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May 18, 2018 201578344

Commonwealth of Kentucky 

Workers’ Compensation Board

 

 

 

OPINION ENTERED:  May 18, 2018

 

 

CLAIM NO. 201578344

 

 

HAYDEN YANCEY                                  PETITIONER

 

 

 

VS.          APPEAL FROM HON. GRANT S. ROARK,

                 ADMINISTRATIVE LAW JUDGE

 

 

 

DUGAN & MEYERS CONSTRUCTION CO.

and HON. GRANT S. ROARK,

ADMINISTRATIVE LAW JUDGE                      RESPONDENTS

 

 

OPINION

AFFIRMING

                       * * * * * *

 

 

BEFORE:  ALVEY, Chairman, STIVERS and RECHTER, Members. 

 

STIVERS, Member. Hayden Yancey (“Yancey”) appeals from the October 30, 2017, Opinion and Order and the January 3, 2018, Order ruling on Yancey’s Petition for Reconsideration of Hon. Grant Roark, Administrative Law Judge (“ALJ”). The ALJ awarded temporary total disability (“TTD”) benefits, permanent partial disability (“PPD”) benefits, and medical benefits. On appeal, Yancey asserts the ALJ erred by finding he suffered a 4% impairment rating. Also, Yancey asserts the ALJ erred by not enhancing his PPD benefits pursuant to KRS 342.165. Finally, Yancey argues the ALJ erred by misapplying the recent statutory change of KRS 342.040 concerning the interest rate due on unpaid income benefits.

          The Form 101 alleges Yancey sustained work-related injuries to his head on June 30, 2015, while cutting with a saw while employed by Dugan & Meyers Construction Co. (“Dugan & Meyers”).

          The June 29, 2017, Benefit Review Conference Order and Memorandum set forth the following contested issues: benefits per KRS 342.730, unpaid or contested medical expenses, TTD [handwritten: “rate overpayment”], and KRS 342.165 violation [handwritten: “both”]. Under “other” is the following: “RTW wages.”

          In the October 30, 2017, Opinion and Order, the ALJ set forth the following findings of fact and conclusions of law:

     Safety Violations

     In this claim, the nature of plaintiff's injury is not in dispute. The parties agree plaintiff was injured when the saw he was operating kicked back and struck him in the face. The question becomes whether either party violated KRS 342.165 such that plaintiff's award should be either enhanced by 30%, reduced by 15%, or both.

     With regard to plaintiff's claim that the defendant committed a safety violation which led to his injury, the Administrative Law Judge is not persuaded. In reaching this conclusion, the ALJ is fully aware of the OSHA citation submitted into evidence by plaintiff. A review of that citation, however, reveals only that the defendant was cited for failing to maintain a safe work environment. Specifically, the OSHA citation indicated the defendant improperly allowed plaintiff to operate the saw which injured him despite not having adequate training or experience on that type of tool. Yet the ALJ is not persuaded this rises to the level of a KRS 342.165 violation in this instance because the record does not adequately support the OSHA conclusion. Specifically, plaintiff's supervisor testified plaintiff was specifically told not to attempt to cut the section of pipe by himself which led to his injury. If this testimony is accepted as true, then it cannot be said that the employer allowed plaintiff to operate a saw on which he did not have appropriate training or experience.

     More importantly, however, even if Hall’s testimony is not true, the ALJ is not persuaded the defendant had reason to believe plaintiff did not have appropriate training or experience to operate the chops on which he was injured. In reaching this conclusion, several factors are persuasive. First, plaintiff's testimony acknowledges he knew the pipe he was cutting should properly be supported on each side of the cut to prevent the pipe from binding at the point of the cut, just as all parties agree plaintiff had been doing [sic] along with his coworkers on the section of pipe they cut immediately before plaintiff was injured. This indicates plaintiff had adequate training and experience on the function in [sic] danger of the saw he was using and of the specific danger with using that piece of equipment that led to his injury. Moreover, plaintiff's employment application indicated he had prior experience in the construction industry, including installing above ground and below ground pipelines. Also, he testified in his deposition that he had previously operated a concrete saw for one of his prior employers. Finally, the OSHA citation does not include any investigative notes to explain the conclusion that plaintiff did not have appropriate training or experience, nor is there anything to suggest what the standard for training and experience should be to be in compliance with such an OSHA requirement. Given this lack of information and the training and experience outlined above, the ALJ is not persuaded by the OSHA conclusion that plaintiff's injury was caused by his lack of training and experience on the saw he was using. For these reasons, it is determined the defendant did not violate KRS 342.165 and plaintiff's award should not be enhanced accordingly.

     With respect to the defendant's claim of a safety violation, the ALJ finds no merit in that allegation. The defendant has not demonstrated that plaintiff violated any known rule or requirement to justify reducing his award by 15%. Accordingly, it is determined plaintiff has not violated KRS 342.165 and there is to be no reduction in his award.

     Extent & Duration

     The next issue to be determined is the extent of plaintiff's impairment. On this issue, the only options are the 43% impairment rating from Dr. Bilkey, which includes a 20% psychological impairment, or a 3% impairment rating from Dr. DuBou. On this issue, the ALJ is simply not persuaded plaintiff has carried his burden of establishing he has a 43% impairment rating for his injury.

     Plaintiff unquestionably suffered a significant and disfiguring injury, but the question is how much functional impairment this injury caused. The records establish plaintiff was released to return to work without any restrictions other than to use sunscreen and avoiding exposing that side of his face to the sun as much as possible. It is noted he is also return [sic] to the same kind of work you [sic] performed at the time of his injury. Given the lack of restrictions and the lack of more significant impact on his functional abilities, the ALJ is not persuaded by Dr. Bilkey's conclusion that plaintiff's physical injuries alone impose a 27% impairment rating on him. Instead, Dr. DuBou’s 3% rating is found most credible in this instance as it takes into account plaintiff's nerve damage in his face while still being realistic about plaintiff's functional abilities. And although Dr. DuBou and Dr. Bilkey each reference the 5th Edition of the AMA Guides to the Evaluation of Permanent Impairment in assigning their impairment ratings, Dr. DuBou’s is simply found more persuasive in this instance. It is therefore determined plaintiff has a 3% impairment rating for his physical injuries.

     With respect to plaintiff's psychological claim, the ALJ also is not persuaded by Dr. Bilkey's impairment rating. Although even the defendant's expert diagnosed some posttraumatic stress disorder, he indicated it was mild and plaintiff has returned to the same industry without restriction. Moreover, he is not receiving any psychological counseling, treatment, or medication. These facts lead the ALJ not to credit Dr. Bilkey's psychological impairment rating. It is therefore determined plaintiff has no impairment for the psychological portion of his claim.

     With respect to multipliers, the Administrative Law Judge is again persuaded by the fact that plaintiff has returned to the same kind of work you [sic] performed at the time of his injury and by the fact that he has no restrictions that would prevent such a return, that plaintiff retains the physical ability to perform the job he held at the time of his injury. Accordingly, he is not entitled to application of the 3x multiplier in KRS 342.730(1)(c)(1). His award of benefits is therefore calculated as follows:

$829.18 x 2/3 = $552.79 x .03 x .65 = $10.78 per week.

          Yancey filed a petition for reconsideration asserting several errors, and the ALJ ruled as follows in the January 3, 2018, Order:

     This matter comes before the Administrative Law Judge upon the plaintiff's petition for reconsideration of the Opinion, Order & Award rendered on October 30, 2017. In his petition, plaintiff argues it was error to award benefits based on a 3% impairment rating from Dr. DuBou because plaintiff argues Dr. DuBou actually assigned a 6% impairment rating. He also argues it was error not to impose a safety penalty or to award 12% interest on all past due amounts rather than just up to June 28, 2017. Having been otherwise sufficiently advised, it is hereby determined as follows:

     Plaintiff's petition with respect to the safety penalty and the interest on the past due amounts raises no patent errors to justify the remedy he seeks. As such, plaintiff's petition on these point is overruled.

     However, as to the award of permanent, partial disability benefits based on Dr. DuBou’s 3% impairment rating, the ALJ agrees that award was erroneous. A review of Dr. DuBou’s report shows he ultimately assigned a 3% impairment rating plus a 1% impairment rating, yielding a total of 4%. It is therefore determined plaintiff should be awarded benefits based on the 4% impairment rating. The ALJ is not persuaded by plaintiff's argument that Dr. DuBou actually assigned a 6% impairment rating. Plaintiff's award of benefits is therefore recalculated as follows:

$829.18 x 2/3 = $552.79 x .04 x .65 = $14.37 per week.

     Accordingly, plaintiff shall receive from the defendant the sum of $14.37 per week beginning June 30, 2015 and continuing for 425 weeks thereafter, except that such weekly PPD benefits shall be suspended during any intervening periods of TTD awarded, and with interest at 12% on all past due amounts up to June 28, 2017 and 6% on all past due amounts from June 29, 2017 up to the present.

     In all other respects, the October 30, 2017 Opinion, Order & Award remains unchanged.

          Yancey first asserts the ALJ committed error by allegedly “misinterpreting” the medical evidence and finding Yancey has a 4% impairment rating. We disagree and affirm on this issue.

          The medical evidence directly relevant to this issue is Dr. Richard DuBou’s February 18, 2016, Independent Medical Examination report filed by Dugan & Meyers. After performing a physical examination and a medical records review, Dr. DuBou set forth the following diagnosis:

My diagnosis is status post right facial injury sustained at work with laceration of the facial nerve, parotid duct, comminuted fracture of the right nasal bone and right maxillary sinus. He also underwent (several days later) postoperative re-repair of the facial nerve and parotid gland duct and additional debridement. He has sensory dysesthesia, sensory loss involving the right cheek, mild right cheek pain and jaw pain that is worse with cold. He also complains of occasional headaches, and facial twitches.

          Dr. DuBou opined Yancey is at maximum medical improvement and assessed an impairment rating explaining as follows:

I believe the patient would be best evaluated by using table 13-12, page 332. He would fit into class 1 which has a 1% to 4% impairment to the whole person which states complete loss of taste anterior tongue or mild unilateral facial weakness. I believe he would qualify for the entire 4%. Due to the intermittent pain that he has, I believe also that he would qualify for impairment using table 13-11, page 331 stated criteria for rating impairment of cranial nerve V (trigeminal nerve). I believe he would fit into class 1 which goes from 0% to 14% impairment of the whole person. This states mild uncontrolled facial neurologic pain that may interfere with activities of daily living.

 

I spoke with Mr. Yancey directly. He has these twitches only occasionally and they last briefly from two to fifteen minutes. I would grant him, therefore, 1/3 the entire percentage which would be 5%. For the intermittent pain that he has, I would give him again the entire 3% from chapter 18, figure 18-1 which states, ‘If pain-related impairment appears to increase the burden of the individual’s condition slightly, the examiner can increase the percentage found in step 1 (formal assessment) by up to 3%. No formal assessment of pain related impairment is required.’ I would give 1%.

 

I believe he would better be served by using table 11-5 Criteria for Rating Impairment Due to Facial Disorders and Dispigmentation rather than using table 8-2 Criteria for Rating Permanent Impairment Due to Skin Disorders. I believe he would get into 1 which goes from 0% to 5% impairment for the whole person and states, ‘Facial abnormality limiting to disorder for cutaneous structures such as visible scars of abnormal pigmentation (refer to chapter 8 for skin disorders) or mild unilateral or total facial paralysis or nasal distortion that affects physical appearance.’ I would give him the entire 5%.

 

After speaking with him and finding out that he can basically eat what he wants, nothing needs to be rated according to dietary restrictions. He is not limited to semisolid or soft foods, not limited to liquid foods, and does not require tube feeding or gastrostomy as is noted in table 11-7, page 262. The total impairment would be (using the combined value scales on page 604) to combine the 4% for unilateral facial weakness, 5% for mild uncontrolled facial neurologic pain, 3% for chronic pain, nothing for dietary limitation, and 5% for impairment related to facial disorders and disfigurement. Again, using the combined value scales on page 604, that would equate to a 15% total person impairment.       

          Dugan and Meyers introduced the October 27, 2016, supplemental report of Dr. DuBou in which he opines as follows:

Thank you very much for the opportunity to see Mr. Yancy [sic] once more. In the eight months since I have seen him, he has improved markedly. His numbness between the scar and the mandible is still constant, still feels ‘funny.’ About his right upper lip there is no facial deformity. He no longer complains of any pain. The stent is still in place which is possible to palpate. I have included pictures of his present condition. He did not mention the twitches that he mentioned significantly before.

 

He no longer complains of having difficulty with his eye opening on the right and says he has more discharge on the right than the left. He is able to close his eyes tightly. He is scheduled to be married in July.

 

As you can tell from the Facebook pictures that you sent me, without actively trying to move, his face has basically normal expression. The best picture, the one dated November 13, 2015, he states was taken before the accident. The others show minimal amounts of facial distortion.

 

As he has improved, I believe his partial permanent impairment is not set, it has been over a year. Using table 13-12, page 332, class 1 which goes from 1% to 4%, last time I gave him the entire 4%. This time I believe it is less and I would give him 3%. That is for mild unilateral facial weakness. He did not mentioned anything for pain. Lastly for the skin laceration which again should he desire can be improved, I would use section 8.7, page 178 on class 1 which goes from 0% to 9%. Class 1 states, ‘Skin disorders, signs, and symptoms present or intermittently present and no or few limitations of performance of activities of daily living, exposure to certain chemicals or physical agents may temporarily increase limitation and requires no intermittent treatment.’ For the small amount of the scar, I would give him 1%. Because of his improvement, especially because of the lack of discomfort from the trigeminal nerve, total impairment I believe would be 3%. That is a significant drop from the 15% when I saw him in February, but he really has improved.

          As the claimant in a workers’ compensation proceeding, Yancey had the burden of proving each of the essential elements of his cause of action, including a permanent impairment rating. Snawder v. Stice, 576 S.W.2d 276 (Ky. App. 1979). Since Yancey was unsuccessful in convincing the ALJ to adopt a different impairment rating than the one assessed by Dr. DuBou, the question on appeal is whether the evidence compels a different result. Wolf Creek Collieries v. Crum, 673 S.W.2d 735 (Ky. App. 1984). “Compelling evidence” is defined as evidence that is so overwhelming no reasonable person could reach the same conclusion as the ALJ. REO Mechanical v. Barnes, 691 S.W.2d 224 (Ky. App. 1985). The function of the Board in reviewing the ALJ’s decision is limited to a determination of whether the findings made by the ALJ are so unreasonable under the evidence that they must be reversed as a matter of law.  Ira A. Watson Department Store v. Hamilton, 34 S.W.3d 48 (Ky. 2000).

          As fact-finder, the ALJ has the sole authority to determine the weight, credibility and substance of the evidence. Square D Co. v. Tipton, 862 S.W.2d 308 (Ky. 1993). Similarly, the ALJ has the discretion to determine all reasonable inferences to be drawn from the evidence. Miller v. East Kentucky Beverage/Pepsico, Inc., 951 S.W.2d 329 (Ky. 1997); Jackson v. General Refractories Co., 581 S.W.2d 10 (Ky. 1979). The ALJ may reject any testimony and believe or disbelieve various parts of the evidence, regardless of whether it comes from the same witness or the same adversary party’s total proof. Magic Coal Co. v. Fox, 19 S.W.3d 88 (Ky. 2000).

          The Board, as an appellate tribunal, may not usurp the ALJ’s role as fact-finder by superimposing its own appraisals as to the weight and credibility to be afforded the evidence or by noting reasonable inferences that otherwise could have been drawn from the record. Whittaker v. Rowland, 998 S.W.2d 479, 481 (Ky. 1999). So long as the ALJ’s ruling with regard to an issue is supported by substantial evidence, it may not be disturbed on appeal. Special Fund v. Francis, 708 S.W.2d 641, 643 (Ky. 1986).

          Dr. DuBou’s October 27, 2016, supplemental report constitutes substantial evidence in support the ALJ’s determination Yancey retains a 4% whole person impairment rating. Dr. DuBou unequivocally stated in his October 27, 2016, supplemental report that, because Yancey improved since his first examination at which time he assessed a 15% whole person impairment rating, particularly “because of the lack of discomfort from the trigeminal nerve,” his total impairment using Table 13-12, page 332, class 1 of the 5th Edition of the American Medical Association, Guides to the Evaluation of Permanent Impairment is now 3%. In the October 27, 2016, report, Dr. DuBou also assessed a 1% impairment rating for scarring, for a 4% total whole person impairment rating.

          This Board is cognizant of the fact there are differing impairment ratings in the record. However, if “the physicians in a case genuinely express medically sound, but differing opinions as to the severity of a claimant's injury, the ALJ has the discretion to choose which physician's opinion to believe.” Jones v. Brasch-Barry General Contractors, 189 S.W.3d 149, 153 (Ky. App. 2006).  Although a party may point to evidence that would have supported a different outcome than that reached by an ALJ, such proof is not an adequate basis to reverse on appeal as long as substantial evidence supports the ALJ’s ultimate determination. McCloud v. Beth-Elkhorn Corp., 514 S.W.2d 46 (Ky. 1974). As Dr. DuBou’s impairment rating constitutes substantial evidence, we affirm the finding of a 4% impairment rating.

          In his second argument, Yancey asserts the ALJ erred by failing to apply the 30% safety penalty pursuant to KRS 342.165. Specifically, Yancey asserts the fact OSHA investigated, cited, and fined Dugan & Meyers dictates imposition of the 30% safety penalty. We disagree and affirm.

          Relevant to this issue is the November 20, 2015, OSHA Citation and Notification of Penalty which indicates Dugan & Meyers received two citations stemming from Yancey’s June 30, 2015, work injury. The first citation is a “serious” violation of KRS 338.031(1)(a), the “general duty clause,” which states as follows:

On or about June 30, 2015, the employer did not provided [sic] a place of employment which was free from recognized hazards that caused or could cause serious physical harm to employees, in that an employee was injured while operating a ‘Stihl’ model #TS 420 cut-off machine. The injured employee was exposed to reactive forces of the cut-off machine while cutting a twelve (12) inch diameter PVC pipe that was unsupported. The injured employee was struck in the left side of the face by the cutting wheel and suffered severe lacerations to his neck, cheek, and left ear. The company did not use workpiece supports (as directed by ‘Stihl’ model #TS 420 cut-off machine instruction manual) in such a way that the cut remained open during the cutting process and when the cut was finished. One feasible and acceptable method, among others, to correct this hazard is to ensure workpieces are supported in such a way that a cut remains open during the cutting process and when a cut is finished when operating a cut-off machine.

          OSHA also cited Dugan & Meyers for violating 29 CFR 1926.20(b)(4) which states as follows: “The employer failed to permit only those employees qualified by training or experience to operate equipment and machinery.” The second citation reads:

On or before June 30, 2015, one (1) employee of Dugan & Meyers Construction Co., was permitted to use a ‘Stihl’ model #TS 420 cut-off machine. The employee was not qualified by training or experience to operate the cut-off machine. On or about June 30, 2015, the employee was injured while operating the cut-off machine.

          Yancey was deposed on February 2, 2016. Pertinent to this second issue is the following testimony:

Q: You say that the saw got in a bind or got pinched by the pipe and flew back and hit you in the face. Is that what you believe happened?

 

A: That’s what I’m assuming happened, yeah. That’s how it came back to me.

 

Q: And then you indicate, you say, ‘I believe that if the backhoe was hooked to the pipe holding it up like the first one, and if I were not alone, the accident could have been prevented.’

 

A: Yeah. When I talked to Jenny, she said in the report or whatever kind of say what happened and say what I think would have been different - could have prevented it, so I put that in there.

 

Q: And you say that if the pipe had been supported the saw may not have gotten pinched because it would have had tension holding it up?

 

A: Yeah, that’s part of the – like, if – you know, if I could have prevented it, if I could go back, that’s, you know, what I think should have been done.

 

Q: And that’s the way you-all had cut the first pipe?

 

A: With the valves and stuff on it, correct.

         

Q: In your mind you didn’t think there was any reason to support this pipe before you cut all the way through it?

 

A: No. I just wanted to get the job done.

          Yancey testified that the saw he was using at the time of his injury is known as a “chop saw” or a “concrete saw,” and he had experience with this type of saw before his injury.

          Attached to Yancey’s deposition is his “New Employee Interview Information” form he completed for Dugan & Meyers indicating he has worked as an assistant to the foreman and was involved in the total construction of homes and has a “little experience” in installing underground and above ground pipes.

          Also pertinent to this issue is the March 3, 2017, deposition of Herbert Hall, a superintendent at Dugan & Meyers. Regarding the project in which Yancey was participating the day of his injury, Hall testified, in part, as follows:

Q: Now, can you go into a little more detail as far as what was involved as far as cutting the pipe out?

 

A: Well, the 16-inch line, it was a ductile line.

 

Q: Can you tell us what a ductile line is?

 

A: Ductile iron pipe. We had to hold it up with a trackhoe in order to cut it so that it didn’t bind or pinch. If you don’t hold it up or brace it up then it tends to pinch on the saw blade, so you have to do one or the other. In this particular situation we had to pick it up anyway so we had the trackhoe tied to it. Then once we had the pipe cut out we laid it out of the hold and put the cluster in and then bolted it up.

 

Q: Mr. Yancey, did he assist as far as attaching the trackhoe to the pipe to support the pipe?

A: Yes. He helped cut one end of that particular spot.

 

Q: Okay. And would they cut the pipe after it was supported by the trackhoe?

 

A: Yes.

 

Q: You said that the purpose of supporting the pipe with the trackhoe was so that the pipe wouldn’t pinch while it was being cut?

 

A: Pinch on the saw blade, yes.

 

Q: And why are you concerned about the pinching on a saw blade?

 

A: Well, if it pinches on the saw, it’s like if you’ve ever cut firewood and you cut from the top down the wood will fold up on your and bind your blade and it’s a real chore to get it back out. That and it could potentially kick out on you as well.

 

Q: You said Mr. Yancy [sic] after the pipe was supported helped saw a side of the pipe?

 

A: Yes.

 

Q: Then once the pipe was removed you said the employees would install the valve?

 

A: We installed a cluster of valves. There was [sic] three valves in that particular cluster.

 

Q: Did Mr. Yancey assist in installing the valve?

 

A: He helped until they started bolting it back together, till they actually started using the wrenches.

 

Q: Was there any reason that Mr. Yancey didn’t help bolt it back together?

 

A: There was [sic] two guys on each end and I think he just kind of got stuck odd man out at that particular moment.

 

Q: There was no reason why he couldn’t have assisted?

 

A: No, no, there wasn’t.

 

Q: Then what happened after that?

 

A: I was running the trackhoe.

 

Q: When you say running the trackhoe –

 

A: I was in the seat. I was doing the trackhoe work. Hayden approached me and asked me if it would be okay if he went down to the other end and start cutting that while we finished that end, that one particular end up.

 

Q: When you say the other end you’re talking about the other section of pipe?

 

A: Yes, the second cut we had to make.

 

I told him that it wouldn’t be a problem, just don’t cut it all the way in two until we get the trackhoe down to support it. He was gone just a few minutes and he come back and asked me about the wire that was laid across the pipe, if he could cut it or not, and I told him no, don’t cut it, because that was the tracer wire, and he seemed like he understood. He just went back down and proceeded to cut.

 

So, we were getting close to having that end closed up so I grabbed one of the other guys and told him to go with me and we would go check on Hayden. I climbed down off the hoe and we were walking down to the other end of the project and he was already walking back towards me, had his T-shirt up on his face. He pulled his T-shirt down and I immediately made him sit down and dialed 911 because the accident had already happened by then.

 

Q: Were there any witnesses to the accident itself?

 

A: No.

 

Q: Do you know why he would have asked you to go to the next section of pipe on his own?

 

A: Like I say [sic], he didn’t want to be the one guy standing there watching while everybody else was working so he was just trying to stay busy.

 

Q: And you instructed him not to cut through the pipe until you got there with the trackhoe to support it?

 

A: Correct.

 

Q: After he was injured did you see the pipe area where he was working?

 

A: Yes.

 

Q: And what had he done?

 

A: Well, he cut all the way through one end of it and he was almost through the second end before – I guess before the accident happened and he had to stop. It looked like he was trying to cut it all, everything out before I got down there.

         

Q: And if I understand correctly you told him not to cut any pipe until you got there?

 

A: I told him not to cut it completely in two until I got there.

 

Q: Completely in two, okay. And were there any witnesses to that comment or was that just between you and him?

 

A: Well, there was [sic] four other guys there. I can’t attest to how many of them heard that, but I know that at least one or two of them did.

 

          KRS 342.165(1) provides in pertinent part:

If an accident is caused in any degree by the intentional failure of the employer to comply with any specific statute or lawful administrative regulation made thereunder, communicated to the employer and relative to installation or maintenance of safety appliances or methods, the compensation for which the employer would otherwise have been liable under this chapter shall be increased thirty percent (30%) in the amount of each payment. 

          The purpose of KRS 342.165 is to reduce the frequency of industrial accidents by penalizing those who intentionally fail to comply with known safety regulations.  See Apex Mining v. Blankenship, 918 S.W.2d 225 (Ky. 1996). 

          It is well-established Kentucky authority that before an award of benefits can be enhanced in accordance with KRS 342.165(1), the record must contain substantial evidence to support an inference by the ALJ that an employer intentionally violated a specific statute or administrative regulation enacted to address the safety of workplace environments. Lexington-Fayette Urban County Government v. Offett, 11 S.W.3d 598 (Ky. App. 2000). Our courts have held that the application of KRS 342.165(1) requires proof of two elements. Apex Mining vs. Blankenship, supra. First, the record must contain evidence of the existence of a violation of a specific safety provision, whether state or federal. Second, evidence of “intent” to violate the specific safety provision must also be present.

     Intent for purposes of KRS 342.165(1) is directed towards the failure by an employer to follow the specific safety statute or regulation. A violation is intentional when a potential hazard either is or should have been reasonably foreseeable, yet ignored or willfully overlooked by an employer or an agent of an employer, in the normal course of business in order to achieve some end desired by the employer or its agent, and this foresight and desire results in the violation producing injury to an employee.  It is not enough that an accident merely happens, or that it results from a malfunction of some equipment. The nature of the intentional act and violation on the part of the employer must be egregious. There must be some degree of pre-existing knowledge on the part of the employer, unless the circumstances of the danger are so readily obvious as to lead to an inference of pre-existing knowledge. 

          Yancey’s argument on appeal regarding the import of the OSHA citations lacks merit, as the ALJ, after an examination of the evidence, was free to accept or reject the findings of OSHA. See Groce v. VanMeter Contracting, Inc., 539 S.W.3d 677 (Ky. 2018). However, even if the ALJ accepts the OSHA citations as evidence of a violation of either a specific safety statute or the “general duty” statute, the ALJ may still find the employer did not intend to violate the applicable safety regulation(s).

Here, the ALJ methodically examined the evidence supporting Yancey’s allegation of a safety violation and was convinced Dugan & Meyers neither violated the safety regulations cited by OSHA nor had the intent to violate said safety regulations. The evidence the ALJ found compelling includes Hall’s testimony that he told Yancey not to cut the section of the pipe by himself.[1] However, as stated by the ALJ, assuming, arguendo, Hall’s testimony is untrue, “the ALJ is not persuaded the defendant had reason to believe plaintiff did not have appropriate training or experience to operate the chops [sic] on which he was injured.” The ALJ based his conclusion on Yancey’s testimony indicating he understood the pipe needed to be supported and the testimony by Yancey and Hall indicating this is what they had been doing just before Yancey decided to cut all the way through the pipe by himself. Because the ALJ’s findings regarding the inapplicability of KRS 342.165 are supported by substantial evidence, we must affirm.

          Finally, Yancey asserts the ALJ erred by misapplying the recent statutory change to KRS 342.040, and, as argued, he “is entitled to 12% interest on past due TTD benefits accruing prior to 6/9/17 and thereafter as a matter of law.” We disagree and affirm on this issue.

          In the October 30, 2017, Opinion and Order, and restated in the January 3, 2018, Order ruling on Yancey’s Petition for Reconsideration, the ALJ awarded 12% interest on all past amounts due up to June 28, 2017, and 6% on all amounts due on June 29, 2017, up to the present. We have recently considered the issue of the appropriate interest rate in Limb Walker Tree Service v. Ovens (WCB No. 2015-78695, December 22, 2017), and Lake Cumberland Health Dep’t v. Oliver (WCB No. 2012-71309, December 21, 2017).  In those cases, we relied upon Stovall v. Couch, 658 S.W.2d 437 (Ky. App. 1983), to conclude a change in the legal interest rate applies prospectively. 

As applied to this claim, Yancey’s entitlement to income benefits vested as of June 30, 2015. Thus, from that date and through June 28, 2017, Yancey is entitled to 12% interest on all past due benefits. Yancey is entitled to 6% interest on income benefits accrued from and after June 29, 2017. We find no indication the legislature desired the recent amendment to have retroactive effect. See KRS 446.080(3).

Accordingly, on all issues raised on appeal, the October 30, 2017, Opinion and Order and the January 3, 2018, Order ruling on Yancey’s Petition for Reconsideration are AFFIRMED.

          ALL CONCUR.

COUNSEL FOR PETITIONER:

HON CHED JENNINGS

401 W MAIN ST STE 1910

LOUISVILLE KY 40202

COUNSEL FOR RESPONDENT:

HON MICHAEL P NEAL

220 W MAIN ST STE 1800

LOUISVILLE KY 40202

ADMINISTRATIVE LAW JUDGE:

HON GRANT S ROARK

657 CHAMBERLIN AVE

FRANKFORT KY 40601



[1] To clarify, Hall testified that he informed Yancey not to cut all the way through the pipe by himself.