Opinion ID: 1746068
Heading Depth: 2
Heading Rank: 1

Heading: The Relationship Between Subsections (a) and (e)

Text: Both the WCAC and Court of Appeals relied on Brown, supra . In Brown, the defendant argued that because the plaintiff was fired for good cause, he was not entitled to worker's compensation benefits. The plaintiff countered that if an injured employee is fired within the first one hundred weeks of employment, he is entitled to benefits regardless of the purpose for discharge. The Court of Appeals held that the plaintiff could only receive benefits if he met the requirements laid out in (a),(b), or (c), and that subsection (e) should not be construed to mean that an employee is entitled to a continuation of benefits even if the employee is discharged for good cause. Instead, subsection (e) should be used only to calculate the rate of compensation when an employee is otherwise qualified to receive benefits under subsections (a),(b), or (c). The Brown Court relied upon Lee, supra, which also held that subsection (e) should be used only to set the amount of damages. We disagree with both Brown and Lee because the plain language of subsection 301(5)(e) makes it clear that an employee, who has established benefit entitlement pursuant to the terms of subsection 301(5), has a right to benefit continuation even if the employee is terminated for just cause. Subsection 301(5) is designed to determine a disabled employee's entitlement to benefits. Subsections (a) through (e) provide guidelines for making entitlement determinations under a variety of circumstances. Pursuant to subsection 301(5)(a), an employee loses an entitlement to benefits during a period in which the employee unreasonably refuses a reasonable offer of work: If an employee receives a bona fide offer of reasonable employment from the previous employer, another employer or through the Michigan employment security commission and the employee refuses that employment without good and reasonable cause, the employee shall be considered to have voluntarily removed himself or herself from the work force and is no longer entitled, to any wage loss benefits under this act during the period of such refusal. [Emphasis added.] Conversely, subsection 301(5)(e) provides: If the employee, after having been employed pursuant to this subsection for less than 100 weeks loses his or her job for whatever reason, the employee shall receive compensation based upon his or her wage at the original date of injury. [Emphasis added.] Thus, while subsection 301(5)(a) prescribes the course of action to be taken when an employee is out of work as a result of his own unreasonable refusal, subsection 301(5)(e) contemplates a situation where the relationship between the employee and the employer has been severed by the employer. The distinctions between subsections 301(5)(a) and (e) are significant. Subsection (a) should be applied in situations where an employee unreasonably refuses an existing offer of work. Similarly, subsection (e) can readily be invoked when an employer terminates an employee who is performing favored work. Essentially, subsection (a) is designed to restrict benefit payment, whereas subsection (e) mandates payment under certain circumstances. When an employee refuses an offer of favored work, subsection (a) operates to suspend benefits during the period of refusal. The statutory reference to a period implies that the employee retains the right to end his refusal at some point in the future. At that point, the benefit reinstatement provisions of subsection 301(5) come into play. Subsection 301(5) does not grant the employer the right to terminate the employee's ability to return to work. In fact, subsection 301(5)(e) provides that an employee who loses his favored-work position for whatever reason shall continue to receive benefits. The plain language of subsection 301(5)(e) considers the possibility that an employee on favored work might lose a job for just cause. When the employee has been employed pursuant to subsection 301(5) for less than one hundred weeks, the Legislature has decided that benefit availability continues. Although the employee's right to receive benefits may be suspended temporarily during a period of unreasonable refusal, the statute simply does not support permanent forfeiture. Subsection 301(5)(a) provides that an employer must pay benefits or extend a reasonable offer of favored work to an employee who has established a disability pursuant to subsection 301(4). Subsection 301(5)(a) suspends the employer's duty temporarily when the employee unreasonably refuses a reasonable offer, but the employee retains the right to end the period of refusal at any time. If the employee ends the period of unreasonable refusal, but is later terminated, then the terminated employee can pursue a remedy under subsection (e).