Appeal of the Commissioner of the New Hampshire Department of Labor

THE STATE OF NEW HAMPSHIRE

SUPREME COURT

In Case No. 2025-0503, Appeal of the Commissioner of the
New Hampshire Department of Labor, the court on September
30, 2026, issued the following order:

The court has reviewed the written arguments and the record submitted
on appeal, has considered the oral arguments of the parties, and has
determined to resolve the case by way of this order. See Sup. Ct. R. 20(3). The
petitioner, the Commissioner of the New Hampshire Department of Labor
(Commissioner), appeals an order of the New Hampshire Compensation
Appeals Board (CAB) granting the claim of the respondent, ESIS, Inc., the
former insurer of BAE Systems, Inc. (BAE),1 for reimbursement from the
Special Fund for Second Injuries (the Fund). See RSA 281-A:55 (2023). We
reverse and remand.

The record reflects the following facts. An employee of BAE suffered a
back injury on the job and the Insurer paid workers’ compensation benefits to
the employee. The Insurer sought reimbursement from the Fund. The
Insurer’s application included information establishing that the injured
employee had a pre-existing permanent impairment related to the employee’s
back. To demonstrate knowledge of the pre-existing condition at the time of
hiring, in compliance with RSA 281-A:54, III, the Insurer provided a “Voluntary
Self-Identification of Disability” form (the Form).

The Form identifies the injured employee and indicates that because BAE
is a federal contractor or subcontractor, the “law requires us to provide equal
employment opportunity to qualified people with disabilities.” The Form
defines “disability” as “a condition that substantially limits one or more of your
‘major life activities.’” The Form lists a variety of conditions that would qualify
as a disability. The injured employee checked a box beside the following text:
“Yes, I have a disability, or have had one in the past.”

The Fund denied the Insurer’s claim, finding the Form to be insufficient
to establish the knowledge required by RSA 281-A:54, III. The Insurer
submitted a request for a hearing to the Department of Labor (DOL). After a
hearing, the DOL hearing officer concluded that the Insurer had met its burden
of proof to demonstrate that it was owed reimbursement from the Fund. The

1 CorVel Corporation is defending this appeal as the third-party administrator for Indemnity

Insurance Company of North America, the successor to ESIS, Inc., as the insurer of BAE. For
ease of reference, we will refer to the respondent as the “Insurer” in this order.

Commissioner appealed to the CAB. After a hearing, the CAB issued a decision
finding that the Form was sufficient for purposes of RSA 281-A:54. The CAB
explained that “[t]he intent of the [Fund] is to reimburse carriers for workers
who are hired despite a disability,” and the Form “fulfills the spirit, if not the
letter, of the law requiring such knowledge of a permanent condition.”2 This
appeal followed.

On appeal, the Commissioner argues that the written record produced
with the application for reimbursement did not establish the statutory
requirement “that the employer had knowledge of the employee’s permanent
physical or mental impairment” at the time the employee was hired or retained
in employment. RSA 281-A:54, III (2023). We agree.

Our review of the CAB’s decision is established by statute. Appeal of The
Lawson Group, 175 N.H. 397, 399 (2022); see RSA 281-A:43, I(c) (2023) (“Any
party in interest aggrieved by any order or decision of the [CAB] may appeal to
the supreme court pursuant to RSA 541.”). We will not set aside the CAB’s
order “except for errors of law,” unless we are satisfied “by a clear
preponderance of the evidence” before us, “that such order is unjust or
unreasonable.” RSA 541:13 (2021). The CAB’s factual findings “shall be
deemed to be prima facie lawful and reasonable.” Id.

RSA 281-A:54, I, provides, in part:

If an employee who has a permanent physical or mental
impairment, as defined in RSA 281-A:2, XIV, from any cause or
origin incurs a subsequent disability by injury arising out of and in
the course of such employee’s employment on or after July 1,
1975, which results in compensation liability for a disability that is
greater by reason of the combined effects of the preexisting
impairment than that which would have resulted from the
subsequent injury alone, the employer or the employer’s insurance
carrier shall in the first instance pay all awards of compensation
provided by this chapter.

RSA 281-A:54, I (2023). “‘Permanent physical or mental impairment’, as used
in RSA 281-A:54, means any permanent condition that is congenital or due to
injury or disease and that is of such seriousness as to constitute a hindrance
or obstacle to obtaining employment or to obtaining employment if the
employee should become unemployed.” RSA 281-A:2, XIV (2023). When
considering whether a permanent condition “constitutes a hindrance or
obstacle to obtaining employment,” the proper “inquiry is whether the
impairment is such that an employer who knew of it and its extent would more

2 We caution against invoking the “spirit” of a statutory scheme as a basis for construing statutory

language.

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likely than not significantly consider it when making a decision to hire or retain
the employee.” Lawson, 175 N.H. at 400-01 (quotations and brackets omitted).
RSA 281-A:54, III provides:

In order to qualify under this section for reimbursement from the
special fund, an employer shall establish by written records, or by
affidavit executed at the time of hire or retention in employment,
that the employer had knowledge of the employee’s permanent
physical or mental impairment at the time that the employee was
hired or at the time that the employee was retained in employment
after the employer acquired such knowledge.

RSA 281-A:54, III.

Thus, to qualify for reimbursement from the Second Injury Fund, a
carrier must pay workers’ compensation benefits to (1) an
employee with a permanent physical or mental impairment from
any cause or origin who (2) incurs a subsequent disability by
injury (3) arising out of and in the course of his employment that
(4) results in a greater workers’ compensation liability by reason of
the combined effects of the preexisting impairment than would
have resulted from the subsequent injury alone. Further, the
carrier must establish by written records that the employer had
knowledge of the permanent physical or mental impairment at the
time that the employee was hired or retained in employment after
the employer acquired such knowledge.

Lawson, 175 N.H. at 401 (quotation and brackets omitted).

We conclude that the Form did not establish the knowledge requirement
of RSA 281-A:54, III. The Form indicated that the injured employee either had
a disability at the time of hiring or “had one in the past.” (Emphasis added.)
Checking this box did not signify that the employee had a permanent disability
because it could be read to mean that the employee’s disability had been
resolved. Therefore, the Form is insufficient as a matter of law to demonstrate
“that the employer had knowledge of the employee’s permanent physical or
mental impairment at the time that the employee was hired.” RSA 281-A:54, III
(emphasis added). The Insurer, then, did not meet its statutory burden to
establish “by written records” or “affidavit” the employer’s knowledge of the
impairment “at the time that the employee was hired.” Id. Thus, we conclude
that the CAB’s decision finding otherwise was both unjust and unreasonable.
See RSA 541:13.

The Insurer argues that although the “contents [of the Form] may be
flawed, . . . BAE did not create [the Form] and should not be penalized for
using it exactly how the federal government intended it to be used: to

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determine how many of its workers are presently disabled.” We are
unpersuaded. The Form is designed to comply with Federal, not State, law.
Using the Form “exactly how the federal government intended it to be used” is
not germane to whether the Form establishes the requirements of RSA 281-
A:54, III. The Form states that “If you have or have ever had” a disability, “you
are a person with a disability.” (Emphasis added.) Therefore, the Form does
not demonstrate that the employee had a presently existing disability at the
time the employee completed it. BAE is not being penalized for using the Form.
Rather, the claim against the Fund fails because the content of the Form does
not satisfy RSA 281-A:54, III.

The Insurer’s remaining arguments do not warrant further discussion.
See Vogel v. Vogel, 137 N.H. 321, 322 (1993). Accordingly, we reverse the
CAB’s decision and remand for further proceedings consistent with this order.

Reversed and remanded.

DONOVAN, COUNTWAY, GOULD, and WILL, JJ., concurred;
MACDONALD, C.J., sat for oral argument but did not participate in the final
vote.

Timothy A. Gudas,
Clerk

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