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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Flowline of Alaska v. Brennan (02/17/2006) sp-5986
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| FLOWLINE OF ALASKA and | ) |
| ALASKA NATIONAL | ) Supreme Court No. S- 11900 |
| INSURANCE COMPANY, | ) |
| ) Superior Court No. | |
| Appellants, | ) 3AN-03-05882 CI |
| ) | |
| v. | ) O P I N I O N |
| ) | |
| VINCENT BRENNAN, | ) [No. 5986 - February 17, 2006] |
| ) | |
| Appellee. | ) |
| ) | |
Appeal from the Superior Court of the State
of Alaska, Third Judicial District,
Anchorage, Sen K. Tan, Judge.
Appearances: Richard L. Wagg, Russell,
Tesche, Wagg, Cooper & Gabbert, Anchorage,
for Appellants. Michael J. Jensen, Law
Office of Michael J. Jensen, Anchorage, for
Appellee.
Before: Bryner, Chief Justice, Matthews,
Eastaugh, Fabe, and Carpeneti, Justices.
FABE, Justice.
In this case, Flowline Alaska, Inc. contests the Alaska
Workers Compensation Boards classification of Flowlines former
employee, Vincent Brennan, as an hourly worker under AS
23.30.220. The Board found that Brennans work did not fit neatly
or precisely into the classifications provided in AS 23.30.220
and concluded that his work most closely fit that of an ongoing,
hourly worker under AS 23.30.220(a)(4). The superior court,
acting as an intermediate appellate court, affirmed. After
careful review of the parties briefs and arguments, we agree with
Superior Court Judge Sen K. Tans conclusions and adopt the
superior courts decision.1
Flowline raises three main arguments in this appeal.
The first is that Brennan is an exclusively temporary employee
for the purposes of AS 23.30.220(a)(6).2 But the Boards finding
that Brennan was not an exclusively temporary employee is
supported by substantial evidence, including the number of hours
Brennan had worked, his continuing relationship with the union,
and his work history with Flowline. The Boards interpretation of
the statutory language is also consistent with the legislative
intent regarding the category of exclusively temporary workers.
This category is intended to apply to those persons who take on
the occasional job but who otherwise do not participate
significantly in the workforce in light of the fact that many
workers in the state choose a subsistence lifestyle and are only
occasionally, sporadically, or on a part-time basis members of
the workforce.3
Flowlines second argument concerns the Boards finding
that AS 23.30.220(a)(4)(A), rather than subsection (a)(4)(B), was
applicable to Brennans compensation calculation.4 But the Boards
application of subsection (a)(4)(A) to Brennans situation is
supported by substantial evidence given that he had been employed
by Flowline for more than thirteen calendar weeks, with stoppages
only for interruptions consistent with the nature of the work he
performed.
Finally, Flowline complains about the Boards use of the
fairness language of Gilmore5 in its decision of February 24,
2003 and argues that the Board used an improper test to decide
Brennans case. But it is clear from the Boards decision that it
was well aware that the Gilmore test and related tests may not be
applied to the post-1995 version of the statute after our
decision in Dougan v. Aurora Electric, Inc.6 The Board properly
discussed which provision of the new statute applies to Brennans
case. And although the Boards use of language from decisions
which no longer apply to the amended statute may seem confusing,
it is clear from the context of the Boards language that the
Board used it as a shorthand method to indicate its
interpretation of the statutes legislative purpose. That purpose
itself retains the fairness language, as it is the legislatures
intent that the statute be used to fix a fair approximation of an
employees probable future earning capacity during a period of
temporary partial or temporary total disability.7 As we pointed
out in Gilmore, a fair approximation of a claimants future
earning capacity lost due to the injury is the essential
component of the basic compromise underlying the Workers
Compensation Act the workers sacrifice of common law claims
against the employer in return for adequate compensation without
the delay and expenses inherent in civil litigation.8 Despite
subsequent amendments to the statute aimed at increasing the
efficiency and predictability of the compensation process, this
compromise, and the fairness requirements it engenders, provide
the context for interpreting the Workers Compensation Act.
For these reasons and those discussed in Judge Tans
attached decision, we AFFIRM the application of AS
23.30.220(a)(4)(A) to the calculation of Brennans compensation
rate.
IN THE SUPERIOR COURT FOR THE STATE OF ALASKA
THIRD JUDICIAL DISTRICT AT ANCHORAGE
FLOWLINE OF ALASKA and )
ALASKA NATIONAL INSURANCE )
COMPANY, )
)
Appellants, )
)
v. )
)
VINCENT BRENNAN and ALASKA )
WORKERS COMPENSATION )
BOARD, )
)
Appellees. )
)
)
VINCENT BRENNAN, )
)
Cross-Appellant, )
)
v. )
)
FLOWLINE OF ALASKA and )
ALASKA NATIONAL INSURANCE )
COMPANY, )
)
Cross-Appellees. )
)
Case No. 3AN-03-5882 CI
DECISION ON APPEAL
INTRODUCTION
This matter is before the court after remand to the
Alaska Workers Compensation Board (Board) for consideration of
the Alaska Supreme Court decision in Dougan v. Aurora Electric
Inc.1 In 2002, this court remanded the case after the Dougan
decision, to allow the Board to review a new authority on point.
Appellants Flowline of Alaska and Alaska National
Insurance Company (Flowline) appeal from the Decisions and Orders
of the Board entered March 18, 2003 and March 28, 2003 modifying
its decision entered February 24, 2003. Flowline is appealing
the Boards determination that, in accordance with Dougan, Vincent
Brennan (Brennan) was an hourly worker under AS
23.30.220(a)(4)(A) rather than an exclusively temporary worker
under AS 23.30.220(a)(6).
Flowline contends that the Board erred as a matter of
law and that the Boards decision is not supported by substantial
evidence. Because the findings are supported by substantial
evidence and there was no error in the Boards decision, the
Boards decision is AFFIRMED.
STANDARD OF REVIEW
The Supreme Court of Alaska has recognized at least
four principal standards of review of administrative decisions.
Those standards were discussed in the courts 2002 decision and
will not be discussed here. For the purposes of this appeal, two
standards are relevant.
With regard to issues of law, such as statutory
interpretation, this court must apply the substitution of
judgment standard when the question of law on appeal does not
involve administrative agency expertise or where the agencys
expertise is not particularly probative. Under the substitution
of judgment standard, this court may substitute its own judgment
for that of the Board even if the Boards decision had a
reasonable basis in law.2
Next, regarding issues of fact, this court must affirm
an agency fact determination if the decision is supported by
substantial evidence. Substantial evidence is such relevant
evidence as a reasonable person might accept as adequate to
support a conclusion.3
FACTS
On March 5, 1999, while working as a laborer for
Flowline, Brennan suffered a back injury and was entitled to time
loss benefits.4 Flowline initially paid Brennans weekly
compensation rate at the statutory minimum, based on a
determination that Brennan was a seasonal, temporary worker.
Brennan had worked for Flowline off and on since
November of 1998 until his injury in March 1999. Brennan
testified that it was his understanding that he would work with
Flowline full time with intermittent interruptions due to weather
conditions, equipment breakdowns, and other factors. Brennan
testified that he believed he was called back on March 3, 1999 to
finish what the crew had previously started.
From 1993 through 1996, Brennan worked between 1,200
and 1,900 hours through the Laborers Union Local 942, taking a
year off in 1997 to build a house. In July of 1998, Brennan
began working for the union again.
The local laborers business manager and secretary
treasurer, Joe Thomas, testified that the union does not classify
workers as seasonal, although employers and contractors might
consider the work seasonal. But the union considered the members
eligible for work year-round. Thomas also testified to Brennans
union work history.
On April 28, 1999, Brennan filed a Workers Compensation
claim, asking for a compensation rate adjustment based on
calculating the rate under AS 23.30.220. Brennan asked to adjust
his compensation to an average weekly wage of $783.85 based upon
the best 13 weeks in the prior 52-week calculation. AS
23.30.220(a)(4)(A).5
After a hearing, on June 15, 2000, the Board issued its
first decision. The Board determined that Brennan was not a
temporary employee as defined in AS 23.30.220(a)(6),6 but rather
determined he was an hourly worker with intermittent
interruptions whose rate should be calculated under AS
23.30.220(a)(4)(B).7 Further, the Board ordered a calculation of
benefits under AS 23.30.395(15) and 8 AAC 45.220(c)(3)(B) to
include pension and health benefit contributions. The Board
dismissed Brennans claim for a penalty award.
Flowline petitioned for reconsideration. The Board
granted reconsideration on July 7, 2000 and ordered additional
briefing.
On August 8, 2000, after reconsidering the evidence,
the Board found that compensation should be set under AS
23.30.220(a)(4)(A) rather than under AS 23.30.220(a)(4)(B)
because Brennan actually worked for Flowline from November 1998
through the beginning of March 1999, a period exceeding the 13
week period required by (a)(4)(B). The Board also affirmed its
original denial of a penalty award.
Again, Flowline petitioned for reconsideration. On
September 1, 2000, after reconsidering Flowlines petition, the
Board affirmed its prior decision.
Flowline then appealed the Boards decisions and Brennan
counter-appealed the Boards denial of penalties. After the
appeal was filed, Brennan made a claim for penalties, interest
and attorneys fees and costs due to Flowlines late payment of the
Board-ordered compensation rate increase.
On January 24, 2001, the Board entered its final
decision. It ordered Flowline to reinstate benefits at the full
rate of $591.61, without an offset, and in addition, to pay a 25
percent penalty on the award as well as awarding interest on all
benefits awarded, attorneys fees and costs.
Flowline appealed the Boards decision and asked that
the court reverse and remand the Boards decision and require them
to place Brennan in the temporary worker category for purposes of
calculating his gross weekly earning and his compensation rate.
Brennan appealed the Boards denial of penalties relating to the
increased compensation rate awarded to him under AS
23.30.220(a)(4).
This court initially affirmed the Boards decision,
finding that the Board properly applied the Alaska Supreme Court
decisions in Gilmore v. Alaska Workers Compensation Board8 and
Thompson v. United Parcel Service.9 However, the Alaska Supreme
Court then issued its decision in Dougan, which declared the
Gilmore test inapplicable to the cases arising under the revised
version of AS 23.30.220(a). Accordingly, upon reconsideration,
this court reversed its decision and remanded back to the Board
for determination, in light of Dougan, whether Brennan was an
hourly worker rather than a temporary worker under AS
23.30.220(a).
On remand, the Board issued its February 24, 2003
decision determining that Brennans work was not exclusively
seasonal or temporary and, in accordance with Dougan, AS
23.30.220(a)(4)(A) was the section applicable to establishing
Brennans compensation rate.
The Board affirmed its decision on reconsideration on
March 18, 2003 and again reaffirmed its decision on March 23,
2003. The Board stated that they could not find Brennans work
was exclusively seasonal or temporary under AS 23.30.220(a)(6).
This appeal follows.
DISCUSSION
The Boards Application of AS 23.30.220 Was Legally Correct.
Alaska Statute 23.30.220 is the statutory provision
that sets the spendable weekly wage upon which workers
compensation is determined. There are different methods of
making this calculation. Two of them are at issue in this
appeal, AS 23.20.220(a)(4) and (a)(6).
Interpretation of AS 23.30.220 is a question of law and
statutory interpretation that does not involve agency expertise.
Therefore, this court will substitute its judgment for that of
the Board.
Alaska Statute 23.30.220(a)(6) provides in part if at
the time of the injury the employment is exclusively seasonal or
temporary, then notwithstanding (1)-(5) of this subsection, the
method provided in subsection (a)(6) applies. The statutory
interpretation issue is straightforward. If an employee is an
exclusively seasonal or temporary worker, then (a)(4) would not
apply.
Here, Brennan was found to not be an exclusively
temporary or seasonal employee, therefore (a)(6) does not apply.
Additionally, the Board found that Brennans employment lasted
longer than 13 calendar weeks, excluding the application of
(a)(4)(B). Brennans earnings while with Flowline were calculated
by the hour, excluding the application of (a)(1-3). The
remaining sections are clearly not applicable. Based on the
Boards factual findings, the most appropriate formula for
calculating Brennans compensation is (a)(4)(A).
The Board, properly, did not apply the Gilmore accurate
predictor test. The accurate predictor test turns on whether the
workers wage history was an accurate predictor of losses due to
injury. Under Gilmore, the Board could not deviate from the
statutory scheme unless there was substantial evidence to support
the conclusion that past wage levels would lead to an irrational
workers compensation award.10 Dougan held that the Gilmore test
is no longer necessary when the Boards initial determination is
based on the amended version of AS 23.20.220.11
As a matter of law, the Board was correct in its
application of AS 23.30.220(a)(4)(A) to Brennans compensation
calculation.
The Boards Finding that Brennan Was Not an Exclusively Temporary
Employee is Supported by Substantial Evidence.
Flowline argues that the evidence presented
conclusively establishes that Brennan was hired in March 1999 for
a 5-day job and therefore AS 23.30.220(a)(6) applies because
Brennan was a temporary employee.
The Board based its decision on the documentary record
and the testimony of both Brennan and Thomas. Brennan testified
that he worked intermittently for Flowline from November 1998
until his injury in March 1999. Brennan also testified that he
believed the March 1999 job was a continuation of a project he
had previously started. Based on Brennans testimony, the Board
found that even though there were interruptions in the work
period, the interruptions were consistent with the nature of the
work Brennan performed and Brennan had a reasonable expectation
of working on an ongoing basis year-round. Due to Brennans
testimony that he understood his work with Flowline to be
permanent and that he would have returned to work for Flowline in
August of 1999, the Board found Brennan did not perform temporary
work.12
The substantial evidence standard applies to the Boards
factual findings. Accordingly, the testimony of Brennan and
Thomas and other relevant evidence is adequate to support the
conclusion that Brennans work was not exclusively temporary. The
Boards finding that Brennan was not an exclusively seasonal or
temporary employee is supported by substantial evidence.
CONCLUSION
For the reasons stated above, the Boards decision that
Brennan was not an exclusively temporary worker and the Boards
subsequent application of AS 23.30.220(a)(4)(A) is AFFIRMED.
DATED at Anchorage, Alaska, this 16th day of March,
2005.
/s/
SEN K. TAN
Superior Court Judge
_______________________________
1 See Appendix A. We have edited the superior courts
decision to conform to our technical rules.
2 AS 23.30.220(a)(6) in the form applicable to this case
provides:
(a) Computation of compensation under
this chapter shall be on the basis of an
employees spendable weekly wage at the time
of injury. An employees spendable weekly
wage is the employees gross weekly earnings
minus payroll tax deductions. An employees
gross weekly earnings shall be calculated as
follows:
. . . .
(6) if at the time of injury the
employment is exclusively seasonal or
temporary, then, notwithstanding (1) - (5) of
this subsection, the gross weekly earnings
are 1/50 of the total wages that the employee
has earned from all occupations during the
calendar year immediately preceding the
injury[.]
3 Ch. 75, 1(a)(4), SLA 1995.
4 AS 23.30.220(a)(4)(A) and (a)(4)(B), in the form
applicable to this case, provide:
(a) Computation of compensation under
this chapter shall be on the basis of an
employees spendable weekly wage at the time
of injury. An employees spendable weekly
wage is the employees gross weekly earnings
minus payroll tax deductions. An employees
gross weekly earnings shall be calculated as
follows:
. . . .
(4) if at the time of injury the
(A) employees earnings are calculated
by the day, hour, or by the output of the
employee, the employees gross weekly earnings
are the employees earnings most favorable to
the employee computed by dividing by 13 the
employees earnings, not including overtime or
premium pay, earned during any period of 13
consecutive calendar weeks within the 52
weeks immediately preceding the injury;
(B) employee has been employed for less
than 13 calendar weeks immediately preceding
the injury, then, notwithstanding (1) - (3)
of this subsection and (A) of this paragraph,
the employees gross weekly earnings are
computed by determining the amount that the
employee would have earned, including
overtime or premium pay, had the employee
been employed by the employer for 13 calendar
weeks immediately preceding the injury and
dividing this sum by 13[.]
5 Gilmore v. Alaska Workers Comp. Bd., 882 P.2d 922, 924
(Alaska 1994). Gilmore was explicitly concerned with balancing
the purposes of the Workers Compensation Act as a whole, purposes
which included the quick, efficient, fair, and predictable
delivery of benefits to injured workers. Id. at 927. Fairness
was considered an essential component of the application of the
statute and could not be sacrificed in the pursuit of the other
purposes. Id. at 928.
6 50 P.3d 789, 797 (Alaska 2002) (holding that the
Gilmore test is no longer necessary when the initial
determination of compensation is based on the amended version of
AS 23.20.220).
7 Ch. 75, 1(b)(2), SLA 1995.
8 882 P.2d at 927.
1 50 P.3d 789 (Alaska 2002).
2 Hammer v. City of Fairbanks, 953 P.2d 500, 504 (Alaska
1998).
3 Nunley v. State of Alaska, 99 P.3d 7, 10 (Alaska 2004)
(citing Handley v. State, Dept of Revenue, 838 P.2d 1231, 1233
(Alaska 1992)).
4 The facts detailed here supplement the statement of
facts set out in this courts June 24, 2003 decision.
5 AS 23.20.220(a)(4)(A) states:
(a) Computation of compensation under
this chapter shall be on the basis of an
employees spendable weekly wage at the time
of injury. An employees spendable weekly
wage is the employees gross weekly earnings
minus payroll tax deductions. An employees
gross weekly earnings shall be calculated as
follows:
. . . .
(4) if at the time of injury the
(A) employees earnings are calculated
by the day, hour, or by the output of the
employee, the employees gross weekly earnings
are the employees earnings most favorable to
the employee computed by dividing by 13 the
employees earnings, not including overtime or
premium pay, earned during any period of 13
consecutive calendar weeks within the 52
weeks immediately preceding the injury[.]
6 AS 23.30.220(a)(6) states:
[I]f at the time of injury the employment is
exclusively seasonal or temporary, then,
notwithstanding (1) (5) of this section, the
gross weekly earnings are 1/50 of the total
wages that the employee has earned from all
occupations during the calendar year
immediately preceding the injury[.]
7 AS 23.30.220(a)(4)(B) states:
(4) if at the time of injury the
. . . .
(B) employee has been employed for less
than 13 calendar weeks immediately preceding
the injury, then, notwithstanding (1)-(3) of
this subsection and (A) of this paragraph,
the employees gross weekly earnings are
computed by determining the amount that the
employee would have earned, not including
overtime or premium pay, had the employee
been employed by the employer for 13 calendar
weeks immediately preceding the injury and
dividing this sum by 13[.]
8 882 P.2d 922 (Alaska 1994).
9 975 P.2d 684 (Alaska 1999).
10 Thompson, 975 P.2d at 689.
11 Dougan, 50 P.3d at 797.
12 Temporary work is defined as employment that is not
permanent, ends upon completion of the task, job, or contract,
and ends within six months from the date of injury. AS
23.30.220(c)(2).
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