By: Kyle Sholes
SOUTH CAROLINA – In 1973, the South Carolina Supreme Court laid out the Cooper test, which brought forth the fraud in the application of employment defense. Cooper v. McDevitt & Street spelled out the general rule that if the following elements were met, a false statement in an employment application would bar benefits: (1) The employee must have knowingly and willfully made a false representation as to their physical condition; (2) The employer must have relied upon the false representation and such reliance must have been a substantial factor in the hiring; and (3) There must have been a causal connection between the false representation and the injury. Cooper v. McDevitt & Street Co., 260 S.C. 463, 468 (1973). Though Cooper itself had dissenters question the authority relied upon by the respondent employers, the Cooper test has been a prominent feature in workers’ compensation defense ever since it was established. But that could soon change.
In the 2024 case Brailey v. Michelin North America, the workers’ compensation commission denied Brailey benefits on four separate grounds, one of which being that Michelin had met its burden of proving the “fraud in the application” defense under Cooper. Brailey v. Michelin N. Am., Inc., 443 S.C. 468, 469-70 (2024). The Court of Appeals reversed the commission on all four grounds, and the South Carolina Supreme Court affirmed. The state’s highest court went beyond affirming, going as far as to express concern “with the continued validity of Cooper.” The Court identified two reasons to “call into question whether we should – or even can – continue to use the Cooper test to determine the consequences of fraud in an employment application.” First, the court noted that under the Americans with Disabilities Act of 1990, which preempts the Cooper decision, employers are not permitted to ask whether an applicant has any preexisting injuries until after the decision to hire them has been made. As such, the court stated it was not possible for Michelin to satisfy the second element of the Cooper test, which required Michelin to demonstrate that its reliance on any false representation Brailey made on his employment application was “a substantial factor in the hiring” decision. Second, the court questioned its previous holding in Cooper since the legislature did not address “fraud in the application” in the South Carolina Workers’ Compensation Act, and the court made clear that the consequences of the fraud should be a legislative determination, not a judicial one.
Ultimately, the Supreme Court did not need to decide on the validity of fraud in the application since Michelin had not proven itself entitled to the defense. Accordingly, the fraud in application of employment defense is technically still viable. The court even emphasized the fact that Cooper is not overruled. However, the court recognized problems with the Cooper test, questioned its validity, and prompted the legislature to find a resolution. So while the fraud in application of employment defense may have survived Brailey, it is under attack – and the legislature could soon provide a lethal blow.
Kyle Sholes, who authored this article, is a student at USC School of Law. Kyle is currently working as a law clerk in the WJCB Greenville office. THIS ARTICLE DOES NOT CONSTITUTE LEGAL ADVICE. PLEASE CONTACT US IF YOU HAVE ANY QUESTIONS FOR AN ATTORNEY OR NEED LEGAL ASSISTANCE [email protected]