PENNSYLVANIA WORKERS’ COMPENSATION
CASE SUMMARIES
11/1/2023 – 11/30/2023
PENALTY – PAYMENT FOR CBD OIL
Mark R. Schmidt v. Schmidt, Kirifides And Rassias, PC (WCAB)
Commonwealth Court of Pennsylvania – Published Opinion
Decided: November 14, 2023
Issues:
Whether the Board erred by: (1) violating the standard of review by disregarding the WCJ’s findings of fact and engaging in its own fact finding, in reaching its conclusions, and failing to accord all reasonable inferences to the prevailing party, Claimant herein; (2) expressly refusing to define whether CBD oil is a medicine or supply within the meaning of the Act; (3) concluding that a claimant is required to submit the type of billing forms and medical reports required of treatment providers to obtain reimbursement for the costs of medicines and supplies to treat his work injuries; (4) concluding it would violate federal law to direct an insurer to reimburse Claimant for an over-the-counter dietary supplement; and (5) theorizing about the effect on insurers if required to pay for over-the-counter medicines or supplies, and disregarding the Act’s humanitarian objectives regarding Claimant’s right to treatment and the goal of enabling injured workers to return to/continue to work?
Background:
In the course of his employment with Employer, Claimant sustained a work injury. Specifically, he sustained an aggravation of a preexisting degenerative disc disease at the levels of L4-5 and L5-S1 with radiculopathy. In 2018, a WCJ granted a Claim Petition for Claimant’s lower back injury and awarded Claimant all reasonable, necessary and related medical expenses. Claimant opposed increasing his pain medication as such would affect his ability to think, focus, and represent clients. After seeking different alternatives, such as aqua therapy, injections, and surgery, Dr. Murphy prescribed CBD oil in lieu of increasing Claimant’s medication dosages. Claimant supplied the CBD oil prescription and receipts to Employer, and Employer refused to reimburse Claimant’s out-of-pocket CBD oil expenses on the basis that CBD oil is not a pharmaceutical drug. Claimant filed a Penalty Petition, alleging therein that Employer violated the Act by failing to reimburse him for out-of-pocket costs for medical treatment. The WCJ granted the Penalty Petition. The Board reversed.
Holding:
The Board erred by: (1) violating the standard of review by disregarding WCJ DiLorenzo’s findings of fact and engaging in its own fact finding, in reaching its conclusions, and failing to accord all reasonable inferences to the prevailing party, Claimant herein; (2) expressly refusing to define whether CBD oil is a medicine or supply within the meaning of the Act; (3) concluding that a claimant is required to submit the type of billing forms and medical reports required of treatment providers to obtain reimbursement for the costs of medicines and supplies to treat his work injuries; (4) concluding it would violate federal law to direct an insurer to reimburse Claimant for an over-the-counter dietary supplement; and (5) theorizing about the effect on insurers if required to pay for over-the-counter medicines or supplies, and disregarding the Act’s humanitarian objectives regarding Claimant’s right to treatment and the goal of enabling injured workers to return to/continue to work.
Claimant was prescribed CBD oil to treat Claimant’s work injury and CBD oil is a supply for which Employer is responsible to pay under the Act. The WCJ’s findings are supported by substantial record evidence. The Board erred by violating the standard of review by disregarding the WCJ’s findings of fact and engaging in its own fact finding. Further, nothing in the Act restricts compensable medicine and supplies to items which can only be obtained through a pharmacist, nor is there any statutory language prohibiting reimbursement for medicines and supplies which can be obtained over the counter. If Employer did not believe that CBD oil is a reasonable and necessary medical treatment for Claimant’s pain, it had the remedy of submitting that claim to the UR process. Whether a treatment is FDA approved for a particular purpose should be raised within the framework of the UR process as it is a challenge to the reasonableness and necessity of the treatment. The Court held that CBD oil is a supply for purposes of Section 306(f.1)(1)(i) of the Act. Further, because Claimant is not a health care provider, Claimant was not required to submit an HCFA form and/or periodic medical reports in order to receive reimbursement from Employer. Claimant only had to submit his doctor’s prescription for CBD oil to treat the pain caused by his work injury and his receipts therefore, which he did. The Court disagreed that requiring Employer to pay for the CBD would violate federal law. CBD is not marijuana or medical marijuana and does not fall under the federal restrictions related to those substances. CBD is lawfully sold over the counter in Pennsylvania and all over the United States, which is exactly how Claimant obtained it here.
Reversed.
DISSENTING OPINION BY JUDGE FIZZANO CANNON
The dissent noted that the legal status of hemp products is in flux and that the medicinal use of these substances raises important policy and regulatory questions that must be answered by the Legislature, not by the Court. Also, the dissent did not believe that claimant’s non-provider status excused him from submitting proper documentation in order to trigger reimbursement requirements or that CBD oil is subject to reimbursement by an employer or its insurer under the current provisions of the WC Act.
CONCURRING OPINION BY JUDGE WALLACE
Judge Wallace agreed with the Majority’s analysis but wished to provide her belief that CBD oil is a medicine rather than a supply under the Workers’ Compensation Act.
NOTICE
Newman & Company v. Mark Warner (WCAB)
Commonwealth Court of Pennsylvania – Unpublished Memorandum Opinion
Decided: November 30, 2023
Issues:
Whether the WCJ erred by not denying and dismissing the Petition because Claimant failed to prove that he gave Employer timely notice of his alleged work-related injury; Whether the WCJ erred by failing to allow Employer to take an offset for Claimant’s post-injury earnings from a subsequent employer?
Background:
On May 14, 2021, Claimant filed the Petition, asserting that on October 28, 2020, he sustained a right leg wound with complications that, he explained, developed from driving a cab-over truck 12 to 15 hours a day, and required hospitalization. Employer denied a work-related injury in a Notice of Compensation Denial dated May 27, 2021. The WCJ directed Employer to pay total disability benefits as of April 23, 2021, and ongoing. Employer appealed to the Board, and the Board affirmed.
Holding:
The discovery rule under Section 311 permits that employees who suffer an injury that is not readily and immediately ascertainable have the same rights under the Act as those employees who sustain an injury as long as they proceed with reasonable diligence. In order to trigger the running of the 120-day period for notice, a claimant must have: (1) knowledge or constructive knowledge, (2) of a disability which, (3) exists, (4) results from an occupational disease or injury, and (5) has a possible relationship to the employment. The WCJ has exclusive province over questions of credibility and evidentiary weight. Based upon the WCJ’s supported findings, the Court concluded that Claimant met his burden of proving he gave Employer notice of his injury as required under Section 311. The WCJ found that Claimant only learned his injuries were work related when his doctor so informed him in April or May of 2021. This finding is directly supported by the testimony. However, the Board’s decision was affirmed in part and reversed in part. The Board’s decision was affirmed insofar as it affirmed the WCJ’s conclusion that Claimant provided timely notice of his injury to Employer, that the WCJ’s decision was reasoned, and that the WCJ’s credibility determinations were supported by substantial evidence. The Court reversed on the issue of the total benefits awarded between April 2021 and September 2021. Claimant had earnings from Health Care Builders during that time. The matter was remanded for consideration of whether Employer was entitled to a credit for Claimant’s post-injury earnings.
AFFIRMED, in part, REVERSED, in part, and REMANDED.
EXCLUSIVITY
Robert and Rosemary McHenry v. Goodyear Tire & Rubber Company, et al.
Commonwealth Court of Pennsylvania – Published Opinion
Decided: November 14, 2023
Issue:
Whether the trial court erred or abused its discretion in exercising subject matter jurisdiction over, and refusing to dismiss or stay the action, where McHenry was diagnosed with asbestosis and failed to provide the workers’ compensation authorities an opportunity to determine whether his claims are within the exclusive remedies of The Pennsylvania Occupational Disease Act?
Background:
In 2018, McHenry commenced this civil tort action in the trial court, alleging that McHenry had contracted asbestosis from exposure to asbestos-containing products during his lifetime. McHenry worked as a mechanic for Goodyear for approximately 12 months, from 1990 until 1991, in Philadelphia and in New Jersey. McHenry received his diagnosis in May 2017. Goodyear filed a motion to dismiss for lack of subject matter jurisdiction. According to Goodyear, any claims by McHenry arising from his employment with Goodyear are subject to the exclusive and primary jurisdiction of the Workers’ Compensation Appeal Board (Board). The trial court denied the motion without prejudice.
Holding:
The Court’s recent decision in Herold was instructive. The Herold Court determined that the former employee’s civil action could proceed in common pleas court, recognizing an exception to the exclusivity provision defined at Section 303 of the ODA. The Herold Court recognized an exception to the exclusive remedy mandate because this latency persisted far longer than the four-year limitations period recognized by the ODA and McHenry’s occupational disease is not compensable under the ODA. However, Section 301(i) of the ODA contains a savings clause that provides certain, more limited, compensation for several enumerated diseases, including asbestosis. Nevertheless, the Court found that exclusivity did not apply here. McHenry was diagnosed with asbestosis, an occupational disease, in 2017 and he retired approximately 15 years prior to this diagnosis. Additionally, McHenry has not worked full time in nearly 40 years, and he last worked in 2000. Therefore, McHenry suffers from a medical disability that had no effect upon his earning power. He is therefore not entitled to benefits under the ODA. Because his occupational disease is not compensable, the ODA exclusivity provision is not applicable. Where a former employee’s occupational disease is not compensable because it did not result in total disability such as would trigger the ODA savings clause, that former employee is not subject to the exclusive remedies defined in the ODA and may proceed with civil proceedings filed in the courts of common pleas.
Affirmed.
MENTAL/MENTAL INJURIES
Premium Transportation Staffing v. Robert Welker (WCAB)
Commonwealth Court of Pennsylvania – Published Opinion
Decided: November 30, 2023
Issue:
Whether the Board erred in affirming the WCJ’s conclusion that the truck fire constituted an abnormal working condition?
Background:
Claimant filed a claim petition alleging that he sustained these injuries in February 2015, when the tractor-trailer he was driving caught on fire. He later withdrew any allegation of a physical injury, leaving only the PTSD claim. The parties agreed to bifurcate the proceeding, separating the question of whether the truck fire experienced by Claimant constituted an abnormal working condition from the question of whether the truck fire caused Claimant to sustain a disabling work injury. Based on the account of the fire, the WCJ issued an interlocutory order holding that Claimant had been exposed to an abnormal working condition sufficient to establish a compensable “mental/mental” injury. Employer argued that the WCJ erred in concluding that the truck fire constituted an abnormal working condition. Employer contended that Claimant had been trained to handle high stress events, such as truck fires, and the situation was foreseeable for a truck driver. This is best illustrated by the fact that another truck driver following Claimant pulled over and put out the fire using his own extinguisher. Further, the fire on Claimant’s truck was relatively minor; did not cause any burns; and was successfully and quickly extinguished. Employer argued that, at most, Claimant sustained a subjective reaction to a normal working condition. The Board affirmed the WCJ decision in its entirety.
Holding:
For an award of workers’ compensation benefits for a psychic injury, the claimant must prove by objective evidence a mental injury is other than a subjective reaction to normal working conditions. Where a psychic injury is claimed, regardless of whether it is manifested through psychic symptoms alone or physical symptoms as well, the claimant must establish that the injury arose from abnormal working conditions in order to recover benefits. Whether a claimant has been exposed to abnormal working conditions is a mixed question of fact and law, and the question must be evaluated in the context of specific employment. Here, Claimant experienced an employment event that was not an everyday occurrence, and it was singular for him. However, the truck fire he experienced bears little semblance to the “extraordinarily unusual” events that have been found to be abnormal. Claimant’s truck was equipped with a fire extinguisher; his pre-trip inspection ensured that fire extinguishers were onboard; and he had seen truck fires and the burned remains of trucks. In short, the record established that in Claimant’s “line of work,” truck drivers “experience” and “anticipate” fires. Claimant was able to retreat from the danger without difficulty and, eventually, assist in the resolution of the fire. The court rejected the Claimant’s contention that mitigation factors, such as knowledge of the risk and training therefore, are irrelevant to the question of whether an employment event constitutes an abnormal working condition. Whether a serious, even dangerous, event constitutes an abnormal working condition is highly fact sensitive. Here, the truck fire that caused Claimant to exit his truck did not, in itself, constitute an abnormal working condition in a profession where drivers are trained to anticipate such an event and are equipped to respond. This does not mean that all truck fires constitute a normal working condition in the truck driving profession. However, there must be something “extraordinarily unusual” about a particular truck fire before it can be held to be an abnormal working condition.
Reversed.
HEARING LOSS
Firstenergy Nuclear Operating Company v. Paul G. Koch, Jr. (WCAB)
Commonwealth Court of Pennsylvania – Unpublished Memorandum Opinion
Decided: November 16, 2023
Issues:
Whether the Board erred in affirming the award of benefits because Employer’s medical expert gave uncontradicted testimony that Claimant’s hearing loss occurred too late to have been work-related?
Background:
Claimant filed a Claim Petition on January 29, 2019 alleging that long-term workplace exposure to hazardous noise led to a partial loss of his hearing. Claimant alleges that he was continually exposed to hazardous noise during his 39-year tenure. The WCJ concluded that Claimant suffered a binaural hearing loss of 26.57% as the result of that exposure and awarded Claimant approximately 69 weeks of benefits. The Board affirmed.
Holding:
Section 306(c)(8)(i) of the Act provides that benefits may be awarded to an employee who has sustained a “permanent loss of hearing which is medically established as an occupational hearing loss caused by long-term exposure to hazardous occupational noise.” A claimant seeking such benefits carries the burden of establishing he suffered permanent hearing loss of 10% or greater, and that the hearing loss is medically established to be work-related and caused by the long-term exposure to hazardous occupational noise. Claimant provided such evidence, and this evidence was found credible by the WCJ. Claimant’s last exposure to occupational noise occurred on February 2, 2016; meanwhile, the hearing test from which came the conclusion that Claimant suffered a 26.57% hearing loss was administered in March 2019, more than three years later. Nevertheless, Employer’s argument that it is unknown what Claimant’s hearing impairment was at the time of his last noise exposure was meritless. Neither Section 306(c)(viii) nor any other Act provision requires that a hearing test be administered on or before Claimant’s last day of employment. Section 306(c)(8)(viii) clearly states that the claim shall be barred unless a petition is filed within three years after the date of last exposure to hazardous occupational noise in the employ of the employer against whom benefits are sought. Section 306(c)(8)’s three-year limit is the only deadline imposed on those seeking compensation for a work-related hearing loss. The WCJ’s findings in this case are supported by substantial evidence. Accordingly, the Board affirmed.
Affirmed.
JUDICIAL DISCRETION
John R. Sherman v. County of Mercer (WCAB)
Commonwealth Court of Pennsylvania – Unreported Memorandum Opinion
Decided: November 6, 2023
Issue:
Whether the WCJ and Board erred in failing to grant his Claim Petition for the loss of the use of his left eye due to the work injury?
Background:
While in the scope and course of his employment as a Correctional Officer with the Employer, Claimant was accidently sprayed in his left eye with a chemical disinfectant. Claimant filed a Claim Petition, seeking payment of medical bills and counsel fees, for a left eye injury. Claimant did not allege a loss of wages but reserved the right to seek wage loss and the loss of use of his left eye. Employer filed a Notice of Compensation Denial, denying that Claimant sustained a work injury. Claimant later amended the Claim Petition to include a wage claim for the loss of the use of his left eye. Based on his credibility determinations, the WCJ specifically rejected any contention that Claimant lost vision or suffered a loss of vision for all practical intents and purposes in the left eye due to chemical exposure. The WCJ granted the Claim Petition to award medical benefits only, finding that Claimant sustained a temporary non-disabling eye injury. Claimant appealed to the Board, and the Board affirmed.
Holding:
The WCJ did not find the opinions of Claimant’s medical expert credible on the issue of the cause of the loss of use of the left eye and instead found the opinions of Employer’s medical expert credible on that issue. Employer’s expert testified that Claimant’s loss of eyesight was due to anterior optic neuropathy which was unrelated to the chemical splash at work or to any alleged hypertensive crisis immediately following the chemical splash. Claimant failed to establish this connection by unequivocal credible medical evidence. Claimant’s criticisms of this testimony is really an attack on the WCJ’s credibility determinations, which are not subject to review on appeal. Credibility determinations are solely within the discretion of the WCJ and are not reviewable on appeal.
Affirmed.
IMPAIRMENT RATING EVALUATIONS
Kenneth Elliott v. City of Pittsburgh (WCAB)
Commonwealth Court of Pennsylvania – Unreported Memorandum Opinion
Decided: November 6, 2023
Issues:
Whether Act 111 violates the due process and due course of law protections of the Pennsylvania Constitution and the “reasonable compensation” requirements of article III, section 18 of the Pennsylvania Constitution?
Background:
In 2003, Claimant sustained a back injury in the course and scope of his employment with Employer. In December 2012, he underwent an IRE provided for in former Section 306(a.2) of the Pennsylvania Workers’ Compensation Act (Act), which resulted in an impairment rating of less than 50%. Employer then filed a modification petition, and in a March 2014 decision and order, a WCJ modified Claimant’s disability status from total to partial as of the December 2012 IRE date. In April 2021, Claimant filed a reinstatement petition seeking a return to total disability status based on the Pennsylvania Supreme Court’s decision in Protz. The WCJ ordered the reinstatement to be effective as of the date of Claimant’s reinstatement petition. Claimant appealed to the Board, arguing that his reinstatement should have been effective as of the 2012 modification date. The Board affirmed the WCJ’s decision. After the April 2021 reinstatement of Claimant’s TTD benefit status, Employer filed a modification petition based on a second IRE on September 8, 2021, which returned an impairment rating of 8%. The WCJ granted Employer’s modification petition. The Board affirmed. The effect of these decisions was that Employer no longer pays Claimant any benefits, as his 500 weeks of TPD have expired.
Holding:
Claimant failed to show that Act 111’s provisions allowing employers to credit previously paid benefits weeks violate either due process or due course of law principles. Claimant has also failed to show that by reenacting the IRE process, Act 111 violates article III, section 18 of the Pennsylvania Constitution, relating to reasonable compensation.
Affirmed.
Richard J. Dennell v. City of Philadelphia (WCAB)
Commonwealth Court of Pennsylvania – Unpublished Memorandum Opinion
Decided: November 17, 2023
Issue:
Whether Act 111 is unconstitutional?
Background:
In 2010, Claimant sustained injuries while tackling a suspect in the course of his employment as a police officer with the City of Philadelphia. Employer issued a Notice of Compensation Payable acknowledging Claimant’s work injury as strains and contusions of the low back and left leg. The NCP recited that Employer had begun paying salary continuation benefits under the Heart and Lung Act in lieu of workers’ compensation. Benefits were suspended as of the date of injury. On July 20, 2018, Employer issued another NCP stating that disability payments resumed on July 22, 2018. On November 18, 2021, an IRE was conducted and concluded that Claimant had a whole-person impairment rating of four percent (4%) based on the American Medical Association’s Impairment Guides (AMA Guides), Sixth Edition (second printing April 2009). Based on this determination, Employer filed a modification petition. After a hearing, the WCJ modified Claimant’s workers’ compensation disability benefits, from total to partial, as of the date of the IRE. The Board affirmed the WCJ’s decision.
Holding:
Claimant’s constitutional arguments have been considered and rejected by this Court. Act 111 is not an unconstitutional delegation of legislative authority. The court rejected Claimant’s premise of vested rights. A claimant has no vested right to workers’ compensation benefits by reason of Section 413(a) of the Act. Also, Act 111 does not violate the separation of powers required by the Pennsylvania Constitution.
Affirmed.
TERMINATION PETITION – DECONDITIONING
James F. Buckley v. Suburban Propane Partners (WCAB)
Commonwealth Court of Pennsylvania – Unpublished Memorandum Opinion
Decided: November 1, 2023
Issues:
Whether the Board erred in affirming the WCJ, as Employer failed to establish that any work restrictions Claimant required upon returning to work were not causally related to his work injury?
Background
Claimant suffered a work injury to his lower back and neck. Employer issued a medical-only NCP, accepting liability for Claimant’s work injury, which the NCP described as a “lower back area injury.” Claimant worked light duty for approximately six months before his physician took him out of work. Employer issued an amended NCP, in recognition of Claimant’s right to wage loss benefits. A few years later, Employer filed a termination petition, alleging that Claimant had fully recovered from his work injury, based on an IME of Claimant on June 29, 2021. The WCJ granted Employer’s termination petition, finding that Claimant was frequently evasive and that he was not a credible witness. Further, the WCJ noted that claimant’s doctor did not appear to treat Claimant, but merely saw claimant often enough to establish a record that he could use for testimony, and he did not have pre-injury medical records and thus little knowledge of Claimant’s pre-injury condition. Claimant appealed to the Board, which affirmed.
Holding:
The WCJ has exclusive province over questions of credibility and evidentiary weight, and the WCJ may accept or reject the testimony of any witness, including a medical witness, in whole or in part. Unless made arbitrarily or capriciously, a WCJ’s credibility determinations will be upheld on appeal. Here, the credible testimony was that Claimant’s deconditioned state was the result of the lengthy period of time he had been out of work, not his work injury or any pain or treatment related thereto. The restrictions were not necessitated by the work injury itself, and the employer’s medical expert credibly testified that the claimant had fully recovered from the work injury, his employer met the burden of proof required to terminate his benefits. Based on the evidence presented, substantial evidence supported that Claimant had fully recovered from his work injury.
Affirmed.
MEDICAL REVIEW AND RES JUDICATA
Bernice Bennett v. Jeld-Wen, Inc. (WCAB)
Commonwealth Court of Pennsylvania – Unpublished Memorandum Decision
Decided: November 20, 2023
Issue:
Whether the WCJ erred in rejecting claimant’s medical expert’s opinion on causation and in finding that Claimant was barred from seeking to include the left trigger thumb as part of her work-related injuries?
Background:
Claimant sustained a work-related injury in 2010 that was, ultimately, determined to include complex regional pain syndrome (CRPS) of the left upper extremity. In October 2017, Claimant and Employer entered into the C&R Agreement, which provided as follows: The parties agree that the nature of the injury or injuries by Claimant are CRPS of the left upper extremity and cervical scarring only. Claimant acknowledges that she did not suffer any other mental, physical, specific loss, disfigurement, or other scarring injuries with[in] the scope of employment. The C&R Agreement settled all aspects of Claimant’s Workers’ Compensation claim, with the exception of medical benefits. In 2020 Claimant underwent multiple trigger finger surgeries and sought payment of medical bills from the Surgery Center. Claimant filed the Review Petition. The WCJ found that Claimant did not meet her burden of proving that a left trigger thumb surgery and associated scar revision surgery were causally related to Claimant’s work injury as defined by an executed and WCJ-approved Compromise and Release (C&R) Agreement. The WCJ also found that Claimant was barred by res judicata from seeking to expand her work injury beyond that set forth in the C&R Agreement. The Board affirmed.
Holding:
This is not a fee review proceeding; it is a Review Petition over which the WCJ plainly had jurisdiction. Further, while an employer was obligated to pay the reasonable medical expenses causally related to the work injury, it may still deny payment based on causation, but opens itself up to a penalty if it is incorrect. Thus, contrary to Claimant’s assertion, Employer could deny payment for medical bills based on causation without invoking the UR process, and because the WCJ found that the trigger thumb was not causally related to the accepted work injury, Employer was not required to retroactively pay for Claimant’s treatments or liable for penalties, had they been requested. Further, while Section 413(a) of the Act permits the amendment of the description of a work injury an injury description in a C&R Agreement is final and binding absent a clear showing of fraud, deception, duress, mutual mistake, or unilateral mistake caused by the opposing party’s fault, none of which Claimant alleges. Claimant was on notice that the triggering of digits and associated medical treatment was possible before she entered into the C&R Agreement, and despite being on notice of the issue, she did not include it in that agreement or reserve the right to amend the injury description in the future. Claimant is barred from amending the description of the work-related injury agreed upon in the C&R Agreement.
Affirmed.
SUPREME COURT AGREES TO HEAR A CASE
Elite Care, Rx, LLC v. Premier Comp Solutions, LLC; et al
Petition for Allowance of Appeal from the Order of the Superior Court
This case was decided in Superior Court of Pennsylvania in a Published Opinion, on May 23, 2023
On October 24, 2023, the Supreme Court granted the Petition for Allowance of Appeal to decide the following issue:
Can a purported medical provider seeking payment for prescription medication in accordance with the provision of the Pennsylvania Workers’ Compensation Act (hereinafter “WCA”), specifically 77 P.S. § 501(a)(1), and corresponding Medical Cost Containment Regulations (hereinafter “MCCR”), 34 Pa. Code §§ 127.1 – 127.755, circumvent the exclusivity provisions of the WCA by initiating litigation outside the forums established by and under the WCA and MCCR for adjudicating such issues? Alternatively phrased, is the liability of the Employer and its Insurer or carrier exclusive in place of any and all other liability, given the WCA provides for an exclusive remedy barring any tort action flowing from a work-related injury?
We will advise when an update is received from the Supreme Court.
PENNSYLVANIA LEGISLATIVE REVIEW
As noted previously, there are presently pending before the Pennsylvania General Assembly, a number of Bills which seek to amend the Pennsylvania Worker’s Compensation Act in various ways. When these Bills are proposed by Pa House members, they go through the House’s Labor and Industry Committee. When, and if, the Bill is passed by the House, it must go through the Pa Senate for additional review. As of this date, two of the proposed Bills have passed the House, and are under review by the Pa. Senate’s Labor and Industry Committee. They are summarized below. At last check the Senate L&I Committee is still reviewing these House Bills and it has not sent them back to the Senate for review, alteration or consideration.
Regular Session 2023-2024
House Bill 760
Short Title: An Act amending the act of June 2, 1915 (P.L.736, No.338), known as the Workers’ Compensation Act, in liability and compensation, further providing for compensation payable in periodical installments.
Subject: Direct Deposit for Workers’ Compensation
This bill seeks to amend Act 338 of 1915 (Workers’ Compensation Act) by allowing individuals who qualify for workers’ compensation to request their compensation through direct deposit into an account of their choosing. These types of payment methods would be similar to the methods that are currently used to pay benefits to those that qualify for Unemployment Compensation. Implementation of this change was recommended unanimously by the Workers’ Compensation Advisory Council (WCAC) last year.
Last Action: Referred to LABOR AND INDUSTRY, May 9, 2023 [Senate]
House Bill 930
Short Title: An Act amending the act of June 2, 1915 (P.L.736, No.338), known as the Workers’ Compensation Act, in liability and compensation, further providing for schedule of compensation. Expanding Workers’ Compensation for Permanent Disfigurement
Subject: Expanding Workers’ Compensation for Permanent Disfigurement
This bill seeks to extend existing workers’ compensation eligibility for permanent disfigurement from 275 weeks to 400 weeks and clarify that claimants are not precluded from collecting both total or partial disability benefits and disfigurement benefits simultaneously. It would also provide workers’ compensation coverage for disfigurement regardless of where it occurs on their body.
Last Action: Referred to LABOR AND INDUSTRY, May 9, 2023 [Senate]
NEW JERSEY WORKERS’ COMPENSATION
CASE SUMMARIES
10/31/2023 – 11/30/2023
COURSE OF EMPLOYMENT – AUTHORIZED VEHICLE RULE
Keim v. Above All Termite & Pest Control
Supreme Court of New Jersey
No. A-30 September Term 2022; 2023 WL 8042920
Decided: 11/21/2023
Background:
Keim was employed by Above All as a pest-control technician. Above all provided Keim with an employer authorized vehicle, which he used to drive from his home to the various worksites, and then return home at the end of the workday. In the morning, Keim would clock in and see which worksites he was assigned to for the day. Above All limited the amount of supplies that could be kept in the authorized vehicles overnight. Above All allowed employees to drive their vehicles directly to the shop to replenish their supplies before going to the worksites for the day. It is up to the employee to decide when they need to replenish their supplies.
On the day of the accident, Keim clocked in and received his work schedule for the day. He decided that he needed more supplies to be able to perform the scheduled services for the day. Therefore, he drove directly to the shop and planned on following his work schedule after replenishing his supplies. Keim sustained injuries in a substantial car accident on his way to the shop.
The insurance carrier for Above All denied Keim’s initial workers’ compensation employee claim petition. Above All moved to dismiss the claim petition in its entirety, stating that the injuries did not arise in the course and scope of employment. Keim filed a motion for temporary and/or medical benefits, which Above all disputed compensability and opposed.
The WCJ heard testimony and concluded that “Keim was merely commuting to work when he sustained the injuries in the car accident.” The Judge additionally stated in regard to the “authorized vehicle rule” that although Keim needed to go get supplies, the rule was “irrelevant since he was on his way to his place of employment.”
The Appellate Division disagreed and “determined that Keim sustained injuries while in the course of his employment because he operated an ‘employer authorized vehicle’ and was on business ‘expressly authorized and directed by his employer.’” The court reversed the dismissal, reinstated the petition, and remanded for further proceedings.
Holding:
Before 1979, broad statutory language defined compensable accidents “as those arising out of and in the course of the employment.” The “going and coming rule” which denied compensation for injuries that were sustained during the routine commute to and from work. The Act was amended in 1979 to define when employment begins and ends every day. There are four rules set out in N.J.S.A. 34:15-36 which govern when an employee is “in the course of employment” under the Act. The rules include: the “premises rule,” the “special mission rule,” the “paid travel time rule,” and the “authorized vehicle rule.”
The “authorized vehicle rule” applies “when an employee ‘utilizes an employer authorized vehicle’ with the employer’s authorization for ‘business authorized by the employer.’” It is important to note that this rule does not apply when an employee is commuting to and from work.
Keim argues that under the “authorized vehicle rule” his injuries are compensable. The word “authorized” separates actions that are unrelated to work and not compensable from those that are related to work and compensable.
This Court determined that “[b]ased on the plain language of the authorized vehicle rule in N.J.S.A. 34:15-36…an employee is ‘in the course of employment’ when (1) the employer authorizes a vehicle for operation by the employee, and (2) the employee’s operation of that identified vehicle is for business expressly authorized by the employer.”
Keim was in the course of employment when he sustained the injuries. Above All provided him with an authorized vehicle and he used the vehicle to go to the shop to replenish supplies, which is an activity authorized by Above All. The permissive approach, where employees are allowed to decide for themselves when to replenish supplies, does not change the analysis. An employer can authorize an employee to do something without expressly directing the activity. Here, Keim was not commuting to work at the time of the accident, he was gathering supplies, which is an activity authorized by his employer. At the time of the car accident, Keim was in the course of employment.
Affirmed and Remanded.
COVERAGE PROVIDED BY A WORKERS’ COMPENSATION INSURANCE POLICY
Alverse Cannon v. Bravo Pack, Inc. v. Employers Preferred Insurance
Superior Court of New Jersey, Appellate Division – Unpublished Opinion
No. A-1731-21; 2023 WL 7140192
Decided: 10/31/2023
Background:
An insurance policy that provided Workers’ Compensation coverage and Employers Liability Insurance was issued by Employers Preferred Insurance Company (preferred) to Bravo Pack, Inc. (Bravo). One of Bravo’s employees, Cannon, sued Bravo and alleged that Bravo was responsible for employment related injuries. This appeal concerns an interpretation of an exclusion in the Insurance Policy.
Cannon worked for Bravo as a machine operator. On his first day, Cannon was being trained by another employee when a machine caught his left hand resulting in a partial amputation of three of his fingers. Cannon received workers’ compensation benefits. Cannon sued Bravo alleging that Bravo “negligently, recklessly, grossly, negligently, and/or intentionally” caused his injuries. Bravo filed a third party Complaint and Amended Answer against Preferred alleging that Preferred breached the insurance policy by improperly denying coverage. Preferred filed an Answer that denied its obligation to provide coverage and asserting an affirmative defense which stated that coverage was excluded.
The Insurance Policy provided workers’ compensation coverage and employer’s liability coverage. The workers’ compensation portion “applies to bodily injury by accident or bodily injury by disease.” Preferred agreed to pay benefits required and assumed the duty to defend Bravo against claims, proceedings, or suits for benefits payable by the insurance. The policy stated that Preferred does not have a duty to defend against suits not covered by the insurance. The employer’s liability section applied to bodily injury by accident or disease. This section did not apply to “any obligation imposed by a workers’ compensation, occupational disease, unemployment compensation, or disability benefits law, or any similar law.” It also did not apply to “bodily injury intentionally caused or aggravated by [Bravo].” An amendment to the employer’s liability section adds that “the insurance does not cover any and all intentional wrongs within the exception allowed by N.J.S.A. 34:15-8.” Preferred stated that it had no duty to defend based on the exclusions in the Insurance Policy. Bravo argued that the amendment was “invalid, ambiguous, or contrary to Bravo’s reasonable expectations.”
The trial court held that for the claims alleging injuries that Bravo intentionally caused, Bravo was not entitled to coverage. The trial court additionally held that for the claims alleging that Bravo caused Cannon’s injuries by negligence, gross negligence, or reckless conduct, Bravo was entitled to defense.
On appeal, Bravo argues that the trial court incorrectly found that the amendment was unambiguous and denied coverage. It additionally asserts that even if it was unambiguous, the amendment “violates the public policy of the Workers’ Compensation Act, which mandates that an employer must make sufficient provisions for payment of any obligation to an injured employee.”
Holding:
It is not disputed that Preferred provided workers’ compensation benefits, providing coverage under the first section of the policy. The question here is whether Bravo is entitled to coverage under the employer liability section. The Court concluded that Preferred had no duty to defend Bravo to the extent of the claim asserting that Bravo’s conduct was an intentional wrong. The Court held that it was unambiguous as it clearly states that the policy “ ‘does not cover bodily injury intentionally caused or aggravated by’ Bravo.” The Court rejected the argument that the amendment violates public policy. Bravo argued that restricting coverage violates the mandate to obtain compulsory insurance and points out that the Workers’ Compensation Act requires the employer to make sure that they fulfill payment that comes out of their obligation to an injured employee. Here, on the intentional tort claims, Bravo was granted summary judgment and therefore sustained no indemnity obligation. The compulsory insurance referred to only addresses employee’s recovery against their employer, not employers’ recovery against their insurer. The “Workers’ Compensation Act is not inconsistent with an employer’s liability policy that excludes coverage for an intentional wrong.” The costs which Bravo is seeking, compensation for its own defense costs, is not mandated by the Workers’ Compensation Act.
Additionally, Bravo has not shown that the Insurance Policy is so difficult to understand that its expectations rule over the plain language.
Affirmed.
INTENTIONAL WRONG EXCEPTION TO THE COMPENSATION ACT
Alverse Cannon v. Bravo Pack, Inc. v. Employers Preferred Insurance
Superior Court of New Jersey, Appellate Division – Unpublished Opinion
No. A-1702-21; 2023 WL 7140900
Decided: 10/31/2023
Background:
Alverse Cannon worked for Bravo Pack, Inc. (Bravo) as a machine operator. An employee, who had previously trained other employees but had not received formal instructions on how to train employees, was instructed to train Cannon. Bravo was aware that the piece of equipment which Cannon trained on frequently jammed. The employee had previously removed a guard to more quickly clear jams. Although he was told not to remove the guard, his manager was aware that he often did not follow instructions. After minimal instruction, Cannon was operating the machine on his own when it jammed. He attempted to remove the jam when a blade caught his left hand and partially amputated three fingers. There were no warning signs and Cannon was not aware that there were blades in this area.
OSHA investigated and cited Bravo for violations. Following the violations, Bravo installed metal guards that were orange colored.
Cannon sued Bravo alleging that the accident was caused by intentional conduct and therefore his remedies should not be limited to the Compensation Act benefits. Bravo moved for Summary Judgment and alleged that “the exclusive remedy provision of the Compensation Act barred [Cannon’s] claims.” An order granted Summary Judgment in favor of Bravo. The Judge determined that Cannon did not have evidence of a finding that there was substantial certainty of an injury and additionally determined that there was no evidence that the incident was outside the scope of conditions that is shielded under the Compensation Act.
Cannon appealed arguing that (1) he provided sufficient proof on an intentional wrong; (2) the Judge “erred in determining that no reasonable juror could conclude that [Cannon’s] accident was substantially certain to result from Bravo’s actions;” and (3) the Judge “erred in finding that his proofs did not satisfy the context prong to prove an intentional wrong.”
Holding:
In most work-related incidents, the Compensation Act provides the employee’s exclusive remedy against the employer. There is an exception when the injury is caused by the employer’s intentional wrong. The Court explained that an “intent” analysis is used to determine what is considered an intentional wrong under the Compensation Act. It is not intent to simply know and appreciate the risk. Intent includes circumstances where the employer is substantially certain that an act will result in harm. In order to prove that an employer committed an intentional wrong, the employee must show either “(1) that the employer has a subjective desire to injure, or (2) that ‘based on all the facts and circumstances of the case … the employer knew an injury was substantially certain to result.’” It has previously been established that substantial certainty is a high bar.
Looking at the conduct prong, the court agreed with the Judge’s determination that the employer’s conduct could be found to be grossly negligent, but it does not rise to the level of substantial certainty. The court reasoned that the manager knew that the employee often did not follow instructions but had no basis to know that the employee would disregard the instructions.
The Court also agreed with the Judge’s analysis for the second prong. This type of accident is the type of accident contemplated by the Legislature when they created the Compensation Act. There is no evidence of intentionally disabling the guard and there is no evidence of an attempt to deceive OSHA.
Affirmed.
JURISDICTION
Hudson Regional Hospital v. New Hampshire Insurance Company
Superior Court of New Jersey, Appellate Division – Unpublished Opinion
No. A-0978-21; 2023 WL 7985354
Decided: 11/16/2023
Background:
Hudson Regional Hospital (Hudson) operates in Secaucus and provided medical treatment to New York residents for injuries they sustained while working in New York for a New York employer. The only connection the patients have to New Jersey is the medical treatment they received. An assignment of workers’ compensation benefits was obtained from each of the patients and Hudson sought to be compensated for the medical treatment it provided to the patients before the New York Workers’ Compensation Board (NYWCB). The NYWCB awarded compensation in accordance with the New York Workers’ Compensation Act Fee Schedule pursuant to the New York Workers’ Compensation Law. Hudson was awarded less than what was billed for the treatment in each instance.
New York law allows medical treatment reimbursement awards from the NYWCB to be disputed by provided avenues. Hudson did not dispute the compensation awards.
Hudson alleged it was entitled to compensation for the medical treatment (the difference between the NYWCB award and what it would be entitled to under the New Jersey Workers’ Compensation Act) and filed claims with the New Jersey Division of Workers’ Compensation. The claims were dismissed for want of jurisdiction. The six possible bases for jurisdiction in New Jersey for a workers’ compensation claim include: “(1) place where the injury occurred; (2) place of making the contract of employment; (3) place where the employment relationship exists or is carried out; (4) place where the industry is located; (5) place where the employee resides; and (6) place whose statute the parties expressly adopt by contract.” Here, the patient’s only connection to New Jersey was their treatment and therefore the Division did not have jurisdiction over the claims.
Hudson then filed a complaint against the insurance carrier with the Law Division alleging the patients are entitled to workers’ compensation benefits for the treatment they received in New Jersey. Hudson alleged that by providing benefits only under the New York fee schedule and not under the New Jersey Workers’ Compensation Act (WCA), the insurance carrier: “(1) breached the contractual rights of the five patients; (2) was unjustly enriched; (3) engaged in bad faith and unfair claim settlement practices; and (4) breached the implied covenant of good faith and fair dealing in its policies.” Hudson additionally alleged both the insurance carrier and the employers conduct business in New Jersey. The insurance carrier moved to dismiss for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted.
The trial court granted the insurance carrier’s motion and dismissed the complaint with prejudice. The court stated that the Division had exclusive jurisdiction and a challenge not to award benefits must be through an appeal. Hudson must appeal the Division’s decision rather than recharacterizing the claim as a breach of contract claim.
Hudson appealed and argued that the Law Division has jurisdiction to hear the patient’s contract claims against the insurance carrier.
Holding:
The Court stated that an unfavorable decision to an employee cannot avoid the statutory structure by filing a breach of contract claim with the Superior Court. Hudson did not appeal the Division’s decision. To review the Division’s decision, Hudson must file an appeal on behalf of the patients.
The Court reviewed the decision in D’Ascoli v. Stieh, which correctly stated that a medical provider located in New Jersey can file an action with the Superior Court to recover “for medical services provided to an out-of-State patient for a work-related injury, even if that patient received workers’ compensation benefits in their home state.” The Court held that this case is not helpful here as a distinction holds the case inapplicable to Hudson’s claims. Hudson is not suing the patients for the outstanding portion of charges, rather it is suing the insurance carrier. Hudson’s claims in the complaint are a breach of contract claim in the form of the patients’ workers’ compensation benefits claims. These claims must only be raised in the Division as it has exclusive jurisdiction.
Affirmed.