Nebraska Court of Appeals Elaborates on When a Relocated Employee’s New Post Accident Domicile Will Not Be Considered the “Hub” for Purposes of Assessment of Loss of Earning Capacity

Recently, in a common sense decision, the Nebraska Court of Appeals elaborated when a relocated employee’s “hub” for purposes of loss of earning capacity assessment will be the location of employment at the time of injury as opposed to the time of loss of earning capacity assessment.

In Widel v. Lucile Duerr Hairstyling, Inc., the Court of Appeals upheld a workers’ compensation court decision in which the loss of earning capacity analysis utilized Claimant’s place of domicile at the time of her injury as opposed to her relocation. In Widel, the Claimant was injured while working as a hairstylist in Lincoln, Nebraska. Subsequent to the work injury, Claimant returned to work in Lincoln, Nebraska with the original employer for a number of years. Claimant underwent an FCE which did place permanent work restrictions on her. Subsequent to the same, she did continue working with the employer although it appears some reasonable accommodations were made to allow her to continue working as a hairstylist.

Based on that information, the stipulated loss of earning capacity specialist indicated the loss of earning capacity was 25%. Sometime later, Claimant relocated to Hebron, Nebraska to be closer to family. Further, she sought out a non-full time position in Hebron. She indicated she did so because she “wanted to take it easy” and no restrictions limited the hours she could work.

Her counsel insisted that the loss of earning capacity assessment be re-conducted with Hebron – a small town with a significantly smaller labor market – considered the “hub” for purposes of assessment of loss of earning capacity. Based on the Claimant’s expert’s opinion, this would result in a designation of permanent and total disability.

The Honorable John R. Hoffert determined that in this circumstance, given the fact that Claimant returned to work in Lincoln for multiple years in the same position after her accident, it was not required that the hub be considered as Hebron – a place she voluntarily moved to, to be closer to family. The court recognized that the Claimant’s move from a larger to a smaller labor market was prompted by her desire to be closer to family and that she intentionally chose working jobs that were only part time. The Workers’ Compensation Court reasoned that one of the primary purposes of the Workers’ Compensation Act was to restore an injured worker to gainful employment and that goal had already been met when the Claimant returned to her employer in Lincoln and worked in her usual position for approximately four years before voluntarily electing to retire and relocate.

Affirming the opinion of the Nebraska Workers’ Compensation Court, the Court of Appeals suggested that Hebron was not the appropriate hub because Claimant had essentially removed herself voluntarily from a suitable return to employment when she moved to Hebron and removed herself from full time employment due to personal reasons (desire to be closer to family and wanting to “take it easy”). The Court acknowledged that generally when an employee injured in one community relocates to a new community, the new community will serve as the hub community to assess loss of earning capacity provided that the change of community was done in good faith. However, this was considered in the current case to only be of “academic interest” as Claimant was able to return to her prior employment in Lincoln for four years and then subsequently chose to retire from that employment and relocate. The Court noted that Claimant chose to work part time in Hebron and given the same, Hebron was not the appropriate hub.

Take aways from this case; generally when a Claimant relocates in good faith subsequent to a work injury, that new community will be the “hub” for purposes of assessment of loss earning capacity. However, the Court’s decision in Widel stresses the importance of understanding why that Claimant is moving and understanding and documenting whether Claimant was able to return to work in the original hub. It would be our position that Widel stands for the proposition that if an employee is able to return to work and demonstrates a return to work subsequent to assignment of permanent restrictions in the original hub and chooses voluntarily to remove themselves from the active labor force via another community, that subsequent assessment of loss of earning capacity in that new community would be inappropriate.

For questions regarding Nebraska Workers’ Compensation cases and assessment of loss of earning capacity, please don’t hesitate to contact Nebraska workers’ compensation attorney, Paul Barta at PBarta@baylorevnen.com or 402-475-1075.