- May 2005 -
Stipulation
of “Permanent Partial Disability” Does Not Preclude Later Termination of
Benefits
Neither claimants and
employers nor even expert witnesses and WCJs, can predict the future
with certainty. Agreements between the parties and adjudications can
incorporate only the current best estimates of the course a disease or
physical impairment will take, or how such conditions may be affected by
future medical developments. Accordingly, the general rule is that if
the original assumptions turn out to be wrong, either party may seek
review to show that what was expected to be a permanent partial
disability has resolved or has worsened into a total disability.” On
the basis of this reasoning, in Wieczorkowski v. WCAB (LTV Steel),
Commonwealth Court affirmed an employer’s right to terminate benefits
after executing a supplemental agreement accepting permanent partial
disability. The case arises from the pre-Act 57 practice of commuting
future partial disability benefits and leaving medical treatment open as
then required by law, and demonstrates that such cases are still subject
to subsequent petitions to terminate benefits if ongoing medical issues
cannot be settled.
Claimant was injured
in an April 1984 slip and fall accident. A Notice of Compensation
Payable was issued accepting liability for a right knee strain. In
1997, the parties commuted the wage loss portion of the claim and
entered into a Supplemental Agreement providing that the claimant’s work
injury had “resolved itself into a partial disability permanent in
nature.” An earning capacity was imputed to claimant which allowed for
commutation of future partial benefits in a lump sum of $76,000. The
agreement also continued employer’s liability for payment of all future
reasonable, necessary, and causally related medical bills.
In 2001, employer
filed a Termination Petition, alleging that all disability related to
the April 1984 injury had ceased. Employer’s expert testified claimant
had fully recovered from the right knee strain, but admitted claimant
had right knee arthritis, though he opined this condition was not
related to the work injury. Claimant’s expert testified that claimant’s
degenerative arthritis and bone-on-bone articulation in the right knee
were related to the work injury, and were disabling.
The Workers’
Compensation Judge (WCJ) credited testimony of employer’s expert over
claimant’s and terminated benefits. WCAB affirmed on appeal, reasoning
that nothing in the Supplemental Agreement barred employer from seeking
to terminate benefits.
Claimant appealed
further to Commonwealth Court arguing first that the Supplemental
Agreement, “Wherein the parties agreed that the work-related disability
had resolved into a permanent partial disability, precludes employer
from seeking to terminate its responsibility for payment of medical
expenses.” According to claimant, employer’s remedies are limited to
challenges to the reasonableness or necessity, as well as casual
relationship, of future medical treatment.
Rejecting claimant’s
argument, Commonwealth Court affirmed termination of benefits, citing
Section 413(a) of the Act, which provides that a WCJ “may at any time,
modify, reinstate, suspend, or terminate a notice of compensation
payable, an original or supplemental agreement…, upon petition filed by
either party…upon proof that the disability of an injured employee
has…finally ceased…” According to the court, the language of Section
413(a) is “plain [and] unambiguous” and permits termination of benefits
upon subsequent proof that disability has ceased. The court observed
that Pennsylvania Supreme Court has determined that an employer is
precluded from litigating a potential termination of benefits only where
the medical condition at issue was clearly irreversible, such as the
progressive occupational disease of coal workers’ pneumoconiosis, citing
Supreme Court’s 1993 opinion in Hebden v. WCAB (Bethenergy Mines,
Inc.). In Hebden, Supreme Court ruled that “the principal of
res judicata or issue preclusion only precludes a challenge to a
claimant’s current disability status where the claimant’s condition is
clearly irreversible, such as the case of a progressive occupational
disease.” The court also reasoned that categorizing disability as
permanent does not equate to a finding that a claimant’s disability or
injury is irreversible.
The “original
assumptions” made when an agreement is drafted or an adjudication
rendered may not, the court reasoned, turn out correct. In that case,
parties can review agreements and adjudications to determine whether
disability has resolved, or even worsened. “[I]f medical science deems
the condition to be irreversible at the time a party seeks to challenge
the prior stipulation or adjudication, no review may be had. In other
words, when a party seeks to challenge the prior stipulation or
adjudication, we must look to two distinct time periods. First we look
to the relevant agreement or decision to determine the nature of the
physical impairment from which the claimant suffered, and in accordance
with Hebden, the nature of that condition may not be collaterally
attacked. It is from the time perspective of the later petition,
however, that we determine whether the established condition is one that
is irreversible, and this determination dictates whether the benefits
previously set may be altered.”
It is important for
employers and insurers seeking review of prior agreements or
adjudications to look not only to what was agreed upon or adjudicated in
the past, but also to current medical opinions about the nature of the
conditions involved. Employers and insurers seeking to close pre-Act 57
commuted claims where medical remained open as a requirement of law can
look to the court’s opinion in this case as support. Finally,
Commonwealth Court summarily rejected the claimant’s contention that the
testimony of employer’s medical expert was insufficient to demonstrate
full recovery, and affirmed termination of benefits.
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Commonwealth Court Affirms Dismissal
Of Claim
Petition With Prejudice Where Claimant
Skips IME
“T]he WCJ did not
abuse his discretion in dismissing the petitions with prejudice when
Claimant, after receiving two warnings, and a request to show cause why
the petitions should not be dismissed, failed to comply with the
deadlines imposed by the WCJ…,” according to Commonwealth Court in US
Airways and Reliance National v. WCAB (McConnell), in a case which
shows there are limits which even a workers’ compensation claimant
cannot cross. Claimant was a flight attendant on international flight
duty since 1968. In January and September 2002, claimant mailed three
separate Claim Petitions alleging injuries in June 1999, July 2001, and
August 2001, involving multiple body parts.
In February 2002, the
first hearing on the petitions was held, limited to the first Claim
Petition. Claimant participated by telephone and testified briefly.
She described her alleged work injury of July 2001 as a neck and
low-back injury with radiating pain into both legs. Because of problems
with the telephone, the hearing was continued and the parties agreed
that her “testimony would be completed by deposition within
approximately 60 days…” Claimant’s attorney also stated he would be
filing two new Claim Petitions, and the Workers’ Compensation Judge
(WCJ) ordered employer to schedule an IME after completion of claimant’s
testimony. No other evidence was presented.
The next hearing
occurred four months later in June 2002, about one week after claimant’s
deposition was completed. Her counsel advised he was waiting for a
medical report and would schedule the expert’s deposition “in due
course.” Counsel admitted that claimant did not have a “clear medical
report certifying an opinion of a causal relationship of the alleged
injuries to the claimant’s work.” Claimant was warned by the WCJ of
“possible dismissal” of all Claim Petitions if she did not have a report
within the next 90 days. No other evidence was offered at this hearing,
but employer was permitted to delay the IME “due to a lack of sufficient
medical records.”
The third hearing
occurred in August 2002 on the first three Claim Petitions only, and
claimant requested withdrawal of two of them. In September 2002, the
fourth and fifth petitions were consolidated with the remaining
petition, and at a hearing that month “each side presented various
exhibits that were admitted into evidence.” Employer advised that
claimant was scheduled for an IME in November 2002, “an arrangement that
Claimant’s counsel stated was satisfactory.” Nevertheless, claimant
failed to attend the IME, and it was rescheduled for two subsequent
dates in January 2003, both of which claimant missed. At a hearing
before the final IME date, “The WCJ gave Claimant’s counsel a second
warning that the Claim Petitions ‘might be dismissed’ for failure to
prosecute if she failed to attend the ‘needed’ IME.”
After learning that
claimant failed to attend any of the scheduled IMEs, the WCJ sent a
letter directing claimant’s counsel “to show cause why the Claim
Petitions should not be dismissed for failure to prosecute pursuant to
the WCJ’s Special Rules and his Bench Order.” However, claimant did not
respond, and a hearing scheduled for April 2003 was canceled by the WCJ
“due to Claimant’s failure to attend any of the scheduled IMEs.” In his
decision dismissing the Claim Petitions with prejudice, the WCJ found as
fact that employer was prejudiced while the case was pending by the
claimant’s failure to attend IMEs. He stated, ”[D]ue to the extensive
time delay after the filing of the petitions, and the expected change of
circumstances of the claimant [due to hip surgery she underwent, this
Judge believes and finds that [employer has] gone to considerable
expense to schedule exams and [has] incurred cancellations fees of
several exams and yet the claimant failed to attend them, although her
counsel originally agreed to the scheduled exams and despite special
accommodations made originally for claimant’s travel schedule…the
claimant also failed to comply with scheduling orders by the Judge to
attend an [IME]. The claimant’s excuse is not satisfactory and did not
explain why she could not travel prior to the planned surgery. It is
also not clear whether the hip surgery was related to the alleged
injuries or not. Due warnings were given to the claimant prior to
deciding if the petitions should be dismissed for failure to timely
prosecute them.”
The WCJ dismissed the
remaining Claim Petitions “with prejudice for failure to prosecute”
because claimant violated the Special Rules of Administrative Practice
and Procedure at 34 PA. Code §131.13(m)(1) “by failing to meet the
conditions upon which the continuance has been premised,” as well as
Special Rule 131.53(c), which permits a WCJ to “issue an order directing
the parties to proceed with the litigation in a manner that promotes
expeditious resolution and avoids delay.”
Claimant appealed the
WCJ’s Order to WCAB, which affirmed dismissal for failure to prosecute,
but deleted the phrase “with prejudice” from the Order, thus allowing
claimant to refile at some future time. Thereafter, employer appealed
to Commonwealth Court.
The court reversed the
Board and affirmed dismissal with prejudice. Commonwealth Court reasoned
that a finding of fact by the WCJ of “actual prejudice, due to the
extensive time delay after the filing of the Claim Petitions, and the
expected change of Claimant’s circumstance postoperatively…” could not
be disregarded on appeal. The finding of actual prejudice “was premised
upon the passage of time since the filing of the original petitions and
the difficulty of proving work-related causation, given Claimant’s
imminent hip-replacement surgery.” Thus, according to the court, the
WCJ’s finding of fact that the delay resulted in actual prejudice is
supported by the record, and dismissal with prejudice must, therefore,
be affirmed.
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Employer That Issues Timely Notice of
Compensation Denial Pays Penalty
The assessment of
penalties as well as the amount of penalties imposed is discretionary,
and absent and abuse of discretion by the WCJ…” will not be overturned
on appeal, according to Commonwealth Court in Brutico v WCAB (US
Airways, Inc.). Discretion exists even where employer violated the
Act by failing to file a Notice of Compensation Denial (NCD) until
“seven months after he became aware of Claimant’s injury…” where
litigation on claimant’s Penalty and Claim Petitions was resolved in
favor of employer. According to the court, “Because there was a
violation of the Act, penalties would have been awardable. However, the
Claim Petition had to be granted as well as some single ‘measure’
against which the Workers’ Compensation Judge (WCJ) could use to award
penalties… because Claimant’s Petition was denied, no penalties could be
awarded.”
Claimant was injured
on January 5, 2001 while loading freight on a van in the rain. As she
stepped off the loading dock “her feet went out from under her causing
her to fall to the floor of the van with her right leg falling between
the back of the van and the loading dock.” She “continued working,” but
that night, at home, felt back spasms. On January 8, 2001, she
reported her injury to her supervisor “and completed an injury form.”
Though still at work,
claimant had ongoing symptoms and eventually was examined by a panel
physician on January 30, 2001. At the time, claimant reported only
“complaints of pain in her neck, upper back and lower back.” She had no
complaints of radiating pain into her lower extremities. The panel
physician diagnosed cervical, thoracic and lumbosacral strains, and
prescribed medication and physical therapy. “Claimant completed
physical therapy without any reports of pain in either of her lower
extremities” and by late March 2001 she was able to work without
restriction. Though the court’s opinion is not specific, it appears
claimant missed no work through that date but had some limitations. All
of claimant’s physical therapy visits and medications were paid by
employer throughout this time.
About six weeks after
completing therapy, claimant reported to employer’s insurer “that she
had ongoing back pain.” She was instructed to see her own physician and
began treatment with a chiropractor. Claimant told the chiropractor she
was having low back pain as well as “intermittent pain in both legs, but
with greater pain in the right leg.” In late August 2001, claimant
returned to the panel physician for treatment, reporting an increase in
her low back symptoms in late April or early May 2001 “with radiation of
low back pain into the right lower extremity that was new over the last
few weeks.”
No Claim Petition had
yet been filed, nor had employer filed a Notice of Compensation Payable
(NCP) or Denial. However, in August 2001, as soon as employer became
aware of claimant’s visits to a chiropractor with “different complaints
of pain” than immediately after the injury, a Notice of Compensation
Denial was issued. In the NCD, employer acknowledged the work injury
but declined to pay benefits on the ground that it was not a disabling
injury.
In January 2002,
claimant filed a Claim Petition alleging disability starting in April
2001 as a result of the January 2001 injury, which she described as
“cervical, upper back, low back radiating into both legs,” and
contending as well that she was disabled as the result of “disc
herniation” which occurred in the injury. Claimant sought counsel fees
for unreasonable contest and later filed a Penalty Petition because the
NCD was filed seven months after her injury and not within 21 days, as
required by Section 406.1(a) of the Act.
At hearings on
claimant’s petitions, employer clarified it was disputing only the claim
of a new or aggravated L5-S1 disc herniation, as well as whether any
disability was caused by the work injury, which was, employer contended,
limited to cervical, thoracic and lumbosacral strains.
The WCJ found
employer’s medical expert more credible and persuasive than claimant’s,
and found as fact that claimant did not sustain a herniated disc
injury. Further, the WCJ found no violation of Section 406.1(a) of the
Act even though the Denial was issued seven months late because, the
Judge reasoned, employer “was only required to issue the notice when an
employee became disabled, not injured…” Claimant appealed and WCAB
affirmed, after which claimant appealed to Commonwealth Court.
Commonwealth Court
also affirmed. Although the court noted that the Denial was filed late,
thus giving rise to a possible penalty, the court further noted that no
compensation was payable as a result of the WCJ’s decision denying the
Claim Petition. Hence, “Because Claimant’s Petition was denied, no
penalties could be awarded.” The court also ruled that the employer’s
contest was reasonable because it properly admitted the sprains and
strains which claimant suffered but denied only the herniated disc, a
point on which it won. According to Commonwealth Court, “In this case
Claimant would have had to hire an attorney regardless of whether
employer filed a timely NCP or NCD when she was first injured because
the nature of her injuries had changed. Therefore, even if the NCP had
been issued within 21 days, she still would have had to file a Claim
Petition to amend the NCP.”
Commonwealth Court’s
opinion on a similar issue in Johnstown Housing Authority and
H.A.R.I.E. v. WCAB (Lewis) resulted in a much different decision,
and is another warning to defendants to exercise caution in the filing
of answers to claim petitions.
Claimant was injured
on July 31, 2002, when he tripped over a tile and “twisted his ankle.”
He gave prompt notice to his supervisor and was sent to the hospital to
be seen by a panel physician who diagnosed “a sprain left ankle.”
Claimant was off work for three days and was released to return to a job
where he was limited to sitting.
The panel physician
also referred claimant to an orthopedic surgeon for an MRI “which
revealed a tear of the anteriortalofibular ligament” of the left ankle.
The surgeon recommended a second surgical opinion, which the employer
did not authorize. Nevertheless, employer sought an Independent Medical
Evaluation (IME).
Claimant was
eventually referred by his family physician to another orthopedic
surgeon who confirmed the diagnosis of the first based upon a bone scan
and “recommended a diagnostic arthroscopy and a ligament reconstruction
surgery.” At the same time, the IME physician found claimant fully
recovered from the sprain, prompting the filing of a Termination
Petition.
In the time between
the IME and the first hearing on employer’s petition, Claimant underwent
the diagnostic and reconstruction surgery. He was off work for
approximately four months when he was released to return to sedentary
work.
At the hearing on the
Termination Petition, counsel for Employer stated “for the first time
that Employer filed a Notice of Workers’ Compensation Denial…” within 21
days of the injury. The NCD acknowledged an injury but denied
disability, describing the accident as a “medicals only claim.”
Claimant testified that he never saw or received a copy of the Notice
from employer, which the WCJ found credible. Because claimant had
undergone surgery, employer withdrew its petition, although claimant
promptly filed his own Claim Petition and requested penalties and
counsel fees.
The WCJ granted
claimant’s petition and awarded a 50 percent penalty in addition to
claimant’s past due benefits. Employer appealed, arguing it did not
violate the Act because it filed a timely NCD, and that it had a
reasonable basis to contest the claim since its IME doctor disagreed
with the surgeon’s diagnosis.
However, in affirming
the penalty, the court stated, “It is undisputed that Employer failed to
provide (a copy of the) Notice to the Claimant as required. This fact
is critical. Without notice to the Claimant, the denial did not serve
its purpose, which was to put Claimant on notice that his Claimant is
being denied and the reason for the denial. As a result Employer’s
Notice of Denial was invalid.”
While the court relied
on the WCJ’s finding that claimant never received the Notice of Denial,
the context of the case makes it clear the WCJ doubted whether employer
ever really issued the NCD as it contends. Nevertheless, it is also
clear that mere “issuance” of a Notice required under Section 406.1 of
the Act is insufficient: obviously, a copy must be sent to the claimant
or, according to the court, any such notice is “invalid.”
Finally, Commonwealth
Court affirmed assessment of counsel fees for unreasonable contest. The
court reasoned that in answering the Claim Petition, “Employer clearly
denied every factual averment contained in the Claim Petition, including
that” claimant suffered a work related injury of any kind. The court
agreed the record supports the WCJ’s Finding of Fact that at the time
employer filed an answer denying the occurrence of an injury, it had
already paid medical bills for treatment of the injury and created a
temporary sedentary job as a result of the injury. The long trend in
workers’ compensation law toward more specific fact pleading, and
stricter examination of the pleadings, continues to plague those who
file general denials and contest the incontestable.
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Amputation Eight Years After Trauma Is
New Injury For Specific Loss Purpose
Although Claimant’s
left index finger was injured in 1976, he “did not lose the use of [it]
for all practical intents and purposes until the amputation [in 1984…]”
Thus, benefits “must be calculated” as of the date of amputation, and
“the carrier at risk on the date the specific loss injury occurred is
the responsible carrier,” according to Commonwealth Court in
J.G. Furniture Division/Burlington and Liberty Mutual
Insurance Co., v. WCAB (Kneller).
When Claimant was
injured in 1976 and received total disability benefits, employer was
insured by Liberty Mutual. Claimant returned to work, but for the next
eight years he had circulation problems and pain in the left index
finger. He was hesitant to undergo a complete amputation of the finger
because during warm weather his circulation was normal and the use of
his finger was not as limited. However, in September 1984, due to
severe pain, numbness and other difficulties, claimant finally agreed to
amputation. At the time of his 1984 surgery, employer was insured by
Federal Kemper Insurance Company.
In 1997, 13 years
after the amputation, Liberty Mutual filed a Petition to Review Benefits
alleging claimant’s left index finger injury had resolved into a
specific loss effective September 6, 1984, the date of surgery. The
Workers’ Compensation Judge (WCJ) agreed and ordered benefits paid to
claimant at the 1976 compensation rate. Claimant appealed to the WCAB,
contending that his compensation should be calculated as of the date the
specific loss injury occurred in 1984, relying on Roadway Express v.
WCAB (Siekierka), a 1998 opinion of Commonwealth Court.
The Board agreed claimant had experienced a “progressive diminution of
the use of the finger due to circulatory problems” and remanded the case
to WCJ for recalculation of the compensation payable utilizing a 1984
date of injury.
On remand, Liberty
Mutual joined Federal Kemper, contending that if compensation was to be
calculated on the basis of a new date of injury, the carrier on that
date, Federal Kemper, must be responsible for the benefits. However,
the WCJ dismissed Federal Kemper and ordered Liberty Mutual to pay
benefits at a new 1984 rate.
Liberty Mutual
appealed further, ultimately to Commonwealth Court. The court agreed
that its reasoning in Roadway Express supported a conclusion that
the amputation constitutes a new injury, and that necessarily the
carrier at risk on that date must pay the benefits, thus relieving
Liberty Mutual’s liability and substituting Federal Kemper. But in a
lengthy dissent, Judge Leadbetter noted that the WCJ found as fact “that
the amputation was the direct result and natural progression of the 1976
injury.” According to dissent, benefits should have been paid at the
1976 rate just as if the “claimant’s physical symptoms had lead to
another period of loss of earnings,” which would have been treated as
recurrence of disability.
The court’s opinion,
as the dissent reveals, raises troubling questions concerning the
calculation of an average weekly wage and compensation rate when an
injury progresses naturally and not as the result of subsequent
employment related activities. The court’s opinion in this case may
well lead to significant future litigation over the common
recurrence/aggravation issues in disability cases as well.
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Requests For IRE Made Within 60 Days Of
Claimant’s “Receipt” Of Total Disability Payments Timely
In two recent cases
Commonwealth Court continues to consider the rules for requesting an
Impairment Rating Evaluation (IRE), though two prior opinions of the
court are now pending before Pennsylvania Supreme Court, which could at
any time revise the existing rules and procedure. Section 306 (a.2) of
the Workers’ Compensation Act permits an employer to request an IRE
“within (60) days upon the expiration of (104) weeks” of total
disability to determine the percentage of permanent impairment which
exists as a result of a work injury. A claimant found to be less than 50
percent impaired is deemed to be partially disabled, thus limiting
future benefits to 500 weeks, though not changing the compensation rate.
In Ramseur v. WCAB
(Wachovia Corp.) the court reiterated its ruling, first announced in
Wal-Mart Stores, Inc. v. WCAB (Rider) (See, “Commonwealth
Court Clarifies Time for Requesting IRE,” Tucker Arensberg,
P.C. Workers’ Compensation Newsletter, April 2004) that the time for
requesting an IRE is controlled by the date on which claimant begins
receiving benefits, rather than the actual expiration of a 104 week
period of total disability. Claimant was paid benefits for “bilateral
carpal tunnel” pursuant to a Notice of Compensation Payable dated August
2, 2000. The date of injury was March 3, 2000, but the first check was
mailed to claimant on August 3, 2000. Thus, although claimant received
total disability benefits retroactive to the date of her injury in March
2000, she first received benefits 5 months later on August 3, 2000. On
August 27, 2002, within 60 days of 104 weeks of the first payment,
employer requested an IRE, which claimant refused to attend, contending
it was requested outside the 60 day limit set forth in Section 306
(a.2). The WCJ ruled in claimant’s favor, and on employer’s appeal,
WCAB reversed.
On further appeal by
claimant, Commonwealth Court affirmed the Board. Relying on its prior
opinion in Wal-Mart Stores, the court reasoned, “the day the
payment of benefits is made, rather than the date of injury, is the date
that the claimant ‘receives’ benefits.” But, Commonwealth Court’s
opinion in Wal-Mart Stores is now pending before the Supreme
Court, which granted Wal-Mart’s petition for allowance of appeal.
In
Wellington Foods v.
WCAB (Rice),
Commonwealth Court ruled the IRE deadline of 60 days after claimant
receives 104 weeks of total disability benefits cannot be extended even
if a claimant attends an untimely IRE because such attendance is not
truly voluntary. Claimant in Wellington Foods was injured on
December 9, 1998, and received benefits pursuant to a Judge’s order
dated October 17, 2000. Though the court’s opinion does not say when
the first payment was sent to claimant, it would not have been before
the order to pay in October 2000, which under Ramseur and
Wal-Mart Stores would extend the 104 week IRE deadline until at
least October 17, 2002, plus 60 days. Yet, the court in Wellington
Foods reasoned that the date of injury controlled the deadline for
requesting an IRE and stated, “As of December 7, 2000, claimant had
received 104 weeks of total disability benefits. On July 23, 2001,
Employer requested Claimant undergo an impairment evaluation.”
Claimant attended the
IRE, which resulted in a finding of 24 percent impairment, after which
on December 9, 2001, “Employer filed a Notice of Change in Workers’
Compensation Disability Status which changed Claimant’s
status from total disability to partial disability,” limiting claimant
to “no more than 500 weeks” of benefits from that date.
Claimant filed a
Petition to Reinstate Total Disability Benefits, contending that
employer failed to request an IRE within 60 days of 104 weeks of total
disability, in violation of Section 306(a.2)(1) of the Act.
At a hearing before
the WCJ, the parties stipulated that claimant had collected over 104
weeks of total disability benefits, that employer requested the IRE more
than 60 days after 104 weeks, that claimant attended the IRE, and that
claimant’s impairment status was changed to partial disability based
upon the 24 percent rating. The WCJ granted claimant’s petition because
the IRE was requested late, and employer appealed to WCAB, which
affirmed. On further appeal to Commonwealth Court, employer argued that
“claimant agreed to the IRE by attending,” thus negating the deadline.
The court noted first
that the IRE Notice form sent to claimant states on its face, “If you
fail to attend the [IRE], your workers’ compensation benefits may be
suspended (stopped) through the decision of a [WCJ].” The court
reasoned that a threat to cease benefits does not result in a voluntary
waiver of the 60 day deadline and voluntary attendance at the IRE. The
court cited its own prior opinion in Dowhower v. WCAB (Capco
Contracting) for the proposition that “a claimant who attends an IRE
does not waive the right to object to the timeliness of the IRE
request.” Thus, claimant’s disability status was changed back to total
despite an IRE actually requested early, not late, and a 24 percent
impairment rating.
Litigation over the
timeliness of IRE requests continues to churn through the system as, in
addition to Wal-Mart Stores, the case which first gave rise to
strict enforcement of the 60 day limitation, Gardner v. WCAB (Genesis
Health Venture), is also pending before Supreme Court (See,
“Commonwealth Court Limits IRE’s,” Tucker Arensberg, P.C. Workers’
Compensation Newsletter Winter 2003). It is clear that these two
most recent opinions are not the final word on the nagging question of
when an IRE may be requested.
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Compensation Benefits Count As Wages
Earned
The “overriding
concern of [the] computational methodology [of Section 309 of the
Workers’ Compensation Act is] to ensure that an injured worker does not
receive more on workers’ compensation than the amount he would have
earned had he not been injured…By the same token, however, …the Act [is]
not designed to punish a worker merely because a work calamity befell
him.” Thus, according to Pennsylvania Supreme Court, “A worker who
receives workers’ compensation benefits resulting from a work-place
injury, and who then returns to work and sustains a new injury,” should
have his new average weekly wage (AWW) calculated by adding in as wages
earned an amount equal to the average weekly wage calculated for the
first injury.
In the consolidated
cases of Colpetzer v. WCAB (Standard Steel) and Zerby v. WCAB
(Reading Anthracite Co.), Supreme Court ratified and expanded on its
2003 Opinion in Hannaberry HVAC v. WCAB (Snyder, Jr.). In that
case, the court concluded that in amending Section 309 of the Workers’
Compensation Act in 1996, the Pennsylvania legislature “intended to
insure an accurate calculation of an injured worker’s average weekly
wages” so that the “diminished wages reflected by earnings in earlier
periods when the claimant [in Hannaberry] was a part-time student worker
could not be included to dilute the appropriate benefit amount” due to
claimant when he was injured shortly after beginning full-time
employment. Although claimant was employed one full year in
Hannaberry, because his status changed from part time to full time,
Supreme Court reasoned that including periods of part-time employment in
the average weekly wage calculation would unfairly dilute and reduce the
benefits to which he was otherwise entitled.
Colpetzer
and Zerby arise also under Section 309, but involve slightly
different facts. William Colpetzer was injured on March 15, 1996, and
was paid weekly benefits at the rate of $527 based on an AWW of $791.32,
until he returned to work approximately six months later.
He suffered a second
injury on December 5, 1996 and began to receive benefits voluntarily
pursuant to a notice of compensation payable. His AWW was calculated to
be $525.80, and compensation was paid at the rate of $350.53. Claimant
contended that his AWW for the second injury “should have been
calculated by averaging only wages he received during the two complete
quarters when he was not disabled [from the first injury] and was
actually earning his normal wages.” He cited Section 309(d.1) of the
Act which applies to situations where a claimant was not employed for 3
consecutive 13 week periods in the year immediately prior to injury, and
permits computation of AWW based upon any completed periods of 13
calendar weeks of employment.
David Zerby injured
his low back on May 23, 1996, and pursuant to a notice of compensation
payable was paid benefits based upon an AWW of $696.22. He returned to
work on November 7, 1996. Later, he filed a new claim petition alleging
new work related back injuries occurring on May 29, 1997. Calculation
of the AWW for the new injury included periods when claimant was
disabled and receiving workers’ compensation benefits for the first
injury.
In Zerby, the
WCJ relied on Section 309(d.1) to calculate claimant’s AWW, reasoning,
“This Judge feels the clear intent of the legislature…was to ensure that
the average weekly wage is an accurate or true reflection of Claimant’s
earnings, rather than being artificially inflated or deflated by unusual
circumstances.”
Through different and
convoluted procedural paths both cases were accepted on petitions for
allowance of appeal by Supreme Court. In each case, “The sole issue
[according to the court,] involves the proper manner of calculating the
AWW in an instance where claimant received reduced or no wages during a
pertinent period solely because he was out on disability for a previous
work injury.” The court began its analysis by stating, “[W]e note that
‘[o]ur basic premise in workmen’s compensation matters is that the
Workmen’s Compensation Act is remedial in nature and is intended to
benefit the worker, and, therefore, the Act must be liberally construed
to effectuate its humanitarian objectives.’”
Supreme Court
summarily rejected the argument of both employers that an AWW “must
reflect wages for work actually done or services actually rendered, and
not estimates of what might have been received for work not actually
done or for services not actually rendered.” The court rejected the
argument that its result in Hannaberry, upon which the court
heavily relied, and the reasoning advanced by both claimants “amounted
to a prohibited judicial re-writing of Section 309(d)” to require
inclusion of an imputed wage, not actual wages earned, into the
calculation of the AWW.
Supreme Court
concluded that Section 309 of the Act, which sets forth the methods of
calculating an average weekly wage, “is silent as to the proper approach
where a previous work injury deflated the otherwise typical wages of an
injured worker.” According to the court, “It is not an accurate measure
of economic reality to treat periods where no wages were earned solely
because the worker was unfortunate enough to have suffered a previous
work injury, as if the worker had no earning capacity for those periods.
Such an approach would severely underestimate the reality of a worker’s
typical
earnings, punish the
worker for no reason approved in the legislation, and contradict the
overriding legislative goal of accuracy and calculation,” the court
reasoned.
Thus, the court ruled
that in calculating an AWW where a claimant’s earnings are diminished
because of a prior work injury “the AWW that was already established for
that first work injury” must be included in the new calculation as
though the sums were wages earned. “The simplest and most accurate
measure of AWW in these cases is to accept the previously-established
AWW as the measure for periods of work disability, and then apply the
formula in Section 309(d),” which pertains to periods of employment of
at least one full year prior to the date of injury.
Thus, in Colpetzer
and Zerby, advancing the result of Hannaberry, Supreme
Court has concluded that in certain situations workers’ compensation
benefits must be counted as wages earned for the purpose of a true and
accurate calculation of an average weekly wage.
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In
each issue, we introduce a member of the Workers’ Compensation Practice
Group. In this issue, we spotlight...
Homer L. Walton
Mr.
Walton, a shareholder with the firm, concentrates his practice in the
areas of employment and labor law and directors’ and officers’
liability. Homer provides defense of claims alleging sexual harassment,
wrongful discharge, discrimination based on age, race, sex, religion,
national origin, handicap and disability in violation of state and
federal laws; i.e., Title VII of the Civil Rights Act of 1964 as amended
by the Civil Rights Act of 1991, the Americans with Disabilities Act of
1990 and the Pennsylvania Human Relations Act. He also provides defense
of unemployment and workers’ compensation claims.
Homer is involved with
proceedings before the National and Pennsylvania Labor Relations Boards,
the Equal Employment Opportunity Commission, the Pennsylvania Human
Relations Commission and the Pittsburgh Commission on Human Relations.
He has litigated cases in state and federal court.
Homer received his
B.A., magna cum laude, from the University of Pittsburgh in 1984, and
his J.D. from Duquesne University School of Law in 1988. Prior to
joining the firm, Homer was a manager at United Parcel Service where he
acquired 21 years of practical experience in resolving labor-related
issues. He was responsible for the resolution of labor disputes at the
local level and participated in panel and arbitration hearings. His
practical experience in a labor-intense environment, combined with his
legal knowledge, enables Homer to resolve employment disputes through
legal analysis combined with creative ideas and techniques.
Homer is
a member of the Allegheny County, Pennsylvania, and National Bar
Associations.
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