Stucco and OmniSource. The Court explained its decision by stating the proposition announced in Pretty Products and relied upon by Reitter Stucco and OmniSource was merely dicta. The Court explained the dispositive holding in Pretty Products was the claimant was not entitled to TTC because the work injury precipitated the work rule infraction: the claimant was terminated for an attendance infraction connected to her absences due to the injury. The Court further reasoned that terminations which have a nexus to the workplace injury cannot be used to abate TTC. In so reasoning, the Court maintained it did not need to revisit its decision in State ex rel. Gross v. Indus. Comm. (aka the Kentucky Fried Chicken case/Gross II), where it held a claimant’s termination for violation of a work rule which caused the injury did not preclude TTC.
Although the Court was unanimous in vacating the court of appeals’ decision, the court was not unanimous in its reasoning. Justice Sharon Kennedy, joined by Justices Terrence O’Donnell and R. Patrick DeWine, wrote a concurring opinion, which argued the court should abandon all exceptions to the voluntary abandonment rule. Justice Kennedy argued not only should the Court have overruled Reitter Stucco and OmniSource, but also, it should have overruled Pretty Products and Gross II. In other words, when a claimant’s voluntary conduct causes the loss of earnings, TTC should not be payable under any circumstances.
The takeaway from Klein is as follows: a voluntary abandonment, whether by quit, termination, retirement, or incarceration will preclude TTC unless there is a nexus between the separation from employment and the work injury. Terminations which are closely connected to the work injury itself seem to be the only remaining exception to the voluntary abandonment rule. Bear in mind, if a claimant quits work or retires because of the work injury, such is not a voluntary abandonment and Klein would not apply. For more insights on this case, listen to our podcast.