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Supreme Tnurf of Bentuckg

20 1 6- SC-OOO466-WC
READY ELECTRIC APPELLANT

ON APPEAL FROM COURT OF APPEALS
_ » CASE NO. 2015-CA-001816
V. WORKERS’ COMPENSATION BOARD
NO. 11-WC-80389

THOMAS SCHARRINGHAUSEN; ' APPELLEES
HON. JOHN B. COLEMAN,

ADMINISTRATIVE LAW JUDGE;

AND WORKERS’ COMPENSATION BOARD

MEMORANDUM OPINION OF THE COURT

AFFIRMING

. On July 25, 2011, Thomas Scharringhausen (Thomas), sustained serious
injuries to his leg while working as a commercial electrician at Ready Electr`ic
(R`eady). His injuries occurred While he was repairing a six-foot exhaust fan
located on the roof of a two-story building. His supervisor, Mike Phillips, was a
journeyman electrician Who failed to properly secure the lock-out/ tag-out
device on the electrical circuit that Would disconnect the fan from electricity so
that it could be repaired. During the course of his repairs, a belt Thomas was
replacing inadvertently contacted the ignition switch and engaged the fan.

Thornas’ leg was pulled into the fan, causing multiple fractures to his .proxirnal

and distal calcaneus, complete disruption of the Achilles’ tendon, and partial
'evulsion of the left heel.

Jeffrey Callam, the safety director at Ready, investigated the incident and .
determined that is was caused by “not placing the Lock-out/ tag»out materials
on the motor’s switch prior to beginning work.” Callam further determined
that this violated the company’s rules and an OSl-IA regulation. 29 CFR
1910. 147. At his deposition, Callam testified that as the supervisor on the
scene, Phillips Was responsible for engaging the lock-out/tag-out mechanism,
and that he failed to do so in this instance.

4 Thomas filed his Form 101 in which he described the July 2,5-, 20 11
incident. A`fter reviewing the evidence of record, the Administrative Law Judge
(ALJ) awarded Thomas temporary total disability (TTD) benefits, permanent-
partial disability (PPD) benefits, and medical benefits. The ALJ also determined
that Thomas was entitled to enhanced benefits pursuant to KRS 342.165(1].

Ready appealed several issues to the Workers’ Compensation Board
(Board), which remanded the case to the ALJ for additional findings as to
whether the ALJ’s decision was premised on an intentional safety violation, or
violation of a general duty. On' reinand,'the ALJ made specific findings that the
violation was intentional under KR'S 342.165(1). The Board affirmed the ALJ’s
decision. Ready appealed to the Court of Appeals, which unanimously affirmed
the Board’s decision. Ready now appeals to this Coui't. Having reviewed the

record and the law, we affirm the Court of Appeals.

Standard of Review
In order to reverse, we must determine that the ALJ's findings were “so
unreasonable under the evidence that it must be viewed as erroneous as a
matter of law.” KRS 342.285; Ira A. Watson Department Store v.'Hamilton, 34

S.W.3d 48, 52 (Ky. 2000). This is clearly a difficult standard to satisfy.

Analysis

KRS 342.165(1) allows for a 390/o enhancement of benefits and provides

asd follows:

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 If
an accident is caused in any degree by the intentional failure of the
employee to use any safety appliance furnished by the employer or
to obey any lawful and reasonable order or administrative
regulation of the commissioner or the employer for the safety of
employees or the public, the compensation for which the employer
would otherwise have been liable under this chapter shall be
decreased fifteen percent (15%) in the amount of each payment.

In applying this statute, the ALJ specifically held:

[I]t is clear the plaintiff’s supervisor disregarded the safety

procedure and reengaged the electrical supply while the plaintiff

was continuing to work in the dangerous position. To the

undersigned this is a clear case for the application of the 30%

penalty provision noted above.
Ready argues that any liability resulting from Phillips’ failure to comply with
the lock-out/tag-out mechanism cannot be imputed to Ready as the employer

under KRS 342`. 165 because Ready specifically trained its employees.on proper

lock-out/ tag-out procedures

We addressed a similar issue in Chaney v. Dags Branch Coal Co., 244
S.W`.Sd 95 (Ky._ 2008). Therein, we held that an employer’s intent is presumed
if there is a failure to comply with a specific statute or regulation. Ici. at 101.
We specifically concluded that “[i]f the violation ‘in any degree’ causes a work-
related accident, KRS 342.165(1) applies.” Id. The Court also addressed the
purpose of KRS 342. 165 as follows

-KRs 342.165(1) is not penal in nature, although the party that

pays more or receives less may well view it as such. Instead, KRS

342.165(1) gives employers and workers a financial incentive to

follow safety rules without thwarting the purposes of the Act by

removing them from its coverage. Id.

In its opinion affirming the ALJ, the Board noted that “we are not without
sympathy for an employer who is penalized despite making every good faith
effort to ensure the safety of its employees through policy, regulation, safety
meetings, and safety equipment.” And while we echo this sentiment, it is
undisputed that Phillips failed to comply with the lock-out/ tag~out procedures
described in 29 CFR _19l0. 147. This failure clearly caused Thomas’ injury'.
Thus, KRS 342.165(1) and Chaney authorize the ALJ’s findings in this case,
and we believe that substantial evidence supports'the ALJ’s decision.

Conclusion
For the foregoing reasons, we hereby affirm the Court of Appeals’

decision, affirming the decisions issued by the Board and the ALJ. n

All sitting. All concur.

COUNSEL FOR APPELLANT:

Rodney Joseph Mayer
U’SELLIS & KITCHEN PSC

COUNSEL F`ORl APPELLEE, THOMAS SCHARRINGHAUSEN:

Stuart E. Alexander, IIl
ST-U'ART ALEXANDER, PLLC

