In a new published opinion which consolidated two cases, the Benefits Review Board (“BRB”) discussed the proper application of Section 14(e) penalties to hearing loss claims resulting from in-house audiograms. Pursuant to Section 14(e), a penalty equal to 10% of any installment of unpaid compensation can become due unless a notice of controversion is filed, or unless the district director excuses the failure to pay (when the failure was due to circumstances outside of the employer’s control).
In this case, the claimants wanted the 10% penalty for their hearing loss claims. Claimant Andrew McGarey worked for employer as a machinist/grinder since 1975. He regularly underwent audiological evaluations conducted at his employer’s facility. On May 18, 2011, Claimant McGarey filed a Notice of Injury identifying May 17, 2011 as the date of injury. He did not submit medical records to his employer. Nonetheless, there was a March 10, 2010 audiogram in the employer’s files. After McGarey filed his claim on May 18, 2011, the employer issued a compensation payment based on the increased binaural hearing loss identified in the March 10, 2010 audiogram. Claimant McGarey wanted Section 14(e) penalties from March 10, 2010, forward.
The second Claimant, Thomas Russell, worked as a welder for the employer for 29 years. He underwent multiple audiological evaluations during that 29-year span, with the most recent occurring on March 7, 2011. Claimant Russell filed his Notice of Injury on May 9, 2011. Two weeks later, the employer voluntarily paid a sum equal to 7.5 percent left monaural hearing loss. Claimant Russell also wanted Section 14(e) penalties.
The administrative law judges (“ALJ”) denied the requests for Section 14(e) penalties based on Mowl v. Ingalls Shipbuilding, Inc., 32 BRBS 51 (1998). The BRB reversed, reasoning that the ALJ read Mowl too broadly. The BRB stated (with internal citations omitted):
Contrary to the administrative law judges’ broad reading, and to the argument made in employer’s supplemental brief in Russell, Mowl does not stand for the proposition that in a hearing loss case in which claimant continues to work for employer and to be exposed to noise after undergoing an audiogram, employer cannot be found to have knowledge for purposes of Section 14(e) until the claim is filed. Such a holding would be contrary to the plain language of Section 14(b) and (d), that employer must pay or controvert upon knowledge or notice of an injury. Rather, Mowl holds only that in a case in which the compensable injury is a cumulative hearing loss injury, the employer does not have knowledge for Section 14(e) purposes until it has knowledge of the full extent of the hearing loss injury on which the claim is based. In these cases, claimants were seeking a Section 14(e) assessment based on the hearing loss injuries demonstrated on the audiograms that formed the basis for the claims, not on prior audiograms.
As Mowl did not address the issue presented in the appeals before us regarding employer’s liability for Section 14(e) assessments based on its knowledge of the injuries demonstrated on the in-house audiograms which served as the bases for its payment of compensation in both cases, the administrative law judges erred in relying on the Board’s decision in Mowl to deny Section 14(e) assessments. We therefore vacate the administrative law judges’ findings that employer is not liable for a Section 14(e) assessment in both McGarey and Russell, and remand the cases for the administrative law judges to reconsider the issue of employer’s knowledge of claimants’ injuries for purposes of Section 14(e) in accordance with the correct legal principles. As previously discussed, supra at n.6, employer possesses the requisite knowledge for purposes of Section 14(e) if it knows of the injury and of such facts that a reasonable person would consider that compensation liability was possible and that further investigation should be made. Thus, on remand, the administrative law judges should determine whether employer had knowledge of the claimants’ respective injuries when it conducted the in-house audiograms that revealed the full extent of the hearing loss for which compensation was claimed and paid.
McGarey, et al. v. Elec. Boat Corp., BRB Nos. 12-0672, 13-0020 (2013).
(Note: I originally published this post on Navigable Waters: A Maritime, Longshore and Defense Base Act Blog.)