The Board ended its last fiscal year on September 30, 2007, with 152 appeals pending under the Longshore Act and its extensions (LHWCA, 33 U.S.C.S. § 901 et seq.).  During the year, the Board received 241 appeals and issued 282 final dispositions.  All decisions were issued within one year of the date the appeal was filed. The Board received decisions from the various Courts of Appeals in 33 cases; the Board's decision was affirmed in 27 of those cases.  We have recently passed the halfway point on the new fiscal year.  As of March 30, the Board has received 111 new appeals and issued 117 decisions, ending the month with 153 pending Longshore appeals. [The Board also issued 635 decisions under the Black Lung Benefits Act (30 U.S.C.S. § 901 et seq.) during the last fiscal year and currently has approximately 600 pending Black Lung appeals.]  Twelve of the pending appeals involved Defense Base Act claims (42 U.S.C.S. § 1651 et seq.).  The average time between filing an appeal and issuance of a decision was 8.35 months, and no appeals were pending for more than a year.

I represented the Board at the Loyola Longshore Conference this year, participating in a panel discussion of average weekly wage issues raised in cases under the Defense Base Act (DBA).  The average weekly wage issues generally arise due to the increased wages being paid to contract employees working overseas, particularly in the combat zones.  Discussion focused on whether the average weekly wage should be based exclusively on overseas earnings, particularly where claimant has worked only a short period of time overseas prior to injury, or on combined earnings overseas and in the states in the year prior to injury.  While the administrative law judges have apparently issued decisions relying on various methods, every case decided by the Board thus far has involved an average weekly wage based solely on overseas earnings.  In cases where the employee was only overseas for a few weeks prior to injury, he or she received an average weekly wage based solely on earnings during that period.

The Board has published two cases on average weekly wage under the DBA.  In Proffitt v. Service Employers International, Inc., 40 BRBS 41 (2006), claimant began working for employer as a labor foreman in in April 2004 and was injured in August.  The administrative law judge found that this job was not comparable to claimant's last two stateside jobs as a maintenance worker and general laborer during the year prior to injury.  The administrative law judge thus rejected employer's argument that Section 10(a) applied (33 U.S.C.S. § 910(a)) and based claimant's average weekly wage on his earnings with employer in .  On appeal, employer argued that claimant's earnings from the entire 52 weeks preceding the injury should be included under either Section 10(a) or (c) (33 U.S.C.S. § 910(a) or (c)).  The Board initially rejected employer's Section 10(a) argument, as the record did not contain evidence of the number of days claimant worked, which is necessary to calculate claimant's average daily wage under that section.  Nevertheless, as it was relevant to a calculation under Section 10(c), the Board considered employer's argument that the administrative law judge erred in finding claimant's job in was not similar to his stateside work and in thus limiting claimant's average weekly wage to his overseas earnings.  The Board affirmed the administrative law judge's decision that the nature of claimant's stateside employment as a maintenance worker and laborer differed from his work as a labor foreman in , finding that the administrative law judge rationally inferred that claimant's job title in denoted managerial responsibilities which claimant did not have in his stateside work.  Moreover, the administrative law judge rationally found that claimant's work in a combat zone is inherently different from his work in the by virtue of the dangerous location and additional safety and security requirements.  The Board also rejected employer's argument that exclusion of claimant's stateside earnings resulted in an inaccurate representation of his earning capacity under Section 10(c).  The Board held that use of only wages earned from employer appropriately reflected the increase in pay claimant received when he began his new job and fully compensated claimant for income lost due to his injury.  The Board reached similar results in unpublished decisions in Zimmerman v. Service Employers International, Inc., BRB No. 05-0580 (Feb. 22, 2006) (unpublished), and Patton v. Brown & Root Services, BRB No. 06-0401 (Nov. 28, 2006) (unpublished), where claimants were truck drivers both in the states and overseas, and the administrative law judge based the average weekly wage solely on earnings overseas.  According to information at the Loyola Conference, both Zimmerman and Patton subsequently were settled.

In S. K. v. Service Employers International, Inc., 41 BRBS 123 (2007), the Board remanded the average weekly wage determination for further consideration.  Claimant was employed as a laundry service worker in .  Her prior employment was as a pre-school teacher in Houston .  She had worked in for approximately five weeks when she was injured in a motor vehicle accident in October 2004.  Her injuries left her paralyzed.  The administrative law judge calculated claimant's average weekly wage under Section 10(c) based on her earnings in .  He found that the wage records for other laundry workers introduced by claimant were missing information regarding the terms of employment and number of hours worked and concluded in his initial decision that these records were not sufficient to establish that the employees were similarly situated to claimant under Section 10(b) (33 U.S.C.S. § 910(b)).  He also found that they represented earnings for periods after claimant's injury.  On modification, claimant submitted into evidence a second set of records from other employees, and employer stated that all but one had substantially the same employment contract as claimant except that the "uplifts" had increased to 75 percent.  The administrative law judge denied modification, finding claimant raised a new legal theory by seeking use of similar employees' wages under Section 10(c) and that prospective wages cannot be considered.  On appeal, claimant asserted that the administrative law judge's calculation of her average weekly wage did not result in a reasonable approximation of her annual earning capacity as the administrative law judge did not consider the earnings of similarly situated employees or the amount of overtime claimant would have been expected to work.  The Board vacated the denial of modification, holding that claimant's arguments regarding the calculation of her average weekly wage under Section 10(c) raised an issue within the scope of Section 22 of the Act (33 U.S.C.S. § 922), as it involves a factual issue.  Moreover, contrary to the administrative law judge's finding, claimant did raise the issue of reliance on the other employees' wages in the initial proceedings. The Board directed the administrative law judge to address claimant's contention that her annual earning capacity is greater than that found as demonstrated by the other employees' earnings and the overtime she could have earned. The Board also noted that, if the administrative law judge again found claimant's actual earnings should be utilized, then the appropriate divisor pursuant to the parties' stipulation was 5 3/7 weeks rather than the 5 weeks used by the administrative law judge.

The decision in S. K. is novel in raising arguments based on the earnings of fellow employees as well as future earnings in addressing annual earning capacity under Section 10(c).  Thus far, the trend in cases decided by the Board is toward use of overseas earnings in determining average weekly wage.  However, the Board has yet to review an appeal of a case where the administrative law judge found a blend of stateside and overseas earnings representative of annual earning capacity, and it remains to be seen what action the Board will take on that and other fact patterns.

The DBA cases are raising a number of issues which will be relevant to all Longshore practitioners.  While some involve the unique facts of employment overseas and in a combat zone, the DBA cases construe the same statutory provisions as in any other case under the Longshore Act and its extensions.  These cases have already had an impact on average weekly wage.  Another area where DBA cases may have a big impact on the development of the law involves psychological injuries.  These injuries have been raised in Longshore claims for many years, but there is expected to be an influx of these claims, specifically post-traumatic stress disorder, in the DBA claims.  Determining whether claimant has a work-related psychological injury and disability poses similar problems in a case whether it involves a longshoreman or a defense contractor.  Another area where the DBA cases may expand existing Longshore law involves determining the appropriate geographic area for showing the availability of suitable alternate employment after injury.  Existing Longshore cases have developed tests for resolving this inquiry, see Wood v. Dep't of Labor, 112 F.3d 592, 31 BRBS 43(CRT) (1st Cir. 1997); See v. Washington Metropolitan Area Transit Authority, 36 F.3d 375, 28 BRBS 96(CRT) (4th Cir. 1994), but it is not an issue that is frequently raised.  However, DBA claims involve overseas employment where claimant returns to a stateside locale, placing the question of the appropriate market at issue in many more cases.  See Patterson v. Omniflex World Services, 36 BRBS 149 (2003).  Practitioners who focus on Longshore claims should not ignore the precedent being set in DBA cases. 

Other noteworthy cases issued by the Board in recent months include J. H. v. Oceanic Stevedoring Co., 41 BRBS 135 (2008), which involved the Director OWCP's appeal of a Section 8(i) settlement (33 U.S.C.S. § 908(i)) that provided a credit to future employers if claimant returned to covered employment and suffered a new injury or aggravation.  The Board vacated the settlement, agreeing with the Director that it was not limited to the rights of the parties or claim in existence.  The Board also held that the credit created by the settlement could not stand as it was not authorized by statutory provision or case precedent.

In R. H. v. Bath Iron Works Corp.,  BRB No. 07-0739 (March 28, 2008), motion for reconsideration pending, the Board addressed the requirements for a pre-existing permanent partial disability under Section 8(f) in a hearing loss case (33 U.S.C.S. § 908(f)).  The Board rejected the Director's argument that, in order to establish a pre-existing permanent partial disability for purposes of Section 8(f) in accordance with 20 C.F.R. § 702.321, an audiogram must comply with all of the requirements of 20 C.F.R. § 702.441, and specifically with the requirements for a presumptive audiogram under Section 702.441(b).  The Board held an audiogram may be probative evidence if it meets the requirements of Section 702.441(d) and 33 U.S.C.S. § 908(c)(13)(E).  The Board followed this holding in G. K. v. Matson Terminals, Inc., BRB Nos. 05-0893, 07-0643 (April 18, 2008).  The Board initially affirmed the administrative law judge's denial of Section 8(f) relief based on his finding that due to test/retest variability, the audiograms relied on to show a pre-existing permanent partial disability and claimant's second injury showed essentially the same disability.  The Board remanded the case for the administrative law judge to consider whether earlier audiograms established a pre-existing permanent partial disability under Section 8(f), rejecting the argument that they could not do so as they failed to meet the requirement of Section 702.441(b) that a copy be given to claimant based on the decision in R. H.  

Determining attorney's fee liability under Sections 28(a) and (b) of the Act continues to be a contested area of the law (33 U.S.C.S. §§ 928(a) and (b)).  The Board has consistently followed the strict construction of those sections in cases arising in the circuits adopting this interpretation of the Act.  See Wilson v. Virginia International Terminals, 40 BRBS 46 (2006) (employer's acceptance of the district director's recommendation that it owed nothing further precluded employer's liability under Section 28(b), notwithstanding the administrative law judge's award of greater benefits).  In Davis v. Eller & Co., 41 BRBS 58 (2007), which arose in the Eleventh Circuit, the Board announced it would apply a strict construction approach in those circuits which have not addressed the issue.  In Davis, as no informal conference was held, the administrative law judge's finding that employer was liable for the attorney's fee was reversed.  

In Andrepont v. Murphy Exploration & Prod. Co., 41 BRBS 1 (2007) (Hall, J., dissenting), aff'd on recon., 41 BRBS 73 (2007) (Hall, J., concurring), the Board held that employer was not liable for the fee under Section 28(b) as employer accepted the District Director's recommendation that it pay nothing further.  Although the Fifth Circuit, the jurisdiction where the case arose, had declined to address the specific requirement that employer refuse the district director's recommendation, see James J. Flanagan Stevedores, Inc. v. Gallagher, 219 F.3d 426, 435 n.18, 34 BRBS 35, 42 n.18 (CRT) (5th Cir. 2000), the Board found that strict adherence to the requirements of Section 28(b) was consistent with the court's decisions.  In R. S. v. Virginia International Terminals, BRB Nos. 07-0664/07-0664A (Mar. 28, 2008), motion for recon. pending, the Board held that employer was not liable under Section 28(b) [There was no argument in R.S. that Section 28(a) applied.] where there was no informal conference and recommendation on the issue on which claimant was ultimately successful before the administrative law judge.  In R. S., an informal conference was held and recommendation made by the district director regarding benefits for claimant's knee injury.  Claimant then claimed benefits for a back condition allegedly related to this injury, but no informal conference was held or recommendation issued regarding this condition.  All benefits for the knee injury were paid prior to referral to the administrative law judge.  The Board held that on these facts, employer was not liable for a fee under Section 28(b) on claimant's successful back injury claim.

Section 28(a) has also been strictly construed.  Based on the plain language of the statute, Section 28(a) applies where employer declines to pay any compensation within 30 days of its receipt of the claim from the district director.  Section 28(b) applies where employer begins the timely payment of benefits.  What happens, then, if employer declines to pay within the 30 day period of Section 28(a), but commences payments at a later date?  The Board initially held that under such circumstances, fee liability for work performed after payments commenced was determined under Section 28(b).  See Day v. James Marine, Inc., BRB No. 05-0346 (Dec. 20, 2005) (unpublished), decision after remand, BRB No. 06-0518 (May 25, 2006) (unpublished), aff'd in part and rev'd in pertinent part, 518 F.3d 411 (6th Cir. 2008).  In W. G. v. Marine Terminals Corp., 41 BRBS 13 (2007), the Board changed this position and held that, once employer does not pay benefits to claimant within 30 days of its receipt of the claim, its liability for an attorney's fee for work involving all benefits due on the claim must be determined under Section 28(a).  In its decision in Day, the Sixth Circuit stated its agreement with this holding.  In both Day and W. G., employer controverted the claim after receipt from the district director.  The court held that the fact that employer paid some benefits prior to receipt of the claim, as well as paying benefits after the 30 day period ended, made no difference.  The question is whether employer paid during the ``30-day window'' after receipt of the claim.  Since employer did not pay during this period, it was liable for post-controversion fees.  The court also held that employer is not liable for pre-controversion fees.

The Board has recently held oral argument in two pending appeals, one of which raises issues involving Section 28(a) and the decisions in Day and W. G.  In A. M., BRB No. 07-0791, employer controverted the claim after receipt.  However, it later paid scheduled benefits and a related fee.  Approximately three years later, claimant required additional surgery and sought related temporary total disability and medical benefits.  Employer paid the disability benefits and medical expenses.  Claimant then sought a fee payable by employer, arguing employer was liable under Section 28(a).  Oral argument concerned the proper construction of Section 28(a) under these facts.  The second case, B. E., 07-1011, concerns the coverage under Section 2(3) of the Act of a maintenance worker who cleaned the cafeteria and restrooms at a shipyard (33 U.S.C.S. § 920(3)).  The administrative law judge in that case granted summary judgment for employer, and oral argument focused on whether his conclusion that claimant was not a covered employee was proper.  Decisions will issue in these cases this summer.

© Copyrighted 2008 by LexisNexis. All rights reserved. This article, written by Janice J. Ulan, Associate General Counsel, Longshore Division, Benefits Review Board, U.S. Department of Labor, originally appeared in the Benefits Review Board Service Longshore Reporter (Release 695).