Opinion
W.C. No. 4-511-380
August 22, 2002
FINAL ORDER
The respondents seek review of a order of Administrative Law Judge Stuber (ALJ) which determined the claimant suffered a compensable injury and awarded medical benefits. The ALJ also denied the respondents' request for penalties under § 8-42-112(1)(d), C.R.S. 2001. We affirm the award of medical benefits and dismiss the petition to review the order denying penalties without prejudice.
In late June 2001, the claimant applied for work with Adarand Constructors (Adarand). The claimant testified that on August 1, 2001, Adarand called and told him he was hired. (Tr. p. 20). The President of Adarand testified the claimant was given a "conditional" offer of employment and that the claimant was told he would not be hired unless he successfully completed drug screening and physical agility testing.
On August 3 the claimant went to Adarand's business office where he attended employee orientation and safety classes. He was also told where he was assigned to work starting the following Monday, and informed of his work schedule and his pay rate. Adarand then instructed the claimant to report to another facility to take an essential functions test. The claimant sustained a back injury while performing the essential functions test. As a result, Adarand rescinded the offer of employment.
The ALJ found the claimant accepted Adarand's offer of employment and the claimant needed to do nothing other than satisfactorily complete the testing in order to begin work the following Monday. Further, the ALJ determined the claimant was not free to decline the agility testing and even though he was not paid to perform the test, the claimant was performing a service at the direction of his employer. Under these circumstances, the ALJ determined the claimant was Adarand's employee when he left Adarand's office on August 3, subject to Adarand's right to terminate the employment if the claimant failed the physical agility and drug testing. The ALJ further determined the claimant's back injury arose out of and in the course of the employment. Therefore, the ALJ determined the claimant proved a compensable injury and awarded medical benefits.
I.
On review the respondents contend there was no employment relationship at the time of the industrial injury because Adarand made a "conditional" offer of employment. In support, the respondents rely on Younger v. City and County of Denver, 810 P.2d 647 (Colo. 1991).
A compensable injury is an injury which "arises out of" and "in the course of" employment. Section 8-41-301(1)(b), C.R.S. 2001. For purposes of the Colorado Workers' Compensation Act, an employment relationship is established when the parties enter into a "contract of hire" either express or implied. Section 8-40-202(1)(b), C.R.S. 2001; Younger v. City and County of Denver, supra.
A contract of hire is subject to the same rules as other contracts. Denver Truck Exchange v. Perryman, 134 Colo. 586, 307 P.2d 805 (Colo.App. 1957). The essential elements of a contract are competent parties, subject matter, legal consideration, mutuality of agreement, and mutuality of obligation. Aspen Highlands Skiing Corp. v Apostolou, 866 P.2d 1384 (Colo. 1994); Moorhead Machinery Boiler Co. v. Del Valle, 934 P.2d 861 (Colo.App. 1996).
However, in the view of Professor Larson, it is appropriate, quite apart from the strict contract situation, to hold that an injury during a try-out period is covered employment, when that injury flows directly from employment activities or conditions. A. Larson, Larsons' Workers' Compensation Law, § 26.02(6) 2002. However, Larson recognizes that some jurisdictions have denied benefits to claimant's injured while performing agility testing.
In Younger v. City and County of Denver, supra, the claimant was employed as a police communications clerk. She was injured while taking a physical agility test on her day off of work to qualify for an entry-level job as a police officer. Passage of the test did not guarantee employment as a police officer. Under these circumstances, the Colorado Supreme Court concluded there was no employment relationship at the time of the injury. In so doing, the Court rejected an argument that where the prospective employer requires special skills, the claimant's performance of the special skills test is of sufficient benefit to the employer to create a contract of employment. Instead, the Court chose to apply a stricter interpretation of the term "contract of hire," as applied in Boyd v. City of Montgomery, 515 So.2d 6 (Ala.Civ.App. 1987); Sellers v. City of Abbeville, 458 So.2d 592 (La App. 1984); and Dykes v. State Accident Insurance Fund, 47 Or. App. 187, 6123 P.2d 1106 (1980). In particular, the Supreme Court cited State Compensation Insurance Fund v. Industrial Commission, 135 Colo. 570, 314 P.2d 288 (1957) (college football player was not required by the school to play football so fatal injuries during game not compensable) in holding there is no employment relationship in the absence of mutual obligation by the parties.
The Supreme Court in Younger appears to have heavily relied on evidence that even if the claimant successfully passed the physical agility test there was no guarantee of employment because she would still have been required to pass a background check, a polygraph test and a medical examination. Rather, the successful completion of the requisite testing merely qualified the claimant to join a pool of candidates from which the final selection of police officers would be made. Under these circumstances, the Supreme Court found no mutual agreement between the prospective employer and the claimant sufficient to create a contract of hire at the time of the injury.
The cases relied upon the Supreme Court in Younger were based on similar facts. For example, in Dykes v. SAIF, supra, the court found no employment relationship existed at the time the claimant was injured while performing a physical agility test in the course of trying out for a position as a deputy sheriff. Because there was no promise of employment, the court concluded that the possibility of future employment was insufficient to demonstrate an employment relationship.
In Boyd v. City of Montgomery, supra, the claimant was injured during her second attempt to pass a physical agility test required for admission to the police academy. The record contained evidence that the claimant's successful completion of the agility test would not have guaranteed the claimant employment because she still had to pass a background investigation, a physical examination, a polygraph, and two interviews before being offered employment. Therefore, the court held there was no employment relationship at the time of the injury.
Here, unlike Younger, Boyd, Dykes and Sellers, the claim does not involve a hypothetical potential of future employment and the claimant was not injured while performing a test required to qualify as a job applicant. Rather, the record supports the ALJ's finding that the employer had already offered the claimant employment as an installer which the claimant accepted. The record also supports the ALJ's finding that the claimant needed to do nothing other than satisfactorily complete the tests to begin employment. (Finding of Fact 9). Accordingly, we agree with the ALJ that Younger is factually distinguishable from the circumstances presented here. Furthermore, we agree with the ALJ that the distinction supports the existence of a contract of hire.
The ALJ's findings reflect that Adarand was obligated to provide the claimant employment beginning the following Monday if the claimant successfully completed the required testing. Conversely, because the claimant accepted the job offer, the claimant was obligated to appear for work on Monday if he passed the test. Consequently, there was a mutual obligation by the parties sufficient to support the ALJ's finding that there was a contract of hire in place at the time the claimant left the employer's premises to take the essential functions test.
Moreover, insofar as there was an employment relationship, the respondents do not dispute the ALJ's finding that the injury arose out of and in the course of employment. Therefore, the ALJ did not err in finding the claimant sustained his burden to prove a compensable injury.
II.
The respondents also contend the ALJ erroneously failed to reduce the claimant's benefits by 50 percent on grounds the claimant willfully misled the employer concerning his physical ability to perform the job. We conclude this portion of the ALJ's order is not currently subject to review.
Section 8-42-112(1)(d), states that "compensation" provided under the Workers' Compensation Act shall be reduced by 50 percent where the claimant is injured as a result of willfully misleading the employer about his physical ability to perform the job. In Wild West Radio Inc. v Industrial Claim Appeals Office, 886 P.2d 304 (Colo.App. 1994), the court concluded that the fifty percent reduction of "compensation" provided by former § 8-42-112(1), C.R.S. 1993 (for injuries caused by the claimant's intoxication) did not apply to medical benefits. The court reasoned that the terms "benefits" and "compensation" are not synonymous in the context of § 8-42-112. Further, the court noted that the purpose of the statute was to deter misconduct and to achieve that purpose it was sufficient to apply the 50 percent reduction against the claimant's entitlement to indemnity benefits. Therefore, the court concluded "medical benefits" were not a form of "compensation" in the context of § 8-42-112(1).
As we have previously stated, § 8-43-301(2), C.R.S. 2001 only allows us to review orders which require "any party to pay a penalty or benefits or denies a claimant a benefit or penalty." See Natkin Co. v. Eubanks, 775 P.2d 88 (Colo.App. 1989). Moreover, orders may be partly final and partly interlocutory. Oxford Chemicals, Inc. v. Richardson, 782 P.2d 843 (Colo.App. 1989).
The ALJ awarded medical benefits. However, the ALJ did not award any specific indemnity disability benefits. ( See Conclusions of Law 3). Rather, the ALJ expressly reserved the issue of temporary disability benefits for future determination. It follows that the ALJ's order denying penalties under § 8-42-112(1)(d) does not require the respondents to pay any specific temporary or permanent disability benefit. Consequently, the ALJ's refusal to impose penalties is interlocutory and not immediately reviewable.
IT IS THEREFORE ORDERED that the ALJ's order dated March 29, 2002, is affirmed insofar as it awards medical benefits.
IT IS FURTHER ORDERED that the respondents' petition to review the ALJ's failure to impose a penalty under § 8-42-112(1)(d) is dismissed without prejudice.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Robert M. Socolofsky
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2001. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed August 22, 2002 to the following parties:
Edward C. Ren, 4440 Loomis Ave., #B, Colorado Springs, CO 80906
Randy Pesch, Adarand Constructors, 2720 E. Las Vegas, #200, Colorado Springs, CO 80906
Valerie Doyle, Zurich N. A., P. O. Box 370308, Denver, CO 80237
Gordon J. Heuser, Esq., 625 N. Cascade, #300, Colorado Springs, CO 80903 (For Claimant)
Daniel F. O'Neil, Esq., 1801 Broadway, #1500, Denver, CO 80202 (For Respondents)
BY: A. Hurtado