For the second time this calendar year, the Supreme Court of Ohio issued a groundbreaking decision impacting injured workers’ eligibility for temporary total disability (TTD) compensation under Ohio Revised Code Section 4123.56. In State ex rel. AutoZone Stores, Inc. v. Indus. Comm., 2024-Ohio-5519, the Supreme Court officially interpreted the much-maligned R.C. 4123.56(F), a provision enacted by the General Assembly in September 2020. In doing so, the Supreme Court reversed the Tenth District Court of Appeals’ decision issued in 2023 (State ex rel. AutoZone Stores, Inc. v. Indus. Comm., 2023-Ohio-633 (10th Dist.)) and clarified the status of Ohio’s voluntary abandonment doctrine following the enactment of R.C. 4123.56(F).

Background on the Case

The facts of AutoZone are relatively straightforward. The claimant injured his right shoulder while working for AutoZone in June 2020, and his claim was allowed for various right arm and shoulder conditions. The claimant was able to work light duty following the injury, and he did so until he was terminated by AutoZone in September of 2020 following an altercation with a co-worker. It was undisputed between the parties that the claimant’s termination was for violating a company policy and was unrelated to the claimant’s injury or workers’ compensation claim. The claimant subsequently had shoulder surgery on Nov. 16, 2020, which was approved by AutoZone as being covered under the claim. However, the claimant likewise sought TTD compensation in relation to his time off of work following the surgery.

At the Industrial Commission, a Staff Hearing Officer (SHO) granted the claimant’s request for TTD compensation from the date of his shoulder surgery onward. AutoZone thereafter filed a mandamus action in the Tenth District Court of Appeals seeking a writ to compel the Industrial Commission to vacate the SHO’s order based upon a misapplication of R.C. 4123.56(F), which states that:

“If an employee is unable to work or suffers a wage loss as the direct result of an impairment arising from an injury or occupational disease, the employee is entitled to receive compensation under this section, provided the employee is otherwise qualified. If an employee is not working or has suffered a wage loss as the direct result of reasons unrelated to the allowed injury or occupational disease, the employee is not eligible to receive compensation under this section. It is the intent of the general assembly to supersede any previous judicial decision that applied the doctrine of voluntary abandonment to a claim brought under this section.”

The matter was referred to a magistrate, who recommended that the writ be denied because the claimant was unable to work as a direct result of the shoulder surgery. The Tenth District ultimately adopted the magistrate’s recommendation, denied AutoZone’s requested writ of mandamus, and determined that the claimant was entitled to TTD compensation following the surgery. In doing so, the Tenth District focused primarily on the first sentence of R.C. 4123.56(F), reasoning that the claimant’s inability to work was the direct result of the shoulder surgery necessitated by the work injury.

From Confusion to Clarity

Ever since the General Assembly enacted R.C. 4123.56(F),  practitioners have been grappling with the apparent incongruity between the first and second sentences of the statute, along with the status of Ohio’s longstanding voluntary abandonment doctrine. The Tenth District’s AutoZone decision in March 2023 further added to this confusion. In AutoZone, the claimant asserted that the first sentence of R.C. 4123.56(F) was the operative portion of the statute, authorizing an award of TTD compensation due to the claimant’s inability to work following the shoulder surgery. The claimant likewise argued that the third sentence of R.C. 4123.56(F) specifically supersedes the voluntary abandonment doctrine. On the other hand, the employer contended that the second sentence controls because the claimant’s inability to work stemmed from his termination in September 2020, which was unrelated to the work injury and therefore rendered him ineligible for TTD compensation. The Supreme Court’s decision in AutoZone reverses the Tenth District’s decision and provides some much-needed clarity for employers and claimants alike.

The Supreme Court made clear that both the first and second sentences of R.C. 4123.56(F) must be considered when determining a claimant’s entitlement to TTD compensation. In analyzing the first sentence of the statute, the Supreme Court recognized that in order for a claimant to be entitled to TTD compensation, there must be a direct and proximate causal relationship between the work injury and the claimant’s inability to work or wage loss. The court then reasoned that the second sentence of R.C. 4123.56(F) is the converse of the first sentence – in order to deny TTD compensation, there must be a lack of a direct and proximate causal relationship between the work injury and the claimant’s inability to work or wage loss. Thus, “an intervening event or condition not related to the employee’s industrial injury can break the causal connection between the injury and the employee’s claimed eligibility for compensation under R.C. 4123.56.” AutoZone at ¶ 27. In AutoZone, the claimant’s termination was an intervening event unrelated to the work injury, which broke the causal connection between the injury and the claimant’s inability to work.

With regard to the third sentence of R.C. 4123.56(F), the Supreme Court first acknowledged that the voluntary abandonment doctrine focused on whether the employee’s departure from the workforce severs the causal connection between the employee’s work injury and subsequent inability to work or loss of earnings. Interpreting the third sentence of the statute, the court affirmatively determined that it was the legislature’s intent to have prior decisions applying the voluntary abandonment doctrine replaced “with the standard articulated in the first two sentences of R.C. 4123.56(F).” AutoZone at ¶ 36.

Accordingly, the inquiry is no longer whether an employee’s departure from the workforce is voluntary or involuntary. Rather, the inquiry is whether the claimant’s inability to work or wage loss is the direct result of an impairment arising from the work injury. If the evidence instead demonstrates that the claimant’s inability to work or wage loss is the direct result of reasons unrelated to the work injury, TTD compensation must be denied. In short, “R.C. 4123.56(F) replaces the voluntary abandonment decisions with a ‘direct result’ requirement, clarifying that the claimed loss of wages or inability to work must be directly caused by an ‘impairment arising from an injury’ and not by ‘reasons unrelated to the allowed injury.’” AutoZone at ¶ 37.

Applying this analysis to the facts of the case, the Supreme Court sided with AutoZone by holding that the claimant was out of work as the direct result of his termination – a reason unrelated to his work injury. Stated differently, because AutoZone had already terminated the claimant, his inability to work following the surgery was not the direct result of the surgery – it was the direct result of his termination. The claimant was, therefore, not entitled to receive TTD compensation from the date of his shoulder surgery onward. In reversing the Tenth District’s decision, the Supreme Court issued the requested writ of mandamus and ordered the Industrial Commission to vacate the SHO order awarding TTD compensation.

Implications for Employers

So what does this mean going forward? For starters, any Industrial Commission or court orders relying on the Tenth District’s now-overruled AutoZone decision are likely subject to challenge. In future situations implicating R.C. 4123.56(F), the Supreme Court’s AutoZone decision will result in employers and claimants debating whether the claimant’s departure from the workforce is causally related to impairments arising from the work injury or to reasons unrelated to the work injury. As in AutoZone, employers who terminate an employee for violating employer policies unrelated to a work injury will have a viable argument for denying TTD compensation.

Please contact a member of Taft’s Workers’ Compensation practice group with questions about the impact of this decision.