By: Richard E. Guttentag, Esq., Stearns, Roberts & Guttentag, L.L.C.

Florida’s Workers’ Compensation Law requires employees who suffer an injury arising out of and in the course of their employment to advise their employer of the injury within 30 days after the date of or initial manifestation of the injury.  The employer must then report the injury to its carrier within 7 days after actual knowledge of such injury. But, what happens when an injured employee (i.e. Claimant) is also a shareholder or owner of the employer company and the employer does not timely notify the Carrier? Is the Claimant denied its workers’ compensation benefits?

In Gomez Lawn Service, Inc. v. The Hartford, 2012 WL 4465233 (Fla. 2012), Claimant and his wife are the owners of a lawn service company. Claimant is the president of the company, and performs the services provided by the company and is paid as an employee of the company (i.e. Employer). Claimant’s wife is the secretary and chief operating officer of the company, handling all of the business details. Claimant did not elect to exempt himself from workers’ compensation coverage as permitted by the Florida’s Workers’ Compensation Law.

In July 2010, Claimant was traveling in a company owned vehicle from one job site to another when he was involved in a car accident that resulted in him suffering injuries. Claimant’s wife reported the accident to the Employer’s motor vehicle insurer, which open a personal injury claim under the personal injury protection (PIP) provisions of the policy.  In August 2010, Claimant’s doctor advised Claimant that surgery may be required. In November 2010, with the PIP benefits for Claimant’s medical treatments reaching their limit and the possibility of surgery looming, Claimant’s wife consulted an attorney. As a result of the consultation, in December 2010, Claimant’s wife notified the Employer’s workers’ compensation carrier (“Carrier”), and Claimant filed a petition for benefits.  The Carrier denied the claim citing lack of timely notice under Florida Statute, Section 440.185.

Florida Statute, Section 440.185(1) provides in part that:

“An employee who suffers an injury arising out of and in the course of employment shall advise his or her employer of the injury within 30 days after the date of or initial manifestation of the injury. Failure to so advise the employer shall bar a petition under this chapter . . .”

Florida Statute, Section 440.185(2) provides in part:

“Within 7 days after actual knowledge of injury or death, the employer shall report such injury or death to its carrier . . .”

The Judge of Compensation Claims (JCC) agreed with the Carrier, and denied and dismissed Claimant’s claim, finding that Claimant and Employer were the same party and they did not notify the Carrier of the injuries until approximately ninety days after the accident. Claimant appealed the JCC’s order denying his petition for benefits.

Florida Statute, Section 440.41(1) provides in part that when the employer is not a self-insurer, “[n]otice to or knowledge of an employer of the occurrence of the injury shall be notice to or knowledge of the carrier.”

On appeal, the appellate court explained that when interpreting a statute, if the statute’s plain language is clear and unambiguous, courts should rely on the words used in the statute without involving rules of construction or speculating as to the legislature’s intent.  The court further explained that a JCC only has those powers expressly provided by statute, and has no jurisdiction beyond that which is specifically conferred by statute.  Thus, a court may not read into chapter 440 authority not granted to the JCCs.

The appellate court concluded that the plain language of Florida Statute, Section 440.41(1) imputes the Employer’s knowledge to the Carrier.  Accordingly, once the Claimant gave notice to the Employer, the Claimant fully satisfied the notice requirement imposed by Florida Statute, Section 440.185(1). The JCC had no authority to read into section 440.185(1) a requirement that Claimant report the injury to the Carrier within thirty days.

The appellate court did recognize that small corporations often have shareholders that are also employees, as in this case.  However, the legislature has not implemented any special rules regarding notice where the employee has some ownership interest in the Employer.  Further, the court reasoned that the injured employee must still prove the merits of his or her case.

This case demonstrates some of the important notice requirements under Florida’s Workers’ Compensation Law, and that even though some corporations have shareholders that also occupy the position of employees, such employees’ (i.e. Claimants’) notice to the Employer that he or she sustain an injury will constitute sufficient notice to the Employer, which in turn constitutes notice to the carrier under Florida’s Workers’ Compensation Law.

About the Author: Richard E. Guttentag is a partner with Stearns, Roberts & Guttentag, L.L.C., and is Board Certified in Construction Law by the Florida Bar. Mr. Guttentag exclusively in construction law including construction lien claims and defense, payment and performance bond claims and defense, bid protests, construction contract preparation and negotiation, and construction and design defect claims and defense. He can be reached for consultation at [email protected].

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