The opinion
IN THE SUPREME COURT OF TENNESSEE
AT NASHVILLE
June 4, 2010 Session
DON NICHOLS v. JACK COOPER TRANSPORT COMPANY, INC. ET AL.
Appeal by Permission from the Special Workers’ Compensation Appeals Panel
Chancery Court for Rutherford County
No. 55486 & 07-00007WC Robert E. Corlew, Chancellor
No. M2008-00204-SC-WCM-WC & M2008-00205-SC-WCM-WC
* Filed August 27, 2010 *
The employee, who suffered two separate injuries during the course of his employment as
a truck driver for the employer, settled his first claim for workers’ compensation and filed
suit on the second. Shortly after being laid off because of an unexpected work shortage, the
employee elected to retire in order to maintain medical insurance coverage rather than face
an indefinite furlough without pay or benefits coverage. When the trial court reconsidered
the settlement and awarded benefits in excess of the lower statutory cap on the second claim,
resolving the issues in favor of the employee, the employer appealed, and the Special
Workers’ Compensation Appeals Panel reversed. Because we have concluded that the
employment relationship terminated when the employee was laid off, rather than when he
subsequently retired, the employee was not meaningfully returned to work, and, therefore,
qualifies for reconsideration of his first injury and is not subject to the lower cap on the
second. The judgment of the Panel is reversed, and that of the trial court is reinstated.
Tenn. Code Ann. § 50-6-225(e) Appeal as of Right; Judgment of the Panel Reversed;
Judgment of the Chancery Court Reinstated
G ARY R. W ADE, J., delivered the opinion of the Court, in which J ANICE M. H OLDER, C.J.,
C ORNELIA A. C LARK, and S HARON G. L EE, JJ., joined. W ILLIAM C. K OCH, J R., J., not
participating.
Larry R. McElhaney and J. Nicholas Harris, Nashville, Tennessee, for the appellee, Don
Nichols.
Richard C. Mangelsdorf, Jr. and J. Paul Brewer, Nashville, Tennessee, for the appellants,
Jack Cooper Transport, Inc. and Liberty Mutual Insurance.
OPINION
Facts and Procedural History
Don Nichols (the “Employee”), who was 57 years old at the time of trial, joined the
Teamsters Union in 1969 and worked as a truck driver for most of his career. In 2000, he
was employed by Jack Cooper Transport, Inc. (the “Employer”), which is involved in the
automotive transportation business operating terminals at seventeen locations nationwide.
The Employee hauled newly manufactured automobiles from the Employer’s Murfreesboro
terminal to a variety of other sites, a physically and mentally demanding job according to
testimony offered at trial. His duties included loading the cars onto his truck, securing them
in place, and transporting them over long distances. By 2007, the Employee ranked in
seniority near the middle of the list of drivers employed at the Murfreesboro terminal. Under
the collective bargaining agreement (“CBA”) between the Employer and the Teamsters
Union, the Employee maintained the same level of seniority during any layoffs, so long as
the period of time off did not exceed seven years.
The business at the Employer’s Murfreesboro terminal depended entirely upon the
manufacture of automobiles at Saturn Corporation’s plant in Spring Hill and the Nissan
Motor Manufacturing Corporation’s plant in Smyrna. For that reason, the Employer had a
history of temporary layoffs for many of its drivers, including the Employee, during biannual
shutdowns at the two plants. Drivers were regularly laid off for one to two weeks in July of
each year and often experienced layoffs for the same length of time during the
Christmas/New Year’s holidays. Both layoffs and recalls were based on seniority; those with
the least seniority were laid off first and recalled last. During these periods of furlough, the
drivers did not qualify for pay or health insurance benefits from the Employer and were
eligible to apply for unemployment insurance benefits from the state. While drivers who
were recalled to work were paid the same wage as they previously had earned, they typically
had to wait approximately one month to qualify for health insurance. The Employer provided
no assurances to its drivers as to when or if they would be recalled. According to David
Wayne Barnes, the manager of the Murfreesboro terminal, the length of the seasonal layoffs
had varied over the years, but the drivers had always been recalled.
During furloughs at the Murfreesboro terminal, drivers were given the opportunity to
work temporarily out of other terminals owned by the Employer. The terms of the CBA
provided that if a driver worked at another terminal during a layoff, the driver would
maintain seniority at Murfreesboro, but the seniority would not transfer to the new location.
That is, the driver would be last on the seniority list at any terminal other than in
Murfreesboro. This, in turn, could affect the routes the driver would be assigned at his
temporary locale.
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During the seven years of employment with the Employer, the Employee suffered two
compensable injuries. In July of 2004, the Employee injured his neck when his truck
unexpectedly struck a series of humps on an interstate in Texas, a phenomenon known to
truck drivers as “whoop-de-do’s.” The impact caused the Employee’s seat to suddenly jerk
downward and then return to its original position while his seatbelt remained locked in place.
The Employee received treatment for about a year and eventually settled a workers’
compensation claim based upon an award of 5.5% permanent partial disability benefits to the
body as a whole. In August of 2005, after having returned to work for only a few weeks, the
Employee, who had no medical restrictions as a result of his neck injury, suffered an injury
to his shoulder while moving vehicles on and off his truck. The shoulder injury required
surgery, and the Employee was assigned a permanent impairment rating of 6% by his treating
physician and 10% by an evaluating physician, for which he also sought workers’
compensation benefits.
In June of 2006, the Employee returned to work, again with no medical restrictions.
Despite the infirmity caused by his injuries, the Employee continued to meet all of the
demands of his employment. His earnings did not change. The Employee, who had no plans
to retire, had arranged a vacation from his employment for September of 2007; however, in
early April of 2007, Saturn’s parent company, General Motors, halted operations in Spring
Hill for the plant to retool and for a modification of its lines. Because the Spring Hill plant
provided 50-55% of the Employer’s business at the Murfreesboro terminal, the Employer
responded to the shutdown with a significant layoff that affected about half of the drivers,
including the Employee. A number of other drivers whose seniority had protected them from
prior seasonal layoffs were also affected. The indefinite shutdown at the Spring Hill plant
was without precedent, and the Employer could not predict the length of time the drivers
would be without work in Murfreesboro. Because of the reason given for the layoff, the time
of year during which it occurred, and the number of drivers it affected, the terminal manager
Wayne Barnes described the April 2007 layoff as “totally different” from the “normal every
year, come to the summertime, going to lay a couple people off layoff.” The Employer
provided no pay or benefits to its drivers during this period and encouraged them to take
temporary jobs.
When, on April 27, 2007, the Employee was laid off as a result of the retooling at the
Spring Hill plant, he informed the Employer that he would be willing to accept temporary
employment at other terminals. In the following weeks, however, when the Employer
offered him work at terminals in Lansing, Michigan, San Antonio, Texas, and Muncie,
Indiana, the Employee declined. When asked why, he said
[w]ell, basically, [I would] more or less keep[] up two families. You’re having
to live. You’re paying your own motel, plus your expenses, and most of the
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time the trips [are] not that good. You get the trash [jobs]. Usually you’re at
the bottom of the board at all those terminals, and at the ones that they w[ere]
discussing at that time I believe . . . w[ere] railheads, so that’s locally 50-mile,
100-mile radius of the railhead. So, no, it would not be worth my deal to even
drive up there, let alone go to work.
The Employee reiterated that when he had worked at a railhead in the past, his “expenses
outweighed what [he] made considerably.” When pressed on cross-examination, the
Employee admitted that he would have been paid the same rate for working out of the
Lansing terminal, but he declined the offer because he did not “really care . . . about going
up” to “Yankee land.” The Employee testified that he considered himself to be employed by
the Employer during the periods he was laid off.
On May 31, 2007, after having been without work for over a month and still without
any knowledge of when or if he might be recalled, the Employee notified the Teamsters
Union of his intent to retire. While it is undisputed that his retirement decision was unrelated
to his neck and shoulder injuries, the Employee explained that he and his wife, Nancy,
needed health insurance benefits to cover the cost of their prescribed medications. The
Employee testified that if he had been “called back to work in a couple of weeks or two,” he
would have returned to his job. Because he had no health insurance, however, and the date
of his recall from the layoff was uncertain, the Employee decided to retire. Afterward, the
Employee sought reconsideration of the settlement amount for his neck injury on the theory
that he had not made a meaningful return to work. The request for reconsideration was
consolidated with his pending claim for his shoulder injury.
At trial, Barnes, testifying for the Employer, stated that if the Employee had not
retired, he would have been recalled to work, based upon his seniority, on June 11, 2007; he
conceded, however, that the Employee would have been laid off again in late June for a
couple of weeks, recalled in July, and finally laid off a third time in August. Barnes also
acknowledged that because the Spring Hill plant had not reopened, the Murfreesboro
terminal still was not operating at full capacity. Barnes was unable to determine whether the
drivers who had been laid off would eventually be recalled.
At the conclusion of the hearing, the trial court held that because the Employee was
laid off in April of 2007, he was not returned to work by the Employer at a wage equal or
greater to his pre-injury wage and, therefore, was neither precluded from seeking
reconsideration of the settlement for his neck injury, see Tenn. Code Ann. § 50-6-
241(d)(1)(B) (2008 & Supp. 2009), nor subject to the benefits cap of 1.5 times the
impairment rating for his shoulder injury, see Tenn. Code Ann. § 50-6-241(d)(1)(A). After
considering each of the two claims, the trial court awarded an additional 5.5% disability to
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the body as a whole for the first injury and found a 7% impairment rating to the body as a
whole for the second, using a multiplier of three to calculate the vocational disability.
The Employer appealed, claiming that the term of employment had ended because of
voluntary retirement, rather than the layoff, thereby prohibiting the Employee from seeking
reconsideration of the award for the 2004 neck injury and subjecting him to the lower
statutory cap on benefits for the 2005 shoulder injury. The Special Workers’ Compensation
Appeals Panel reversed the holding of the trial court. Engaging in the fact-intensive inquiry
required by Tryon v. Saturn Corp., 254 S.W.3d 321 (Tenn. 2008), the Panel held that the
Employee voluntarily retired at a time he was still employed by the Employer because (1)
layoffs without pay or benefits were expected, rather than exceptional, events at the
Employer; (2) the Employee considered himself employed during the layoff periods; (3) the
Employee rejected the option to accept temporary positions during the 2007 layoff; and (4)
the Employee would have been recalled within two weeks had he not left. The Panel,
therefore, declined reconsideration of the neck injury and applied the minimum multiplier
of 1.5 to the award for the shoulder injury. We granted full court review to consider the
important and timely question of whether the layoff of the Employee constituted a “loss of
employment” under our workers’ compensation law.
Standard of Review
We review the trial court’s findings of fact “de novo upon the record . . . accompanied
by a presumption of the correctness of the finding, unless the preponderance of the evidence
is otherwise.” Tenn. Code Ann. § 50-6-225(e)(2) (2008). “This standard of review requires
us to examine, in depth, a trial court’s factual findings and conclusions.” Crew v. First
Source Furniture Group, 259 S.W.3d 656, 664 (Tenn. 2008) (quoting Galloway v. Memphis
Drum Serv., 822 S.W.2d 584, 586 (Tenn. 1991)). We review questions of law, however, de
novo with no presumption of correctness. Perrin v. Gaylord Entm’t Co., 120 S.W.3d 823,
826 (Tenn. 2003). The interpretation and application of our workers’ compensation statutes
are questions of law. See Seiber v. Reeves Logging, 284 S.W.3d 294, 298 (Tenn. 2009).
Our primary objective when engaging in statutory construction is to carry out the intent of
the legislature without unduly broadening or restricting the statute. Arias v. Duro Standard
Prods. Co., 303 S.W.3d 256, 260 (Tenn. 2010).
Applicable Law
This case provides us with the unique opportunity to consider two provisions of our
workers’ compensation statute with a shared history – the cap on permanent partial disability
benefits and the subsection permitting reconsideration of a prior benefits award. In 1919, the
first workers’ compensation laws in Tennessee were enacted with the purpose of relieving
society of the burden of compensating injured workers and placing that responsibility on
employers. Lynch v. City of Jellico, 205 S.W.3d 384, 390 (Tenn. 2006); Scott v. Nashville
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Bridge Co., 223 S.W. 844, 849 (Tenn. 1920). Because of their remedial nature, Tenn. Code
Ann. § 50-6-116 (2008), this Court has traditionally construed workers’ compensation
statutes in a liberal manner in order “to promote and adhere to the Act’s purposes of securing
benefits to those workers who fall within its coverage.” Trosper v. Armstrong Wood Prods.,
Inc., 273 S.W.3d 598, 609 n.5 (Tenn. 2008) (quoting Martin v. Lear Corp., 90 S.W.3d 626,
629 (Tenn. 2002)). From time to time, however, the legislature has seen fit to limit the
recovery to which employees are entitled under the Act. In 1992, for example, the legislature
instituted a cap on permanent partial disability benefits of 2.5 times the medical impairment
rating for eligible employees who are returned to their employment at a wage equal to or
greater than the wage they were receiving at the time of their injury. Workers’ Compensation
Reform Act of 1992, ch. 900, § 16, 1992 Tenn. Pub. Acts 859, 870 (codified at Tenn. Code
Ann. § 50-6-241(a)(1) (1999)). The 1992 Act also added a provision entitling an employee
to reconsideration of a disability award “where the employee is no longer employed by the
pre-injury employer and makes application to the appropriate court within one (1) year of the
employee’s loss of employment if such loss of employment is within four hundred (400)
weeks of the day the employee returned to work.” Id. at 870-71 (codified at Tenn. Code
Ann. § 50-6-241(a)(2)). The Act lists several factors to be considered in the reconsideration
process, “including lay and expert testimony, employee’s age, education, skills and training,
local job opportunities, and capacity to work at types of employment available in claimant’s
disabled condition.” Id. at 870.
In 2004, the General Assembly passed a sweeping overhaul of the workers’
compensation statutes, Act of May 20, 2004, ch. 962, 2004 Tenn. Pub. Acts 2346, with the
purpose of reducing the Employer’s costs for workers’ compensation. Lynch, 205 S.W.3d
at 390. Specifically,
the legislature recognized that “significant cost savings will result” to
employers, and that “[i]t is in the best interest of the citizens of Tennessee that
such cost savings be passed to the entities that have paid faithfully workers’
compensation premiums in order to ensure the economic well-being of their
employees.”
Id. (quoting Act of May 20, 2004, ch. 962, § 42(a), 2004 Tenn. Pub. Acts 2346, 2372). The
2004 Act included amendments to both the benefits cap and reconsideration provisions for
injuries occurring after July 1, 2004. Act of May 20, 2004, ch. 962, § 11, 2004 Tenn. Pub.
Acts 2346, 2350-53. Significantly, the Act reduced the cap on permanent partial disability
benefits to 1.5 times the impairment rating when the employee has returned to his place of
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employment at the same or a greater wage.1 Id. at 2351 (codified at Tenn. Code Ann. § 50-6-
241(d)(1)(A) (2008 & Supp. 2009)). Moreover, the 2004 amendments placed specific
limitations on a request for reconsideration, providing that
under no circumstances shall an employee be entitled to reconsideration when
the loss of employment is due to either:
(a) the employee’s voluntary resignation or retirement, provided such
resignation or retirement does not result from the work-related disability which
is the subject of such reconsideration; or
(b) the employee’s misconduct connected with his employment.
Id. at 2352 (codified as amended at Tenn. Code Ann. § 50-6-241(d)(1)(B)(iii)).2
Our courts have applied a similar analysis to interpret and apply the benefits cap and
reconsideration provisions. The “meaningful return to work” concept provides guidance in
the determination of whether the statutory provisions apply to a claim. In Tryon, this Court
made the following observation:
When determining whether a particular employee had a meaningful return to
work, the courts must assess the reasonableness of the employer in attempting
to return the employee to work and the reasonableness of the employee in
failing to either return to or remain at work. The determination of the
reasonableness of the actions of the employer and the employee depends on the
facts of each case.
1
The cap on permanent partial disability benefits for an injured employee who is not returned to
work by the employer at a wage equal or greater to her pre-injury wage is six times the impairment rating.
Tenn. Code Ann. § 50-6-241(d)(2)(A). This figure remained unchanged as a result of the 2004 amendments
to the workers’ compensation laws.
2
The reconsideration provisions were even more recently amended to provide that
[e]mployees who continue in their employment after a reduction in pay or a reduction in
hours due to economic conditions shall not be entitled to reconsideration of their claims
under this section if the reduction in pay or reduction in hours affected at least fifty (50%)
of all hourly employees operating at or out of the same location.
Act of June 11, 2010, ch. 1034, § 1, 2010 Tenn. Pub. Acts ___, ___. This amendment, which only affects
“reconsideration of claims approved or adjudicated on or after July 1, 2010,” id. at § 3, “does not apply to
or include employees involved in layoffs, closures or a termination of business operations,” id. at § 2.
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254 S.W.3d at 328 (citations omitted). We concluded that “the same standard should be
applied to determine whether an employee had a meaningful return to work as part of an
initial assessment as in a reconsideration case.” Id. at 333 n.25; see also Lay v. Scott County
Sheriff’s Dep’t, 109 S.W.3d 293, 298 (Tenn. 2003).
With regard to the cap on benefits, “[i]f . . . the employee . . . retires or resigns for
personal reasons or other reasons that are not reasonably related to his or her workplace
injury, the employee has had a meaningful return to work which triggers the” lower cap.
Tryon, 254 S.W.3d at 329. When the employee has made a meaningful return to work, the
lower cap of 1.5 times the impairment rating (for injuries occurring after July 1, 2004) or 2.5
times the impairment rating (for injuries prior to that date) applies. If, however, an employee
has not made a meaningful return to work, six times the impairment rating is the ceiling on
the award of benefits. See id. at 328; Nelson v. Wal-Mart Stores, Inc., 8 S.W.3d 625, 629-30
(Tenn. 1999); see also Lay, 109 S.W.3d at 297.3
As to the reconsideration provision, the phrases “loss of employment” and “no longer
employed by the pre-injury employer” are left undefined in the statute, but must be read
harmoniously with one another. Perrin, 120 S.W.3d at 827. The limitations enumerated in
the statute are the only restrictions on reconsideration for an erstwhile employee. For
example, a workers’ compensation claimant need not prove that the loss of employment was
related to the workplace injury to be eligible for reconsideration. Niziol v. Lockheed Martin
Energy Sys., Inc., 8 S.W.3d 622, 624 (Tenn. 1999). Further, a worker does not forfeit his
right to reconsideration of a prior award if he suffers a subsequent work-related injury for
which he also seeks compensation. Clark v. Lowe’s Home Ctrs., 201 S.W.3d 647, 650-51
(Tenn. 2006). Finally, and most significantly in this instance, reconsideration is permitted
even when the employee has resigned in the interim, so long as that resignation is not
voluntary or is related to his or her workplace injury. Tenn. Code Ann. §
3
A “meaningful return to work” requires an employee not only to return to employment, but also
to receive “a wage equal to or greater than the wage that they were receiving at the time of the injury.” Tenn.
Code Ann. § 50-6-241(d)(1)(A). Thus, an employee could be free from the restrictions of section
50-6-241(d)(1)(A) even if she is still working for the employer, so long as she is making less than she was
receiving before her injury. See, e.g., Patton v. Hartco Flooring Co., No. E2008-01829-WC-R3-WC, 2009
WL 3170391, at *6-7 (Tenn. Workers’ Comp. Panel Oct. 1, 2009) (holding that there was not a meaningful
return to work when the employee transferred to a position that paid seventy cents less per hour and the
transfer was directly related to her workplace injury). In contrast, the reconsideration provision applies only
where the employee is “no longer employed by the pre-injury employer,” Tenn. Code Ann. § 50-6-
241(d)(1)(B)(i), and where the “loss of employment” was not due to one of the conditions set forth in section
50-6-241(d)(1)(B)(iii).
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50-6-241(d)(1)(B)(iii)(a); Hardin v. Royal & Sunalliance Ins., 104 S.W.3d 501, 505-06
(Tenn. 2003).4
Because, in this case, the Employee is no longer working for the Employer, the
standard for determining the applicability of the cap and the reconsideration of the initial
award is identical. Initially, the Employee voluntarily retired. Moreover, because his
retirement was unrelated to the work-related injuries to his neck and shoulder, he ordinarily
would be precluded from seeking a reconsideration of the award for his neck injury and
subject to the lower cap on his shoulder injury. The Employee, however, was laid off on
April 27, 2007. If that qualifies as a “loss of employment” that preceded the voluntary
retirement, then the Employee did not make a meaningful return to work, may seek
reconsideration of his initial injury, and is not subject to the lower benefits cap on his
pending second claim. The disposition of each claim turns on whether the layoff terminated
the employment relationship prior to the date of the Employee’s retirement.
Analysis
The question of whether a layoff constitutes a loss of employment under our workers’
compensation statutes is one of first impression. The full Court has considered the impact
of temporary layoffs once before, but in a different context: whether Tennessee or Virginia
workers’ compensation law should apply based upon the location of the claimant’s “contract
for hire.” See Hale v. Fraley’s Inc., 825 S.W.2d 690, 691 (Tenn. 1992). In Hale, we held
that a temporary layoff did not terminate the employment relationship based upon testimony
“that temporary layoffs [were] common in the construction industry and that a laid off
employee is not considered to have been dismissed,” and for the further reason that “the
parties behaved as though there had been no significant break in [the employee’s] service.”
Id.5
4
In Hardin, this Court also held
that while a trial court may reconsider a previous award if the employee resigns, it may
increase that award only if the resignation was reasonably related to the injury. For
example, the resignation may be due to the employee’s inability to perform the work or the
employer’s refusal to accommodate the worker’s medical restrictions.
104 S.W.3d at 505-06 (emphasis added). The 2004 amendments to the workers’ compensation statute, which
occurred a year after the decision in Hardin, indicate that a resignation or retirement that is both voluntary
and unrelated to the workplace injury precludes reconsideration. If the resignation or retirement is
involuntary, however, reconsideration may still be available, even if it is unrelated to the injury. Whether
to grant a supplemental award depends on the facts of each case.
5
Courts in other jurisdictions have considered the effect of an employee’s retirement during a period
(continued...)
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Our Special Workers’ Compensation Appeals Panel has written extensively on the
effect of layoffs on the meaningful return to work analysis. In Haney v. Five Rivers
Electronic Innovation, LLC, No. E2004-01941-WC-R3-CV, 2006 WL 2423430 (Tenn.
Workers’ Comp. Panel Aug. 23, 2006), the employee suffered a work-related injury, was laid
off during his recovery, returned to work after the layoff, and then was laid off a second time.
Id. at *1. After the second layoff, he accepted a job with another employer. Id. When Five
Rivers offered to recall Haney to his former job six months later, he declined the offer. Id.
at *4. The Panel in Haney equated the layoff with termination of the employment
relationship, holding that “when the employer returns the employee to work, but then
terminates the employee, due to no fault of the employee, with no assurance that he will be
re-employed in the future,” the employee has not had a meaningful return to work. Id. at *5.
In a lengthy opinion, the trial court in this case relied upon Haney to hold that
[f]or purposes of [section] 50-6-241 . . . a lay-off, no matter how long and no
matter whether the custom in the industry calls for laid off employees
generally to be called back, allows an Employee who is laid off to be justified
in seeking other employment, or in terminating his relationship with the pre-
injury employer. When he does so, he is no longer bound by the limitations of
one and one-half times the anatomical impairment rating . . . .
On appeal by the Employer, the Panel distinguished Haney, observing that, unlike the
Employee in this case, Haney “did not return to his pre-injury position within the company”
and “resigned because his pre-injury employer could not provide him with a position
compatible with his injury and in the meantime he had found another job that was.” The
Panel instead relied upon Edwards v. Saturn Corp., No. M2007-01955-WC-R3-WC, 2008
WL 4378188 (Tenn. Workers’ Comp. Panel Sept. 25, 2008). In Edwards, litigation also
arising out of the April 2007 shutdown of the Spring Hill plant, the employee filed a claim
for workers’ compensation in March 2006 but continued to work at Saturn until the layoff.
Id. at *2. Throughout the term of the layoff, Edwards considered himself employed and
received 95% of his pre-layoff wage and all of his health care, life insurance, and other
benefits. Id. at *2, 6. Under these circumstances, the Panel in Edwards ruled that “[a]part
from the fact that Mr. Edwards was not physically going to work every day, every other fact
in the [Edwards] record suggests that [he] was an employee . . . during his lay-off period.”
5
(...continued)
of layoff with regard to that employee’s ability to obtain state unemployment insurance benefits. Compare
Phelps Dodge Corp. v. State Dep’t of Econ. Sec., 609 P.2d 612, 615 (Ariz. Ct. App. 1980) (holding that the
employment relationship was terminated not by the layoff but by the employee’s “own act in choosing to
accept retirement”) with Reserve Mining Co. v. Cooke, 372 N.W.2d 796, 798 (Minn. Ct. App. 1985) (holding
that the employee’s retirement subsequent to his being laid off “did not disqualify him from receiving
unemployment benefits”).
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Id. at *6. In drawing this conclusion, “the Panel place[d] great emphasis on the specific
terms of the contract between the [union] and [the employer] that allowed Mr. Edwards to
continue to receive almost the exact same benefits and compensation that he was receiving
prior to his lay-off.” Id. at *7. In other words, “the terms of th[e] collective bargaining
agreement . . . constitute[d] the functional equivalent of continued employment.” Id. at *8.
In a third opinion, Wheeler v. Whirlpool Corp., No. M2009-00206-WC-R3-WC, 2010
WL 366672, at *5-6 (Tenn. Workers’ Comp. Panel Feb. 3, 2010), the employee, who chose
to be laid off rather than transfer to another position when hers was abolished, was
determined not to have either resigned or retired. The Wheeler Panel observed that the
employee “anticipated the availability of being recalled” because she “had been laid off and
recalled several times during her tenure with” the employer and “[s]he had significant
seniority.” Id. at *5. Moreover, there was evidence that the employee’s choice to accept the
layoff was not entirely voluntary, because her workplace injury may have prevented her from
meeting the demands of the new position. Id. at *6. Although the Panel did not address
whether Wheeler received pay or benefits during the layoff, it did make reference to the
testimony of her human resources representative, who stated that the employee continued her
employment during the layoff. Id. at *2. Based upon these facts, the Panel held that Wheeler
had not had a meaningful return to work and was not subject to the lower cap. Id. at *6.6
These Panel decisions demonstrate that the nature of layoffs vary. Indeed, Black’s
Law Dictionary has defined the term “layoff” broadly as “[t]he termination of employment
at the employer’s instigation; esp., the termination – either temporary or permanent – of many
employees in a short time.” Black’s Law Dictionary 906 (8th ed. 2004) (emphasis added).
But see Willis v. Franklin County Bd. of Educ., No. 01A01-9606-CH-00266, 1998 WL
391760, at *3 (Tenn. Ct. App. July 15, 1998) (defining “layoff” as “a period during which
a worker is temporarily dismissed or allowed to leave work” and “a period of temporary
dismissal with the anticipation of recall” (emphasis added)). Because layoffs and their effect
on an employment relationship may take a variety of forms, we decline to adopt, as the trial
court did, a bright line rule applicable to all layoffs. Instead, we continue to subscribe, as we
did in Tryon, to a fact-intensive method for determining whether a layoff is a “loss of
6
The Panel has considered, with only limited analysis, the effect of a layoff on the employment
relationship in other cases. See Harrison v. Peterbilt Motors Co., No. M2003-01457-WC-R3-CV, 2004 WL
2821630, at *3 (Tenn. Workers’ Comp. Panel Dec. 9, 2004) (footnote omitted) (observing that it could
“foresee circumstances where an employer could frustrate the purpose of the Workers’ Compensation Act
by keeping an employee on lay-off status indefinitely to avoid providing the employee with a higher award
under” the reconsideration provision); Haywood v. Ormet Aluminum Mill Prods. Corp., No. W2001-01494-
WC-R3-CV, 2002 WL 927440, at *3-4 (Tenn. Workers’ Comp. Panel May 1, 2002) (finding no meaningful
return to work when the employee was laid off by the pre-injury employer, even though the employee had
returned to work for almost two-and-a-half years prior to the layoff).
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employment” and, therefore, not a meaningful return to work under the workers’
compensation statutes. Factors that may assist trial courts in the meaningful return to work
inquiry include, but are not limited to, the following: (1) whether layoffs are a customary or
expected part of the employee’s position and, if so, whether the specific layoff in question
falls within the pattern of previous layoffs in the position; (2) whether the employee expected
or should have expected, at the time of the layoff, to be recalled to work; and (3) whether the
employee received pay and/or benefits while laid off.
The Panel below appropriately considered the fact-specific approach that we
prescribed in Tryon. Based upon our review of the record, however, we cannot agree with
its ultimate assessment. Although the Panel relied upon Edwards when holding that the
Employee had a meaningful return to work, the Panel in Edwards expressly reserved
judgment regarding “other factual situations,” such as those present here, “where the laid-off
employee is receiving significantly less compensation and benefits during his or her lay-off
period or where the employee is laid off after his or her initial workers’ compensation case
has been decided.” 2008 WL 4378188, at *7 n. 14. By the application of all the pertinent
factors, we hold that the loss of employment occurred when the Employee was laid off on
April 27, 2007, shortly before his voluntary retirement.
There are several reasons for our assessment. Initially, the April layoff did not fall
within the pattern of the previous layoffs. Although the Employer commonly engaged in
biannual layoffs, during which its employees received neither pay nor benefits, those periods
typically occurred during the summer and during the Christmas season. While the Panel, in
finding for the Employer, ultimately ruled that the April 2007 layoff qualified as
“customary,” it also observed that “[i]f the pre-injury layoffs occurred in a patterned manner,
then post-injury layoffs in a similar pattern do not equal unemployment,” and “[i]f the pre-
injury layoffs occurred sporadically based on business demand, then similar post-injury
layoffs can be expected.” (Emphasis added.) Instead of “occur[ing] sporadically,” the
Employer’s seasonal layoffs occurred like clockwork, at the same time and for the same
length of time nearly every year. Moreover, the April 2007 layoff, during which the
Employee retired, was not “in a similar pattern” to those seasonal layoffs. The April 2007
layoff occurred at a different time of year, lasted longer, and affected a number of drivers
whose seniority had previously served as protection. That David Wayne Barnes, the
Murfreesboro terminal manager, described the April 2007 layoff as “totally different” from
the “normal” seasonal layoffs is particularly compelling evidence. Because the April 2007
layoff was so very different, this factor suggests a termination of the employment relationship
rather than a temporary layoff.
Second, the Employee did not know in April and May of 2007 when or if he would
be recalled to work. While there was testimony that drivers had always been recalled at the
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end of the seasonal layoffs, the indefinite shutdown at the Spring Hill plant was without
precedent. Thus, the Employer had no way of predicting the length of time those drivers
subjected to the layoff would be without work in Murfreesboro. Unlike the Wheeler case,
2010 WL 366672, at *5, the Employee could not “anticipate[] the availability of being
recalled.” Further, the fact that the Employee would have been recalled within weeks of his
retirement is of little consequence. Initially, the proof establishes that the Employee would
have been almost immediately laid off a second time because of the lack of business. The
business slowdown continued at least until the time of trial.7 More importantly, the key
factor is not whether the Employee would actually have been recalled at the time he was laid
off, but whether he knew or should have known at that time that a recall was likely. Given
the unusual timing and duration of the layoff, the number of drivers affected, and the
economic uncertainty surrounding the shutdown of the Spring Hill plant, it was reasonable
for the Employee to determine that a recall to his pre-layoff position was unlikely. While
perhaps only marginally so, this factor also suggests that the loss of employment occurred
at the time of layoff. The Employee’s subsequent retirement from the Teamsters Union,
primarily for the purpose of obtaining health benefits, does not alter our view.
Finally, the Employee was not paid and did not receive health benefits during the term
of the layoff. Instead, he was eligible to receive unemployment benefits and encouraged by
the Employer to take temporary jobs. This, of course, differentiates the Employee from the
circumstances of the employee in Edwards. Faced with an indefinite period of time without
pay or benefits, it was reasonable for the Employee to choose retirement. Furthermore,
because his seniority did not transfer to those other positions, the types of jobs available to
the Employee at the other terminals likely would have been limited. The Employee’s
testimony that living and travel expenses related to those positions often outweighed any
potential income was unrefuted. That the Employee chose to retire rather than take
temporary jobs that were not equivalent to his previous position suggests that his return to
work after the injuries did not qualify as meaningful.
7
After retooling, which “virtually shut down the [Spring Hill] plant for 18 months,” the plant began
manufacturing the Chevrolet Traverse, a sport utility vehicle. Richard Locker, GM Will Let Tennessee Plant
at Spring Hill Idle; May Make New Car, The Commercial Appeal, June 1, 2009, available at
http://www.commercialappeal.com/news/2009/jun/01/spring-hill-gm-plant-going-standby-better-shutting/.
On June 1, 2009, however, General Motors announced that it was moving the production of the Traverse to
a Michigan facility and placing the Spring Hill plant on “standby,” meaning that it could reopen, if needed,
to support an increase in demand for automobiles. Id.; Nick Bunkley, G.M. Designates 14 Plants for Closing,
N.Y. Times, June 1, 2009, available at http://www.nytimes.com/2009/06/02/business/02union.html?_r=1.
The last Chevrolet Traverse rolled off of the Spring Hill assembly line on November 25, 2009. Eric Snyder,
Retooling Gives Hope that Spring Hill GM Plant Could Rebound, Nashville Business Journal, Dec. 25, 2009,
available at http://nashville.bizjournals.com/nashville/stories/2009/12/28/focus1.html. Since that time, the
plant has employed less than one thousand workers and engaged in the production of engine parts. Id.
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None of the factors we have applied today is conclusive. For example, there may be
circumstances in which an employment relationship continues throughout a period of layoff
even though the layoff was unexpected or indefinite, or the employee did not receive pay or
benefits. An inquiry into all of the facts and circumstances surrounding this case, however,
leads us to conclude that the loss of employment occurred at the time of the layoff, not the
Employee’s date of retirement. Although unpaid layoffs were an expected part of the
Employee’s job for the Employer, the nature of the April 2007 layoff indicates that the
Employee was warranted in taking his retirement in May of 2007. His decision to do so
should not preclude him from seeking reconsideration of the award for his 2004 injury under
Tennessee Code Annotated section 50-6-241(d)(1)(B) or limit recovery for his 2005 injury
to the lower 1.5 multiplier cap under Tennessee Code Annotated section 50-6-241(d)(1)(A).
Conclusion
The Employee did not make a meaningful return to work due to the nature of his
layoff in April of 2007. The trial court properly concluded that the award for the Employee’s
2005 shoulder injury was subject to the higher cap set forth in Tennessee Code Annotated
section 50-6-241(d)(2)(A), rather than the lower cap of 1.5 mandated by section 50-6-
241(d)(1)(A). Further, because the layoff of the Employee in April of 2007 constituted a loss
of employment, the Employee’s subsequent retirement does not preclude reconsideration of
the settlement of his 2004 neck injury pursuant to section 50-6-241(d)(1)(B). The judgment
of the Chancery Court is reinstated. Costs are assessed to the Employer, Jack Cooper
Transport Company, Inc., for which execution, if necessary, may issue.
_________________________________
GARY R. WADE, JUSTICE
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