Oregon Supreme Court Allows Workers' Comp Coverage for Gastric Bypass
This morning, in SAIF Corp. v. Sprague, the Oregon Supreme Court upheld the workers' compensation claim of an employee who sought coverage for gastric bypass surgery, on the grounds that the surgery was necessary to treat a decades-old on-the-job knee injury.
Sprague injured his knee on the job in 1976, filed a workers' comp claim, and sought treatment. In 1999, he reinjured his knee and filed a new workers' comp claim with a new employer. He also was successful in expanding his original claim to include a new condition, consequential arthritis in the knee. In 2000, his knee had deteriorated and his doctor recommended a knee replacement. However, plaintiff (who weighed over 300 pounds) needed to lose weight to be eligible for the knee surgery and to relieve pressure on the injured knee. His doctor recommended gastric bypass surgery, but both workers' comp insurers (for his new and old employers) refused to pay for it. The insurers argued that the gastric bypass was not covered because it was directed at Sprague's obesity, which had existed before the original 1976 injury.
The Oregon Supreme Court disagreed. The insurers did not dispute that the current knee problems were compensable, because they were related to the original on the job injuries. The only relevant issue was whether the gastric bypass surgery was "directed to" the knee injury. The court ruled that it was, because the medical evidence was undisputed that the weight loss was necessary to the success of the surgery. It was irrelevant that the Sprague would also obtain free surgery that had substantial cosmetic benefits (as Al Roker, John Popper, Roseanne Barr, Star Jones, Randy Jackson, and others can attest).
As Stoel Rives World of Employment pointed out earlier, this doesn't mean that all gastric bypasses will now be covered by workers' comp. However, the statute that mandated this decision just doesn't strike the balance that the workers' comp system promised. The system was created as a compromise between employers and employees. Employees received a defined benefit for any on-the-job injury regardless of fault. Employers received protection from high punitive damage awards and the knowledge that their costs would be controlled. While the system often works well, decisions like this show that it doesn't always. According to some experts, gastric bypass surgery costs between $20,000-and $25,000. That's a cost that these employers might not have had to pay absent the workers' comp system.
Oregon Supreme Court Denies Employee's Wrongful Discharge Claim for Reporting Unlawful Trade Practices
.jpg)
The Oregon Supreme Court has denied a car salesman's wrongful discharge claim. In Lamson v. Crater Lake Motors, Inc., the salesman, Kevin Lamson, claimed he was terminated for complaining to his employer that an outside entity managing sales on his employer's car lot was engaging in unlawful trade practices. Lamson refused to participate in special promotional events run by the outside company, because he believed company was engaging in sales tactics that were unethical and unlawful.
As the Stoel Rives World of Employment has discussed earlier, wrongful discharge is a common law remedy. One way a plaintiff may assert the claim is by arguing that the employer terminated him for fulfilling an "important societal obligation." Oregon courts determine what obligations qualify by reviewing state statutes and the state constitution.
In this case, the Oregon Supreme Court ruled that plaintiff would have had a wrongful discharge claim if he had been terminated for refusing to engage in illegal practices prohibited by Oregon's Uniform Trade Practices Act.. However, the court determined that plaintiff's evidence did not meet that burden. Plaintiff had not complained that he was being forced to act illegally; he had complained only that the outside company was acting illegally and urged his employer not to do business with that company. The court also held that plaintiff would have had a viable claim if he had been terminated for reporting the outside company's illegal practices to a government agency that could have taken legal action about the outside company. Reporting the allegedly illegal practices to his employer, the court ruled, was insufficient to trigger the common-law remedy.
Lamson does not signal an entirely new direction in the law of wrongful discharge; employers have known for some time that they may be held liable for terminating employees for performing public duties such as jury service or even arresting lawbreakers. However, Lamson is a valuable precedent for employers because it shows that Oregon courts are not willing to extend a wrongful discharge remedy for every act that a discharged employee can relate (however tangentially) to an Oregon statute. Plaintiffs asserting wrongful discharge must show how their complaint directly relates to the furtherance of a public policy
Oregon Supreme Court: Corporate Directors Not Employees
The Oregon Supreme Court recently ruled that a corporation's board of directors are not employees, and therefore not subject to Oregon's unemployment tax. In Necanicum Investment Co. v. Oregon Employment Department, the Supreme Court reversed a 2007 Oregon Court of Appeals decision that had held unemployment tax should be assessed on the fees paid to the directors. The Supreme Court instead reasoned that because the directors were not acting in the capacity of employees, no employer-employee relationship was formed and therefore there was no basis for the Employment Department to apply the tax.
This decision is good news for corporations who pay fees to their directors; however, many corporate directors act both as directors and also as employees. In those cases, the corporation will still be liable for unemployment taxes on any wages paid to the directors in their roles as employees.
