HR Management & Compliance

Is Terminated Indiana Worker Entitled to Workers’ Comp Benefits?

The Indiana Court of Appeals recently heard a claim from a former employee who was injured on the job, but was subsequently fired for cause. Does the employee have a claim for workers’ compensation benefits?Indiana


In 2013, Masterbrand Cabinets hired “Oliver” as a production associate, a position that involved physical labor. During his employment, Oliver was counseled numerous times on his conduct and his anger issues.

In June 2014, Oliver slipped while he was working and injured his lower back. He immediately reported his injury to his supervisor but initially thought medical care was unnecessary. However, his pain worsened over the weeks following the incident, and Masterbrand referred him to Dr. Butler for an evaluation.

Butler determined that he would need Oliver’s medical records to determine the absolute causation of the pain he was experiencing, and he returned Oliver to full duty. Oliver disagreed with the full-duty recommendation; however, he did try to return to work.

The day after working one full shift, Oliver was unable to get out of bed. However, the following day, he returned to work. On that day, he got into a verbal altercation with his supervisor over his back pain and lack of work restrictions, threw his ice pack—nearly striking another employee—and cursed at the supervisor. Masterbrand suspended him and terminated his employment in early July 2014.

Oliver had several follow-up appointments with Butler. In September 2014, Butler found he had reached maximum medical improvement, released him from treatment, and assigned a three percent whole-person impairment rating. Oliver continued to disagree with Butler’s determination and filed a motion to compel an independent medical examination (IME).

Dr. Chou performed the IME and determined that Oliver probably had exacerbated a preexisting back condition and that 10 to 20 percent of his condition could be attributed to the job-related injury. Further, Chou determined that Oliver could return to sedentary work and would reach maximum medical improvement either when his pain resolved or after he recovered from any surgery necessary to treat his pain.

After a hearing on the matter, a single hearing officer of the WCB found that Oliver was entitled to an award for his temporary total disability (TTD). Masterbrand appealed to the full board, which affirmed the decision. Masterbrand then appealed to the Indiana Court of Appeals.

Indiana Court of Appeals’ Decision

On appeal, Masterbrand argued that Oliver wasn’t entitled to TTD benefits under the Indiana Workers’ Compensation Act because he was fired for misconduct. In support of its argument, the company contended that the Act allows for the termination of TTD benefits when an employee is unable or unavailable to work for reasons unrelated to a work injury.

Therefore, Masterbrand argued, Oliver’s loss of earning power resulted from his anger and misconduct rather than his injury. Oliver countered that he was entitled to benefits under the Act because he didn’t have the ability to return to work of the same kind or character after his on-the-job injury.

The Indiana Court of Appeals restated the purpose of the Act: “The purpose of awarding [TTD] payments under the Indiana [Workers’] Compensation Act is to compensate an employee for a loss of earning power because of an accidental injury arising out of, and in the course of, his or her employment. . . . If the injured worker does not have the ability to return to work of the same kind or character during the treatment period for the injury, the worker is temporarily totally disabled and may be entitled to benefits.”

The court also noted that the Act doesn’t explicitly bar the claim of an employee who has been terminated before he begins receiving TTD benefits. Therefore, the court reiterated, any doubts in the application of the workers’ comp statute must be resolved in favor of the employee. Judge Michael Barnes, writing the opinion for the court, stated, “The relevant inquiry is whether [the employee’s] inability to work, even for other employers, was related to his injury.”

The court concluded that Oliver’s termination for misconduct didn’t prevent him from receiving TTD benefits as a result of his on-the-job injury. Masterbrand Cabinets v. Waid, No. 93A02-1609-EX-2228 (Ind. Ct. App., 2017).

Bottom Line

An employee who is injured on the job may still be eligible to receive workers’ comp disability benefits even after he is terminated for just cause. When the workers’ comp statute is ambiguous or silent about its application to specific scenarios, the WCB and Indiana courts will likely resolve the dispute in favor of the employee.

Sarah Noack works for Faegre Baker Daniels’ labor and employment group, and editor of Indiana Employment Law Letter.