In the unfortunate event that an employee is hurt on the job, an employer must be mindful of several things beyond the medical care and treatment of the employee.
An employer must be mindful that they may not refuse to rehire the employee, without reasonable cause, once the employee is permitted to return to work.
The unreasonable refusal to rehire an injured employee could subject the employer to liability, including payment to the employee of one year’s wages. This article discusses Wisconsin law basics regarding claims of wrongful refusal to rehire an employee under the worker’s compensation statute.
What is the Wisconsin Law Regarding Refusal to Rehire an Injured Employee?
Under the applicable statute, Wis. Stat. § 102.35(3), “Any employer who without reasonable cause refuses to rehire an employee who is injured in the course of employment, when suitable employment is available within the employee’s physical and mental limitations…[the employer] has exclusive liability to pay to the employee, in addition to other benefits, the wages lost during the period of such refusal, not exceeding one year’s wages….”
This statute is meant to prohibit an employer from relying upon an employee’s compensable work-related injury as the basis for his or her termination. Generally, a compensable work-related injury is one that occurs while the employee is engaged in an activity related to the employer’s business. The statute will be “liberally construed to effectuate its beneficent purpose of preventing discrimination against employees who have sustained compensable work-related injuries.” Great Northern Corp. v. Labor and Industry Review Com’n, 189 Wis.2d 313, 317, 525 N.W.2d 361, 363 (Ct. App. 1994). Several specific provisions of the statute are discussed below.
What is Reasonable Cause? And why is it important?
Whether an employer has reasonable cause to refuse to rehire an employee can be fact intensive. Wisconsin courts have determined that, under Wis. Stat. § 102.35, an employer has reasonable cause to refuse to rehire an injured employee if suitable employment is available if the cause or reason is fair, just, or fit under the circumstances. deBoer Transp., Inc. v. Swenson, 2011 WI 64, ¶ 43, 335 Wis.2d 599, 804 N.W.2d 658.
An employee may not be terminated on the basis that the employee was injured. Under some circumstances, an employer has reasonable cause to refuse to rehire an employee when the employer makes a business decision in order to reduce costs, such as eliminating the employee’s position.
One court has determined that employers are not required to change their “legitimate and universally applied business policies to meet the personal obligations of their employees.” Id. at ¶ 45. The employer will bear the burden of proving that it had reasonable cause for refusing to rehire the employee.
What is Suitable Employment?
Wis. Stat. § 102.35 does not define “suitable employment.” Under another section of Wisconsin’s worker’s compensation law, “suitable employment” is defined, in part, as “employment that is within an employee’s permanent work restrictions, that the employee has the necessary physical capacity, knowledge, transferable skills, and ability to perform…” Wis. Stat. § 102.61(1g)(a). When determining whether “suitable employment” is available, an employer may consider the continuance of the business, written rules of the employer with respect to seniority, or collective bargaining agreements regarding seniority.
The Exclusivity Clause
The exclusivity clause with respect to liability means that the employer, and not its insurer, is liable to the employee for the payment of up to one year’s wages.
As discussed above, the refusal to rehire statute will be interpreted liberally and in a manner to protect injured employees. As a best practice, both generally and to mitigate risk under this statute, employers should sufficiently track in writing an employee’s performance and other employment metrics so as to have a written record in order to justify reasonable cause.
In the event that an injured employee brings a claim against the employer claiming a wrongful refusal to rehire, a well-documented employment file may serve as sufficient evidence that a refusal to rehire was based upon reasonable cause and not the injury itself.
If you have any further questions regarding the refusal to rehire an injured employee please call one of our trusted Green Bay Business Attorney’s today at (920) 499-5700.