Furloughed worker denied wage losses, can't show connection

In Virginia, an injured worker who is furloughed must show a causal relationship between his incapacity and wage loss in order to be entitled to wage loss benefits.

Case name: Utility Trailer Manufacturing Co. v. Testerman, No. 1484-10-3 (Va. Ct. App. 07/12/11).

Ruling: The Virginia Court of Appeals held that an injured worker subjected to a furlough was not entitled to benefits for his wage loss.

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What it means: In Virginia, an injured worker who is furloughed must show a causal relationship between his incapacity and wage loss in order to be entitled to wage loss benefits.

Summary: A worker for a manufacturer was injured. He was awarded medical benefits, temporary total disability benefits, and permanent partial disability benefits. Later, he returned to work for the manufacturer. The manufacturing line was shut down for a week, and all workers on the line were furloughed. The line was shut down as the result of economic downturn and for inventory. The worker sought compensation for total wage loss for the week. The manufacturer agreed that the worker adequately marketed his residual work capacity during the week. The worker returned to work following the furlough at the same salary. The Virginia Court of Appeals held that the worker was not entitled to wage loss benefits.

In previous cases awarding benefits, the court said that the suspension or reduction of work began or continued for an undefined duration, wages were lost, and there was a causal relationship between the wage loss and the injury.

The court considered whether a worker without the disability suffered a loss in earnings under the same economic condition. Here, the furlough was for one week, and all workers in the manufacturing line were furloughed. The furlough's length was predetermined. All workers were advised that they could return to work after the furlough, as the worker did. The court explained that no potential employers were hiring, so all of the furloughed employees were unable to obtain work during the week. Therefore, it was not the worker's limited work capacity that caused his lack of employment.

The court said that a causal relationship between the incapacity and the loss had to be shown. A partially incapacitated worker did not have to prove an actual loss of wages during a period of furlough.

A dissenting judge said that the majority did not think it was good policy to award wage loss benefits to a worker that he would not have earned if he had not suffered a work-related injury.

Read more at the WorkersComp Forum homepage.

September 1, 2011

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