Application of Good Cause in Claims Investigations

One question PartnerSource hears frequently is: “How and when should Good Cause be applied?”  

For those utilizing a Texas Option plan prepared by PartnerSource, the concept of Good Cause is familiar, but the fine details of the whole investigation process may not be fully understood. This case study aims to dissect the investigation process for timely reporting of work-related injuries and the potential application of Good Cause within the plan. 

PartnerSource advises employers on creating Texas Option plans that delineate specific timeframes for reporting work-related injuries, which vary based on employer preferences. All plans incorporate the consideration of Good Cause during the investigation of timely reporting.

Manic Monday for Mechanic

Consider this real-life case scenario: A worker lifts a heavy piece of equipment while servicing a customer’s vehicle. In his role as a mechanic, this individual often lifts and moves heavy objects throughout his work shift. 

On this particular day, the mechanic felt he injured his low back. Because the incident occurred at the end of his work shift, the worker elected to rest and self-treat at home. The incident occurred on a Saturday, and the worker reported the accident on Monday morning when returning to work.   

This worker’s employer has a requirement to report all work-related injuries to management by the next calendar day. Because the injured worker did not report the incident by the next calendar day, the claims specialist recommended a denial of benefits for failing to timely report an injury resulting from an accident.  

Timely Reporting of an Occupational Injury

As part of PartnerSource’s consultation of coverage determination, we reviewed the investigation into this incident. PartnerSource is committed to creating detailed, fact-based programs to help our clients determine coverage. As part of our review, PartnerSource carefully considered the following:

• Training on Reporting Requirements: It is essential to verify whether the injured worker received training on the Plan and its reporting requirements, including the date of the training. For long-term employees, refresher training or discussions during staff meetings about the importance of timely reporting should be confirmed. Additionally, if the worker transferred from another worksite out-of-state, it is imperative to ensure they were informed of the Plan requirements post-transfer.
• Workplace Postings: It is helpful to confirm if this information is posted in the workplace because it is a reminder of the reporting requirements. Some employers may include reporting timeframes as part of an employer-issued security badge or display this information in company vehicles or on other equipment that may be used outside of the workplace.
• Management Awareness: If management witnessed the incident, it should be considered as satisfying timely reporting. Additionally, PartnerSource recommends confirming the availability of management for reporting during business hours, and whether the employee had access to a manager on duty.
• Impact of Injury on Reporting: Assess whether the injury impeded the worker's ability to report the incident verbally or complete an incident form, which could justify Good Cause for delayed reporting.

Investigating Worker’s Claim

In the case of this mechanic, it was verified that he was notified of the Plan and its requirements within one year prior to the date of the incident. As part of his recorded statement to the third-party administrator, he confirmed having knowledge of the reporting requirements. The employee also stated to the claims specialist that he did not report his injury to management before going home on the date of incident because he wanted to see if his symptoms would resolve after resting at home.  

Based on this information, the claims specialist recommended denial. However, the claims specialist did not explain to the injured worker Good Cause or how it would be considered in this case. More specifically, the injured worker was not given the opportunity to explain why he did not timely report the incident. This may appear to be a simple question, but it allows the employee an important opportunity to provide any additional information to assist with the administration of benefits.   

This mechanic’s employer is open for business Monday through Saturday and does not have business hours on Sundays. The employee reported the injury on Monday when management was available. As part of PartnerSource’s review, we recommended our client accept the claim based on Good Cause, since the employee reported his injury to his employer when management was first available.

PartnerSource Assists Employer

PartnerSource’s advice allowed the employer to take care of the employee the way they would want to care for one of their business’s best assets, and to stay compliant with their Texas Option plan. It also avoided the kind of scenario--an angry worker without care or options—that often results in expensive litigation.

At PartnerSource, we strongly recommend asking probing questions and looking for Good Cause when investigating claims for late reporting. As part of the investigation process, it is important to explain Good Cause to the injured worker and ask if they have additional evidence or information to provide before finalizing the coverage determination. 

The main reason for timely reporting of an incident is to allow for prompt care to an injured worker; not to establish an arbitrary timeframe as a way to deny coverage. It is also necessary to address the cause of the incident and make any corrections to prevent a similar event from occurring in the future. We strive to help our clients provide great benefits to their most valuable asset, their employees.