Articles Posted in Labor & Employment Law

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Mark Black was hired as an agent of the South Dakota Division of Criminal Investigation (DCI) in 2005. Approximately one decade later, DCI terminated Black’s employment after a series of incidents and disciplinary actions. The Civil Service Commission (CSC) found that DCI had just cause to terminate Black’s employment. The circuit court affirmed. The Supreme Court affirmed, holding (1) CSC did not err in finding that DCI had just cause to terminate Black’s employment; and (2) DCI complied with the applicable rules and regulations and afforded Black due process of law. View "Black v. Division of Criminal Investigation" on Justia Law

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James Mordhorst was injured while working for Fischer Furniture. Almost one year later, Dakota Truck Underwriters and Risk Administration Services (collectively, Insurers) terminated all workers’ compensation benefits. The South Dakota Department of Labor subsequently ordered Insurers to pay all past medical bills and interest as well as future medial expenses. Mordhorst then filed an action seeking punitive damages for an alleged bad-faith denial of workers’ compensation benefits. The circuit court granted Insurers’ motion to dismiss for failure to state a cause of action upon which relief could be granted. The Supreme Court reversed, holding that the circuit court erred by granting Insurers’ motion to dismiss because Mordhorst asserted facts that, if true, state a claim for bad faith denial of a workers’ compensation claim and that Insurers’ reliance on an independent medical examiner’s report to deny benefits was not per se reasonable. View "Mordhorst v. Dakota Truck Underwriters" on Justia Law

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James Leach, a South Dakota attorney who represents clients in workers’ compensation cases, petitioned the Department of Labor for a declaratory ruling regarding the application of a statute under which the Department excludes discretionary bonuses from the earnings used to calculate an injured worker’s average weekly wage. The Department issued a declaratory ruling that discretionary bonuses may not be included in the wage calculation. Leach appealed. The circuit court sua sponte dismissed the appeal for lack of jurisdiction, ruling that, in the absence of an actual case, the Department was without subject matter jurisdiction to issue the declaratory ruling. The Supreme Court reversed, holding that the Department and the circuit court had jurisdiction to consider Leach’s petition for a declaratory ruling. Remanded to consider the appeal on the merits. View "In re Petition for Declaratory Ruling" on Justia Law

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Adam Ray, a former employee of Granite Buick GMC, Inc., and Scott Hanna, a former employee of McKie Ford Lincoln, Inc., left their respect employment and started their own automobile dealership. Granite Buick and McKie Ford sought injunctions to enforce non-compete agreements Defendants signed during the course of their employment. After the Supreme Court reversed and remanded, the circuit court concluded that the non-compete agreements were valid but granted judgment in favor of Defendants on their affirmative defenses. The Supreme Court affirmed, holding that the circuit court properly determined (1) Ray’s covenant not to compete was fraudulently induced; and (2) McKie Ford waived its right to enforce Hanna’s covenant not to compete. View "Granite Buick GMC, Inc. v. Ray" on Justia Law

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On December 31, 2009, Employee was injured during the scope of her employment at Employer. One week later, Employee suffered a massive intraventricular hemorrhage in her brain, which caused her to undergo brain surgery. Employer denied Employee’s claim for workers’ compensation benefits, alleging that Employee’s brain injuries were the result of a different incident on January 4, 2010. After a hearing, the Department of Labor ruled in favor of Employee, finding (1) the work-related injury was a major contributing cause of the hemorrhage and Employee’s resulting disabilities, and (2) the alleged second incident did not take place after the workplace incident as Employer claim, if it occurred at all. After the Department clarified compensable damages, the circuit court affirmed. The Supreme Court affirmed, holding (1) the Department was not clearly erroneous in finding that the workplace injury was a major contributing cause to Employee’s injury and disability and that there was no second incident; and (2) the Department did not abuse its discretion in admitting the undisclosed testimony of an expert witness. View "Sorensen v. Harbor Bar, LLC" on Justia Law

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Appellant injured his right shoulder while working for Employer. Due to his injuries and Employer’s lack of workers’ compensation coverage, Appellant sued to recover for his disability, arguing that Employer was in violation of South Dakota’s workers’ compensation law by failing to provide workers’ compensation insurance for its employees. The circuit court granted summary judgment in favor of Redstone, concluding that Redstone was exempt from the requirement to purchase workers’ compensation insurance under S.D. Codified Laws 62-3-15, which exempts “farm or agricultural laborers” from coverage. The Supreme Court affirmed, holding (1) the applicable test for determining an employee’s status as an agricultural laborer under section 62-3-15 is examining the entire nature of the employee’s work, which involves looking at the nature of the employer’s business; and (2) in this case, Appellant’s employment was agricultural in nature and performed for an exclusively agricultural employer, and therefore, Appellant was an agricultural laborer under the code and thus exempt from workers’ compensation coverage. View "Hofer v. Redstone Feeders, LLC" on Justia Law

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Wharf Resources, Inc., a mining company, terminated Lisa Davis for “disruptive behavior in the workplace.” Several months later, Davis filed a gender discrimination claim and a retaliatory discharge claim with the South Dakota Department of Labor, Division of Human Rights (Department). The Department concluded that there was no probable cause for Davis’s claims. The circuit court affirmed. The Supreme Court affirmed, holding that the circuit court did not err by (1) affirming the Department’s finding of no probable cause; (2) determining that Davis was terminated for permissible factors; and (3) affirming the findings of fact and conclusions of law submitted by the Department. View "Davis v. Wharf Res. (USA), Inc." on Justia Law

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Dakota Trailer Manufacturing, which makes radiator components for an unrelated company, performs its component work in one of Dakota Trailer’s locations that was originally classified as a “machine shop” for workers compensation insurance rating purposes. After an inspection, the National Council on Compensation Insurance changed the location’s classification to “welding or cutting.” Both the Workers’ Compensation Appeals Board and the South Dakota Department of Labor affirmed the new classification. The circuit court reversed and reinstated the machine shop code. The Supreme Court reversed, holding that the circuit court properly found that Dakota Trailer’s activities fit within the machine shop code. View "Dakota Trailer Mfg. v. United Fire & Cas. Co." on Justia Law

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Employee was injured when he ran from a co-worker on the job site after tricking that co-worker. Employee sought workers’ compensation benefits. Employer and Insurer denied workers’ compensation benefits, asserting that Employee’s injury did not “arise out of” or “in the course of” his employment because Employer specifically prohibited horseplay by its employees. Employee petitioned for a hearing. The Department of Labor concluded that Employee’s injury arose “out of” his employment because, but for his work with Employer” he would not have been at the job site where he was injured, but that the injury did not occur “in the course of” the employment. The circuit court affirmed. The Supreme Court reversed in part, affirmed in part, and remanded for an award of benefits, holding that the Department (1) correctly concluded that Employee’s injury arose “out of” the employment; and (2) erred when it did not consider the effect of the mandatory lull in Employee’s work when it determined that the injury did not occur “in the course of” his employment. Because Employee’s act of horseplay was not a substantial deviation from his employment, it occurred “in the course of the employment.” View "Petrik v. JJ Concrete, Inc." on Justia Law

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Patricia Wheeler was employed by Cinna Bakers, Westside Casino, and Get ’N’ Go and held the three separate jobs concurrently. Wheeler was injured in the course of her employment with Cinna Bakers, which rendered her unable to work at any of her jobs. Cinna Bakers and its insurance company (together, Cinna Bakers) accepted Wheeler’s injuries as compensable but disputed whether all three of Wheeler’s concurrent employments should not be aggregated to calculate her Average Weekly Wage (AWW). An administrative law judge determined that only Wheeler’s wage from Cinna Bakers could be utilized to calculate her AWW. The circuit court affirmed. The Supreme Court reversed, holding (1) South Dakota law allows for the aggregation of wages when an injury at one employment renders the worker incapable of performing that employee’s other concurrently held employments; and (2) the Court is persuaded to adopt the “growing minority rule,” which allows for aggregation of wages from all concurrently held employments, not just similar or related employments. View "Wheeler v. Cinna Bakers LLC" on Justia Law