IMPORTANT NOTICE 

NOT TO BE PUBLISHED OPINION 

THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED." 

PURSUANT TO THE RULES OF CIVIL PROCEDURE 

PROMULGATED BY THE SUPREME COURT, CR 76.28(4)(C), 

THIS OPINION IS NOT TO BE PUBLISHED AND SHALL NOT BE 

CITED OR USED AS BINDING PRECEDENT IN ANY OTHER 

CASE IN ANY COURT OF THIS STATE; HOWEVER, 

UNPUBLISHED KENTUCKY APPELLATE DECISIONS, 

RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR 

CONSIDERATION BY THE COURT IF THERE IS NO PUBLISHED 

OPINION THAT WOULD ADEQUATELY ADDRESS THE ISSUE 

BEFORE THECOURT. OPINIONS CITED FOR CONSIDERATION 

BY THE COURT SHALL BE SET OUT AS AN UNPUBLISHED 

DECISION IN THE FILED DOCUMENT AND A COPY. OF THE 

ENTIRE DECISION SHALL BE TENDERED ALONG WITH THE 

DOCUMENT TO THE COURT AND ALL PARTIES TO THE 

ACTION. 
KEVIN REECE 

RENDERED: DECEMBER 17, 2015 

NOT TO BE PUBLISHED 

rani Court of Ifirhrifumr4 LI uu 

2015-SC-000115-WC 

il-\\ jr---',1--i-tco 

APPELLANT 

ON APPEAL FROM COURT OF APPEALS 

V. CASE NO. 2014-CA-000380-WC 

WORKERS' COMPENSATION NO. 06-72669 

INTEGRAL STRUCTURES, INC.; 

HONORABLE CHRIS DAVIS, 

ADMINISTRATIVE LAW JUDGE; AND 

WORKERS' COMPENSATION BOARD APPELLEES 

MEMORANDUM OPINION OF THE COURT 

REVERSING AND REMANDING 

Appellant, Kevin Reece, appeals a Court of Appeals decision which 

affirmed the Administrative Law Judge's ("ALP) finding that his workers' 

compensation award should not be enhanced by the two multiplier pursuant to 

KRS 342.730(1)(c)2. Reece argues that: 1) the ALJ misunderstood the reason 

his wages decreased; 2) the ALJ erred by relying on evidence not available 

when the claim was filed; and 3) the ALJ erroneously shifted the burden of 

proof onto him to prove that the cessation of greater wages was related to the 

work-related injury. Because of this Court's decision in Livingood v. 

Transfreight, LLC, 467 S.W.3d 249 (Ky. 2015), we reverse. 
Reece suffered a work-related injury while refurbishing a storage unit for 

Appellee, Integral Structures, on October 25, 2006. The injury occurred when 

Reece was struck in his left eye and nose by a metal bracket from a garage door 

he was replacing. Reece suffered a fractured eye socket and underwent 

reconstructive surgery. Despite the surgery, Reece still experiences difficulty 

with depth perception, light sensitivity, and blurry vision. Reece underwent a 

second surgery to treat glaucoma. 

Reece's treating physician, Dr. Louis Cantor, recommended several work 

restrictions due to the symptoms. Dr. Cantor believes that tasks requiring 

good binocular vision and depth perception would be difficult for Reece to 

perform. Reece usually was assigned lead or supervisory tasks before his 

injury. However, he indicated that after his injury, due to his inability to work 

on rooftops or high locations, he was no longer assigned those tasks. He was 

assigned the position of "helper" after Dr. Cantor submitted his recommended 

restrictions. 

Reece testified that he earned $15.50 per hour at the time of his workrelated accident. In January 2008, his hourly wage was increased to $17.50. 

However, Reece argues that Integral Structures reduced the number of hours 

he worked as a result of his physical limitations. 

Reece filed for workers' compensation. The ALJ, after a review of the 

evidence, entered an opinion and order awarding Reece permanent partial 

disability ("PPD") benefits. The parties did not argue whether the two multiplier 

was applicable to Reece's award in the original proceeding. On appeal, the 

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Workers' Compensation Board ("Board") remanded the matter for the AI.,1 to 

make a finding regarding the applicability of the two multiplier to Reece's 

award in light of Chrysalis House, Inc. v. Tackett, 283 S.W.3d 671 (Ky. 2009). 

The Board's opinion specifically stated that "the decision on remand be based 

upon the evidence of record at the time the claim was submitted" and that 

"nothing that occurred after August 25, 2009 [was] relevant to the issues on 

remand." Before the AI, J could enter an opinion and order on remand, Reece 

filed a petition to reopen arguing that he was entitled to the two multiplier 

because Integral Structures further reduced the hours he worked and that he 

was ultimately terminated in November 2009. 

After reviewing the additional evidence submitted by the parties, the AIJ 

made the following findings in his opinion and order on remand: 

The only real question then, put to us by Chrysalis House, 

is: Is the reason he earned less than on his date of injury from 

date of return to work through the date of submission of original 

claim, causally related to the work injury. In deciding this 

question I note the res judicata finding that, objectively, [Reece] 

does and did retain the capacity to return to the type of work done 

on the date of injury. I also note that as far as [Reece's] credibility 

I believe he has always been forthright and honest. Nonetheless, 

not unexpectedly, he has viewed all of the relevant events through 

a personal prism not always confirmed by the objective facts. 

Specifically, I have no doubt, since [Reece] has told me so, 

that his interactions and relationships with some of his 

supervisors were not always cordial when he refused to perform 

certain tasks. Regardless, the business records of [Integral 

Structures] are clear and convincing that during the timeframe in 

question [Integral Structures] total level of business was in decline. 

Certainly [Reece's] hours and total wages were not the only one 

whose were reduced. 

[Reece] has made subjective, if honestly made, arguments 

and allegations that his level of skill and experience were such that 

no other reasonable explanation can be given for why his hours 

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were reduced. I reject that theory. Of course [Reece] retains the 

burden of proof on this issue. 

For the aforementioned reasons and including the fact that 

[Reece] has failed to offer any proof beyond his own opinion of his 

skills and his own subjective interpretation of events, which do not 

persuade me, I find that his is not entitled to any additional 

multipliers. 

The ALJ made the following findings in his opinion and order on 

reopening regarding application of Chrysalis House: 

I also note that as far as [Reece's] credibility I believe he has 

always been forthright and honest. Nonetheless, not unexpectedly, 

he has viewed all of the relevant events through a personal prism 

not always confirmed by the objective facts. 

Specifically, I have no doubt, since [Reece] has told me so, 

that his interactions and relationships with some of his 

supervisors were not always cordial when he refused to perform 

certain tasks. Regardless, the business records of [Integral 

Structures] are clear and convincing that at the time [Reece] was 

laid off that much of the workforce of [Integral Structures] was 

either laid off or required to accept a pay cut. Later, as in several 

months, the workforce returned to a level close to, but not 

exceeding that at the time [Reece] was laid off. However, the pay 

rate of these employees is typically less than the pay rate of the 

same employees prior to [Reece's] lay off. 

In short, [Reece] was laid off from his job due to economic 

reasons and not for reasons due to his work injury. While I 

understand that the timing of events, his lay off took place very 

close in time to the original decision being issued, and his 

arguments with his direct supervisors, concern him these are 

subjective, not objective concerns. Many other employees were laid 

off at the same time, not just him and he was not being singled 

out. There is no evidence his direct supervisors had a role in 

laying him off and in fact the evidence suggests the contrary in 

that assertion that the individual, Mr. Eckert, who provided this 

testimony was not the man with whom [Reece] has on site disputes 

with. Nor was Mr. Travis Varble, the man [Reece] says actually 

told him to stay home. 

There is also no evidence, accepted by the undersigned that 

prior to his actual lay off that his gradual decrease in hours 

worked was due to the work injury. It is [Reece's] burden to prove 

that any reduction in his average weekly wage was due to the work 

injury. Given that I have already rejected the theory that he was 

being retaliated against and accepted the theory that [Integral 

4 
Structures] was suffering a wholesale, on-going loss in business 

there is no remaining compelling evidence to find his reduction in 

wages was due to the work injury. 

In short, the evidence leads the undersigned to determine 

that the reason he lost his job, and thus his earning capacity from 

November, 2009 through July 2012 was in no way connected to 

his injury. Pursuant to Chrysalis House, supra, he is not entitled 

to any enhancement of his benefits pursuant to KRS 

342.730(1)(c)2. 

Reece filed a petition for reconsideration on the order on remand. He 

argued that the ALJ improperly based his decision on evidence that the Board 

instructed him not to review. Reece argued that the records introduced on 

remand only show that Integral Structures' business declined in 2010 and 

2011, but did not explain the reduction in the hours he worked from 2007 

through August 2009. Reece contended that his work-related injury was the 

cause for him earning reduced wages, and thus Chrysalis House does not bar 

application of the two multiplier. The petition for reconsideration was denied. 

The Board affirmed the ALJ. The Court of Appeals also affirmed, and this 

appeal followed. 

The Board's review in this matter was limited to determining whether the 

evidence is sufficient to support the ALJ's findings, or if the evidence compels a 

different result. W. Baptist Hosp. v. Kelly, 827 S.W.2d 685, 687 (Ky. 1992). 

Further, the function of the Court of Appeals is to "correct the Board only 

where the Court perceives the Board has overlooked or misconstrued 

controlling statutes or precedent, or committed an error in assessing the 

evidence so flagrant as to cause gross injustice." Id. at 687-88. Finally, review 

by this Court "is to address new or novel questions of statutory construction, 

5 
or to reconsider precedent when such appears necessary, or to review a 

question of constitutional magnitude." Id. The ALJ, as fact-finder, has the sole 

discretion to judge the credibility of testimony and weight of evidence. 

Paramount Foods, Inc. v. Burkhardt, 695 S.W.2d 418 (Ky. 1985). 

Reece first argues that the ALJ must have misunderstood the evidence 

by finding that his wages were reduced due to Integral Structures' business 

problems and not the work-related injury. However, in finding for Reece on 

this issue, we need not address the ALJ's analysis of the evidence. Since the 

ALJ issued the opinion and order on remand and the opinion and order on 

reconsideration, this Court has reversed the portion of Chrysalis House, 283 

S.W.3d 671, which held that the claimant's failure to earn the same or greater 

wages must relate to the work-related injury before the two multiplier may be 

awarded. Livingood, 467 S.W.3d at 249. Instead, "KRS 342.730(1)(c)2 permits 

a double income benefit during any period that employment at the same or a 

greater wage ceases 'for any reason, with or without cause,' except where the 

reason is the employee's conduct shown to have been an intentional, deliberate 

action with a reckless disregard of the consequences either to himself or to 

another." Id. at 259 

On remand, the ALJ should make a finding of whether Reece engaged in 

conduct which constitutes deliberate malfeasance as outlined in Livingood that 

led to the reduction of hours he worked and ultimate termination. If he did not 

engage in such conduct, the two multiplier may be applied to his award. Thus, 

6 
we reverse the decision of the Court of Appeals and remand the matter to the 

Reece has raised two other arguments which we will briefly address. 

First, Reece argues that the ALJ erred in his opinion and order on remand by 

relying on business records which show Integral Structure's financial 

performance after August 25, 2009. This evidence was filed as a part of the 

record on the motion to reopen. We agree that the AIJ erred because the 

Board specifically instructed him to make findings on remand based on the 

evidence already submitted dealing with events occurring before August 25, 

2009. 

Second, Reece argues that the AIJ erred by placing upon him the burden 

to prove the cessation of greater wages was for reasons other than his workrelated injury. Reece, as claimant, "bears the burden of proof and the risk of 

non-persuasion before the fact-finder with regard to every element of a workers' 

ti 

compensation claim." Magic Coal Co. v. Fox, 19 S.W.3d 88, 96 (Ky. 2000). 

However, employers have the burden of proving affirmative defenses. Wolf 

Creek Collieries v. Crum, 673 S.W.2d 735 (Ky. App. 1984). Because a finding 

that the employee engaged in certain wrongdoing is a defense to an employer's 

payment of the two multiplier, the burden is on the employer to show that such 

acts occurred. 

Thus for the above stated reasons, we reverse the decision of the Court of 

Appeals and remand this matter for proceedings consistent with this opinion. 

7 
Minton, C.J.; Abramson, Cunningham, Keller, Noble, and Venters, JJ., 

sitting. All concur. Wright, J., not sitting. 

COUNSEL FOR APPELLANT, 

KEVIN REECE: 

Wayne C. Daub 

COUNSEL FOR APPELLEE, 

INTEGRAL STRUCTURES, INC.: 

Rodney Joseph Mayer 

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