*The Honorable Byron R. White, Associate Justice of the

United States Supreme Court, (Ret.), sitting by designation,

pursuant to 28 U.S.C. § 294(a). 

1

United States Court of Appeals,

Fifth Circuit.

No. 93-5426.

LOUISIANA INSURANCE GUARANTY ASSOCIATION, Petitioner,

v.

Neil ABBOTT, Jr., and Director, Office of Workers' Compensation

Programs, U.S. Department of Labor, Respondents.

Dec. 20, 1994.

Petition for Review of a Decision of the Benefits Review Board.

Before WHITE, Associate Justice (Ret.),* BARKSDALE and PARKER,

Circuit Judges.

WHITE, Associate Justice (Ret.).

Appellant challenges certain portions of a decision of the

United States Department of Labor Benefits Review Board (the

"Board") awarding benefits to appellee under the Longshore and

Harbor Workers' Compensation Act (the "Act"), 33 U.S.C. § 901 et

seq. Specifically, appellant contends that the Board erred in

affirming the findings of the administrative law judge (the "ALJ")

on three points: the date of appellee's "maximum medical

improvement," the availability of permanent total disability

benefits during the period of appellee's vocational rehabilitation,

and the calculation of appellee's post-retraining wage earning

capacity. This court's review of Board decisions is limited to

considering whether the Board "correctly concluded that the ALJ's

order was supported by substantial evidence on the record as a
2

whole and is in accordance with the law." Avondale Industries,

Inc. v. Director OWCP, 977 F.2d 186, 189 (5th Cir.1992). Because

we conclude that the Board's appraisal of the ALJ's careful

decision was correct on each of the points outlined above, we

affirm.

I.

On January 11, 1983, Neil Abbott, Jr., the appellee, injured

his back while hanging tires, to be used as bumpers, around a

vessel at the Universal Iron Works facility in Houma, Louisiana.

Universal employed Abbott as a welder. Shortly after the injury,

Abbott was diagnosed as having a herniated disc; he received

treatment from an orthopedic specialist until April 1984, when he

was released for return to work under significant restrictions.

Because of the nature of his back injury, Abbott was unable to

return to his previous, physically demanding job with Universal;

the doctor recommended that Abbott seek vocational rehabilitation

so that he could change to a more sedentary form of employment.

Following his medical release, Abbott sought vocational

counseling through the Department of Labor and was referred to

Jennifer Palmer, a licensed vocational rehabilitation specialist.

Palmer believed that Abbott was a good candidate for vocational

retraining rather than simple placement in an unskilled,

minimum-wage job; she therefore designed a rehabilitation and

retraining program that would allow Abbott to earn a salary equal

to—if not greater than—that which he had earned as a welder with

Universal. Accordingly, in the fall of 1985, Abbott began a
3

four-year college program in medical technology at Nicholls State

University in Lafayette, Louisiana. The Department of Labor paid

Abbott's tuition and required him to attend school full-time

throughout the year. Abbott also was required to maintain a

certain minimum grade point average. Palmer believed that school

and family pressures would have precluded Abbott from working, even

on a part-time basis, had the Department of Labor allowed him to do

so. Abbott completed his program, plus a one-year internship, on

July 25, 1990; he began working as a medical technician the

following month at Southern Louisiana Medical Center, a public

hospital.

From the time of the accident until September 15, 1986, Abbott

received voluntary worker's compensation payments from Universal's

insurer or from Universal itself. These voluntary benefits were

paid—and ended—while Abbott was enrolled in the retraining program

at Nicholls State. Both Universal and its insurer apparently were

aware of Abbott's rehabilitation program while they made the

compensation payments, and neither objected. After September 15,

because of the insolvency of Universal and its insurer, Abbott

sought compensation benefits under the Longshore and Harbor

Workers' Compensation Act from appellant, Louisiana Insurance

Guaranty Association ("LIGA"), a non-profit, unincorporated entity

created by the Louisiana legislature to pay claims when the primary

insurer is insolvent. See LSA-R.S. 22:1375 et seq.

In July 1988, an administrative law judge issued an order

requiring LIGA to pay Abbott benefits for his continuing temporary
 

1The Board denied LIGA's petition for a stay of compensation

benefits while the appeal was being considered, an action that

was sustained in the courts. In re Compensation Under Longshore

& Harbor Workers' Compensation Act, 889 F.2d 626 (5th Cir.1989),

cert. denied sub nom. Louisiana Ins. Guaranty Ass'n v. Abbott,

494 U.S. 1082, 110 S.Ct. 1813, 108 L.Ed.2d 944 (1990). The

issues presented in that earlier appeal are not relevant here. 

 

2As the Board later noted, the ALJ erred in characterizing

Abbott's total disability as temporary during the period of

rehabilitation, which occurred after he reached maximum medical

improvement. As we discuss infra, part II.A., the nature of a

claimant's disability is permanent once the claimant reaches

maximum medical improvement, regardless of whether the extent of

that disability is total or partial. The Board corrected the

ALJ's error in terminology on appeal. 

4

total disability. The Board initially affirmed the ALJ's decision

in all respects. Abbott v. Universal Iron Works, Inc., 23 BRBS 196

(1990). On reconsideration, however, the Board remanded for a new

hearing on Abbott's entitlement to benefits under the Act because

LIGA had never been given the opportunity to contest the nature and

extent of Abbott's disability.1 Abbott v. Universal Iron Works,

Inc., 24 BRBS 169 (1991).

On remand, the ALJ found that Abbott had reached maximum

medical improvement on April 18, 1984, and determined that Abbott

was entitled to compensation for temporary total disability2 until

he completed vocational retraining on July 25, 1990, and to

permanent partial disability compensation thereafter. LIGA

appealed the ALJ's decision, and the Board affirmed in all relevant

respects. Abbott v. Louisiana Ins. Guaranty Ass'n, 27 BRBS 192

(1993). We are now asked to review three aspects of the Board's

decision, all of which concern the amount of benefits to which

Abbott is entitled and not LIGA's liability therefor. We discuss
5

each in turn.

II.

A.

 A claimant is considered permanently disabled under the Act

if he or she has any residual disability after reaching maximum

medical improvement, the date of which is to be determined solely

by medical evidence and is not dependent on economic factors. See

Trask v. Lockheed Shipbuilding & Construction Co., 17 BRBS 56, 60-

61 (1985). LIGA argues that the ALJ erred in concluding that

Abbott did not reach maximum medical improvement until April 18,

1984, because Abbott's treating physician testified in a deposition

that Abbott's physical condition had reached a "plateau" in August

1983. In finding April 18, 1984, to be the relevant date, the ALJ

considered the doctor's estimation to have been a retrospective

characterization. That is, the physician was saying only that,

after the fact, it became clear that Abbott made no significant

improvement after August 1983. The ALJ reasoned, however, that the

later date represented the point of maximum medical improvement

because the doctor continued to treat and evaluate Abbott between

August 1983 and April 1984; it was only then that the doctor

concluded that nothing further could be done for Abbott. The Board

affirmed the ALJ's decision on this point; and LIGA apparently

believes that the Board's holding delayed the point at which LIGA's

compensation payments to Abbott could potentially be reduced for

approximately eight months.

The Act provides coverage for four different categories of
6

disabilities: permanent total disability, temporary total

disability, permanent partial disability, and temporary partial

disability. 33 U.S.C. § 908. Thus, "[t]his statutory structure

indicates two independent areas of analysis—nature (or duration) of

disability and degree of disability." Stevens v. Director, OWCP,

909 F.2d 1256, 1259 (9th Cir.1990), cert. denied, 498 U.S. 1073,

111 S.Ct. 798, 112 L.Ed.2d 860 (1991). The Act does not define

those terms, and hence the courts have been left to enunciate

standards for distinguishing between the various categories. New

Orleans (Gulfwide) Stevedores v. Turner, 661 F.2d 1031, 1037 (5th

Cir.1981). The statutory scheme does provide, however, for

different amounts of compensation based on extent and permanence of

a worker's disability.

The point of maximum medical improvement represents the

beginning of permanent, as opposed to temporary, disability under

the statutory scheme. This court has stated that an employee is

permanently disabled when "his condition has continued for a

lengthy period, and it appears to be of lasting or indefinite

duration, as distinguished from one in which recovery merely awaits

a normal healing period." Watson v. Gulf Stevedore Corp., 400 F.2d

649, 654 (5th Cir.1968), cert. denied, 394 U.S. 976, 89 S.Ct. 1471,

22 L.Ed.2d 755 (1969). A claimant is thus entitled to temporary

disability payments until he or she has attained what courts and

the Board have termed the point of maximum medical improvement.

The federal courts have provided various definitions of this point,

all of which amount to the same concept. See, e.g., Palombo v.
7

Director, OWCP, 937 F.2d 70, 76 (2d Cir.1991) (viewing the date of

maximum medical improvement as "the point when the injury has

healed to the full extent possible"); Director, OWCP v.

Berkstresser, 921 F.2d 306, 312 (D.C.Cir.1990) (defining maximum

medical improvement as "the time at which no further medical

improvement is possible"); Stevens, 909 F.2d at 1257 (explaining

that "[m]aximum medical improvement is attained when the injury has

healed to the full extent possible"). Once an injury becomes

permanent, an employee becomes eligible for federally-sponsored

vocational rehabilitation programs, see 33 U.S.C. § 939(c)(2), and

an employer becomes entitled to relief from compensation liability

under certain conditions, see 33 U.S.C. § 908(f). An earlier date

of maximum medical improvement is therefore likely to reduce an

employer's overall compensation liability.

In this case, the Board held that a condition becomes

permanent when the employee is no longer undergoing treatment with

a view towards improving his condition. See also Brown v. Lykes

Bros. Steamship Co., 6 BRBS 244, 247 (1977) (noting that even where

subsequent treatment does not improve a claimant's condition, the

claimant may not reach maximum medical improvement until medical

opinion establishes that the treatment was not successful and

further treatment would not improve the claimant's condition). The

Board's position is entirely consistent with this court's

precedent. If a physician determines that further treatment should

be undertaken, then a possibility of success presumably exists.

One cannot say that a patient has reached the point at which no
8

further medical improvement is possible until such treatment has

been completed—even if, in retrospect, it turns out not to have

been effective. Here, the physician clearly believed until April

1984 that further treatment could be productive. Although LIGA

contends that the doctor impermissibly took into account the fact

that Abbott had not completed a vocational evaluation in the summer

of 1983, the Board found that the ALJ's findings were still

adequately supported when only medical, and not vocational, factors

are considered. Accordingly, we hold that the Board was correct in

affirming the ALJ's determination of Abbott's date of maximum

medical improvement as rational and supported by substantial

evidence in the record.

B.

Whereas maximum medical improvement is the indication of

permanent versus temporary disability, the availability of suitable

alternative employment distinguishes partial from total disability.

See Stevens, 909 F.2d at 1259. Thus, the degree of a claimant's

disability is not determined solely by reference to medical

information. The Act defines the term "disability" as the

"incapacity because of injury to earn the wages which the employee

was receiving at the time of injury in the same or other

employment." 33 U.S.C. § 902(10). Because the statute frames the

definition in terms of the worker's lost wage-earning capacity,

courts have generally viewed disability principally in economic

terms. Turner, 661 F.2d at 1037-38. See also Bumble Bee Seafoods

v. Director, OWCP, 629 F.2d 1327, 1328 (9th Cir.1980) ("The degree
9

of physical impairment is measured by its impact on the worker's

earning capacity."). As this court has stated, "[i]t is therefore

possible under [the Act] for an individual to be totally disabled

"when physically capable of performing certain work but otherwise

unable to secure that particular kind of work.' " Turner, 661 F.2d

at 1038 (quoting Diamond M. Drilling Co. v. Marshall, 577 F.2d

1003, 1006 (5th Cir.1978)).

In this case, the ALJ awarded total disability compensation

from the date of maximum medical improvement until Abbott completed

his vocational rehabilitation program. LIGA's vocational expert

testified that, during this entire period, Abbott had a

minimum-wage residual earning capacity (i.e., he was physically

capable of performing any number of available minimum-wage jobs).

Thus, LIGA argues, Abbott was only partially disabled within the

meaning of the Act while he was completing his job retraining

program. Abbott contends, on the other hand, that it was

appropriate for the ALJ to treat him as totally disabled during

this time because (1) he returned to school as part of a Department

of Labor-sponsored retraining program that was carefully planned

and was agreed to by both his former employer and its insurance

carrier, (2) even part-time work would have disqualified him from

receiving the federal tuition payments that allowed him to complete

the program, and (3) evidence in the record revealed that he would

have been unable to maintain the required minimum grade point

average while working. This case therefore cleanly presents a

question of first impression in this circuit, as it was for the
10

Board: may an injured worker continue to receive permanent total

disability benefits while undergoing vocational rehabilitation if,

but for the requirements of the retraining program, the individual

would be able to take a minimum wage job? The Board affirmed the

ALJ's decision, noting that "while claimant was capable of

performing jobs employer's expert identified as available, he could

not realistically secure that particular employment due to his

participation in his Department of Labor-approved rehabilitation

plan."

As this court explained in Turner, once a claimant

demonstrates that he is unable to perform his former longshore

employment tasks because of a job-related injury, he has made a

prima facie case of total disability. The burden then shifts to

the employer, should it wish to reduce or eliminate its

compensation liability, to establish that the employee is capable

of performing other realistically available jobs. Turner, 661 F.2d

at 1038; see also P & M Crane Co. v. Hayes, 930 F.2d 424, 429-30

(5th Cir.1991). The Turner court developed a two-pronged test by

which employers can satisfy this alternate-employment burden.

Courts should consider (1) what types of jobs the claimant is

capable of performing or capable of being trained to do, and (2)

whether there are jobs reasonably available in the community for

which the claimant is able to compete and which he could

realistically and likely secure. Turner, 661 F.2d at 1042. The

Turner court acknowledged, however, that the Act provides no

standard for determining the extent of disability, see also Roger's
11

Terminal & Shipping Corp. v. Director, OWCP, 784 F.2d 687, 690 (5th

Cir.1986), cert. denied, 479 U.S. 826, 107 S.Ct. 101, 93 L.Ed.2d 51

(1986), and that disability under the Act is determined "not only

on the basis of physical condition but also on factors such as age,

education, employment history, rehabilitative potential, and the

availability of work that the claimant can do." Turner, 661 F.2d

at 1038.

The Act does not explicitly provide for the result chosen by

the ALJ and approved by the Board in this case, but the decision

below is consistent with this court's analysis in Turner, as well

as with the Act's goal of promoting the rehabilitation of injured

employees to enable them to resume their places, to the greatest

extent possible, as productive members of the work force. See

Palombo, 937 F.2d at 74; Stevens, 909 F.2d at 1260. Moreover, the

Supreme Court has held that the Act should be "liberally construed

in conformance with its purpose, and in a way which avoids harsh

and incongruous results." Director, OWCP v. Perini N. River

Assocs., 459 U.S. 297, 315-16, 103 S.Ct. 634, 646, 74 L.Ed.2d 465

(1983). We conclude that the Department of Labor's restrictions on

outside employment rendered the minimum wage jobs "unavailable"

within the meaning of the Act and Fifth Circuit precedent. While

Abbott was physically capable of performing the minimum-wage jobs

LIGA's expert identified as having been available, he could not

reasonably secure that employment under the statutory scheme

because his participation in his rehabilitation plan approved by

the Department of Labor precluded him from working.
12

Furthermore, the ALJ found, Abbott increased his earning power

well above the minimum-wage level by completing his vocational

retraining, thereby reducing LIGA's long-term compensation

liability. LIGA now argues, after the fact, that Abbott should

have been required to take a minimum-wage job instead (or, at

least, that its compensation obligation should be limited as if he

had taken such a job, regardless of whether he did or not). Such

a result would be inconsistent with the flexible inquiry outlined

in Turner.

The Board and the ALJ also noted that the rehabilitation

program developed for Abbott in this case was consistent with the

Act and the Department of Labor's regulations. The Act provides

that "[t]he Secretary shall direct the vocational rehabilitation of

permanently disabled employees." 33 U.S.C. § 939(c)(2). The

Secretary is authorized to promulgate such rules and regulations as

are necessary to administer the statute, 33 U.S.C. § 939(a), and

the Department of Labor has done so regarding vocational

rehabilitation, see 20 C.F.R. §§ 702.501-702.508. The regulations

provide that "[t]he objective of vocational rehabilitation is the

return of permanently disabled persons to gainful employment

commensurate with their physical or mental impairments ... through

a program of reevaluation or redirection of their abilities, or

retraining in another occupation...." § 702.501. Vocational

advisers are to construct training programs "in anticipation of a

short, realistic, attainable vocational objective terminating in

remunerable employment, and in restoring wage-earning capacity or
13

increasing it materially." § 702.506. The regulations give the

advisers significant flexibility in devising such training

programs: they "shall be developed to meet the varying needs of

eligible beneficiaries, and may include courses at colleges...."

§ 702.506(b).

In retrospect, it may be that Abbott's vocational counselor

could have devised a shorter rehabilitation program for Abbott. We

agree, however, that the program chosen was reasonable, and that,

contrary to LIGA's assertion, that plan was not blindly or rigidly

adhered to by either the counselor or the administrative review

panels below. In light of the limited standard of review, the

Board's decision must be affirmed. It would be "unduly "harsh and

incongruous' to find that suitable alternative employment was

reasonably available if the claimant demonstrates that, through his

own diligent efforts" at rehabilitation, he was ineligible for such

a job. Palombo, 937 F.2d at 73 (affording claimant an opportunity

to prevail by showing he diligently sought but was unable to secure

a job because that result is consistent with the remedial goals of

the Act). The Act gives the Department of Labor the authority to

direct rehabilitation programs; courts should not frustrate those

efforts when they are reasonable and result in lower total

compensation liability for the employer and its insurers in the

long run.

C.

Finally, LIGA asserts that the ALJ erred in calculating

Abbott's post-retraining residual wage-earning capacity (from the
14

time he completed his rehabilitation program and began working as

a medical technician at the Southern Louisiana Medical Center).

The ALJ determined that Abbott was entitled to permanent partial

disability compensation commencing in July 1990 and measured as the

difference between his average weekly earnings as a welder at the

time of his accident in January 1983 and the wages available to a

medical technician in the area at that time. In calculating the

latter figure, the judge relied upon an average between the wage

earned by such technicians in private and public hospitals in

Abbott's area, and the Board approved that calculation. LIGA

contends that the ALJ should have used the higher, private-industry

figure because the evidence suggests that Abbott could have

obtained a private sector job as a medical technician at Terrebonne

General Hospital or Lakewood Hospital.

The parties agree that Abbott was entitled to permanent

partial disability benefits after he completed the vocational

rehabilitation program and began work as a medical technician. The

statute provides that "the compensation shall be 662/3 per centum

of the difference between the average weekly wages of the employee

[before the accident] and the employee's wage-earning capacity

thereafter in the same employment or otherwise, payable during the

continuance of partial disability." 33 U.S.C. § 908(c)(21). The

wage-earning capacity of an injured employee in cases of partial

disability, in turn, "shall be determined by his actual earnings if

such actual earnings fairly and reasonably represent his

wage-earning capacity: Provided, however, that if the employee['s]
15

... actual earnings do not fairly and reasonably represent his

wage-earning capacity, the [ALJ] may, in the interest of justice,

fix such wage-earning capacity as shall be reasonable...." §

908(h). The statute thus permits the factfinder significant

discretion in fashioning a reasonable post-injury wage-earning

capacity for the injured worker. See, e.g., Penrod Drilling Co. v.

Johnson, 905 F.2d 84, 87 (5th Cir.1990) (describing method of

calculating award for permanent partial disability); Randall v.

Comfort Control, Inc., 725 F.2d 791, 795 (D.C.Cir.1984).

Here, the ALJ calculated Abbott's wage-earning capacity by

averaging the wages a medical technician would have earned at the

area's higher-paying private hospital with those of the

lower-paying, publicly-funded hospital where Abbott was actually

employed. The ALJ therefore recognized that Abbott's actual income

did not fairly represent his wage-earning capacity for the period

after his vocational retraining; the judge then attempted to

calculate the relevant wage in the market as a whole. The record

shows that Abbott applied for a job at Terrebonne Hospital upon

completion of his medical technician degree but was not accepted.

Later, Abbott was contacted twice by Terrebonne with regard to

employment, but he declined to pursue the opportunities, noting

that he was content with his job at the public hospital because of

its proximity to his house and because he was not required to work

on weekends. Taking these facts into account, the ALJ determined

that averaging the two salary figures would provide a fair and

appropriate measure of what a trained medical technician would have
16

earned in 1983.

The Board concluded on appeal that the ALJ's determination was

supported by substantial evidence, and our review of the record

reveals no reason to disagree. The ALJ's compensation order fixed

a residual wage-earning capacity that is clearly reasonable within

the meaning of the Act, and it compensates Abbott appropriately for

his permanent partial disability.

III.

Because it correctly concluded that the ALJ's compensation

order was supported by substantial evidence on the record as a

whole, and that it was in accordance with the law, the decision of

the Benefits Review Board is

Affirmed.