Thursday, June 30, 2005

Social Security Old Age Benefits Are "Received" Under Section 204(a) on Date Of Eligibility and Application

In Pittsburgh Board of Education v. WCAB (Davis) The Commonwealth Court held the Employer was not entitled to an offset for the Claimant's Social Security old age benefits when the Claimant applied for benefits prior to his work injury but received his first check (including benefits back to the date of application) after the injury.

Workers' Compensation TV and Radio on the Web

The Legal Talk Network is offering a show on workers' compensation matters hosted by Attorney Alan S. Pierce of Massachusetts. Shows on sick building syndrome and ethical considerations are available for listening or download at Legal Talk Network.

Law Journal TV continues to offer webcasts of its shows from WFMZ-TV 69 in Philadelphia. About every fourth weekly show is on a workers' compensation topic.

Wednesday, June 29, 2005

Commonwealth Court Holds Attorney Fees For Unreasonable Contest Are Not Automatic When A Penalty Is Granted

In B. Bates v. WCAB (Titan Construction Staffing, LLC) the Commonwealth Court expressly overruled its holding that a finding of a violation of the Workers' Compensation Act mandates the imposition of attorney's fees for unreasonable contest. Hoover v. WorkersÂ? Comp. Appeal Board (ABF Freight Systems), 820 A.2d 843, (Pa. Cmwlth. 2003), overruled on other grounds by Snizaski v. WorkersÂ? Comp. Appeal Board (Rox Coal Co.), 847 A.2d 139 (Pa. Cmwlth.), alloc. granted, ___ Pa. ___, 862 A.2d 582 (2004). The Court stated the Employer has the right to establish a reasonable basis for contest in any case.

In Hoover, the issue was the conflict between the thirty day requirement to pay and the Board regulations that gave the Board more than thirty days to rule on supersedeas. The WCJ granted a penalty of 10% rather than the requested 50% on payments of over 85,000.00 that were only (arguably) a few days late. The WCJ found a reasonable contest because the effect of the Board regulations on the Employer's duty to pay was unsettled at the time. The Commonwealth Court affirmed the penalty and further held that due to the Employer's violation of the Act I erred as a matter of law in failing to award attorneys fees to the Claimant.

In the Bates case, the Claimant requested a penalty because SWIF paid him biweekly rather than weekly, as he was paid on the job. The WCJ awarded a reduced penalty of 10% rather than the 50% requested on this, what the WCJ determined to be a violation of the Act. The WCJ recognized, however, and explained that reasonable minds could differ on this issue and the WCJ found a reasonable contest. The Commonwealth Court agreed the contest was reasonable based on the genuine issue of law and on the basis the WCJ awarded less than the 50% requested.

Accordingly, counsel fees for unreasonable contest will be awarded only where the Claimant asserts a reasonably clear violation of the Act and requests an appropriate penalty.

This raises the issue of whether any penalty between 10% and 50% can be granted, since these are the only numbers the statute provides. I still may award 20%, 30% or 40%. Other Judges award only 10% or 50%.

The best practice would be to request the minimum 10% and amend the request in the course of litigation if a higher penalty seems warranted. Counsel could then seek guidance from the WCJ on whether the WCJ will consider numbers in between 10% and 50%.

Wednesday, June 22, 2005

Commonwealth Court Defines Competent Medical Records in Two Cases of Less Than 52 Weeks of Disability

In two decisions, City of Harrisburg v. WCAB (Palmer) and Joy Global, Inc. v. WCAB (Hogue) the Commonwealth Court reviewed awards of the WCJ made on medical reports. In both, the WCJ found credible evidence of a strain (of the knee and ankle respectively) and awarded benefits for the sequelae of these injuries.

In both cases, the Court began with the premise that a case involving medical expenses and less than 52 weeks of disability may be decided on medical reports under Section 422(c) of the Act. The Employers' challenges were to the competency of the evidence submitted by the Claimant in each case.

In Palmer, the WCJ credited the Claimant's medical evidence, even though in one instance the Claimant's physician stated the Claimant's knee condition was unrelated to the work injury. The WCJ rejected this as inconsistent with the doctor's other statements on the issue. The Employer's main argument was there was no medical opinion relating the Claimant's total knee replacement to the work-related strain. The Court found it was sufficient that Claimant's physician diagnosed worsening pain as a result of the injury and also stated unrelenting pain is an indication for knee replacement surgery.

In Hogue, the Claimant's medical evidence was only "Clinical Worksheet" forms prepared by a nurse at the panel provider's office. The Court held these were competent to support an award because they fit the definition of reports of "medical providers" as defined in Section 109 of the Act. The forms clearly addressed the injury. Any other discussion of the content of the forms goes to the credibility of the evidence, not the competence, according to Budd Company v. Workers' Compensation Appeal Board (Kan), 858 A.2d 170, 180 (Pa. Cmwlth. 2004).

The Court did state in a footnote that Claimant's counsel fees in Hogue would not be awarded under Pa.R.A.P. 2744 regarding frivolous appeals. The Court stated the application of the provisions of Section 422(c) is an emerging area in workers' compensation law, citing Budd.

Tuesday, June 14, 2005

Commonwealth Court Holds WCJ's Findings of Fact Establish Collateral Estoppel

In D. Williams v. WCAB (South Hills Health System) the first WCJ granted a Termination Petition and found the Claimant did not have a herniated disk. The Claimant did not appeal. On a Reinstatement Petition, the second WCJ found there was a herniated disk and awarded benefits.

The Board and Commonweath Court reversed the second WCJ, holding the finding the Claimant did not sustain a herniated disk was final, e.g. the finding could not be revisited under the doctrine of collateral estoppel. This analysis was consistent with the holding in Gillyard v. WCAB (PA LCB), where the Court held a second WCJ could not adopt a lesser diagnosis than that accepted by the first WCJ to then terminate benefits.

I originally felt these holdings were inconsistent with J. Almeida v. WCAB (Herman Goldner Company). In that case, the Commonwealth Court held the Claimant does not have standing to appeal a WCJ's finding of fact (in fact, the exact same finding of fact, that the Claimant did not sustain a herniated disk). By holding the Claimant did not have standing to appeal, the use of the fact in a later proceeding would be a denial of due process.

However, even though the facts in this case are the same, the result on the first petition in this case would have given the Claimant standing to appeal. Termination was denied in the Almeida case. When termination was granted in this case, the finding of no herniated disk was essential and material to the judgement, and the Claimant would have had standing to appeal.

Similarly, Almeida will be able to argue a disk herniation occurred the next time a termination petition is filed against him, because the finding of no herniated disk was not essential and material to the denial of the Employer's request for termination in his first case.

WCRI Issues New Study on Return To Work

The Workers' Compensation Research Institute recently issued a study of Return-To-Work Outcomes of Injured Workers: Evidence from California, Massachusetts, Pennsylvania, and Texas. Nothing surprising, but the findings underscore several principles of managing return to work scenarios. Press Release

Monday, June 13, 2005

State Service Connected Disability Supplement Available When Workers' Compensation Benefits Are Offset For Receipt of Disability Pension

Section 5704(f) of the State Employees Retirement Code provides for a supplement for a service connected disability under which the Claimant is guaranteed to receive 70% of the Claimant's Final Average Salary in pension, workers' compensation (and social security, if applicable). In W. R. Gowden v. State Employees' Retirement Board the Claimant received workers' compensation benefits and his disability pension. After the Commonwealth took an offset for the pension, the Claimant's pension and workers' compensation benefits did not equal 70% of his Final Average Salary and he applied for the supplement.

The State Employees Retirement Board denied the supplement. They reasoned this would deprive the Commonwealth of the benefit of Section 204(a) of the Workers' Compensation Act. The Board also attempted to assert they would be entitled to a credit for the supplement, setting off a cycle at the end of which the Claimant would receive no workers' compensation benefits at all, only the supplement.

The Commonwealth Court held the Commonwealth clearly gets the benefit of Section 204(a) of the Act. It is an unrelated statutory provision which binds the State Employees Retirement System to pay the supplement. Furthermore, the Commonwealth Court stated the Commonwealth's second argument is not supported in the record. Counsel for the Board stated at oral argument SERS will not seek reimbursement for the supplement from The Office of Attorney General, the Claimant's Employer.

To assure a balance between the statutes, the Commonwealth Court held the Section 204(a) offset under the Workers' Compensation Act should be calculated without regard to the supplement the Claimant is entitled to under Section 5704(f) of the State Employees' Retirement Code.

Monday, June 06, 2005

WCJ Does Not Have Jurisdiction To Rule On URO When Provider Does Not Send Records

In County of Allegheny, et al. v. WCAB (Geisler) the Commonwealth Court held the WCJ does not have jurisdiction in an appeal from a URO based on the provider's failure to provide records. The Court observed that a provider could intentionally not respond to the records request and proceed to make its case before the WCJ, bypassing the URO process.

Under this ruling, a prospective URO will be required to recommence payment for treatment. Certainly there is no res judicata effect of the first URO, since the determination was not on the merits.

A provider that has an excuse for not supplying records should still appeal to the WCJ, but the WCJ can only enter an order that in a subsequent prospective URO the reviewer must review treatment back to the date of the original UR request.

Saturday, June 04, 2005

Commonwealth Court Holds Board Should Not Have Reduced Subrogation Credit And Extended Time For Repayment Based On Financial Hardship

In Monessen, Inc. v. WCAB (Fleming) the Board affirmed the WCJ's determination that the workers' compensation carrier could recover its subrogation lien from the Claimant's indemnity payments. The Claimant presented no evidence of financial hardship in the event of suspension of benefits. The WCJ entered a suspension of benefits for 241.38 weeks for recovery of the lien.

However, the Claimant asserted financial hardship before the Board. The Board, without taking any evidence, reduced the insurer's credit to $80.00, extending the period for repayment to 494.30 weeks.

The Commonwealth Court reversed the reduction of the credit, holding the Board had no authority in fact or in law to grant less than a complete suspension of benefits. The Court distinguished Fahringer, McCarty & Grey, Inc. v. Workers’ Comp. Appeal Bd. (Green), 529 A.2d 56 (Pa. Cmwlth. 1987) (en banc) stating both there was no factual evidence of hardship presented before the WCJ and Fahringer did not involve subrogation under Section 319, which the Court said confers an absolute right to immediate repayment.

Wednesday, June 01, 2005

Amounts Offset From Social Security By Workers' Compensation Benefits Are Included In Taxable Gross Income

In the T.C. Summary Opinion of the United States Tax Court in Flores V. Commissioner No. 2005-57, the Special Trial Judge held Section 86(d)(3) of the Tax Code requires an injured worker to pay income tax on the amount of a workers' compensation offset from social security disability benefits. The SSA-1099 provided by the Social Security Administration always shows both benefits received and the amount of a workers' compensation offset for the year. The tax Court held it was appropriate to consider the offset amount income.

The Court recognized the Claimant had to apply for social security disability to get a long term disability benefit, and of course the Court recognized workers' compensation benefits are not generally taxable. However, the Court identified legislative history that stated the purpose of section 86(d)(3) was to equalize the federal tax treatment of social security benefits in precisely this scenario.

This opinion is branded: PURSUANT TO INTERNAL REVENUE CODE SECTION 7463(b),THIS OPINION MAY NOT BE TREATED AS PRECEDENT FOR ANY OTHER CASE. However, there is no reason the same logic would not carry the day in the future. This is another consideration in the decision whether to apply for social security disability (when there is a choice).

Thanks to Ronald L. Calhoon, Esquire of Serratelli, Schiffman, Brown & Calhoon, P.C.

Issues In Creating Modified Duty Positions In Scranton

In Scranton, the City is attempting to bring back public safety workers on workers' compensation as greeters in City Hall. The Scranton Times has an article about the twists and turns so far with this plan.