IRS Business Rate Proper Rate for Cure Mileage Reimbursement

SEATTLE - Oct. 15, 2014 - PRLog -- In Seattle, Washington, King County Superior Court Judge Julie Spector ruled earlier this year that a Jones Act employer must reimburse an injured seaman for cure-related travel at the rate of $0.565 per mile.  $0.565 is the 2013 IRS “business” rate.  The employer had been reimbursing the injured seaman at a paltry $0.24 per mile, the 2013 IRS “medical” rate.  The lower mileage rate should not apply for travel to medical appointments for treatment of the seaman’s occupational injury.

The recent favorable ruling came down in ongoing litigation in King County captioned Brandon Jaime v. Beauty Bay of Washington, LLC, case number 13-2-15462-5 SEA.  In Jaime, the plaintiff successfully argued that a Jones Act employer must reimburse a seaman’s travel to medical appointments for treatment of an injury sustained in the service of a vessel at the higher IRS business rate.  In the absence of any (known) maritime authority on the subject, the plaintiff asked the Superior Court to follow the lead of the United States Department of Labor and the workers’ compensation schemes of the various states.

As part of the Longshore and Harbor Workers’ Compensation Act, the United States Department of Labor requires maritime employers to reimburse injured longshoremen and other harbor workers (http://www.boatlaw.com/admiralty-and-maritime-law/longsho...) at the IRS business rate for travel to and from medical appointments to treat occupational illnesses and injuries. The Department of Labor uses the rate established by the U.S. General Services Administration.  This is the same rate used for federal witnesses, jurors, and other federal employees.

The IRS business rate is also the prevailing rate for injured workers under the workers’ compensation schemes of many states.  The Washington State Department of Labor & Industries currently requires landside Washington employers to reimburse injured workers at the reasonable rate of $0.565 per mile for medical appointments necessitated by on-the-job injuries.  Other states requiring reimbursement at the same rate for travel expenses stemming from occupational injuries include Oregon, California, Connecticut, Michigan and Iowa.

Why should seamen receive less than half of what their shoreside counterparts receive?  They should not.  Bedrock principles of admiralty law require superior, not inferior, treatment of injured seamen.  These “wards of admiralty” receive special treatment because of the peculiar perils they face while furthering the national interest in marine commerce.  Admiralty does not afford the same protections to other maritime workers, like longshoremen, who receive the higher rate as compensation for medical travel expenses.

It is also noteworthy that employers must pay a seaman’s cab fare if necessary to travel to receive curative treatment.  In this author’s experience, taxis charge more than $0.24 per mile.

In response to the foregoing contentions, the Jones Act employer argued that the seaman should only receive reimbursement for his “actual” travel expenses, namely gas, oil and insurance.   Consequently, because the IRS business rate is designed to additionally encompass costs of vehicle ownership like depreciation or lease payments and license and registration fees, the business rate overstates the actual expense to the seaman.  The Superior Court judge was apparently not impressed by this argument and awarded plaintiff his attorney’s fees incurred in preparing the Motion for Maintenance and Cure to secure the higher rate.

The IRS business rate for 2014 is $0.56 per mile.

Douglas Williams is a Seattle maritime injury lawyer (http://www.boatlaw.com/) who represents seaman and other maritime workers injured at sea or on the job, including longshoreman and other harbor workers, throughout the Pacific Northwest.