Mar 9, 2022
PENNSYLVANIA
Arlet v WCAB (Commonwealth of Pennsylvania, Department of Labor and Industry, Bureau of Workers Compensation)
Pennsylvania Commonwealth Court
Decided: 2/24/2022
Issue:
Does an insurer have a right to subrogation from an insured when it made payments under a commercial policy to an injured employee, and it was later determined the employee should have been paid under the Workers’ Compensation Act. The commercial policy made payment to the injured employee under the Jones Act, a federal maritime law.
Holding:
The Pa. Supreme Court explained subrogation is an equitable principle and the general rule is an insurer may not subrogate from its insured. Here, a limited exception to that rule was created wherein the insurer was allowed to seek subrogation as it was determined that insurer paid for a risk it did not insure.
Background:
The claimant worked as a shipwright. In March 2011 claimant slipped and fell sustaining an injury. Under the Jones Act injuries to seamen and members of a crew who are injured at work have the right to sue their employer for negligence, and to recover damages for injuries sustained in the course of their employment. If an individual is found to be covered by federal maritime law, the Jones Act pre-empts a state’s workers’ compensation law.
Here the claimant was injured after he slipped and fell. The insurer who pursued this appeal insured the employer under a commercial liability policy. After being placed on notice of claimant’s injury at work, insurer negotiated a settlement, pursuant to the Jones Act, under the commercial liability policy and made payments.
After claimant received payment under the commercial policy, he then sought benefits under the Pennsylvania workers’ compensation Act, arguing he was not a covered individual under the Jones Act (seaman or crew member). After a significant amount of litigation, it was determined that the claimant was not a covered individual under the Jones Act and was entitled to Pennsylvania workers’ compensation benefits. There were further complications as the employer lacked workers compensation insurance at the time of the injury. The commercial insurer sought subrogation arguing the subsequent determination that the claimant was not covered by the Jones Act should allow it to seek subrogation for the payment made pursuant to the commercial liability policy.
After reviewing the party’s respective arguments and the decisions below, the PA Supreme Court noted that subrogation is an equitable principle, and it is well settled law that an insurer cannot subrogate against its own insured. In this instance however, the Court held equity allowed for the commercial insurer to seek subrogation. The matter was remanded to address additional issues and factual development.
Carbon Lehigh Intermediate Unit v WCAB (Waardal)
Pennsylvania Commonwealth Court
Decided: 1/3/2022
Issue:
In an instance where a claimant was laid off at the beginning of the COVID epidemic, workers’ compensation benefits were reinstated, he received unemployment compensation, and federal pandemic unemployment compensation, could the employer take a credit for the federal pandemic unemployment payments?
Holding:
The legislative intent behind section 204(a) of the Act (section which provides a credit for pension, severance, and/or unemployment payments), is to prevent the employer from paying duplicate benefits. Denying a credit for pandemic compensation which is paid for by another entity, does no disservice to the overall purpose of section 204(a), nor does it place an employer in the position of paying duplicate benefits for the same loss of earnings. Therefore, the credit was denied.
Background:
The claimant was employed as a substitute teacher. In May 2017, claimant sustained a work-related injury. After a period of total disability, claimant returned to modified duty. Claimant was laid off March of 2020. Claimant then filed a Reinstatement petition seeking to return to total disability. Claimant also began collecting unemployment compensation benefits and the pandemic compensation which was made available under the federal CARES Act. The WCJ granted a reinstatement of benefits and a credit for unemployment compensation. The request to take a credit for the pandemic relief payments was denied and the employer appealed. As noted above, the employer was unsuccessful in that appeal.
Sadler v WCAB (Philadelphia Coca Cola): Case handled by Andrea Weaver of this firm.
Decided: 1/7/22
Issue:
1. Whether the Social Security offset in Section 204(a) of the Act, violates the Equal Protection clause of the Pennsylvania Constitution.
2. Whether the WCJ improperly considered an earning power assessment, when the Bureau Regulations were allegedly not followed.
3. Whether the WCJ should have considered claimant’s felony conviction when determining if jobs identified in an earning power assessment were open and available.
4.Whether the WCJs decision was reasoned.
Holding:
1. The rational basis analysis must be used to determine the constitutionality of Section 204(a) of the Act, under the Pennsylvania Equal Protection Clause. Under that analysis, the language in the statute must be rationally related to a legitimate state interest. Here there is a legitimate state interest in preventing double recovery through the receipt of Social Security retirement benefits and total disability payments. Therefore, section 204(a) does not violate the Pennsylvania constitution.
2. The WCJ’s decision that the vocational expert followed the Bureau regulations was supported by substantial competent evidence in the record.
3. The purpose of the Act is to assess the effect a claimant’s work injury has on their ability to work. Non-work-injury related restrictions, caused by claimant’s conviction, (felony conviction limited how close claimant could be to certain locations and people) do not render the identified jobs as unavailable as that is not a work-injury related restriction.
4. The WCJ’s decision was reasoned, as there were multiple citations to the record which showed the basis for the WCJ’s opinion.
Background:
This was a lengthy opinion, and this claim has a long history. For the purposes of this decision, it was established that claimant worked for approximately 4 weeks before he sustained his injury. Claimant thus argued employer was not entitled to an ongoing Social Security Old Age credit when employers’ contribution was limited to the four (4) weeks claimant worked for employer before his injury.
As to the earning power assessment claimant alleged the vocational counsellor failed to timely send his initial report to claimant and his attorney. Since this mailing was to occur within 30 days, and did not, claimant argued the earning power assessment was invalid. Further, claimant argued the regulations required vocational counsellors to proactively declare or deny a financial interest in the employer, rather than an obligation to disclose an interest only if one exists.
As to claimant’s conviction, while we were prohibited from introducing evidence of claimant’s sex crime involving a minor, we were allowed to established claimant’s conviction limited how close he could get to certain people and places. Thus, a job may be unavailable, but not because of the work injury.
Thompson v. WCAB (Trustees of Univ. of Pennsylvania)
Decided: 1/18/22
Unpublished Memorandum Opinion
Issue:
Whether a Claim petition was properly denied for failure to provide timely notice of an injury to the employer.
Holding:
Timeliness of notice requires a factual inquiry. Here, the WCJ considered conflicting testimony and accepted testimony that claimant was made aware her symptoms were work related during a visit to her initial treating physician. The 120-day clock to provide notice began to run as of that visit rather than when she was subsequently made aware of work-relatedness by her second physician. Thus, the WCJ properly denied the claim.
Background:
In the Claim petition it was alleged that claimant’s upper extremity complaints were caused by her nursing duties. The litigation focused on whether claimant’s initial or current physician made her aware of her symptoms being caused by her employment. Claimant initially treated with Dr. Liebman, who, after a few months, referred claimant to Dr. Purewal. During her deposition, when asked when she first thought her symptoms were work related, claimant responded during a September 28, 2017 visit with Dr. Liebman. When testifying, in response to a question from the WCJ, claimant said she understood her symptoms were work-related after a February 20, 2018 visit with Dr. Purewal. The WCJ found clamant was aware of her work-related symptoms as of Dr. Liebman’s visit and thus, gave untimely notice. On appeal claimant argued her testimony about her visit with Dr. Liebman was not legally sufficient to show she was aware her symptoms were work related. The Court, rather than focusing on the legal sufficiency of the word’s claimant used, held the WCJ’s finding was supported by substantial competent evidence in the record and affirmed the Claim’s denial.
Kamp v WCAB (Green Acres Contracting)
Decided: 1/21/22
Issue:
Whether Section 319 of the Act (subrogation) violates the Equal Protection Clause of the Pennsylvania Constitution.
Holding:
Since Section 319 does not implicate a fundamental right it is subject to the rational basis analysis under the Equal Protection Clause. Section 319 is constitutional because it is rationally related to the promotion of the legitimate state interest of preventing employers from being responsible for the negligence of a third-party.
Background:
The claimant sustained accepted work injuries caused by a 2016 motor vehicle accident. Claimant began receiving total disability benefits. Two years into the claim, the parties entered into a Compromise and Release Agreement which resolved any and all specific loss benefits could receive. Claimant continued to receive total disability benefits. Claimant subsequently filed a third-party action, wherein it was determined that claimant sustained damages of over a million dollars. The third-party insurance policy limit was $150,000. The Employer’s subrogation lien, after the deduction of litigation costs and fees, exceeded the $150,000 recovery and the employer sought the entire amount of the remaining recovery. Claimant argued the employer could not subrogate because Section 319 violated the Equal Protection clause of the Pennsylvania Constitution. The Court, relying on well settled precedent, rejected claimant’s constitutional challenge. The Court explained the General Assembly properly drafted Section 319 to accomplishes the goals of preventing a claimant’s double recovery for the same injury, ensuring employers are not responsible for the negligence of a third party and preventing third parties from escaping liability for their negligent conduct.
Michael Trasatti v. WCAB (City of Chester)
Decided: 2/1/2022
Issue:
Claimant challenged employer assertion of a right to subrogation in his third-party recovery, arguing the benefits were paid under the heart and lung Act and thus, subrogation was prohibited.
Holding:
Since claimant did not present evidence regarding his receipt of heart and lung benefits and did not raise this issue until the matter was before the Appeal Board, WCJ’s award of subrogation was affirmed.
Background:
There is a rather lengthy factual history. In short, the claim involved a police officer who received total disability payments for a work injury and heart and lung benefits. Claimant was involved in a third-party action for his injuries and employer sought subrogation. Claimant argued the employer was not entitled to subrogation because the payments he received were pursuant to the Heart and Lung Act. By statute, there is no subrogation for heart and lung benefits payments. Here, however, the WCJ awarded the employer subrogation in the claimant’s third-party recovery. On appeal, the Court focused on the claimant’s failure to present evidence before the WCJ that he received heart and lung benefits and did not raise the receipt of those benefits until his appeal. The Court found the WCJ’s decision was supported by substantial competent evidence in the record and denied claimant’s appeal.
Bernie Steoschick v. WCAB (Air Products & Chemicals, Inc.)
Decided: 2/3/2022
Unreported Memorandum Decision
Issue:
In this appeal the Commonwealth Court addressed two issues regarding the Act 111 amendments to the Workers’ Compensation Act (new IRE section): (1) whether Act 111 can be constitutionally applied to workers whose injuries occurred before Act 111’s October 24, 2018 effective date; and, (2) whether Act 111 contains sufficiently specific language to make the law retroactive.
Holding:
Relying on its decision in Rose Corp v. WCAB (Espada) 238 A.3d 551 (Pa Commonwealth 2020) the Court answered both of the above issues in the affirmative.
Background:
The claimant sustained a work-related injury in March 2009. Pursuant to a July 26, 2011 IRE, claimant’s status was modified from total to partial disability. Following the Pa. Supreme Court’s decision in Protz 161 A3d 827 (Pa 2017 ((prior IRE section was unconstitutional). claimant filed for reinstatement. The WCJ issued a decision in accordance with Whitfield v. WCAB (Tenant Health System Haneman LLC) 188 A3d 599 (Pa Commonwealth 2018) (holding the proper date for modification based on an unconstitutional IRE is a date the reinstatement petition was filed).
Following the enactment of Act 111, in February 2019, a new IRE was performed, and the employer filed for modification based on the new IRE. In the decision, the WCJ reinstated claimant to total disability status as of the date the Reinstatement petition was filed and modified claimant’s status back to partial disability as of the date of the new IRE. (Post Act 111 IRE). Employer was credited for the weeks of partial disability between the first IRE and the date the reinstatement petition was filed.
Before the Commonwealth Court claimant argued the Remedies Clause of the Pennsylvania constitution was violated because continuing to credit prior weeks of partial disability gives force to an unconstitutionally invalid statute and deprives claimant of a vested right to workers’ compensation. The Court rejected this argument noting the vested right protected by the Remedies Clause must have become a title, legal or equitable to the present or future enforcement of a demand or a legal exemption from a demand made by another. The Court then explained that §413 of the Act, makes clear a claimant’s benefit status may be modified, reinstated, suspended or terminated by a WCJ, and as such claimant’s do not have a vested right in workers’ compensation benefits and the remedies clause does not apply.
Claimant then argued the employer’s modification petition should be denied because Act 111 did not contain language which gave it retroactive application. The Court rejected this argument explaining in passing Act 111 the General Assembly understood employers and insurers detrimentally relied on the former IRE provisions because they did not pursue other methods of modification. The General Assembly did not intend for the employers and insurers to bear the entire burden of the prior IRE provision being declared unconstitutional and as such employers/insurers were provided a credit for the weeks of compensation, whether total or partial in nature previously paid.
Fidelity Contracting LLC. V. WCAB (Risbon)
Decided: 2/15/22
Unpublished Memorandum Opinion
Issue:
Two Issues presented to the Court were: (2) whether a WCJ’s decision was supported by substantial competent evidence; and, (2) whether the WCJ issued a reasoned decision as required by Section 422 of the Act
Holding:
The decision is supported by substantial competent evidence in the record and was reasoned.
Background:
Claimant filed a Claim petition alleging his job duties caused left hip and groin conditions to worsen, resulting in multiple surgeries. Both parties submitted medical expert testimony regarding the nature of claimant’s alleged conditions and whether he was disabled. The Court declined to consider whether the medical experts relied on appropriate information and offered a competent opinion. Instead, the Court noted that the WCJ decision was based on the weighing of the evidence and there was substantial competent evidence in the record to support the WCJ’s conclusion.
Moody v WCAB (American Heritage FCU)
Decided: 2/15/22
Unreported Memorandum Opinion
Issue:
Whether the Act 111 amendments (new IRE provisions) which became effective October 24, 2018, were unconstitutionally applied to a June 2013 work injury.
Holding:
The Act 111 amendments are constitutional because they did not affect claimant’s’ substantive rights by imposing new legal burdens or otherwise change claimant’s status. The amendments are procedural in nature because they merely establish a means for an employer to seek a change in status.
Background:
Claimant’s injury was sustained on June 4, 2013. In 2017, Protz declared the prior IRE provisions were unconstitutional. The Act 111 amendments IRE Section became effective October 24, 2018. Clamant argued it was unconstitutional for the General Assembly to enact a law that creates a new mechanism to impair rights that vested prior to the amendment. The Commonwealth Court relying on several recent decisions, explained that a vested right was not affected. Further, the Court explained the amendments did not change claimant’s status, it simply created a mechanism for an employer to seek a modification of benefits.
Johnson v WCAB (Driversource, Inc.)
Decided: 2/24/2022
Unpublished Opinion
Issue:
An instance where there is an accepted injury, employer filed for Termination of benefits and claimant filed a Review petition to amend the injury definition, did the WCJ err in terminating claimant’s benefits.
Holding:
Since the WCJ’s findings were supported by substantial competent evidence, the grant of the Review and Termination petitions were affirmed.
Background:
Claimant had an accepted injury and employer filed a Termination petition. Claimant then filed a Review petition and employer relied on the testimony of its medical expert and a supplemental report issued after the Review petition. The WCJ granted the Review petition but found employer’s medical expert sufficiently addressed all injuries and terminated benefits. The Court dismissed arguments that employers’ medical experts’ opinions were equivocal or not supported by substantial competent evidence. Claimant raised the argument that a termination cannot be granted unless the IME report, upon which the termination is based, must be issued with a Notice of Ability to Return to Work. The Court found there was no authority for claimant’s position and rejected that argument.
4883-5956-0206, v. 1
Oct 4, 2021
Pennsylvania
COVID-19
Objection Sustained to Attending an IRE because of COVID-19 Pandemic
In Josephine Smigley v. City of Philadelphia, the employer filed a Motion to Compel an IRE when the claimant objected to attending the evaluation on July 9, 2020 because of the Covid-19 pandemic. In her decision of October 5, 2020, the WCJ sustained the claimant’s objection to the request for an IRE due to the pandemic. The claimant provided no evidence of why she could not attend the examination except for her age which was 83 years. The WCJ dismissed the Motion to Compel without prejudice. The WCJ ruled that the employer could have a telemedicine IRE “at the close of the pandemic.” If the claimant failed to appear, the employer can re-file another Motion to Compel. The employer appealed to the Workers’ Compensation Appeal Board.
The Appeal Board affirmed holding that the WCJ did not abuse her discretion given the claimant’s age and the global pandemic crisis due to COVID. The Board modified the WCJ’s decision to preserve the effective date of any resulting change in disability status back to the date the IRE was originally requested since the pandemic did not have a foreseeable end date. The employer did not appeal to the Commonwealth Court, and this Appeal Board opinion is only persuasive and not binding.
Adverse Reaction to an Employer-Mandated COVID-19 Vaccine likely Compensable as an Injury Arising in the Course of Employment
During the unprecedented COVID-19 global pandemic employers begin to inquire whether illnesses or injuries caused by adverse reactions to COVID-19 vaccine are compensable.
Section 301(c)(1) of the PA Workers’ Compensation Act defines a work-related injury to include those injuries “arising in the course of employment and related thereto.” This definition includes aggravation, reactivation, and acceleration of pre-existing conditions. 77 Pa. Stat. Ann. § 411(1). As there are only a few cases that have addressed the compensability of employer-provided vaccination in PA, past appellate decisions involving employers’ actions are instructive in the issue of compensability of adverse effects resulting from employer-mandated vaccinations.
When vaccination is mandated or a condition of one’s employment, resulting illnesses and injuries are likely compensable as they are deemed to have occurred in the course and scope of employment. In Colagreco v. W.C.A.B. (Vanguard Group Inc.), an employee received a flu shot at work mandated by her employee. The Commonwealth Court affirmed the Appeal Board, which affirmed the WCJ’s award of workers’ compensation benefits after the employee experienced shoulder symptoms and her arm was “almost paralyzed” within a day or two of receiving the flu shot. In this case, the employee’s post-vaccination care included shoulder surgeries, multiple nerve blocks, office visits, diagnostic testing, medications.
Compensability is likely extended to situations where there was direction or strong urging from the employer. In Wells Fargo Co v. W.C.A.B. (Pacheco), employee was involved in a motor vehicle accident when he was traveling to another company office under the direction of the employer. The Commonwealth Court held that when an employer directs an employee to travel to another company office, the employee was on a “special assignment” for the employer and thus his injury was compensable. On the other hand, in Storms v. W.C.A.B (Big Boulder), when the employee had the option to attend the employer-sponsored picnic and suffered an injury, the Commonwealth Court found that the employee’s attendance was not furthering the employer’s business and the injury was not compensable.
Employer liability is also likely found in situations where there were employee incentives and rewards. For example, in SEPTA v. W.C.A.B. (McDowell), employee police officer injured his knee while running in a park during his off-duty hours. Employee testified that he ran several times a week to meet employer’s physical fitness requirements. To encourage its officers to meet such requirements, employer provided reimbursement of gym memberships, cash and bonus day awards. The Commonwealth Court found that the employee was actually engaging in furtherance of the employer’s affairs at the time of his injury and held the employee’s injury compensable.
In conclusion, we anticipate that it will follow that when an employee suffers from adverse reactions to employer-mandated COVID-19 vaccine, such injuries are likely compensable. Further, depending on the level of employer involvement, an employer’s support, encouragement, recommendation, facilitation or rewards to an employee to obtain the vaccine can also lead to employers’ workers’ compensation benefit liability.
First PA Covid-19-Related Wrongful Death Case Allowed to Proceed in State Court
In Benjamin v. JBS SA et al, a meat processing plant worker, after reporting to his job during the pandemic, contracted COVID-19 and died at home from respiratory complications on April 3, 2020. The worker’s family sued defendants UBS USA Food Company, JBS USA Holdings, Inc., UBS Souderton, Inc, and Pilgrim’s Pride Corporation in state court for negligence and gross negligence alleging, in part, that the they ignored the risk of COVID-19 infection to employees, failed to provide appropriate personal protective equipment, and to follow official guidance related to the prevention of the pandemic in the workplace.
In June 2020, the defendants removed the case to federal court and filed a motion to dismiss. One of the defenses was that the plaintiff’s claims are barred by the exclusive remedy provision of the PA Workers’ Compensation Act (PAWCA), which states that “[t]he liability of an employer under this act shall be exclusive and in place of any and all other liability to such employees…in any action at law or otherwise on account of injury or death … or occupational disease.” 77 Pa. Stat. Ann. § 481(a).
Defendants contend that Souderton was the employer, not its parent company JBS USA Holdings and therefore, the PAWCA bars the plaintiff’s claims against it. But the plaintiff countered that there were questions about which company was the worker’s employer and whether JBS Souderton fell under an exception to workers’ compensation immunity because it had misrepresented the safety of the workplace during the pandemic. The plaintiff stated that a June 15 workers’ compensation denial letter was signed by JBS USA Holdings. Although the worker’s W-2 form named Souderton as the employer, the W-2 form contained an address in Greeley, Colorad, where JBS USA Holdings, Inc. was located. The employer identification number on the letter is the number for JBS USA Holdings, Inc. As such, the plaintiff argued, JBS USA Holdings Inc. did not cease to exist in 2015 and “at a minimum, factual disputes exist…which entitles plaintiff to discovery.”
The plaintiff also cited the PA Supreme Court’s 1987 ruling in Kiehl v. Action Manufacturing Co. to argue that even if the local subsidiary were immune under the Workers’ Compensation Act, its parent company could still be sued. The same court’s 1992 decision in Martin v. Lancaster Battery Co. held that a company lost its immunity when it actively misled employees about workplace hazards.
Evaluating the plaintiff’s complaint assuming as true all factual allegations of the complaint, the court reject defendants’ contention that Plaintiff’s claims could not possibly fall under the Martin exception to the PAWCA exclusivity. On January 29, 2021, the federal court granted the plaintiff’s motion to remand and remanded the case to state court.
INCARCERATION
Employers not Entitled to a Suspension of Benefits for Incarceration that Occurs Prior to Either a Conviction or a Guilty Plea, Even if Time Served is Traded for Post-Conviction Sentence
In Sadler v. W.C.A.B. (Philadelphia Coca-Cola), the employee was injured in 2012 and received WC benefits. While the employee was receiving benefits, he was accused of committing a crime and was incarcerated. Because the employee could not post bail, he spent 75 weeks in jail before sentencing. He pled guilty and was sentenced to time served and immediately released. The employer subsequently filed a suspension petition claiming that since the employee was found guilty that he would be unjustly enriched if he was permitted to retain the benefits he received while he was incarcerated. The WCJ concluded the employer was entitled to reimbursement of benefits paid during the period in which the employee was incarcerated. However, the WCJ did not allow a future credit against the employee’s benefits stating that the employer would be required to go to the Supersedeas Fund.
The Workers’ Compensation Appeal Board modified the WCJ’s decision, allowing the employer to seek a credit against future payments. The employee appealed to the Commonwealth Court, maintaining that because he spent no time in jail after his conviction as required by Section 306(a.1), his benefits had been improperly suspended. The Commonwealth Court agreed, indicating that 306(a.1) clearly states that payment of compensation is not required for any period during which the employee is incarcerated after a conviction. The court stressed that the employee’s incarceration was due solely to his inability to post bail not because of a conviction for criminal conduct. Therefore, the court cannot engraft language onto a statute or impute intent for a statutory language that was unambiguous.
The PA Supreme Court granted allocator on the issue. In a unanimous Decision, the PA Supreme Court affirmed the Commonwealth Court’s decision largely on the same grounds. The Court found that the forfeiture provision in 306(a.1) specifically refers to benefits paid after a conviction, and since the employee was not incarcerated even for one day after his conviction, the Court affirmed the Decision of the Commonwealth Court.
The Court rejected a number of arguments that the employer raised. The employer argued that once a claimant was convicted, his time served converted to a period of incarceration. The Court explained such interpretation would eliminate the temporal restriction that the legislature included in the Statute. In the Court’s view, the legislature included the words “after a conviction” to provide a clear temporal restriction that was consistent with the sentencing code which allows incarcerated defendants to receive credit against a sentence for time spent in custody. The Court also stressed that workers’ compensation benefits may not be denied to an individual who is “presumed innocent” until convicted; as such, compensation cannot be denied to that individual pre-conviction.
The Court stated that if a credit was meant to be given for time served, it would state so in the Statute.
The Court also rejected the employer’s argument that Section 306(a.1) results in an unequal application of the law which has created two classes of claimants who have been convicted of crimes: those who are able to post bail and those who cannot. The employer argued that this division among convicted claimants is not rationally related the cost containment purpose of the PA Workers’ Compensation Act. The Court, however, found a rational relationship stating that the purpose of Section 306(a.1) is to preclude payment of benefits who are removed from the workforce because of his/her own criminal conduct. In conclusion, employers are not entitled to a suspension of benefits for incarceration that occurs prior to either a conviction or a guilty plea; only time served subsequent to a conviction will be allowable for purposes of a credit/suspension.
IMPAIRMENT RATING EVALUATIONS
Employee Entitled to Reinstatement of Total Disability Status where Testimony Establishes Continuing “Disability” as Required by Whitfield.
In City of Pittsburgh v. W.C.A.B. (Donovan), the claimant worked for the employer as a career firefighter and sustained a work-related injury to both of his shoulders on July 24, 2010. The employer issued a Notice of Compensation Payable (NCP), acknowledging the claimant’s total disability status and that he would receive benefits concurrently under the PA Workers’ Compensation Act and the Heart and Lung Act. On January 25, 2013, the claimant underwent an IRE pursuant to former section 306(a.2) of the PAWCA, and received a 15% whole person impairment rating under the 6th Edition of the American Medical Association (AMA)’s Guides to the Evaluation of Permanent Impairment (Guides). As this was below the 50% impairment necessary for a presumption of total disability status under the former Section 306(a.2), the parties stipulated that the claimant’s disability status would be changed from total to partial effective January 25, 2013.
In 2015, the Commonwealth Court issued its decision in what is commonly referred to as “Protz I.” The court held that the IRE provision of former Section 306(a.2) of the PAWCA was an unconstitutional delegation of legislative power to a private entity—namely the AMA, violating Article II, Section I of the Pennsylvania Constitution. In 2017, the PA Supreme Court in Protz II affirmed the ruling in Protz I regarding the illegal delegation of legislative power, rendering the former Section 306(a.2) unconstitutional. In response to Protz II, the PA legislature passed Act 111 of 2018, which added Section 306(a.3), which specifies that IREs are to be conducted pursuant to the AMA Guides “6th edition (second printing April 2009).”
Following the Supreme Court’s Decision in Protz II, the claimant filed modification and review petitions seeking to invalidate the employer’s 2013 IRE. The WCJ allowed the claimant’s testimony but did not allow the employer to have a vocational analysis of the claimant’s earning power. Citing Whitfield, the judge granted the claimant’s petitions. The Appeal Board affirmed, and the employer appealed to the Commonwealth Court.
The Commonwealth Court affirmed, finding that its recent decisions supported the Appeal Board’s decision. Citing Whitfield as controlling precedent, the court first stated claimant’s petitions were timely as they were filed within three years after the date of his most recent compensation payment. The court then affirmed that “earning power is not a factor when seeking a change in disability status under the former IRE provisions,” since the original modification of benefits stemmed not from a change in earning power but from a now unconstitutional IRE, making a change in earning power at this time unnecessary. Employers cannot use that unconstitutional IRE to activate the retroactive provisions of Act 111. The Commonwealth Court noted, the employer could seek a new IRE and change the claimant’s status back to partial disability under the newly enacted section 306(a.3) should the new IRE yield an impairment rating below 35%.
Order Compelling Injured Employee to Attend an IRE is Interlocutory and Not Subject to Appeal.
In Cantanese v. W.C.A.B. (RTA Services Co., Inc.), a claimant was injured in a work-related injury on December 11, 2013 and received workers’ compensation benefits pursuant to a Notice of Compensation Payable. In January of 2019, the employer filed a petition seeking to compel the claimant’s attendance at an impairment rating evaluation (IRE), alleging that the claimant failed to attend an IRE that was scheduled to occur earlier that month.
The WCJ granted the employer’s petition on May 3, 2019. The employee appealed that decision to the Appeal Board, arguing that the WCJ erred by ordering him to appear at an IRE because Act 111 of 2008 was unconstitutional. On November 5, 2019 the WCAB quashed the claimant’s appeal as interlocutory and the claimant appealed to the Commonwealth Court.
In its decision to affirm the Appeal Board, the Commonwealth Court cited the well-established law that “where an order does not dispose of all claims or all parties, it is interlocutory and not appealable.” Swartz v. W.C.A.B. (Cheltenham York Rd. Nursing & Rehab.). According to the Court, because the IRE Order “merely stated that the claimant was required to participate in the IRE and neither affected the claimant’s benefits nor affected the employer’s obligation to pay benefits,” the IRE Order was a non-appealable, interlocutory order.
COMPROMISE AND RELEASE
Employer’s Termination Petition after a Compromise and Release Agreement May be Barred if its Right to Challenge Claimant’s Entitlement to Benefits is not Expressly Preserved.
In Central Transport v. W.C.A.B (Thornton), the claimant sustained a work-related injury on July 6, 2016. The employer file a termination petition on November 19, 2018. At a hearing on March 14, 2019 before WCJ Melcher, the termination petition was amended to a Compromise and Release agreement where the parties settled the claimant’s entitlement to wage/specific loss benefits. Accordingly, the claimant was paid a one-time lump sum of $90,000.00 for his wage/specific loss benefits. The C&R agreement stated that “medical bills which are reasonable, necessary and casually related to the injury…will remain the responsibility of Employer, in accordance with the cost containment provisions of the PA Workers’ Compensation Act.”
On March 19, 2019, four days after the parties accepted the C&R agreement, the employer filed another termination petition alleging that the claimant was no longer entitled to benefits because he fully recovered from his work injury on October 12, 2018. WCJ Poorman dismissed the employer’s termination petition under res judicata on the grounds that it was identical to the one dismissed as moot before WCJ Melcher. WCJ Poorman also explained that under the C&R agreement, the employer remained obligated to pay for the claimant’s medical benefits. The Board affirmed, and the employer appealed to the Commonwealth Court.
The issue which the Commonwealth Court had to analyze was whether the second termination is barred by res judicata. In an unpublished opinion, the Commonwealth Court reasoned that res judicata encompasses two related yet distinct principles: technical res judicata and collateral estoppel. Technical res judicata provides that when a final judgment on the merits exists, a future suit between the parties on the same cause of action is precluded. Whereas, collateral estoppel acts to foreclose litigation in a later action of issues of law or fact that were actually litigated and necessary to a previous final judgment. On appeal, the employer argued that res judicata does not apply because its November 19, 2018 termination was never adjudicated and a final determination on the merits never existed with respect to that petition.
The Commonwealth Court disagreed with the employer’s contention that a final judgment on the merits never existed. The court considered a C&R agreement as a final determination on the merits for the purpose of technical res judicata. Further, the court explained that plain language of the agreement indicates the claimant was to be paid “$90,000.00 for a one-time lump sum payment to resolve [his] entitlement to any benefits he may be entitled under the [Act], except medical benefits. Medical bills which are reasonable, necessary, and causally related to the injury [described in this agreement] will remain the responsibility of Employer.” Because the employer did not preserve the right to seek termination of medical benefits, it was precluded from doing so.
This opinion from the Commonwealth Court demonstrates the importance of careful draftsmanship of C&R stipulations. If the C&R is one where medical benefits are not being settled, or if the employer has the option either to fund an MSA or continue to pay medical benefits, it is important that the employer reserves the right to file termination petitions in the future and indicates that the obligation to pay medical benefits ends when the claimant is deemed to have fully recovered from the work injury.
FEE REVIEW
Hearing Officer had Jurisdiction over Fee Reviews when Employer failed to file a Utilization Review after Accepting Liability for the Injury
In Omni Pharmacy Services, LLC, v. W.C.A.B. (American Interstate Insurance Company), an employee sustained a left ankle fracture. A physician prescribed the employee a compound cream, which Pharmacy dispensed and billed the employer. The employer denied payment, stating that it was not liable for treatments. Pharmacy then filed fee review applications with the Medical Fee Review Section, which resulted in determinations in favor of Pharmacy.
Employer appealed and requested hearings to contest the determinations. At the hearing the employer argued that causation must be determined by a WCJ. Pharmacy argued that the employer asserted its causation issue without presenting any evidence that the compound cream was not prescribed for treatment of the employee’s work injury. The hearing officer concluded “that there is a dispute… pertaining to the causal relationship of the prescribed compound cream and the accepted work injury” and vacated the fee review determinations directing the employer to pay Pharmacy’s invoices. Pharmacy petitioned for review of the Commonwealth Court.
The Commonwealth Court stated that a fee review proceeding is not the mechanism for establishing the existence and precise scope of a work injury. The fee review process presupposes that liability has been established, either by voluntary acceptance by the employer or a determination by a WCJ. Neither the PAWCA nor the medical cost containment regulations provide any authority for a hearing officer to decide the issue of liability in a fee review proceeding.
In the present matter, the employer accepted liability for employee’s work injury. As in the case Workers’ First Pharmacy v. W.C.AB., by arguing compound cream was not related to accepted work injury, the employer challenged whether the compound cream prescribed constituted reasonable and necessary treatment for the accepted work injury. Put another way, if the compound cream was prescribed for a non-work-related injury of the employee, it is not reasonable or necessary for treatment of the accepted work injury. The employer’s failure to file the UR after accepting liability for the injury meant the hearing officer had jurisdiction over Pharmacies’ fee reviews. For these reasons, the Commonwealth Court vacated the adjudication of the Hearing Office and remanded the matter for a decision on the merits of the fee review determinations.
NOTICE
Employee Gave Timely Notice of Her Injury Where She Gave Notice 121 Days Following the Injury Because the 120th Day Fell on a Sunday.
In Holy Redeemer Health Systems v. W.C.A.B. (Figueroa), an employee who worked as an ER nurse gave notice to the employer of her work injury on the 121st day after her work injury, which was a Monday. Under the PA Workers’ Compensation Act, a claimant is required to give notice to the employer no later than 120 days after the injury for compensation.
The employer argued that since the hospital is open 365 days a year, 24 hours a day, the employee could easily have provided notice on day 120, a Sunday, or earlier. The employer also argued that Section 311 of the PAWCA is unambiguous as to the 120-day notice requirement.
In deciding whether the employee’s claim was barred by the 120-day notice provision, the Commonwealth Court looked beyond the PAWCA and to Section 1908 of the Statutory Construction Act of 1972, which specifically excludes Saturday, Sunday and holidays when the final day to take action falls on one of those days.
Because the last day of the 120-day period of time, established by Section 311, fell on a Sunday, the court omitted that day from the 120 computation and held that the employee gave timely notice.
STATUTE OF LIMITATIONS
Employer’s Payment of Medical Expenses Under a Medical Only TNCP Does Not Toll the PAWCA’s Statute of Limitations when Payments were Not Made in Lieu of Compensation.
In Dickerson v. W.C.A.B. (A Second Chance), the employee was injured in a work-related motor vehicle accident on May 15, 2014. The employer issued a Medical Only TNCP. On July 31, 2014, the employer issued a Notice Stopping and Denial. The employer then paid medical bills incurred as of August 12, 2014, but only for treatment rendered prior to the issuance of Notice Stopping and Denial. On June 5, 2017, the employee filed a claim petition.
Under the PAWCA, a claim petition must be filed within three years from the date of injury. Concluding that the claim petition was time barred and that the employer’s bill paid on August 12, 2014 did not toll the 3-year statute of limitations, the WCJ dismissed the claim. The employee appealed to the WCAB, which affirmed.
There is a two-part test to determine if a payment of medical expenses qualifies as a payment of compensation: an employee must establish that (1) the injury was work-related, and (2) that the payments were made with the intent that they be “in lieu of workers compensation.” Payments considered to be “in lieu of compensation” will toll the repose period if they are voluntary or informal, apart from the PAWCA, and paid with the intent to compensate for a work-related injury. On appeal to the Commonwealth Court, the court affirmed and held that employer’s payments were not made “in lieu of compensation” as the record did not reflect a single instance where the employer paid wage loss benefits.
The controlling question was that the employer’s intent, which was expressly clear in that it would pay the employee’s medical expenses but accepted no liability for wage-loss benefits. The court noted that the medical bill that the employer paid for treatment rendered on July 24, 2014 was for treatment prior to Employer’s issuance of the NCD, which further supported the conclusion that the employer intended only to pay for medical treatment that was rendered during the time the Medical-Only NTCP was in effect.
EMPLOYEE/INDEPENDENT CONTRACTOR
Despite an Explicit Independent Contractor Agreement, Employer-Employee Relationship was Found as Facts Established Ownership and Control.
In Berkeabile Towing and Recovery v. W.C.A.B. (Harr, State Workers’ Insurance Fund and Uninsured Employers Guaranty Fund), the employee was pinned between two vehicles and suffered fatal injuries. The employee’s fiancé filed a fatal claim petition with the Uninsured Employers Guaranty Fund (UEGF) on behalf of the employee’s minor children. The employer and UEGF each answered the petition, denying liability and that there was an employer-employee relationship. The WCJ granted the petition, finding the existence of an employer-employee relationship. The Board affirmed.
The employer appealed to the Commonwealth Court, arguing a lack of employer-employee relationship due to the pay and tax arrangements, lack of a regular schedule or actual supervision of towing and service jobs, and the employee’s purported freedom to pursue work or income from other sources. In particular, the employee signed a contract agreeing in writing that he was an independent contractor.
Under Section 103 and 104 of the PA Workers’ Compensation Act, an independent contractor is not entitled to benefits due to the absence of a master/servant relationship. See 77 P.S. §§ 21-22. As such, status as an employee or independent contractor is a crucial threshold determination. In order to receive benefits, claimants maintain the burden to establish an employer-employee relationship. The existence of such relationship is a question of law that is determined on the unique facts of a case.
The Commonwealth Court looked to its prior decision in Sarver Towing v. W.C.A.B. (Bowser) in which it acknowledged the long tenet that “control of the work and manner in which the work accomplished” is the “key indicator” in the analysis of an employment relationship. The court also noted, that an employer-employee relationship inquiry depends heavily on a WCJ’s underlying credibility and factual determinations.
In the present matter, employer presented testimony from former and current employees that no one supervised employee when he did tow jobs or other service calls for employer. These employees also testified that they understood the employer’s tow truck drivers were contractors and that they leased their trucks from employer, that they were paid by the tow or auto mechanic work job and that employer was not liable for their taxes or personal injury or liability.
However, the court looked at other facts beyond the contractual relationship. All of the employee’s jobs came from the employer and highly visible size of the employer’s name and information were on the side of the truck that he used, which employer owned. The employee could not use the tow trucks to do jobs for other companies. Further, if the employee received a call from another company, he could not accept it, and he could not lend the truck to another tow truck driver to do the job in his stead. The employer had also disallowed employee’s fiancée to accompany him on his jobs. Another employee also testified that she did not believe she could refuse a call from the employer for jobs unless she had an emergency or some other reason. In particular, the court noted that the WCJ gave the employee’s written independent contractor agreement little weight, finding that “rather than attempting to define an independent contractor relationship, the agreement was little more than pretext for employer to avoid the obligations of having employees.” The ability to decline work, the court also noted, does not defeat the otherwise persuasive evidence of an employer-employee relationship.
The court held that under the facts as found by the WCJ, the employer’s ownership and control over the availability and use of its trucks favored finding an employer-employee relationship. As a result, fatal claim benefits to employee’s fiancée on behalf of the minor dependent children were warranted, along with reimbursement of funeral expenses.
SUSPENSION OF BENEFITS
Benefits Suspended for Voluntary Removal from Workforce
In Philips Respironics v. W.C.A.B. (Mika), the claimant sustained a work-related injury of a left shoulder strain and sprain, which employer accepted by a medical-only NTCP. Both claim and termination petitions were filed and litigated before a WCJ. The WCJ granted the claim petition and denied the termination petition, but suspended TTD payments as of September 1, 2017, the date the injured worker testified about no longer looking for work. The claimant appealed to the Board, who reversed the WCJ on the issue of the suspension of benefits.
The employer appealed to the Commonwealth Court. On September 1, 2017, the claimant testified that he was no longer looking for work and was now a stay-at-home parent taking care of the children while his wife returned to work. He testified that it was a financial decision, and that he was not totally disabled. He admitted he was capable of working but elected not to do so.
The court concluded that the claimant “unequivocally testified that he had stopped looking for work, in part due to his shoulder condition and in part due to the economics of his personal situation.” Because the claimant acknowledged that there was work he could do but chose not to pursue due to personal financial considerations, the employer was not required to present evidence of available work within the claimant’s restrictions or expert testimony regarding the claimant’s earning power.” Accordingly, the court reversed the Board in favor of the original decision of the WCJ.
NEW JERSEY
Presumption Laws in Response to Covid-19
Traditionally, workers’ compensation coverage does not cover routine community-spread illnesses such as a common cold or a flu because it cannot be proven that they were directly contracted at the workplace. However, Covid-19 has created a situation where “essential” workers in certain fields such as healthcare are at higher risk of virus transmission in the workplace. Due to the nature of the COVID-19 disease, as well as inconsistent testing and documentation, it remains extremely difficult, and at times impossible, to prove through contact tracing when and where the disease was contracted. In response to such challenge, many state and federal governments have enacted COVID-19 presumption legislation to overcome this obstacle.
New Jersey is one of the states that have enacted COVID-19 presumption legislation, which would allow employees who suffer from a communicable disease to file workers’ compensation claims presuming that the contraction of the disease is work-related and compensable. Enacted on September 14, 2020 and applied retroactively to March 9, 2020, Senate Bill 2380 applies to certain “essential employees”, which is broadly defined and includes not only employees in the public safety, healthcare, transportation, hospitality and retail industries, but also any other employee defined as an “essential employee” in a state of emergency declaration by the Governor. However, an employee who is an employee of the State who is offered the option of working at home but has refused that option is not regarded as an essential employee. The prima facia presumption would be rebuttable, meaning that if an employer can prove by a preponderance of the evidence that the worker contracted the illness elsewhere, the claim can be denied.
Jurisdiction of Medical Claim Petitions and Orders to Compel
In Anesthesia Assocs. of Morristown, PA v. Weinstein Supply Corp., the NJ Superior Court Appellate Division addressed whether NJ medical providers can file an independent claim under NJ Workers’ Compensation Act (NJWCA) to recover payment for their services from their patients’ employers, where the patients lived and worked outside of NJ, were injured outside of NJ, and filed WC claims in their home states that resulted in payments being made to their NJ providers.
In the first case, the employee suffered compensable work-related injuries in PA in 1998. All connections were with PA, except that the employee had a medical procedure in NJ. Provider submitted its charges of $12,992 under the PA fee schedule and got paid $1,070.31. Provider then filed a medical claim petition (MCP) in NJ seeking the balance. The defense took the position that there was no jurisdiction in NJ over this MCP application. The Judge of Compensation dismissed the MCP application, concluding there were insufficient contacts in NJ with respect to the underlying compensation claim. In the second case, the facts were similar except that virtually all contacts were in the State of NY instead of PA. The Judge of Compensation found that “one day of treatment in NJ is insufficient to grant NJ jurisdiction” and dismissed the claim.
The Appellate Division began the analysis of jurisdiction by looking at the plain language of the 2012 amendment, which grant the Division “exclusive jurisdiction for any disputed medical charge arising from any claim for compensation of a work-related injury or illness.” The court then noted that medical provider claims could be brought under the NJWCA when the underlying WC claim would have jurisdiction in NJ. In order to determine jurisdiction, the court embraced Larson’s six-factors that courts must consider in deciding jurisdiction: 1) the place where the injury occurred; 2) the place of the making of the contract; 3) the place where the employment relation exists ; 4) the place where the industry is localized; 5) place where the employee resides 6) the place whose statute the parties expressly adopted by contract.
Applying these considerations into the two cases, the Appellate Division agreed with the two judges of compensation. The Appellate Division concluded that there was no cognizable claim for a work-related injury in either case. The court also declined the argument of the medical providers that these applications were contractual disputes. The court reasoned that such arguments are unsupported by any evidence of an agreement between the medical provider and the employer or the insurance carrier.
New Jersey Employers Must Reimburse for Medical Marijuana
In Vincent Hager v. M&K Construction, the employee injured his back in a work-related accident in 2001. For years thereafter, employee received treatment for chronic pain with opioid medication and surgical procedures to no avail. The employee then began taking medical marijuana to treat his back pain as a method of weaning off of opioids, which cost more than $600 each month. The employer denied the employee’s request for medical marijuana reimbursement on the grounds that it was not a necessary treatment under the NJ Workers’ Compensation Act. The employer also argued that it should be treated like a private health insurer under the Compassionate Use Act and be exempt from reimbursing the cost of the medical marijuana. Further, the employer argued that reimbursement would expose it to potential federal criminal liability for aiding and abetting. The workers’ compensation court rejected the employer’s claims and the Appellate Division affirmed.
On appeal, the NJ Supreme Court affirmed. The Court determined that palliative care falls within its scope and treatment that reduces symptoms of pain is “reasonable” and “necessary.” The Court also rejected the employer’s argument that they fall within the Compassionate Use Act’s limited reimbursement exception as workers’ compensation insurance is not supported as a type of health insurance in the Life and Health Insurance Code. Finally, the Court held that the employer does not face a credible threat of federal criminal charges for paying for the medical marijuana as it would be reimbursing the petitioner involuntarily through an Order. As such, the NJ Supreme Court has held that the employer was obligated to reimburse the employee under the NJWCA.
Volunteering Employee Entitled to Workers’ Compensation
In Goulding v. New Jersey Friendship House, Inc., the petitioner worked as a cook for the employer. The employer hosted a recreational event for its clients and asked its employees to volunteer to work the event, but there were no consequences for those who did not. The petitioner volunteered to work the event as a cook, her normal job with the employer. On the day of the event, she stepped in a pothole and fell down, injuring her ankle.
Petitioner filed a claim for WC benefits. The employer argued that the employee was not entitled to benefits because she was not working for the employer when the injury occurred. Under the NJ WCA, an employee injured during a social or recreational activity generally cannot receive compensation. However, the NJWCA provides a two-prong test for an exception when such recreational or social activity (1) was a regular incident of her employment; and (2) produced a benefit to the employer beyond improving employee health and morale.
The WC court dismissed the claim, determining that it was a social or recreational event and that the two-part test was not satisfied. The Appellate Division affirmed.
The New Jersey Supreme Court unanimously reversed the judgment of the Appellate Division and concluded that the petitioner’s injuries were compensable. The Court first addressed whether employer’s event was a social or recreational event. The Court noted that if the employee is helping to facilitate the activity, the event cannot be deemed a social or recreational activity as to that employee, and any injuries sustained by the employee while acting in that capacity should be compensated. Here, the employee’s role at the event as a cook was the same as her role as an employee and, “but for” her employment, she would not have been asked to volunteer and would not have been injured while generating client goodwill for her employer.
The Court then addressed the second prong of the exception and found that the employer received a benefit from the event beyond an improvement to employee health and morale. The event was not a closed, internal event for the employer; rather, it was an event designed to celebrate and benefit the employer’s clients, thereby creating goodwill for the employer in the community that could expand its fundraising opportunities in the future. The Court thus found the petitioner’s injuries compensable and remanded the matter to the WC court for further proceedings.
