GT Alert

Arizona Supreme Court: Workers’ Compensation Covers On-The-Job Injuries Even When Drugs Or Alcohol Are At Play

September 2005

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The Arizona Supreme Court last month decided the long-anticipated case Grammatico v. Industrial Commission, 117 P.3d 786, 458 Ariz. Adv. Rep. 40 (2005). The Court analyzed a pair of Arizona statutes that provide that a worker who tests positive for illegal drug use or alcohol impairment and who is injured on the job may be denied workers’ compensation benefits. The Arizona Court of Appeals previously issued contradicting opinions on these statutes in Grammatico v. Industrial Commission, 208 Ariz. 10, 90 P.3d 211 (Ct.App. 2004), and Komalestewa v. Industrial Commission, 209 Ariz. 211, 99 P.3d 26 (Ct.App. 2004). The Supreme Court set out to resolve the contradiction by consolidating the two cases.

The Supreme Court struck down both Arizona statutes as unconstitutional, effectively eliminating drug and alcohol use as a factor that may be considered to deny workers compensation benefits.

The On-the-Job Injuries

David Grammatico installed metal trim on buildings while standing on forty-two inch stilts. He was injured on the job when he fell off the stilts into a cluttered area on the job site. He broke his wrist and knee. Grammatico admitted that he had smoked marijuana and ingested methamphetamines on the two previous days, and a post-accident drug test confirmed the presence of illegal drugs in his system.

Austin Komalestewa was injured on the job when he crawled under a broken conveyer belt to try to fix it. His arm was caught in the drum and was seriously injured. Blood tests at the hospital revealed the presence of alcohol in his system, and a doctor later testified that his blood alcohol content at the time of the accident was around 0.176 percent. Komalestewa admitted that he had been drinking the night before the accident.

The Statutes

A.R.S. § 23-1021(D) provides that if an employer maintains a certified drug-testing policy, “an employee’s injury... shall not be considered a personal injury by accident arising out of and in the course of employment and is not compensable... if the employee fails to pass... a drug test for the unlawful use of any controlled substance,” unless the employee proves that the use of an unlawful substance “was not a contributing cause of the employee’s injury.”

The Industrial Commission in Grammatico held that this provision barred Grammatico’s claim because he failed to prove that his unlawful use of drugs was not a contributing cause of his injuries. The Court of Appeals set aside the decision and ruled that A.R.S. § 23-1021(D) violated the Arizona Constitution because it attributed fault for an injury to the employee. The Constitution, the Court held, established a strict “no fault” workers’ compensation system.

A.R.S. § 23-1021(C) provides that “An employee’s injury… shall not be considered a personal injury by accident arising out of and in the course of employment and is not compensable... if the impairment of the employee is due to the employee’s use of alcohol... and is a substantial contributing cause of the employee’s personal injury.”

In Komalestewa, the Industrial Commission denied the workers compensation claim because the evidence showed that Komalestewa’s intoxication had contributed to the accident. The Court of Appeals affirmed the claim denial, and rejected the constitutional arguments that another panel of the court had adopted in Grammatico.

The Supreme Court’s Ruling

The Supreme Court combined Grammatico and Komalestewa to resolve the dispute. It focused on Article 18, Section 8 of the Arizona Constitution, which established a “no-fault” system for workers’ compensation. The Court determined that Article 18, Section 8 prohibited the legislature from injecting fault into the workers’ compensation system.

According to the Supreme Court, an on-the-job accident that is truly an accident (i.e., is not intentional) must be compensated. Although drug use can certainly be seen as intentional, the Supreme Court explained: “[w]hile alcohol consumption and illegal drug use shortly before work or during work undeniably increase the chances of being injured on the job, it cannot be unequivocally said that employees with alcohol or drugs in their systems who sustain injuries have intentionally injured themselves.”

Ultimately, “the constitutional system for workers’ compensation requires the payment of benefits if a necessary risk or danger of employment partially caused or contributed to an industrial accident, without consideration of any fault by the injured employee.” As a result, the Supreme Court concluded that A.R.S. Sections 23-1021(C) and (D), were unconstitutional as applied to Grammatico and Komalestewa.

How Grammatico Affects Employer Policies

The Supreme Court’s decision, in effect, practically eliminated drug or alcohol use as a factor that may be used to deny workers’ compensation to an injured employee. While a case of actual on-the-job drug use or an intentional injury may still warrant denial of workers’ compensation, the lesson of Grammatico is that the Industrial Commission, and Arizona courts, will err on the side of the employee with respect to injury causation.

This makes it all the more important for employers to have drug and alcohol use policies that are clear, well-drafted, and strictly enforced. As a general proposition, Arizona employers may still ban drug and alcohol use in the workplace, may still require drug and alcohol testing, and may still “take adverse employment action based on a positive drug test or alcohol impairment test,” including termination of employment. A.R.S. § 23-493.05.

Despite its ruling, the Supreme Court noted that strong policy reasons support the banning of drug and alcohol use at work, and it suggested that a Constitutional Amendment may remove the barrier for future statutes that are similar to A.R.S. Sections 23-1021 (C) and (D). A proposed amendment has already been circulated in the legislature.

This Alert was written by Michael C. Mason in the Phoenix office. Please contact Mr. Mason 602.445.8535 or your Greenberg Traurig liaison if you have any questions regarding the subject matter of this Alert.

© 2005 Greenberg Traurig

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