In a July 28, 2023 decision, the Michigan Supreme Court revisited the criteria for compensability under the Michigan Workers’ Compensation Disability Act (WCDA) in cases involving mental disabilities arising from workplace injuries. The case, Agnes Cramer v Transitional Health Services of Wayne, dealt with an employee who sought workers’ compensation benefits after suffering an electrical shock and falling from a ladder while at work. Ms. Cramer’s alleged injuries included post-traumatic stress disorder.

Following trial, a magistrate concluded that Ms. Cramer failed to meet the requisite burden of proof that her employment contributed or accelerated her mental injury in a significant manner as required by MCL 418.301(2) based on a four-factor test set forth in Martin v Pontiac Sch Dist, 2001 ACO 118. The magistrate’s decision was appealed. The Michigan Supreme Court ultimately overturned the magistrate’s decision. The Court explicitly overruled Martin to the extent it established an exclusive test, one that it said imposes a higher burden on claimants than MCL 418.301(2) requires. Instead, the Court adopted a totality of the circumstances test as set forth in Farrington v Total Petroleum, Inc, 442 Mich 201 (1993) which is described below.

The (New) Mental Disability Standard

MCL 418.301(2) provides that mental disabilities and conditions of the aging process, including but not limited to heart and cardiovascular conditions and degenerative arthritis, are compensable if contributed or aggravated or accelerated by employment in a significant manner. This is known as the significant manner test.

In Martin v Pontiac Sch Dist, 2001 ACO 118, the Michigan Compensation Appellate Commission described four factors to be considered in applying the significant manner test:

1. The number of occupational and non-occupational contributors;
2. The relative amount of contribution of each contributor;
3. The duration of each contributor; and
4. The extent of permanent effect that resulted from each contributor.

The Supreme Court in Cramer wrote that the Martin factors were originally designed to interpret the term “significant;” it was not a test to evaluate overall compensability. Thus, the Court held that, in place of the Martin factors, the test set forth in Farrington v Total Petroleum, Inc, 442 Mich 201 (1993) should be used. In Farrington, the court held that under MCL 418.301(2), a claimant must show that their health injury was significantly caused or aggravated by employment considering the totality of the occupational factors and the claimant’s health circumstances and nonoccupational factors.

Lombardi v William Beaumont Hosp (On Remand), 199 Mich App 428 (1993) clarified the Farrington test further. The Lombardi Court held that the significant manner test requires analysis of whether the events occurring at work had more than a minor contributing, aggravating, or accelerating effect in the overall psychiatric scheme. According to the Court, this involves reviewing and comparing all the contributing factors, including those both occupational and nonoccupational.

Conclusion

The four-factor Martin test may still be relevant when evaluating allegations of a psychiatric injury, but should only be used as one part of that inquiry. A totality of the circumstances approach must be used instead.