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§ 44 Apportionment as a Limitation on Liability In Occupational Disease Claims

New York
March 13, 2019
February 15, 2019
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There are generally two types of workers’ compensation claims: those for injuries sustained in a specific accident and those for injuries that develop over time due to a distinctive feature of employment. The latter are referred to as occupational disease claims. For example, a construction worker may file an occupational disease claim for a back injury that develops due to years of heavy lifting in the course of his employment.  

Workers’ Compensation Law § 44 provides that in occupational disease cases “[t]he total compensation due shall be recoverable from the employer who last employed the employee in the employment to the nature of which the disease was due and in which it was contracted.” In other words, the responsible employer in occupational disease claims is the last employer of the claimant in the field that ultimately caused the disabling conditions. Thus, if the construction worker worked in construction for Company X for 5 years, then Company Y for 10 years, then Company Z for 1 month before going out of work and filing the occupational disease claim, Company Z, as the last employer, would be responsible for the payment of all benefits despite the limited period of time that the claimant worked for it.  

The potential inequity that can result from the last employer being held responsible for the entire claim is accounted for once the occupational disease has been deemed permanent, as § 44 further provides that except for in dust disease and compressed air illness cases, if the occupational disease “was contracted while such employee was in the employment of a prior employer, the employer who is made liable for the total compensation . . . may appeal to the board for an apportionment of such compensation among the several employers who since the contraction of such disease shall have employed such employee in the employment to the nature of which the disease was due.” Put more simply, if the record supports that the occupational disease was contracted while the claimant was working for a prior employer, the responsible employer can seek to apportion its liability for the claim among the prior employers who similarly employed the claimant since the date of contraction.

To this end, the last employer has a right to obtain the names and addresses of former employers from the claimant. Pursuant to Workers’ Compensation Law § 46, a claimant’s refusal to provide such information, or provision of insufficient information to enable the last employer to exercise its reimbursement right against former employers, can result in a loss of benefits. Each prior employer charged with liability by the last employer is entitled to be given notice of a hearing by the Board so that it may attend and defend if necessary against the claim of the last employer for apportionment and proportionate reimbursement of the award already made in favor of the claimant.

A date of contraction must be set prior to calculating apportionment pursuant to § 44. The date of contraction is a question of fact for the Board and has been defined as when the disease process began, as evidenced by symptoms, diagnosis or other medical evidence that the disease process must have existed. Medical evidence that the claimant’s prior employments caused or contributed to the condition is not sufficient to proceed with a § 44 apportionment claim; rather, evidence must be presented that the occupational disease was contracted while in the employment of a prior employer that employed the claimant in the employment to which the nature of the disease was due. Such evidence can include: medical evidence showing that the disease was diagnosed during a prior employment, evidence that the claimant exhibited symptoms of the disease during a prior employment, testimony from the claimant describing symptoms during a prior employment, or the opinion of a consulting physician that the disease must necessarily have been contracted during a prior employment. Notably, there need not be any evidence of a disability during the prior employment to support a finding that an occupational disease was contracted during the prior employment. The prior employer’s liability under § 44 is premised upon employment at the time of or following the contraction of the occupational disease, not the disability that ensued.

Once the date of contraction is set, liability for the claim is apportioned based on the length of time that each liable employer employed the claimant after the date of contraction, and the Board will direct the prior employers to reimburse the last employer for benefits paid in accordance with the apportionment findings. Section 44 apportionment applies to both medical and indemnity benefits. The carrier liable for apportionment against a prior employer under § 44 is the carrier who insured that prior employer on the claimant’s last day of employment for that employer.

In sum, § 44 enables employers to apportion the liability for an occupational disease among the multiple employments in which that disease was contracted, developed, and eventually became disabling, and can be a means of significantly limiting liability in occupational disease claims that is sometimes overlooked in the rush to settle and close files. While you may be deemed responsible for an occupational disease claim when it is established, the issue of § 44 apportionment should be raised and pursued where there is some evidence that the disease was contracted by the claimant during prior employment(s). Such evidence typically takes the form of medical records, claimant’s testimony, or an IME report indicating that the disease was contracted during a prior employment.

In practice, once there is a permanency finding, the issue of § 44 apportionment should be raised, and the claimant directed to produce a list of all employers since the earliest potential date of contraction. The prior employers and their carriers are then placed on notice, and the record is typically developed on the issue with the testimony of the claimant and medical depositions. If the Workers’ Compensation Law Judge finds that the occupational disease was contracted while the claimant was working for a prior employer, the Judge will set the date of contraction, apportion liability for the claim based on the length of time that the claimant worked for each employer subsequent thereto, and direct that the last employer be reimbursed for benefits paid – previously and in the future – in accordance with the apportionment findings. Awards of reimbursement are enforceable by the last employer under Workers’ Compensation Law § 26, if the employer is self-insured, or § 54-b, if the employer is carrier-covered, which allow a party to request consent to file a judgment from the Chair, upon receipt of which the party can file a judgment to enforce the award in the appropriate County Clerk’s office without commencing an action.

The potential for mitigation of liability pursuant to § 44 apportionment should be considered in valuing occupational disease claims for settlement and determining the ripeness of such claims for settlement. In claims in which the claimant only worked for the last employer for a short period of time and there is a strong likelihood that the lion’s share of liability will be apportioned to prior employers, it may be advisable to hold off on settling the claim – and thereby assuming full responsibility for it – until after there is a § 44 apportionment finding. Once there is a § 44 apportionment finding, the prior employers/carriers may contribute to a settlement, or the last employer may negotiate a much lower settlement with the claimant than it would have been able to prior to the § 44 apportionment finding, in light of its future exposure only being for its apportioned share, with the remainder of the claim being the responsibility of the prior employers/carriers. Apportionment against and reimbursement from prior employers pursuant to § 44 cannot be pursued after full and final settlement with the claimant pursuant to § 32. Thus, settling a claim prior to a § 44 apportionment finding effectively acts as a waiver of the issue.

Points to Remember:

§ 44 apportionment is not ripe for litigation until after there is a permanency finding.

§ 44 apportionment applies to both medical and indemnity expenses.

§ 44 apportionment is calculated based on the length of time the claimant was employed with each liable employer since the date of contraction.

The availability of § 44 apportionment is determined by the date of contracture, which is a question of fact for the Board to decide and can be based on several factors including:

- medical evidence of diagnosis during a prior employment;

- medical evidence of symptoms during a prior employment;

- testimony from the claimant of symptoms during a prior employment; or

- the opinion of a consulting physician that the disease must necessarily have been contracted during  a prior employment.

§ 44 apportionment cannot be pursued after a claim is settled.