January 4, 2010

Employers’
Championship
Season

IRE
Benefit Offset
Supersedeas Reimbursement
Subrogation
Specific Loss
Reinstatement
Mental Injury
Claims
Modification/Suspension
Penalty
Review

The Phillies had a great year in 2009, finishing with 93 wins in a 162-game season for a winning percentage of .574. Currently, the Eagles have eight wins with a .660 winning percentage. Alas, our Flyboys and 76ers are struggling with the Flyers just under .500 and the Sixers at a disturbing .227. However, for Employers throughout the Commonwealth 2009 was a championship appellate season with 37 wins out of 52 published appellate cases, which translates to over a .700 winning percentage. ¹  Following are the highlights, and some lowlights, of Employers’ championship season.

IRE

In Johnson v. WCAB (Sealy Components Group), 763 C.D. 2009 (Pa. Cmwlth. 2009), the Court invalidated the Bureau’s regulation set forth at 34 Pa. Code Section 123.105(f) to the extent that it allowed an employee to challenge the validity of an initial IRE determination at any time during the 500-week partial disability period. The plain language of Section 305(a.2)(4) of the Act imposed the requirement that there be a determination that the employee meet the threshold impairment rating equal to or greater than 50% impairment. To the extent that Section 123.105(f) expanded the ability to challenge the IRE, it was invalidated. In Ford Motor v. WCAB (Gerlach), 970 A.2d 517 (Pa. Cmwlth. 2009), modification of benefits based on impairment rating outside the automatic provisions of Section 306(a.2) and less than 50% was as of the date of the evaluation by the IRE physician.

Benefit Offset

There were multiple benefit offset cases. In Allegheny Ludlum Corporation v. WCAB (Bascovsky), 977 A.2d 61 (Pa. Cmwlth. 2009), Employer was entitled to a complete offset based on Claimant’s pension benefit since Employer proved that it provided the sole funding for the pension trust that paid the benefit despite the fact that a previous employer would provide funding in the future. In City of Philadelphia v. WCAB (Calderazzo), 968 A.2d 841 (Pa. Cmwlth. 2009), Employer met is burden that it was entitled to an offset for a service-connected disability pension paid to Claimant although the matter was remanded for the WCJ to accept testimony as to what percent of the pension funds were funded by the Employer. In Consolidation Coal Co. v. WCAB (Albani), 968 A.2d 815 (Pa. Cmwlth. 2009), the Court found that Employer’s expert’s use of a service-based methodology to ascertain the portion of Employer’s contribution that could be offset from Claimant’s benefits was a valid methodology in a defined benefit plan. In City of Philadelphia v. WCAB (Grevy), 968 A.2d 830 (Pa. Cmwlth. 2009), Claimant’s ability to withdraw pension contributions or designate benefits for a survivor did not exempt the pension from application of Section 204(a) of the Act. However, in Philadelphia Gas Works v. WCAB (Amodei), 970 A.2d 508 (Pa. Cmwlth. 2009), Claimant’s compensation benefits were offset by the net amount of his pension, not the gross amount.

Supersedeas Reimbursement

There were four significant supersedeas reimbursement decisions. In The Boeing Company v. WCAB (Horan), 977 A.2d 92 (Pa. Cmwlth. 2009), Employer was entitled to supersedeas fund reimbursement when the WCJ did not allow an offset for severance and unemployment compensation when first determining Claimant’s benefits, and Employer later prevailed in its claim for offset. In Department of Labor & Industry v. WCAB (Ethan-Allen), 972 A.2d 1286 (Pa. Cmwlth. 2009), general release provisions in the parties’ C&R did not override the parties’ specific agreement to allow the WCJ to determine the suspension petition, in order that Employer could pursue request for supersedeas reimbursement. In Department of Labor & Industry v. WCAB (Crawford & Co.), 965 A.2d 332 (Pa. Cmwlth. 2009), Insurer was entitled to reimbursement for medical treatment incurred prior to the filing of a petition requesting supersedeas, since the request for payment was submitted and paid after the request for supersedeas was denied. However, in Henkels & McCoy, Inc v. WCAB (Barner), 972 A.2d 82 (Pa. Cmwlth. 2009), Insurer was not entitled to supersedeas reimbursement where benefits were unilaterally stopped, even though Claimant had returned to work at the same rate of pay and was fired two days later for cause.

Subrogation

There were three important subrogation decisions. In Good Tire Service v. WCAB (Wolfe), 978 A.2d 1043 (Pa. Cmwlth. 2009), the offset for attorney fees paid to Claimant’s third party counsel was limited to the actual amount of attorney’s fees paid in order to avoid sham fee agreements for the purpose of avoiding the law regarding employers’ subrogation rights. In Young v. WCAB (LGB Mechanical), 976 A.2d 627 (Pa. Cmwlth. 2009), the Court determined that any attorney’s fees paid out of Claimant’s compensation were part of Employer’s accrued lien subject to subrogation. In Fox v. WCAB (PECO Energy), 969 A.2d 11 (Pa. Cmwlth. 2009), sovereign immunity did not nullify Employer’s subrogation rights over settlement paid to Claimant by the City of Philadelphia.

Specific Loss

In Community Service Group v. WCAB (Peiffer), 976 A.2d 594 (Pa. Cmwlth. 2009), Employer was not obligated to make payment of specific loss benefits for a disfigurement caused by medical treatment related to the work injury until disability payments were no longer due and owing.

Reinstatement

In Reutzel v. WCAB (Allegheny General Hospital), 448 C.D. 2009 (Pa. Cmwlth. 2009), Claimant was not entitled to a second 500-weeks of partial disability benefits for a second injury that occurred one year after the initial injury. Rather, partial disability could continue only until 500 weeks after the second injury. In Ward v. WCAB (City of Philadelphia), 966 A.2d 1159 (Pa. Cmwlth. 2009), Claimant failed to prove that he was unable to perform the specific functions of a position that he had been found capable of performing at an earlier time in a prior litigation when his benefits had been modified for bad faith.

Mental Injury

In McLaurin v. WCAB (SEPTA), 980 A.2d 186 (Pa. Cmwlth. 2009), Claimant was not entitled to benefits for a mental injury after a gun attack on the job where Employer was able to prove that such attacks were not abnormal working conditions in his job as a bus driver.

Claims

In Gentex Corporation v. WCAB (Morack ) 975 A.2d 1214 (Pa. Cmwlth. 2009), Claimant’s voicemail message to Employer that her absence from work due to work-related physical problems was not sufficient notice under the Act to give Employer proper notice of the nature and severity of her complaints. In Reyes v. WCAB (AMTEC) 967 A.2d 1071 (Pa. Cmwlth. 2009), Claimant was not entitled to benefits or litigation costs because he failed to show that his loss of earnings was due to his work injury, rather than his termination for cause after the work injury. In Department of Labor & Industry v. WCAB (Savani), 977 A.2d 585 (Pa. Cmwlth. 2009), Claimant was not entitled to benefits for injury in the nature of a broken arm when she fell while walking on her break in an industrial park where Employer was located, but was not Employer’s property.

Modification/Suspension

In Diehl v. WCAB (IA Construction), 972 A.2d 100 (Pa. Cmwlth. 2009), petition for allowance of appeal granted (Pa. 2009), the Court held that Employer need not present proof of available employment when seeking to modify the disability status of Claimant more than 60 days after Claimant’s receipt of 104 weeks of disability benefits. Such proof is required only when seeking to modify the amount of the benefit.

In Harvey v. WCAB (Monongahela Valley Hospital), 333 C.D. 2009 (Pa. Cmwlth. 2009), Employer was not required to present proof of available positions in order to prevail on modification position where Claimant had been discharged for cause based on pre-injury actions that were made known to Employer after the work injury.

In Rebeor v. WCAB (Eckerd), 976 A.2d 655 (Pa. Cmwlth. 2009), Employer was not obligated to conduct an earning power evaluation near Claimant new home in South Carolina based on the plain language of Section 306(b)(2), which defined usual employment areas in those instances as where the injury occurred.

In Mendes v. WCAB (Lisbon Contractors), 981 A.2d 334 (Pa. Cmwlth 2009), Employer was not required to present medical evidence to support suspension petition where Claimant had moved to Portugal and voluntarily removed himself from the workforce. See also, Braz v. WCAB (Nicolet, Inc.) 977 A.2d 1 (Pa. Cmwlth. 2009).

In Presby Homes and Services v. WCAB (Quiah), 978 C.D. 2009 (Pa. Cmwlth. 2009), an offer of modified duty was valid even if it contained a provision that the job offered could be changed at any time because it was made in good faith and Claimant was not without recourse if she could not perform the position if it was changed. However, the Supreme Court recently held that Employer’s earning power evaluation for an out-of-state employee was not valid where it was not conducted in the usual employment area where the injury occurred.

Also, in Lisanti Painting Company v. WCAB (Starinchak), 973 A.2d 464 (Pa. Cmwlth. 2009), Claimant could not be required to repay benefits paid to him when he refused to undergo surgery that had been recommended by his doctor and Employer’s doctor.

In Roegele, Inc. v. WCAB (Mattson), 969 A.2d 634 (Pa. Cmwlth. 2009), Employer was ordered to pay Claimant benefits from the date he solicited the murder of his wife to the date of his incarceration after conviction where Claimant plead guilty. The Court relied on the plain language of Section 306(a.1) of the Act. In Giant Eagle v. WCAB (Givner), 813 C.D. 2009 (Pa. Cmwlth. 2009), the WCJ properly maintained Claimant’s medical benefits while her wage loss benefits were suspended for failure to attend an IME.

Penalty

In Equitable Resources v. WCAB (Thomas), 981 A.2d 386 (Pa. Cmwlth. 2009), Employer was found responsible for repairs to construction negligently performed to make accommodations in Claimant’s bathroom. The Court dismissed Employer’s argument that it was required to only make one-time modification to Claimant’s home. Claimant sought to have the original modification properly performed.

Review

In Cinram Manufacturing, Inc. v. WCAB (Hill), 975 A.2d 577 (Pa. 2009), the Court rejected Employer’s argument that Claimant was required to file a review petition, in the context of a termination petition, to support a corrective amendment to a notice of compensation payable. The NCP acknowledged a “lumbar strain/sprain. Claimant defended with medical evidence that he continued to suffer from a work-related aggravation of a pre-existing disc herniation, a condition not described in the NCP. The first paragraph of Section 413(a) allows discretionary corrective amendments where there has been an “inaccuracy” in the identification of the existing injury. The language of this section allows the WCJ to correct an NCP at any time.

1. The appellate statistics run from January 1, 2009 to November 30, 2009. The team statistics are as of December 11, 2009. Here’s hoping that our Eagles, Flyers and Sixers finish strong.

(Back to top)