MICHAEL J. THELEN, Employee/Cross-Appellant,
v.
THELEN HEATING & ROOFING, INC., and STATE FUND MUTUAL INS. CO., Employer-Insurer/Appellants,
and
THELEN HEATING & ROOFING, INC., and CNA INS. CO., Employer-Insurer.
Minnesota Workers Compensation
Workers' Compensation Court of Appeals
January 19, 1999
HEADNOTES
TEMPORARY
PARTIAL DISABILITY - EARNING CAPACITY. In order for an
employee to qualify for temporary partial disability
benefits, there must be reasonably definite documentary and
other evidence that his "employment" generated
positive and substantial earnings, either actual or
imputed. In a case where the employee's ongoing work
was primarily in a self-employment venture, the compensation
judge exceeded his authority in imputing an ongoing full-time
weekly earning capacity from an already imputed hourly wage
for only 5.3 hours of work a week that the employee had been
performing without pay at a second job, particularly in that
the judge himself had found that employee's
self-employment activities had so far proved unprofitable and
that the self-employment plan itself as it existed was
unreasonably speculative and in need of amendment.
Reversed.
Determined by Pederson, J., Wilson, J. and Johnson, J.
Compensation Judge: Rolf G. Hagen
OPINION
WILLIAM R. PEDERSON, Judge
The
employer and insurer appeal from the compensation judge's
award of temporary partial disability benefits based on an
imputed earning capacity and from the judge's consequent
award of attorney fees. The employee cross-appeals from
the judge's conclusion that the employee's earning
capacity should be calculated based on a forty-hour work week
rather than on actual hours worked. We reverse the
judge's award of benefits and related attorney fees,
rendering the cross-appeal moot.
BACKGROUND
On
February 15, 1991, Michael Thelen [the employee] sustained a
work-related injury to his low back while working as a
tinsmith for Thelen Heating & Roofing, Inc. [the
employer], at an average weekly wage of $779.65. The
employee was twenty-six years old at the time of his
injury. He was able initially to return to work with the
employer, but by the spring of 1992 he had become medically
restricted by the injury from lifting over twenty-five pounds
and from repetitive bending or twisting.1 The insurer on
the injury, State Fund Mutual Insurance Company [the
insurer], commenced payment of wage replacement benefits
apparently about that same time. On November 15, 1993,
Dr. Peter Schmitz diagnosed the employee's injury as a
ruptured disc at L4-5 and a bulging disc at L5-S1 and
determined that the employee had reached maximum medical
improvement [MMI] from that injury on September 27,
1993. The employer and insurer ultimately paid
impairment compensation for a 14% whole-body impairment
consequent to that injury. About two years after
reaching MMI, in August of 1995, while still working for the
employer, the employee apparently became temporarily disabled
by an alleged aggravation of the injury, which aggravation is
not here at issue.2 Disability case management was
evidently commenced in January of 1996, and by the end of
April of that year the employee had been released to return
to work at light duty, but the parties were apparently unable
to agree upon a rehabilitation plan. On June 25, 1996,
the employer and insurer filed a Notice of Intention to
Discontinue [NOID] payment of temporary total disability
benefits "due to [the employee's]
self-employment."3
Apparently
in July of 1996, the employee obtained the rehabilitation
assistance of QRC Kenneth Moberg. On July 26, 1996, QRC
Moberg proposed a Rehabilitation Plan contemplating that the
employee would spend thirty to forty hours a week working at
$5.75 an hour as a supervisor and project estimator for Gull
Lake Sandblasting [Gull Lake], a seasonal business belonging
to his wife, and would spend his remaining working hours
developing a business venture of his own entitled Fiber Tech
Productions [Fiber Tech]. Fiber Tech's business is
primarily the fabrication of fiberglass castings that are
used in the replication of trophy fish.4 These castings
are then either marketed wholesale to taxidermists or to
other businesses to complete into fish replicas or are
painted and completed into replicas by Fiber Tech itself for
its own retail customers. The final replicas are
analogous to a taxidermist's product, but the necessity
of preserving the natural skin of the subject animal is
avoided, either by casting the subject animal itself in
fiberglass and then painting the casting or by painting a
casting of an animal of identical size and species to exactly
resemble the subject animal as it appears in a
photograph. Because the initial molds for the castings
are therefore reusable, Fiber Tech's cost in producing
castings diminishes substantially as its inventory of molds
grows. The employee's knowledge of the technology
of this process is evidently due entirely to instruction that
he has received from his father-in-law, Charles Riley, who
the employee testified was principally responsible for
inventing the technology while employed previously by what
may be one of Fiber Tech's purportedly few competitors.
By the
summer of 1996, Fiber Tech was not yet profitable, and on
August 8, 1996, the insurer indicated that it would not agree
to the proposed rehabilitation plan, essentially on grounds
that it did "not consider $5.75 to be suitable earning
potential." The employee's work-related low
back condition was deteriorating, and on October 3, 1996,
based on a September 27, 1996, MRI scan, the employee
underwent a hemilaminotomy and discectomy at L-3-4 on the
left. He...
