In this recent case, the Michigan Compensation Appellate Commission has affirmed a magistrate’s findings that a workers’ compensation claimant’s decision to retire was the actual cause of her wage loss as opposed to her work injury, which she suffered after she decided to retire.
Under MCL 418.301(4) and Sington v. Chrysler Corp., 467 Mich. 144, 160-161 and note 11 (2002), a workers’ compensation claimant must prove that wage loss following a decision to retire is due to his or her work-related injury, rather than her retirement. In this case, the Supreme Court’s remand order directed the magistrate, on remand, to consider this question in light of the available evidence.
In this case, in 2004, the claimant decided to apply for a special retirement plan (a SAP agreement or Special Attrition Plan), which allowed her to continue working until January of 2006. Shortly after she applied for this retirement plan, she injured her knee at work. After her injury, the claimant stopped performing her regular job and was transferred to a plant where disabled workers were allowed to continue working. GM paid the claimant workers’ compensation benefits until her retirement.
On appeal to the Michigan Compensation Appellate Commission, GM argued the claimant’s “wage loss” was not the result of her work-injury, but rather of her retirement. The Commission disagreed initially, but a dissenting Commissioner noted this was a crucial prima facie question that had to be considered.
The Michigan Supreme Court issued a remand order in 2011 to have the magistrate reconsider the dissenting Commissioner’s point. The magistrate’s opinion (which is largely reproduced in the attached Commission decision) provides a thorough, and in my judgment, correct analysis of the requirement of a workers’ compensation plaintiff to prove that his or her wage loss post-injury is actually the result of, i.e., caused by, the work injury as opposed to some other reason.
Finally, this case represents an analysis of the hypothetical situation referred to in footnote 11 of the Sington opinion. Where there is evidence that a claimant intends to retire and shows no intention of ever returning to work, he or she is not entitled to benefits because subsequent “wage loss” is not attributable to the injury, but rather to the retirement.
The Commission affirms the magistrate’s analysis. Plaintiff’s choice in deciding to retire and applying for the plan prior to her work-injury and her subsequent retirement without a showing of a firm intention to work again means she failed to prove her subsequent wage loss after retirement was work-related under MCL 418.301(4) (second sentence) and Sington.
As noted here by the magistrate, “the Supreme Court in Sington  specifically commented on the need to find a connection between a work-related injury and subsequent wage loss in any claim, as reflected in the Court’s reference to Sington in their
remand order in this case.”
“As noted in the Sington decision: [T]he second sentence [of Section 301(4)] reflects an understanding that there may be circumstances in which an employee, despite suffering a work-related injury that reduces wage earning capacity, does not suffer wage loss.¹¹ For example, an employee might suffer a serious work-related injury on the last day before the employee was scheduled to retire with a firm
intention to never work again. In such a circumstance, the employee would have suffered a disability, i.e., a reduction in wage earning capacity, but no wage loss because, even if the injury had not occurred, the employee would not have earned any further wages.”
Somewhat ironically, the Court in its remand order in this case also
specifically referenced footnote 11 of the Sington decision, indicating that it intended that statement to have relevance as well, contrary to the prior magistrate’s comment in his decision that his conclusions were reached “in spite of any dicta in any Supreme Court footnotes.” As that footnote states: “We note that, once it is found that an employee is disabled under § 301(4), the employee must then establish wage loss in order to compute wage loss benefits under MCL 418.361. The clear language of the second sentence of § 301(4) militates against any holding that the terms ‘wage earning capacity’ and ‘wage loss’ are synonymous.”
As the prior quote of Sington noted, if a plaintiff intended to retire with a firm intention never to work again prior to an injury, that would be the basis for wage loss, regardless of how disabled he or she was from the injury.
The magistrate concluded “[a] review of the record… reveals no convincing evidence that plaintiff intended to continue working after this retirement. She testified she ‘could’ have worked, had she not been injured, but not that she ‘would’ have worked. There is no evidence that plaintiff had other work lined up. She did not testify to any particular plan to work or any job she wished to try. The available evidence supports the finding that plaintiff did not intend to work following her retirement. Thus, the retirement is again the cause of the wage loss, not the disability.”
This is a good decision, bolstered largely by the Magistrate’s thorough and pointed analysis (for the most part). Although the Magistrate goes on to apply Stokes after finding no wage-loss attributable to the work injury (an analysis that is questionable as it does not appear to be necessary) the Commission largely ignores that part of the analysis and affirms the decision to deny benefits.
This is a significant decision, which will likely generate further appeal, but it sets up an opportunity to ultimately address the hypothetical referenced in Sington‘s footnote 11 with respect to a claimant’s burden to prove that wage loss is attributable to injury, rather than to some other of a host of reasons (including retirement).
The opinion is attached here: 2013 ACO 66 (Kirby v. GM)