Printable Format44-567. Same; employment or retention of handicapped workers; relief from or apportionment of liability for subsequent injuries; knowledge of impairment; presumptions; commissioner of insurance to be impleaded. (a) An employer who operates within the provisions of the workers compensation act and who knowingly employs or retains a handicapped employee, as defined in K.S.A. 44-566 and amendments thereto shall be relieved of liability for compensation awarded or be entitled to an apportionment of the costs thereof as follows:
(1) Whenever a handicapped employee is injured or is disabled or dies as a result of an injury which occurs prior to July 1, 1994, and the administrative law judge awards compensation therefor and finds the injury, disability or the death resulting therefrom probably or most likely would not have occurred but for the preexisting physical or mental impairment of the handicapped employee, all compensation and benefits payable because of the injury, disability or death shall be paid from the workers compensation fund; and
(2) subject to the other provisions of the workers compensation act, whenever a handicapped employee is injured or is disabled or dies as a result of an injury and the administrative law judge finds the injury probably or most likely would have been sustained or suffered without regard to the employee's preexisting physical or mental impairment but the resulting disability or death was contributed to by the preexisting impairment, the administrative law judge shall determine in a manner which is equitable and reasonable the amount of disability and proportion of the cost of award which is attributable to the employee's preexisting physical or mental impairment, and the amount so found shall be paid from the workers compensation fund.
(b) In order to be relieved of liability under this section, the employer must prove either the employer had knowledge of the preexisting impairment at the time the employer employed the handicapped employee or the employer retained the handicapped employee in employment after acquiring such knowledge. The employer's knowledge of the preexisting impairment may be established by any evidence sufficient to maintain the employer's burden of proof with regard thereto. If the employer, prior to the occurrence of a subsequent injury to a handicapped employee, files with the director a notice of the employment or retention of such employee, together with a description of the handicap claimed, such notice and description of handicap shall create a presumption that the employer had knowledge of the preexisting impairment. If the employer files a written notice of an employee's preexisting impairment with the director in a form approved by the director therefor, such notice establishes the existence of a reservation in the mind of the employer when deciding whether to hire or retain the employee.
(c) Knowledge of the employee's preexisting impairment or handicap at the time the employer employs or retains the employee in employment shall be presumed conclusively if the employee, in connection with an application for employment or an employment medical examination or otherwise in connection with obtaining or retaining employment with the employer, knowingly: (1) Misrepresents that such employee does not have such an impairment or handicap; (2) misrepresents that such employee has not had any previous accidents; (3) misrepresents that such employee has not previously been disabled or compensated in damages or otherwise because of any prior accident, injury or disease; (4) misrepresents that such employee has not had any employment terminated or suspended because of any prior accident, injury or disease; (5) misrepresents that such employee does not have any mental, emotional or physical impairment, disability, condition, disease or infirmity; or (6) misrepresents or conceals any facts or information which are reasonably related to the employee's claim for compensation.
(d) An employer shall not be relieved of liability for compensation awarded nor shall an employer be entitled to an apportionment of the costs thereof as provided in this section, unless the employer shall cause the commissioner of insurance, in the capacity of administrator of the workers compensation fund, to be impleaded, as provided in K.S.A. 44-566a and amendments thereto, in any proceedings to determine the compensation to be awarded a handicapped employee who is injured or disabled or has died, by giving written notice of the employee's claim to the commissioner of insurance ten days prior to the first full hearing where any evidence is presented on the claim.
(e) Amendments to this section shall apply only to cases where a handicapped employee, or the employee's dependents, claims compensation as a result of an injury occurring after the effective date of such amendments.
(f) The total amount of compensation due the employee shall be the amount for disability computed as provided in K.S.A. 44-503a, 44-510a through 44-510i and 44-511, and amendments thereto, and in no case shall the payments be less nor more than the amounts provided in K.S.A. 44-510c and amendments thereto.
History: L. 1945, ch. 221, § 2; L. 1947, ch. 290, § 1; L. 1955, ch. 250, § 12; L. 1957, ch. 293, § 8; L. 1961, ch. 243, § 9; L. 1967, ch. 280, § 13; L. 1970, ch. 190, § 11; L. 1974, ch. 203, § 47; L. 1977, ch. 179, § 2; L. 1979, ch. 156, § 15; L. 1982, ch. 213, § 7; L. 1987, ch. 187, § 15; L. 1987, ch. 189, § 3; L. 1993, ch. 286, § 62; L. 1997, ch. 125, § 16; L. 2000, ch. 160, § 18; July 1.
Law Review and Bar Journal References:
Scope and effect of second injury fund discussed, Alvin D. Herrington, 35 J.B.A.K. 167 (1966).
"Changes in Workmen's Compensation," William F. Morrissey, 36 J.B.A.K. 173, 174 (1967).
"The Unusual-Exertion Requirement and Employment-Connected Heart Attacks," William A. Kelly, 16 K.L.R. 411 (1968).
"Potential Federalization of State Workmen's Compensation Law—The Kansas Response," James C. Wright and James P. Rankin, 15 W.L.J. 244,257 (1976).
Subsection (a) cited in survey of workmen's compensation, Ann Hoover, 15 W.L.J. 409 (1976).
"Workmen's Compensation—An Introduction to Changes in the Kansas Statute," Bryce B. Moore, 24 K.L.R. 603, 607 (1976).
"Workmen's Compensation—The Preliminary Hearing, the Workmen's Compensation Fund, and Civil Penalties for Failure to Pay Compensation When Due," Albert M. Ross, 24 K.L.R. 623, 625, 626 (1976).
"Workmen's Compensation—The Workmen's Compensation Fund," Charles J. Woodin, 24 K.L.R. 641, 642, 643, 644, 645, 646, 647 (1976).
"Liability of the Kansas Workmen's Compensation Fund," Bryce B. Moore, 17 W.L.J. 458 (1978).
"Survey of Kansas Law: Workers' Compensation," William A. Kelly, 27 K.L.R. 377, 386 (1979).
"Major Legislative Changes in Workers' Compensation Law," Gary L. Jordan, 3 J.K.T.L.A. No. 1, 14, 16 (1979).
"When is an Employee's Misrepresentation of His Health Sufficient to Allow the Employer Reimbursement from the Kansas Workmen's Compensation Fund?" Gary L. Jordan, 5 J.K.T.L.A. No. 6, 27 (1982).
"Workers' Compensation—A Salute to the Trial Lawyers of Kansas," Gary L. Jordan, 10 J.K.T.L.A. No. 6, 9, 11 (1987).
"The Achille's Heel: Employer's Knowledge of Employee Preexisting Handicaps in Workers' Compensation Cases," David J. Rebein, 57 J.K.B.A. No. 1, 21, 22, 23 (1988).
"An Overview of the 1993 Amendments to the Kansas Workers Compensation Act," David J. Rebein, 62 J.K.B.A. No. 5, 30, 34 (1993).
"Workers' Compensation Review," Patrick Nichols, J.K.T.L.A. Vol. XVIII, No. 4, Work. Comp. Review Section, 1, 4 (1995).
"Worker's Compensation Review," J.K.T.L.A. Vol. XIX, No. 2, Review Section, 1, 2 (1995).
"Workers Compensation Review," Jan L. Fisher, J.K.T.L.A. Vol. 24, No. 4, 21 (2001).
CASE ANNOTATIONS
1. Act inapplicable where previous disability resulted only in partial loss of, or use of, member of body. Polston v. Ready Made Homes, 171 Kan. 336, 337, 341, 342, 232 P.2d 446 (1951).
2. Supreme court has no original jurisdiction to determine amounts of awards hereunder. Justice v. Continental Can Co., 174 Kan. 539, 540, 546, 547, 550, 257 P.2d 564 (1953).
3. Act applicable where permanent injury is followed by injury causing permanent total disability. Justice v. Continental Can Co., 174 Kan. 539, 540, 546, 547, 550, 257 P.2d 564 (1953).
4. Second injury fund held inapplicable. Piper v. Kansas Turnpike Authority, 200 Kan. 438, 446, 436 P.2d 396 (1968).
5. Subsection (a) construed and applied; burden of proving notice was filed and proving existence of causal relationship between handicap and compensable injury is on the employer. Leiker v. Manor House, Inc., 203 Kan. 906, 911, 912, 914, 915, 916, 917, 457 P.2d 107 (1969).
6. Congenital "bad back" sufficient physical impairment to involve second injury fund. Hardwick v. General Motors Corporation, 206 Kan. 182, 186, 476 P.2d 244 (1970).
7. Cited in case holding that where findings of fact entered by a district court in a workmen's compensation proceeding are supported by substantial competent evidence they will not be set aside on appellate review. Calvert v. Darby Corporation, 207 Kan. 198, 199, 483 P.2d 491 (1971).
8. Applied; no causal relation between preexisting condition and compensable injury proven. Second Injury Fund v. Hahner, Foreman & Cale, Inc., 209 Kan. 411, 412, 497 P.2d 107 (1972).
9. When employer relieved from paying compensation benefits; burden of proof on employer. Stanley v. A & A Iron Works, 211 Kan. 510, 512, 506 P.2d 1120.
10. Finding of total permanent disability upheld; preexisting injury not proximate cause of accident; second injury fund not liable. Scott v. Zimmerman, 215 Kan. 782, 783, 786, 787, 788, 529 P.2d 679.
11. Substantial competent evidence to support award for total temporary disability arising from a second accident; second injury fund liability. Day and Zimmerman, Inc. v. George, 218 Kan. 189, 194, 542 P.2d 313.
12. Apportionment of award attributing five percent of disability to second injury fund upheld. Blevins v. Buildex, Inc., 219 Kan. 485, 487, 488, 489, 548 P.2d 765.
13. Sufficient competent evidence; apportionment of award to workmen's compensation fund proper. Cody v. Jayhawk Pipeline Corporation, 222 Kan. 491, 492, 565 P.2d 264.
14. Section construed and applied; failure to apply "but for" rule requiring fund to pay full award. Barke v. Archer Daniels Midland Co., 223 Kan. 313, 316, 317, 318, 573 P.2d 1025.
15. Injury occurred as result of preexisting conditions; award of director reinstated. Demars v. Rickel Manufacturing Corporation, 223 Kan. 374, 375, 573 P.2d 1036.
16. No error in concluding employer did not have knowledge claimant was handicapped employee; fund not liable. Hinton v. S.S. Kresge Co., 3 Kan. App. 2d 29, 30, 33, 592 P.2d 471.
17. Subsection (a)(2) applied; comparison of preexisting functional disability to present; apportionment of costs; medical expenses included. Desbian v. Key Milling Co., 3 Kan. App. 2d 43, 44, 46, 588 P.2d 482.
18. Fund not timely impleaded; "first full hearing" construed. Safeway Stores, Inc. v. Workers' Compensation Fund, 3 Kan. App. 2d 283, 284, 285, 287, 288, 593 P.2d 1009.
19. One who has had a cerebral vascular accident is a handicapped employee; entire award assessed against fund. Oates v. Post & Danley Truck Lines, 3 Kan. App. 2d 337, 338, 339, 594 P.2d 684.
20. Former awards to employee does not constitute notice of preexisting handicap; fund dismissed from proceedings. Baum v. Greyhound Corp., 3 Kan. App. 2d 456, 457, 459, 460, 601 P.2d 6.
21. Subsection (d) [now subsection (c)] cited; workmen's compensation fund not given written notice prior to first full hearing; impleaded fund not proper party. Griggs v. Sears, Roebuck & Co., 4 Kan. App. 2d 22, 23, 601 P.2d 695.
22. Substantial evidence presented to meet employer's burden of proving that it knowingly hired handicapped worker. Morgan v. Inter-Collegiate Press, 4 Kan. App. 2d 319, 323, 324, 606 P.2d 479.
23. Sufficient evidence that employer knowingly retained handicapped claimant in employment and compensable injury caused by preexisting impairment. Grounds v. Triple J Constr. Co., 4 Kan. App. 2d 325, 333, 606 P.2d 484.
24. Under subsection (a)(2) apportionment must be based on medical evidence. Razo v. Erman Corp., 4 Kan. App. 2d 473, 475, 476, 608 P.2d 1025. Reversed: 228 Kan. 491, 618 P.2d 1161.
25. Apportionment of disability can be upheld when apportionment not based on specific percentages of disability established by medical evidence. Razo v. Erman Corp., 228 Kan. 491, 492, 494, 496, 618 P.2d 1161.
26. Fund liable only for proportion of award attributable to second injury and only to extent preexisting impairment contributed thereto. Spencer v. Daniel Constr. Co., 4 Kan. App. 2d 613, 614, 616, 620, 621, 609 P.2d 687.
27. Maximum recovery and medical stability are key factors in determining time demarcation between temporary and permanent disability. Rose v. Thornton & Florence Electric Co., 4 Kan. App. 2d 669, 670, 609 P.2d 1180.
28. Evidence sufficient to support finding that employee was a knowingly-hired handicapped worker; "first full hearing" defined. Hampton v. Professional Security Co., 5 Kan. App. 2d 39, 41, 42, 43, 611 P.2d 173.
29. Court did not err in holding that employer failed to prove employer knowingly retained handicapped employee. Carter v. Kansas Gas & Electric Co., 5 Kan. App. 2d 602, 603, 604, 621 P.2d 448.
30. A person who misrepresents condition of such person's health solely by reason of accident or mistake has not knowingly made a misrepresentation. Krauzer v. Farmland Industries, Inc., 6 Kan. App. 2d 107, 109, 113, 626 P.2d 1223.
31. Liability of workmen's compensation fund derives from that of employer; settlement between claimant and employer precludes action against fund by claimant. Arduser v. Daniel International Corp., 7 Kan. App. 2d 225, 227, 229, 230, 232, 640 P.2d 329 (1982).
32. In determining whether "handicapped" employee "knowingly" misrepresented the condition, employee's state of mind when misrepresentation made controls. Collins v. Cherry Manor Convalescent Center, 7 Kan. App. 2d 270, 271, 273, 640 P.2d 875 (1982).
33. Injury and any disability resulting supported by "but for" provision of (a)(1); clarification needed on aggravation. Harris v. Cessna Aircraft Co., 9 Kan. App. 2d 334, 335, 337, 678 P.2d 178 (1984).
34. Fund not liable where employer knew of prior injury but neither party aware of any impairment. Hines v. Taco Tico, 9 Kan. App. 2d 633, 634, 683 P.2d 1295 (1984).
35. Occupational disease of chronic bronchitis developed over several years did not create handicapped employee with preexisting condition. Box v. Cessna Aircraft Co., 236 Kan. 237, 246, 689 P.2d 871 (1984).
36. Employer's liability for award pursuant to (a)(A) secondary to Fund's liability. Nuttle v. CertainTeed Corp., 10 Kan. App. 2d 225, 227, 696 P.2d 415 (1985).
37. Settlement between others not binding on fund; court must determine portion attributable to second injury and any credits under K.S.A. 44-510a. Brozek v. Lincoln County Highway Dept., 10 Kan. App. 2d 319, 323, 698 P.2d 392 (1985).
38. Determination of knowledge made on case-by-case basis; knowledge of accident or injury not necessarily knowledge of handicap. Ramirez v. Rockwell Int'l, 10 Kan. App. 2d 403, 405, 701 P.2d 336 (1985).
39. Cited; traumatic neuroses (or conversion hysteria) and knowledge of handicap discussed in detail. Ruse v. State, 10 Kan. App. 2d 508, 512, 708 P.2d 216 (1985).
40. Director of State Self-Insurance fund not agent of state employer for purpose of imputing knowledge to employer. Johnson v. Kansas Neurological Institute, 11 Kan. App. 2d 161, 716 P.2d 598 (1986).
41. Factors in determining knowledge of preexisting impairment on case-by-case basis examined. Johnson v. Kansas Neurological Institute, 240 Kan. 123, 127, 727 P.2d 912 (1986).
42. Cited; effect of prior 100% permanent partial disability rating on second injury claim examined. Baxter v. L.T. Walls Constr. Co., 241 Kan. 588, 594, 738 P.2d 445 (1987).
43. Not necessary for employer to prove mental reservation in hiring or retaining employee to be relieved of liability. Denton v. Sunflower Electric Co-op, 12 Kan. App. 2d 262, 269, 740 P.2d 98 (1987).
44. Cited; existence of "mental reservation" as unnecessary for employer to shift burden to fund for liability for compensation examined. Denton v. Sunflower Electric Co-op, 242 Kan. 430, 748 P.2d 420 (1988).
45. Cited; respondent's failure to implead following claimant's oversight in filing claim after notice of second injury examined. Pyeatt v. Roadway Express, Inc., 243 Kan. 200, 206, 756 P.2d 438 (1988).
46. Cited; burden on respondent as necessary to establish extent preexisting impairment contributed to resulting injury examined. Williams v. Excel Corp. 12 Kan. App. 2d 662, 664, 667, 756 P.2d 1104 (1988).
47. Liability of fund to electing self-employed handicapped worker determined. Miller v. Miller, 13 Kan. App. 2d 262, 768 P.2d 308 (1989).
48. Credit to be granted to workers compensation fund for overlapping disability payments examined. Miner v. M. Bruenger & Co., Inc., 17 Kan. App. 2d 185, 191, 836 P.2d 19 (1992).
49. Fund held not a proper party when not impleaded prior to hearing where handicapped claimant testified by direct examination (K.S.A. 44-567(d)). West-Mills v. Dillon Companies, Inc., 18 Kan. App. 2d 561, 859 P.2d 392 (1993).
50. Whether claimant was a handicapped employee for compensation liability purposes examined. Grizzle v. Gott Corp., 19 Kan. App. 2d 392, 395, 872 P.2d 303 (1994).
51. Whether an employee who settles with employer on modification request may proceed solely against fund examined. Brandt v. Kansas Workers Compensation Fund, 19 Kan. App. 2d 1098, 1099, 880 P.2d 796 (1994).
52. Employer failed to prove knowledge of employee's handicap to relieve itself of workers compensation liability. Guerrero v. Dold Foods, Inc., 22 Kan. App. 2d 53, 57, 913 P.2d 612 (1995).
53. Workers compensation time limits for appeals of workers compensation board decisions govern over civil procedure code (K.S.A. 60-2101 et seq.). Jones v. Continental Can Co., 260 Kan. 547, 549, 920 P.2d 939 (1996).
54. Employer failed to sustain burden of proving it knowingly hired or retained handicapped employee. McKinney v. General Motors Corp., 22 Kan. App. 2d 768, 774, 921 P.2d 257 (1996).
55. Workers compensation fund is not liable for claims arising under subsection (a)(1) on or after July 1, 1994. Shain v. Boeing Military Airplanes, 22 Kan. App. 2d 913, 916, 924 P.2d 1280 (1996).
56. Worker compensation fund's liability limited under both subsections (a)(1) and (a)(2) after July 1, 1994 by 1993 amendments. Farrell v. U.S.D. No. 229, 23 Kan. App. 2d 668, 937 P.2d 967 (1997).
57. Employer failed to meet burden of proof that they had knowledge of employee's preexisting handicap for liability purposes. Bohanan v. U.S.D. No. 260, 24 Kan. App. 2d 362, 371, 947 P.2d 440 (1997).
58. Employer knowingly retained a handicapped employee; fund is liable for subsequent costs for subsequent injuries. Cozad v. Boeing Military Airplane Co., 27 Kan. App. 2d 206, 2 P.3d 175 (2000).
59. Workers compensation fund has no liability for accidents occurring on or after July 1, 1994. Lott-Edwards v. Americold Corp., 27 Kan. App. 2d 689, 6 P.3d 947 (2000).
60. ALJ did not impose liability on workers compensation fund, employer did not have knowledge of worker's condition. Quandt v. IBP, 38 Kan. App. 2d 874, 876, 881, 882, 883, 173 P.3d 1149 (2008).