State supreme court rules buyout doesn't affect worker's comp payments

Nissan employee wins despite resigning position

A Nissan employee is entitled to his full worker's compensation award despite taking a buyout after his injury, the state supreme court ruled.

In 2008, Cha Yang suffered two separate shoulder injuries while working at Smyrna's Nissan manufacturing facility, requiring two surgeries. Later that year, he accepted a voluntary buyout from the auto manufacturer, taking one year's salary and a year's worth of health insurance coverage. He then filed a worker's compensation suit related to ongoing suffering from his injuries.

A trial court ruled in favor of Yang, awarding him 90 percent permanent partial disability benefits, temporary total disability benefits, long-term disability benefits, vocational benefits, attorney's fees and costs. Nissan appealed that ruling, arguing that Yang's permanent partial disability benefits should be reduced because Yang had accepted the voluntary buyout.

On appeal, the Special Workers' Compensation Appeals Panel agreed with Nissan, reducing Yang's permanent partial disability benefits from 90 percent to 37.5 percent, ruling Yang's decision to accept the buyout was not "reasonable" because he resigned his employment before he had completed the medical treatment for his shoulder injuries. The state's worker's comp law says benefits can be capped at a lower rate if an employee acts unreasonably by leaving his employment after being injured.

Yang appealed and the Supreme Court reversed the panel's ruling. The court agreed that state law requires an employee to act reasonably, but said the question of whether an employee acted reasonably is fact-intensive and left for the trial court to decide.

In Yang's case, the trial judge heard testimony Yang accepted the buyout because "his recovery 'wasn't progressing,' he did not know if his medical condition would improve, and he believed he 'couldn't go back' to work after his shoulder surgeries." Because these reasons were all related to Yang's work-related injury, the Supreme Court determined that the trial court had properly awarded the higher amount of benefits. The Court also rejected the Panel's conclusion that an injured employee can never retire or resign prior to completing medical treatment.

This is the second blow this summer to employers in worker's comp cases from the Supreme Court. Earlier, the court declined to hear further arguments in a case surrounding the requirement of an employer to pay premiums for independent contractors.