                IMPORTANT NOTICE
          NOT TO BE PUBLISHED OPINION

  THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED."
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  PROMULGATED BY TH; SUPREME COURT, CR 76~28(4)(C),
  THIS OPINION IS NOTrTO BE PUBLISHED AND SHALL NOT BE
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  CASE IN ANY COURT OF THIS STATE; HOWEVER,
. UNPUBLISHED KENTUCKY APPELLATE DECISIONS,·
  RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR
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                                                      RENDERED: JUNE 15, 2017


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                   .     .·     2016-SC-000466-WC ·
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 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 Electric

 (Ready). 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 propi;rly 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.

 Thomas' leg was pulled into the fan, causing multiple fractures to his .proximal
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 ru)es and an OSHA 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.

      Thomas filed his Form 101 in which he described the July 25, 2011

incident. After reviewing the evidence of record, the Administrative Law Judge

(AW) awarded Thomas temporary total disability (TTD) benefits, permanent

partial disability (PPD) benefits, and medical benefits. The AW 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 AW for additional findings as to

whether the AW's decision was premised on an intentional safety violation, or

violation of a general duty. On re·mand, the AW made specific findings that the

violation was intentional under KRS 342.165(1). The Board affirmed the AW's

decision. Ready appealed to the Court of Appeals, which unanimously affirmed
                                                      )

the Board's decision. Ready now appeals to this Court. Having reviewed the

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




                                         2
                               Standard of Review

      In order to reverse, we must determine that the AW'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 3~% enhancement of benefits and provides

as 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 shaJl 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 fot 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 AW specifically held:

      [I]t is clear the plaintiffs 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.
                                        3
      We addressed a similar issue in Chaney v. Dags Branch Coal Co., 244

S.W.3d 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. Id. 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 AW, 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 1910.147. This failure clearly caused Thomas' injury.

Thus, KRS 342.165(1) and Chaney authorize the AW's findings in this case,

and we believe that substantial evidence supports 'the AW's decision.

                                    Conclusion

      For the foregoing reasons, we hereby affirm the Court of Appeals'

decision, affirming the decisions issued by the Board and the AW.

      All sitting. All concur.




                                         4
COUNSEL FOR APPELLANT:

Rodney Joseph Mayer
U'SELLIS & KITCHEN PSC


COUNSEL FOR APPELLEE, THOMAS SCHARRINGHAUSEN:

Stuart E. Alexander, III
STUART ALEXANDER, PLLC




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