Appeals court backs Jimmy John's franchisee in labor dispute

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A company that owns 10 Jimmy John's sandwich shops in the Twin Cities was within its rights to fire six union workers who circulated posters critical of the company's sick-leave policy, a federal appeals court ruled Monday.

The full 8th U.S. Circuit Court of Appeals reversed a three-judge appeals panel, which had affirmed a National Labor Relations Board ruling in favor of the workers, who were part of a unionization drive by the Industrial Workers of the World at shops owned by MikLin Enterprises.

The full appeals court concluded that the poster attack was "so disloyal" that it wasn't protected by federal labor law.

The posters were timed to the flu season in early 2011. They protested the company's policy against workers calling in sick without finding replacements to take their shifts, and accused the company of putting the health of its customers at risk. The poster features two identical photos of Jimmy John's sandwiches but said one was made by a healthy worker and one was made by a sick worker.

"Can't tell the difference?" the poster read. "That's too bad because Jimmy John's workers don't get paid sick days. Shoot, we can't even call in sick. We hope your immune system is ready because you're about to take the sandwich test."

The poster and a press release were distributed to more than 100 local and national news organizations, and the IWW threatened wider distribution if its demands were not met.

The NLRB concluded that MikLin violated protections for employee communications to the public that are part of an ongoing labor dispute. The three-judge appeals panel agreed. But the full appeals court said the board misapplied a controlling precedent set in a 1953 U.S. Supreme Court case that permits firings for disloyalty when the quality of a company's product is attacked, as opposed to communications targeting the employer's labor practices.

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Workers’ Compensation Subrogation of Administrative Fees and Costs

When a worker covered by workers’ compensation makes a claim against a third party, the workers’ compensation insurance retains the right to subrogate against any recovery from that third party for all benefits paid to or on behalf of a claimant injured at work. When subrogating for more than basic medical and indemnity benefits, the Texas workers’ compensation subrogation statute provides that “the net amount recovered by a claimant in a third‑party action shall be used to reimburse the carrier for benefits, including medical benefits that have been paid for the compensable injury.” TX Labor Code § 417.002.

In fact, all 50 states provide for similar subrogation. However, none of them precisely outlines which payments or costs paid by a compensation carrier constitute “compensation” and can be recovered. The result is industry-wide confusion and an ongoing debate and argument with claimants’ attorneys over what can and can’t be included in a carrier’s lien for recovery purposes.

In addition to medical expenses, death benefits, funeral costs and/or indemnity benefits for lost wages and loss of earning capacity resulting from a compensable injury, workers’ compensation insurance carriers also expend considerable dollars for case management costs, medical bill audit fees, rehabilitation benefits, nurse case worker fees, and other similar fees. They also incur other expenses in conjunction with the handling and adjusting of workers’ compensation claims. Workers’ compensation carriers typically assert, of course, that, they are entitled to reimbursement for such expenditures when it recovers its workers’ compensation lien. Injured workers and their attorneys disagree.

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