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McAdam v. United Parcel Service
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2000 ME 4
Docket:	WCB-99-639
Argued:	September 6, 2000
Decided:	January 9, 2001




	[¶1]  United Parcel Service appeals from a decision of a hearing officer
of the Workers' Compensation Board raising several issues relating to the
hearing officer's grant of Gary McAdam's petition to fix compensation and
the determination of McAdam's average weekly wage.  UPS also appeals from
the hearing officer's decision declining to apportion liability against
McAdam's subsequent employer, the City of Portland.  We vacate the
decision and remand to the hearing officer for further proceedings.
	[¶2]  Gary McAdam began employment at United Parcel Service in
1987 after a prior career as a professional ice hockey player.  McAdam
alleges that he suffered a work-related shoulder injury at UPS in 1990.  
McAdam terminated employment with UPS sometime after February 1994.  
	[¶3]  After he ceased working for UPS, McAdam began working as a
bus driver, first for the Town of Cape Elizabeth and later for the City of
Portland.  Beginning in January 1995, he increased his hours as a bus driver
for the City of Portland to thirty hours a week, and then to forty hours a
week in 1996, exclusive of summers.  During that period, UPS voluntarily
paid McAdam a weekly partial incapacity benefit of $171.16.
	[¶4]  McAdam eventually requested vocational rehabilitation through
the Board.  A plan was prepared by a rehabilitation specialist and adopted
after a hearing by the Workers' Compensation Board Rehabilitation Assistant
Administrator.  Pursuant to the plan, McAdam enrolled in a full-time two-
year program at Kennebec Vocational Technical College for training as a
physical therapist's assistant.{1}
	[¶5]  In November 1997, UPS filed a petition for award against the
City of Portland, seeking apportionment of liability and alleging that
McAdam suffered bilateral shoulder injuries during his post-injury
employment as a bus driver.  At approximately the same time, McAdam filed
petitions to fix medical expenses and to determine his average weekly wage. 
The proceedings were consolidated by the hearing officer.  
	[¶6]  Prior to the hearing, UPS filed a motion to compel production of
medical records relating to prior shoulder injuries McAdam had earlier
reported he may have suffered during his career as a professional ice hockey
player.  The motion was granted, but McAdam refused to comply with the
order.  When the employer sought enforcement of the order at the hearing
on the pending petitions, the hearing officer vacated his previous order and
denied UPS's motion to compel.  
	[¶7]  After the hearing, the hearing officer found that McAdam's bus
driving responsibilities had not "independently produce[d] the employee's
disability," and denied UPS's petition for award against the City of Portland. 
The hearing officer also granted McAdam's petition to determine average
weekly wage, increasing his pre-injury average weekly wage from $694 to
$905.65, including so-called "Ashby" fringe benefits,{2} and calculated the
average weekly wage by taking the total of McAdam's earnings over the
immediately preceding year and dividing by fifty-one, the number of weeks
that the employee had earnings as reflected in his wage statement.  Also
included in McAdam's wages for that year was a $1000 one-time bonus that
he received when his labor union entered into a new contract. 
	[¶8]  In the original decree, the hearing officer awarded McAdam
$444 in weekly benefits, based on the difference between McAdam's pre-
injury wage and a theoretical post-injury earning capacity of $240 for a forty-
hour week at $6 an hour.  In response to the parties' motion for further
findings of fact, however, the hearing officer increased the award after
finding that McAdam "could not safely continue in his work as a school bus
driver for the City of Portland."  The hearing officer ordered varying rates of
compensation with a credit for wages earned.  Because McAdam chose not
to work during his enrollment in vocational rehabilitation, the varying rates
compensation had the effect of requiring UPS to pay close to 100% partial
incapacity benefits.{3} 
	[¶9]  We granted UPS's petition for appellate review pursuant to 39-A
M.R.S.A. § 322 (Pamph. 2000).
	[¶10]  The hearing officer denied UPS's petition for award against the
City of Portland, finding that "[w]hile [McAdam's] bus driving duties
aggravated the continuing effects of the 1990 injury, they themselves 'did
not . . . independently produce the employee's disability.'" 
	[¶11]  In reaching that conclusion, the hearing officer relied on Poole
v. Statler Tissue Corp., 400 A.2d 1067, 1069 (Me. 1979).  Poole was decided
prior to the enactment of 39-A M.R.S.A. § 201(4) (Pamph. 2000), which is
applicable to the facts here.  Subsection 201(4) provides: "If a work-related
injury aggravates, accelerates or combines with a preexisting physical
condition, any resulting disability is compensable only if contributed to by
the employment in a significant manner."  39-A M.R.S.A. § 201(4).  This
section provides the standard for determining liability in cases when an
alleged work-related injury combines with a preexisting condition. 
	[¶12]  UPS alleged that McAdam's employment as a bus driver for the
City either entirely caused his current shoulder problems or significantly
contributed to the shoulder injuries that McAdam previously suffered in his
employment at UPS and as a professional athlete.  The task of the hearing
officer, therefore, was to determine (1) whether McAdam suffered any
work-related injury while working for the City, and if so, (2) whether that
injury contributed to the preexisting shoulder condition in a significant
manner.  Thus, the hearing officer's conclusion that McAdam's employment
as a bus driver for the City did not "independently cause" the shoulder
injuries missed the point.  When apportionment issues arise in the context
of consecutive employment, if the second employment results in a "work-
related injury," there exists no requirement that the second injury
constitute an "independent cause" of the employee's disability in order for
the second employer to be responsible for a portion of the benefits to an
employee.{4}  We therefore vacate the hearing officer's denial of UPS's
petition for award against the City and remand for consideration of the
petition pursuant to 39-A M.R.S.A. § 201(4).
	[¶13]  UPS next challenges the hearing officer's decision to include
the value of McAdam's fringe benefit plan in his weekly wage.  McAdam
concedes on appeal that the fringe benefits were erroneously included in his
average wage, and therefore, there is no dispute that the union-benefits
were incorrectly included in the weekly wage calculation.  See Hincks v.
Robert Mitchell Co., 1999 ME 172, ¶ 12, 740 A.2d 992, 995-96. 
Accordingly, we vacate the hearing officer's inclusion of those fringe benefits
in McAdam's average weekly wage.
	[¶14]  The remaining issues with respect to the average weekly wage
calculation that merit discussion are (1) whether the hearing officer erred
in averaging McAdam's pre-injury weekly wages, pursuant to 39-A M.R.S.A.
§ 102(4)(B) (Pamph. 2000); and (2) whether the $1000 bonus that McAdam
received on the signing of a new labor agreement should be included in his
yearly earnings.
A.  Averaging

	[¶15]  The determination of the average weekly wage is controlled by
subsection 102(4), which provides, in pertinent part:
A.  "Average weekly wages, earnings or salary" of an injured
employee means the amount that the employee was receiving at
the time of the injury . . . .  In the case of piece workers and
other employees whose wages during that year have generally
varied from week to week, wages are averaged in accordance
with the method provided under paragraph B.

B.  When the employment or occupation did not continue
pursuant to paragraph A for 200 full working days, "average
weekly wages, earnings or salary" is determined by dividing the
entire amount of wages or salary earned by the injured employee
during the immediately preceding year by the total number of
weeks, any part of which the employee worked during the same

. . . .
39-A M.R.S.A. § 102(4) (emphasis added). 
	[¶16]  Both parties agree that the Board calculated the average weekly
wage by averaging, applying paragraph 102(4)(B).  UPS contends that
because the employment lasted longer than 200 days, the hearing officer
should have applied paragraph 102(4)(A).  We disagree.  The plain language
of subparagraph A requires averaging when the wages have "varied from
week to week," without regard to the 200 day cutoff.  39-A M.R.S.A.
§ 102(4)(A).
	[¶17]  The mere fact that wages are not identical from week to week,
however, does not mean that the wages "varied" for purposes of
subparagraph A.  The extent and frequency of fluctuation will determine
whether the wages varied for purposes of averaging.  Thus, the hearing
officer was required to determine whether the fluctuations in McAdam's
wages constituted a "variance" pursuant to subparagraph A.{5}  During the year
in question, McAdam's wages ranged from a low of $443.56 to a high of
$948.42 and varied substantially within that range from week to week.  The
hearing officer acted within his authority in determining that McAdam's
wages varied from week to week, therefore requiring that the average
weekly wage be calculated by averaging.

B.  Bonus

	[¶18]  The next issue is whether the hearing officer should have
treated McAdam's $1000 bonus as a "fringe or other benefit" for purposes
of paragraph 102(4)(H).  39-A M.R.S.A. § 102(4)(H) (Pamph. 2000).  The
bonus was awarded to UPS employees as a result of a new labor agreement
contract.  UPS contends that the one-time $1000 bonus was not a part of
McAdam's wages but rather falls within the category of "fringe or other
benefit," 39-A M.R.S.A. § 102(4)(H).  Therefore, according to UPS's
argument, the hearing officer erred in failing to determine whether
inclusion of that bonus would result in a weekly benefit greater than two-
thirds of the state average weekly wage at the time of the injury.{6} 
	[¶19]  The Act contains no explicit references to the treatment of a
bonus.  Therefore, in determining whether such a payment should be
included in the average weekly wage as "wages" or treated separately, we
look again to the definition of average weekly wages, which is defined as
"the amount that the employee was receiving at the time of the injury for
the hours and days constituting a regular full working week."  39-A M.R.S.A.
§ 102(4)(A).  Fringe or other benefits are not includable in that amount
unless (1) they are not continued during the disability and (2) the inclusion
of the fringe or other benefit will not result in a weekly benefit amount that
is greater than two-thirds of the state average weekly wage at the time of the
injury.  39-A M.R.S.A. § 102(4)(H).
	[¶20]  Because the language of paragraph 102(4)(H) contains no
guidance for interpreting the phrase, "fringe or other benefits," we look to
legislative history and Board rules to determine whether a one-time signing
bonus should be treated as wage, fringe benefit, or other benefit.
	[¶21]  We have no difficulty in concluding that a bonus is not a "fringe
benefit."  Fringe benefits have traditionally referred to goods or services
purchased by the employer for the employee.{7}  Most often, fringe benefits
take the form of some benefit other than an immediate payment of cash, for
example, employer contributions specifically earmarked for the purchase of
health, disability, or retirement insurance.{8}  The payment of a cash bonus
does not fall within the description of fringe benefits.  
	[¶22]  Because a bonus is clearly not a "fringe benefit," we must
determine whether the Legislature intended to encompass bonuses within
the description of "other benefits," contained in section 102(4)(H).  The
Legislature has not defined "other benefits" and, although the Board has
promulgated an interpretive rule for paragraph 102(4)(H), the rule contains
no definition of "other benefits" and is silent with regard to the treatment
of bonuses.  Me. W.C.B. Rule ch. 1, § 5(1).
	[¶23]  Our only occasion to address bonuses arose long before the
enactment of section 102(4)(H).  In Freeman v. Co-Hen Egg Co., 430 A.2d
1107 (Me. 1981), a case that preceded both former section 2(2)(G) and
current section 102(4)(H), we held that it was error to exclude the
employee's annual bonus from his average weekly wage when the bonus was
a part of the employee's regular annual compensation for the hours and days
of service.  Id. at 1108.  We relied, in part, on a rule of the former Workers'
Compensation Commission expressly providing that "[i]n computing the
average weekly wage, vacation pay, bonuses, tips, etc. should be included in
the total amount of earnings for the period employed."  Id. (citing former
Me. W.C.C. Rule 7(a) (1981)).  We again relied, in part, on the former
Commission rule in Nielsen v. Burnham & Morrill, Inc., 600 A.2d 1111 (Me.
1991), in which we affirmed a decision of the Commission to include
vacation pay in the employee's average weekly wage.  Id. at 1112 (citing
former Me. W.C.C. Rule 16.8 (1991), replaced by Me. W.C.B. Rule ch. 1,
§ 5(1)).  
	[¶24]  Examination of decisions from other jurisdictions suggests that,
although most states exclude fringe benefits from the average weekly wage,
bonuses are often included in the average weekly wage.  See 5 Arthur Larson,
Larson's Workers' Compensation Law, § 93.01(2)(a) (2000).  The cases turn on
a variety of rationales.{9}  Generally, cash bonuses are included as wages when
they represent value received as consideration for work.  Id.
	[¶25]  We conclude that the determination as to whether a bonus
received by an employee is part of wages or is an "other benefit," pursuant
to section 102(4)(H), relates to the nature of the bonus received.{10}  If the
bonus is regularly received by the employee as a part of an ongoing
compensation scheme, such as annual bonuses, or is a bonus related to
productivity or other employee and employer accomplishments, or is based
on other measurable employee goals, it should be included in the employee's
wages.  Cf. Clukey v. Piscataquis County Sheriff's Dep't, 1997 ME 124,
¶¶ 9-11, 696 A.2d 428, 431 (holding that unrestricted cash payments to
military personnel ostensibly for meals and housing were wages not "fringe
or other benefit(s)").  If, in contrast, the bonus is a one-time event, not
related to the employee's work, efforts, or employment goals, it must be
considered an "other benefit," pursuant to 39-A M.R.S.A. § 102(4)(H).  See
5 Larson, § 93.01(2)(a).
	[¶26]  Here, McAdam received his bonus as a result of the negotiations
between the union and the employer.  The new contract provided that "[a]ll
seniority employees on the payroll as of 7/31/90 shall be paid a one-time
signing cash bonus within one month following ratification."  (Emphasis
added).  This one-time bonus did not represent compensation for work
performed, it was not part of an ongoing compensation scheme, it was not
expected to recur, and it was not related in any way to McAdam's
performance.  It was, therefore, not representative of the amount that
McAdam was receiving at the time of the injury for hours and days worked.
See 39-A M.R.S.A. § 102(4)(A).  Accordingly, it falls not within the definition
of wages, but within the catch-all of "other benefits" subject to the
restrictions of section 102(4)(H). 
A.  Post-injury Earning Capacity

	[¶27]  UPS next contends that the hearing officer erred in finding a
post-injury earning capacity of $240 a week in its first decree, when the
employee was earning $437.26 a week as a bus driver prior to beginning
vocational rehabilitation.  Our review of a hearing officer's findings of fact are
deferential.  Section 318 provides, in pertinent part:  "The hearing officer's
decision, in the absence of fraud, on all questions of fact is final; but if the
hearing officer expressly finds that any party has or has not sustained the
party's burden of proof, that finding is considered a conclusion of law and is
reviewable in accordance with section 322."  39-A M.R.S.A. § 318 (Pamph.
2000).  In its subsequent findings, the hearing officer found that even
though McAdam had been earning $437.26 prior to beginning school, he
"could not safely continue in his work as a school bus driver for the City of
Portland."  Although the Board could have reached a different conclusion,
there is evidence in the record to suggest that the school bus driving
employment was becoming increasingly difficult, if not impossible for
B.  Applicability of Varying Rates Compensation

	[¶28]  UPS also contends that the Board erred in its subsequent
motion for findings of fact by awarding "varying rates" compensation, i.e.,
compensation based on the difference between pre-injury and actual post-
injury wages.  As UPS contends, because McAdam did not seek employment
while he was enrolled in vocational rehabilitation, varying rates benefits
would approximate 100% partial incapacity benefits.  
	[¶29]  We recently held that the determination of the availability of
post-injury employment must be based on the traditional criteria of an
employee's physical capacity and qualifications, and not the employee's
enrollment in vocational retraining.  Johnson v. Shaw's Distribution Ctr.,
2000 ME 191, ¶¶ 14, 17, 760 A.2d 1057, 1061.  Accordingly, we held that
it was not error to treat full-time work in the employee's local community as
available to a partially incapacitated employee, notwithstanding the
employee's enrollment in Board-ordered vocational rehabilitation, as long as
the employee is physically capable and otherwise qualified to obtain and
perform that employment.  Id.
	[¶30]  In this case, it is unclear from the hearing officer's subsequent
findings of fact whether the determination that McAdam "could not safely
continue in his work as a school bus driver for the City of Portland," is an
explanation of the hearing officer's original finding that McAdam has a
continuing capacity to earn $240 a week, or whether it constitutes a new
determination that McAdam suffers a greater level of incapacity.  Because
the hearing officer's findings are unclear on this crucial point, we cannot
determine whether the use of varying rates was based on McAdam's actual
incapacity or his enrollment in the rehabilitation program.  Thus, this issue
must also be addressed on remand.
	[¶31]  Finally, because the matter will be reheard on remand, we
address UPS's contention that the hearing officer's denial of its motion to
compel was in error.  UPS sought medical treatment history and medical
releases concerning a shoulder injury that McAdam may have suffered while
playing professional hockey with the National and American Hockey Leagues. 
UPS was precluded from obtaining those records by McAdam's refusal to
comply with the hearing officer's order and the hearing officer's refusal to
enforce the order.  The hearing officer concluded that "given unlimited
time I wouldn't mind knowing what there is out there [concerning possible
previous injuries], if anything, but I think in this forum, on this record, that
the ruling [denying enforcement] is a correct one."
	[¶32]  The Board's rules entitle employers to obtain relevant written
medical records concerning preexisting physical injuries without the
necessity of first obtaining a Board order.{11}  The existence, nature, and
extent of a prior injury to the same body part is relevant to determinations
regarding "work-related injury," causation, and "significant contribution,"
all of which were in issue in this matter  See 39-A M.R.S.A. § 201(4).  Board
rule, section 15 of chapter 12, titled "Exchange of Information," requires
the employee to provide a limited release of information concerning prior
injuries.  See Me. W.C.B. Rule ch. 12, § 15.{12} 
	[¶33]  Moreover, Board rule, chapter 12, section 18 provides for a
"Limited Authorization for the Release of Certain Written Medical
Information," and deals specifically with medical information related to
preexisting conditions:
1. In the event that the employer contends that the medical
records and information, pre-existing and subsequent to the
workplace injury, for which claim is being made are relevant for
determination of compensability and disability, it may obtain
from the employee and the employee is obliged to within a
reasonable time to execute a limited authorization for focused
written medical records only employing the form set forth in
Appendix III.
Me. W.C.B. Rule ch. 12, § 18 (emphasis added).  
	[¶34]  Although we give great deference to hearing officer's decisions
in matters of discovery, the discretion granted by law and rule is not
unlimited.  We review such decisions for abuse of discretion, recognizing the
greater opportunity for hearing officers to determine what matters are
relevant and to control their dockets to reduce costs, redundancies, and
unnecessary delays.{13}  
	[¶35]  In the present case, UPS sought the release of relevant medical
information pursuant to the Board rules.  Although the hearing officer has
discretion to limit discovery, and may decline to order discovery when the
information sought is not relevant to the matters in issue, in light of the
clear relevance of the information sought and the Board rules authorizing
the employer to obtain that information, the hearing officer's subsequent
decision to deny the employer's motion to compel discovery constituted an
abuse of discretion.
	The entry is:	
Decision of the Workers' Compensation
hearing officer vacated and remanded to the
hearing officer for further proceedings
consistent with this opinion.

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