Court upholds $3M judgment against Gerber Products Co.
Recent Cases
A sharply divided Arkansas Supreme Court on Thursday said a baby food manufacturer must pay more than $3 million to workers for the time they spent dressing and undressing into uniforms and protective gear.
In a 4-3 ruling, the high court upheld a lower court's ruling that Gerber Products Co. should have compensated more than 800 workers at its Fort Smith facility for the time they spent changing into uniforms, donning protective gear such as ear plugs and washing their hands, as well as undressing after their shifts ended. Justices sided with the workers who said Arkansas' Minimum Wage Act required the company to compensate for the activities despite an agreement with the union.
"We hold that the donning and doffing activities constitute compensable work under the AMWA, despite the custom and practice under the collective-bargaining agreement," Justice Karen Baker wrote in the majority opinion.
The ruling drew sharp objections from three justices, who said in a dissenting opinion that because of the decision "the floodgates will open to litigation at the enormous cost to businesses in Arkansas."
"In addition, the majority undermines the collective-bargaining process and destroys any confidence employers and employees have in the enforceability of their agreements," Justice Rhonda Wood wrote.
Gerber had argued the workers' union had agreed to not be paid for the time in a contract that also included larger wage increases for the employees. The company said in a statement it was disappointed with the ruling and was evaluating its options.
Related listings
-
Swedish court upholds arrest warrant for Julian Assange
Recent Cases 05/25/2016A Swedish court on Wednesday rejected a request to overturn the arrest warrant of WikiLeaks founder Julian Assange because there were no new circumstances to consider. The Stockholm District Court said it made the decision because Assange is still wa...
-
US appeals court revisits Texas voter ID law
Recent Cases 05/24/2016A federal appeals court is set to take a second look at a strict Texas voter ID law that was found to be unconstitutional last year. Texas' law requires residents to show one of seven forms of approved identification. The state and other supporters s...
-
Maryland high court issues opinion in Gray case
Recent Cases 05/22/2016Maryland's highest court has released an opinion explaining its recent decision to force an officer charged in the death of Freddie Gray to testify against his colleagues. The Maryland Court of Appeals issued its opinion Friday. Chief Judge Mary Elle...
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.