If Carl Kelly is lying about his mental health problems, he better not join Facebook and post “happy pictures.” Natalie Blanchard, a Quebec woman on long-term leave from a Canadian IBM office, was receiving payments after being diagnosed with depression. But the company’s insurer, Manulife, cut her off this fall, at least in part because “several pictures Blanchard posted on the popular social networking site, including ones showing her having a good time at a Chippendales bar show, at her birthday party and on a sun holiday,” according to a Nov. 21 report at CBC.com.

The idea is that the pix constitute “evidence that she is no longer depressed, Manulife said.” One insurance-industry blogger writes: “Manulife says it was just doing its job, sort of like a workers compensation firm would do when investigating an ‘injured’ worker who finds himself atop a surf board while collecting benefits for his injury.”

Mr. Kelly’s case is, in fact, a worker’s comp case–one that may be precedent setting, as described in a Nov. 22 report by the Anchorage Daily News with the hed, “Compensation case sets mental injury rule.” Here’s their lede: “A former prison guard at the Anchorage Jail who was threatened by a convicted murderer intoxicated on hair spray and armed with a sharpened pencil deserves workers’ compensation for mental injury, the Alaska Supreme Court has ruled. “Carl Kelly, 60, suffered psychological health problems, maybe even post-traumatic stress disorder, from the 1994 confrontation, the court said.”

Apparently, Kelly’s employer, the Alaskan corrections department, believes guards should expect to face hairspray-huffing inmates armed with handheld, No.2 punji sticks. But the state supreme court disagreed: “The state Department of Corrections had argued unsuccessfully that every prison guard expects a certain level of misbehavior from inmates and that Kelly’s experience in jail was no different from that of other guards. But Kelly argued successfully that what happened went beyond what he expected from the job and beyond what a reasonable person would expect from the job, according to the court’s decision last month.”

Kelly, “according to paperwork from the Alaska Workers’ Compensation Appeals Commission,” had served in the U.S. Navy, tried several jobs before signing on as a corrections officer in 1987, including truck driver  and air traffic controller–not exactly a history one associates with lack of either responsibility or mental stress.

Nevertheless, the conditions in the facility eventually wore him down, including having urine dumped on him, threats of physical violence and “knowing where you live,” according to testimony. In 1994 he had a run-in with an inmate who had threatened him before, one “Jacob Kochutin, [who was] serving 99 years for sexually assaulting, then murdering a 7-year-old boy on St. Paul Island in mid-1980s . . . .”

Assigned on solo-duty to a unit that held “inmates with mental disorders,” the unarmed Kelly encountered Kochutin, who was “was intoxicated on hair spray and confronted Kelly with the sharpened pencil, according to Kelly’s testimony. The prisoner said he was going to poke Kelly’s eyes, blinding him, then stab him to death. Kelly was too scared to call for help, which finally arrived after he didn’t answer calls on his radio, he testified.”

What happened afterward may be in the medical or court record, but the news account does not address it. But “[t]hree weeks later, Kelly checked into a hospital with high blood pressure and chest pain. A physician said he was suffering from significant anxiety about his safety at work and his safety outside of work. He prescribed Kelly anti-depressant and anti-anxiety medication. “A month later, Kelly filed for temporary workers’ compensation because of what he alleged was his mental injury caused by mental stress, a rare filing because most filings for workers’ compensation in Alaska stem from physical injuries.”

In the years in between, he’s worked only one year, and the case has taken this long to grind through the system, and there’s more legal proceedings in the works.

But if Kelly prevails, he “could recoup lost wages back to the early part of this decade, when his workers’ comp benefits ended and he last worked. He could look forward to salary compensation potentially as long as he lives.”

One note of caution, Mr. Kelly: Don’t post on social media any photos that can be mistaken for anything other than the appearance of shell-shocked terror.

Employers’ workers comp rates continue to fall in some states (9.6% in North Carolina; 9.7% in Colorado, ), while group-rate discounts are taking a hit in Ohio, and plans to take its system private are near final recommendation in Oklahoma.

But in Montana, elderly, injured workers are getting whacked by a state supreme court ruling that upholds a law allowing insurance companies to continue to stop workers comp payments for permanently disabled workers once they become eligible for Social Security retirement benefits.

In a Nov. 4 report, the Associated Press writes of the Nov. 3 5-2 ruling that the court finds that “workers’ compensation benefits for permanently and totally disabled workers are meant to assist them for their ‘work life,’ [but] not into retirement.”

According to the AP, “Officials with the Montana State Fund, which writes workers’ compensation insurance for about 27,000 businesses, said a decision in favor of the workers could have cost the fund as much as $300 million for current and future claims, leading to a rate increase.”

Laurence Hubbard, president of the state fund, was quoted as being “relieved,” saying the decision brings “closure” to an issue that “had a very large potential cost, not only to current insurance rates, but also for claims that remain open.”

Not everyone was relieved, however.

Jim Hunt, attorney for the three injured plaintiffs,  “said the court order ignores constitutional protections for aging, permanently disabled workers.”

Explaining the majority’s rationale for upholding the state law, Justice William Leaphart wrote: “While this may not always seem fair, it is not unconstitutional. By acting to terminate benefits as it does, [the law] rationally advances the governmental purpose of providing wage-loss benefits that bear a reasonable relationship to actual wages lost.”

The two dissenting justices were Brian Morris and James Nelson; Morris had harsh words for the majority opinion:

” ‘The court … employs a toothless analysis that permits the legislature to advance the perfectly legitimate task of protecting the economic viability of the workers’ compensation system through the illegitimate means of penalizing injured workers who have qualified for (Social Security),’ Morris wrote. He said he could accept some coordination of benefits similar to how Montana law reduces workers’ compensation benefits by one-half of the amount of Social Security disability benefits a person receives.”

Beginning at the end of the year, sole proprietors in Tennessee get a break, particularly those who work for residential clients.

According to The Commercial Appeal, the rule change was instigated in 2008 but was “ambiguous” and has only recently been clarified by the state Attorney General. Basically, the interpretation says that ” ‘a sole proprietor who contracts directly with a homeowner’ to perform work on the home ‘is not required to carry worker’s compensation coverage on himself but must carry workers’ compensation insurance for any subcontractor, employee, or worker who is not otherwise covered by a workers’ compensation policy.’ ”

Apparently, the original intent of the 2008 legislation was to ensure that employees and sub-contractors were covered by workers comp and to prevent a crew working at a home to skirt the law by each declaring themselves as sole propreietors. “But the change was not intended to ‘overburden true sole proprietors who work directly for homeowners by requiring them to carry workers’ compensation coverage on themselves.’ “