State News

May 2013

Tennessee Governor Signs Workers’ Compensation Reform Bill

On April 29, 2013, Governor Bill Haslam signed Senate Bill 200 – House Bill 0194.  Self-titled as “The Workers’ Compensation Reform Act of 2013,” this legislation brings about the most sweeping changes of Tennessee Workers’ Compensation Law since it was first codified in 1919.

The bill has been enacted as Tennessee Public Chapter 289.  Please see our posting of April 26, 2013, for more detail as to the specific elements of this reform. 

Fredrick R. Baker, Member
Wimberly Lawson Wright Daves & Jones, PLLC
1420 Neal Street, Suite 201
P.O. Box 655
Cookeville, TN 38503-0655
Phone: 931-372-9123
Fax:  931-372-9181
fbaker@wimberlylawson.com
www.wimberlylawson.com

TO RETIRE OR NOT TO RETIRE

By

Jeffrey D. Snyder and Kevin L. Connors

Yes, genuflecting in the general direction of T. S. Eliot:

“April is the cruelest month,

Lilacs of the dead land, mixing

Memory and desire, stirring

Dull roots with spring rain.

And, indeed, there will be time for us to determine the burden of proof in cases where an employer claims that an employee, post-retirement, has voluntarily withdrawn from the workforce, entitling the employee to the magis hubris of a suspension of indemnity compensation benefits.

What are we talking about, and why do we care?

Burdening all with the instructive yet pedantic ruling recently issued by the Pennsylvania Supreme Court inCity of Pittsburgh UPMC Benefit Management Services, Inc. v. WCAB (ROBINSON), we are nevertheless constrained to consider its analysis of the burden of proof in cases when an employer claims that an employee, allegedly post-retirement, has voluntarily withdrawn from the workforce, presumptively entitling the employer to the conceit of a suspension of indemnity compensation benefits.

What presumption are we talking about, and why should we read with relish on?

Poetic liberties aside, the Supreme Court has concluded in the City of Pittsburgh, decided on March 25, 2013, that the employer carries the burden of proof, under a “totality of circumstances” test, to establish an employer’s basis to suspend a Claimant’s workers’ compensation benefits, with the Court finding that the employer must prove, in a withdrawal from the labor force case, that the Claimant’s election and receipt of an employment-based pension establishes that the Claimant has voluntarily withdrawn from the workforce, effectively constituting a post-working motif, not to be confused with a paradigm, of making no effort to seek re-employment.

Will this result in higher cable TV charges, we wonder?

Da Facts

In the City of Pittsburgh, the Claimant was a Pittsburgh Police Officer, who had sustained a work-related injury in 1997.

Subsequent to that workers’ compensation claim, she sustained new injuries in 2001, when she was involved in an automobile accident, as she was driving to treatment for the original work injury.

Following her car accident, the Claimant was not able to continue working in a light-duty capacity, and she was not offered any subsequent employment by the employer.

Three years after the car accident, the Claimant applied for and received a disability pension from Pittsburgh.  Pensions are awarded to police officers, who, due to a work injury, are unable to perform the duties of their position.

Da Ruling

The Supreme Court held that the Claimant’s entitlement to receive the pension simply meant that she was unable to perform her pre-injury employment as a police officer, but that did not mean that she was precluded from performing any employment whatsoever.

Another three years fly by, as often happens in our squirrely compensation universe, and the Claimant was referred for an independent medical examination, with the IME doctor, bless his board-certified credibility, finding that the Claimant was unable to perform the pre-injury job as a police officer, but that she certainly could perform modified-duty work, as we all know that even Christopher Reeves was able to do that in a wheelchair, post-Superman.

As the Act requires, a Notice of Ability to Return to Work was issued, with the employer shortly thereafter filing a Suspension Petition, under which it was alleged that the Claimant was capable of working, but that the Claimant had voluntarily removed herself from the workforce, as she was not looking for work, had not looked for work, and was not seeking employment in the general labor market.

Yes, they subpoenaed her cable company bills to prove her inactivity (not).

Oddly enough, the Claimant responded, alleging that she remained umbilically attached to the workforce, having registered for work with the Pennsylvania Job Center, and she also claimed that she was not presently working because of the unavailability of work, as her light-duty position had been eliminated, negating the availability of immediate work for her.

Litigated before the workers’ compensation judge, the Claimant was able to establish, through testimony from a senior claims examiner, that the light-duty position that she had previously held had, yes, been terminated.

Proof positive that April is the cruelest month.

Notwithstanding the employer presenting the expert medical testimony of the IME doctor, evidencing that the Claimant was physically capable of performing modified-duty work, the workers’ compensation judge, bizarrely enough, denied the Suspension Petition, concluding that the Claimant had not voluntarily removed herself from the workforce.

The workers’ compensation judge concluded that the Claimant had been forced into retirement when her light-duty work was taken away from her, cruelly eliminated by her employer.

The workers’ compensation judge also accepted the Claimant’s testimony that she had reported to the Pennsylvania Job Center, after receiving the Notice of Ability to Return to Work.

Da Appeals

Ascending through the appellate ranks, the employer eventually appealed the judge’s decision to the Commonwealth Court, which affirmed the judge’s decision in a bearish polarity opinion, finding that it was constrained by prior holdings, to include the infamousKachinski case, decided in 1987 by the Pennsylvania Supreme Court, forever establishing an employer’s burden of proof, when seeking a suspension of compensation benefits under Section 306, based on the ability to perform some level of work post-injury.

So, before the Supreme Court, the appellate issue turned on the question of when a Claimant has actually “retired” so as to invoke the suspending powers of the “withdrawal” cases, as the Commonwealth Court had concluded that the acceptance of any type of pension does not create a presumption of retirement, nor does it necessarily establish a complete withdrawal from the labor force.

Granting allocator, which is like getting dessert at your favorite diner, the Supreme Court recognized that to establish that a Claimant was withdrawing from the labor force, requires the tortured analysis of a Claimant’s state of mind, further requiring the interpretation and analysis of various subjective facts, to determine if the withdrawal was voluntary, as well as being presumptively total.

In shorthand, the Supreme Court held that the receipt of a pension, any type of pension, is not sufficient evidence, in and of itself, to establish an employer’s burden of proof, that a Claimant has voluntarily removed themselves from the workforce.

Presumptive v. Permissive

To establish that fact, as a legitimate basis for suspending a Claimant’s workers’ compensation benefits, there must be an unequivocal admission of no further attachment to or connection with the workforce, such as had been in the case ofDugan v. WCAB, 569 A.2d 1038 (Pa. Cmwlth. 1990). 

The analytical paradigm being, in City of Pittsburgh, that an employee’s receipt of a disability pension only entitles the employer to a “permissive inference that the Claimant has retired”.

That inference, alone, is insufficient to establish that the worker has fully retired from the workforce, such that a suspension of compensation benefits would be inappropriate under the Pennsylvania Workers’ Compensation Act.

Other relevant and credible evidence must be introduced by the employer, to sustain its burden of proving a withdrawal from the workforce.

In short, to be disabled is not necessarily to be retired, nor does it with any prima facie likelihood, mix the memory of working with the desire to do so.

Practical Tips

The Supreme Court’s ruling in City of Pittsburgh certainly clarifies the burden of proof and burden of production in cases of voluntary withdrawal from the workforce, while effectively reinforcing the standards of proof that had been applied in prior withdrawal cases, to include Dugan, with the predicate test for a “retirement/withdrawal” case, as basis for a suspension, being a “totality of the circumstances”, effectively begging the presidential, as opposed to precedential, question, “what is the meaning of the word, is?”.

Get it in writing!

ConnorsLaw LLP

Trust us, we just get it!  It is trust well spent!

Defending workers’ compensation claims throughout Pennsylvania for employers, self-insureds, insurance carriers, and third party administrators, our 100+ years of cumulative experience defending our clients against compensation-related liabilities, empowers our workers’ compensation practice group attorneys to be more than mere claim denials, entrusting us to create the factual and legal leverage to expeditiously resolve claims, in the course of limiting/reducing/extinguishing our clients’ liabilities under the Pennsylvania’s Workers’ Compensation Act.

SUMMARY OF PENNSYLVANIA

WORKERS’ COMPENSATION LAW

By

Kevin L. Connors, Esquire

The following is a broad summary of practices and procedures under Pennsylvania’s Workers’ Compensation Act, 77. P.S. § 1-1031,

I.          Filing Deadlines:

Employee required to report injury to employer within 21 days of occurrence, for notice provisions of WCA; notice must be to management.

If not report within 120 days of injury, claim is time-barred under WCA. The same is true whether alleging physical injury, psychological injury, or occupational disease. 

Report of Injury required to be filed with the Bureau of Workers’ Compensation by employer within 48 hours of fatal injury, and within 7 days of other injuries.

There is a 7 day waiting period for the payment of wage loss disability benefits following injury. 

Beyond the 7 day waiting period, the injured employee is entitled to be paid wage loss disability benefits.  Benefits are payable back to the first date of disability, if disability exceeds 14 days post-injury. 

Wage loss disability payments must be made on the same schedule as the payment of wages pre-injury.  If benefits, inclusive of wage, medical, interest, attorneys’ fees, and/or penalties, are awarded to injured employee, under a Bureau-circulated WCJ decision, the benefits must be paid within thirty 30 days of issuance of the award/decision. 

II.        STATUTE OF LIMITATIONS:

A 3 year statute of limitations applies to the filing of a Claim Petition, seeking workers’ compensation benefits for an alleged work injury.

If workers’ compensation benefits are terminated, either by agreement or by decision, the injured employee has a 3 year statute of limitations to seek reinstatement of compensation, and to strike the effective termination of compensation benefits.

If compensation benefits have been suspended, and/or modified, based upon an injured employee again being able to return to work at wages equal to or greater than the pre-injury average weekly wage, or, if the injured employee is earning less than the pre-injury average weekly wage, the injured employee has a 500 week statute of limitations to reinstate temporary total disability benefits, to strike a suspension or modification.

Any employer or insurer seeking to limit an injured employee’s receipt of wage loss disability benefits in reliance upon an impairment rating evaluation cannot seek to convert a temporary disability claim to a permanent disability claim, until the injured employee has received 104 weeks of total disability benefits; the total disability benefits need not be cumulative, but they cannot be partial disability benefits.

The statute of limitations for an occupational disease claim is 300 weeks from date of last exposure. 

Appeal from a decision circulated by a workers’ compensation judge must be filed within 20 days of the circulation date of the decision. The appeal must be filed with the Workers’ Compensation Appeal Board; a party seeking Supersedeas from a decision issued by a WCJ must file the Supersedeas Petition within the same timeframe as the appeal, being 20 days from decision circulation date.

Any appeals from the Appeal Board to the next appellate level, the Pennsylvania Commonwealth Court, must be filed within 30 days of the decision circulation date.

III.       COMPENSATION BENEFIT RATE SCHEDULES:

2011 – 2012 - 2013

A.        AVERAGE WEEKLY WAGE CALCULATION:

The injured employee’s average weekly wage is calculated using the gross wages of the employee over the 52 weeks prior to the work injury. 

The 52 weeks are divided into 4 – 13 calendar quarter periods. The 3 highest 13 week periods are added together, and divided by 3, resulting in the average weekly wage.

If the injured employee has worked less than a full calendar quarter, wages are based upon the “expectations of the parties”. 

IV.       SCHEDULE/SPECIFIC LOSSES:

The following schedules apply to specific losses, either as total/partial amputations, or as “complete loss of use for all practical intents and purposes”:

V.        MOST COMMONLY USED WC FORMS:

VI.       GENERAL PRINCIPLES:

Injuries occurring in the course and scope of employment and related thereto are compensable under the Act.

Pennsylvania utilizes the AMA Guidelines to determine impairment ratings, although the same guidelines have no application whatsoever to a disability claim.

Appeals of decisions have three levels, from WCJ to Appeal Board, from Appeal Board to Commonwealth Court, and from Commonwealth Court to Supreme Court.

The Commonwealth Court averages about four compensation decisions per month. 

The Supreme Court averages about three or four compensation decisions per year.

 A.        COMPENSATION BENEFITS:

There are six compensation benefits available under the Pennsylvania WCA.

The compensation benefits are: 

·         Temporary compensation benefits;

·         Temporary total disability benefits (total disability wage loss);

·         Temporary partial disability benefits (difference between pre-injury wages and post-injury wages – subject to 500 week limitation);

·         Specific loss benefits (payable for amputation, complete loss of use of body part, or facial scars);

·         Death benefits, payable if the fatality is work-related;

·         Medical compensation benefits (payable for reasonable, necessary and related medical care for work injuries);

Compensation benefits are payable for work-related injuries occurring in the course and scope of employment, excluding intentionally self-inflicted injuries, injuries occurring as a result of a violation of law, such as when incapacitated due to intoxication or drugs, when violating a positive work order of the employer, when injury is caused by “personal animus), or where there is no employer/employee relationship.

Temporary total disability benefits are payable when an injured employee is disabled from performing pre-injury job.

Partial disability benefits are payable if the injured employee is capable of working, with some presumption of continuing disability, and earning less than pre-injury wages.

Permanent partial disability is recognized in the context of specific loss claims and claims governed by impairment rating evaluations, but only where the impairment rating is less than 50% of a whole man threshold.

Permanent partial disability is compensable if an injured employee loses two appendages.

Death benefits are payable as long as the fatality is related to the work injury.

Workers’ compensation is regarded as an exclusive remedy, providing the employer with statutory immunity from tort-based liability, so long as the employee is insured for workers’ compensation.

The WCA is regarded as being both humanitarian, and an affirmation of public social policy.

B.        CLAIM PROCEDURES:

Pennsylvania Workers’ Compensation procedures are form-intensive, as every change in the compensation status of a claim requires that the change be recognized with the filing of the appropriate compensation form.

Most commonly used compensation forms are:

            Report of Injury (when injury is reported to employer);

            Notice of Compensation Payable (claim being accepted with injury and wage rates identified);

            Notice of Compensation Denial (when claim being denied, requiring basis be identified);

            Notice of Temporary Compensation Payable (temporary compensation benefits are payable for ninety (90) days without admission of liability as to injury or disability);

            Notice Stopping Temporary Compensation Payable (required to be filed before expiration of ninety (90) day temporary compensation period);

            Supplemental Agreement (post-claim acceptance form evidencing employee change in status, either as to return-to-work, or as to reinstatement, if work is stopped);

            Notice of Ability to Return to Work (form advising employee that they are medically released to return to work); (with mandatory issuance prior to any employer job offer being extended);

            Statement of Wages (provides basis to calculate pre-injury average weekly wage and compensation payable rate);

            Compromise & Release Agreement by Stipulation (document used to settle workers’ compensation claims, subject to approval by WCJ);

            Utilization Review (challenge to reasonableness and necessity of medical care);

            Physician’s Affidavit of Recovery (attesting to full recovery post-injury);

            Notification of Suspension/Modification (used to suspend or modify wage loss benefits within 7 days of return to work.

Reporting of injury claim with disability requires acceptance, denial, or agreement to pay temporary compensation benefits, within 21 days of first day of claimed disability from work injury.

Claim acceptance requires payment on weekly/biweekly schedule of temporary total disability benefits (TTD) to employee, without specific statutory time limitation, subject to change if the employee’s disability/ability to return to work status.

Claim acceptance results in the employer/insurer obligation to continue paying workers’ compensation benefits for both wage loss and medical expenses until:

·         Employee dies from non-work-related causes;

·         Employee sufficiently recovers from work injury to be able to return to some level of work;

·         If employee returns to work at pre-injury wages, wage loss benefits are suspended, and medical compensation benefits continue;

·         If employee returns to work at wages less than pre-injury wages, the employee receives temporary partial disability benefits, payable as 2/3 of the difference between pre-injury wages and post-injury wages, subject to 500 week limitation;

·         Impairment rating evaluation determines, after the Claimant has received 104 weeks of temporary total disability benefits, that the Claimant’s impairment rating is less than 50% under a whole person impairment standard, resulting in wage loss benefits being paid as temporary partial disability benefits, subject to the 500 week limitation;

·         An employee returns to work and the employer/insurer suspends or modifies wage loss benefits with the filing of a Notification of Suspension/Modification within 7 days of return-to-work;

·         An employee executes a Supplemental Agreement, evidencing a suspension, modification or termination of wage loss compensation benefits;

·         A WCJ orders wage loss benefits to suspend, modify, or terminate, in reliance upon evidence from the employer/insurer that the Claimant’s compensation status has changed, either due to full recovery from work injury, or due to employee sufficiently recovering from work injury to be capable of working with “earning power”;

·         The employee and employer/insurer settle the claim under a Compromise & Release Agreement, required to be approved by WCJ, with the WCJ’s jurisdiction over the Compromise & Release Agreement limited to determining whether the employee understands the “legal significance” of the settlement agreement.

Employers/insurers are entitled to credits for unemployment, employer-funded pension distributions, and a 50% credit for old age social security payments. 

C.        LITIGATION PROCEDURES:

Disputes over workers’ compensation claims are litigated before the Office of Adjudication, an office within the Bureau of Workers’ Compensation, a division of Pennsylvania Department of Labor and Industry.

• The web portal to the Office of Adjudication is www.portal.state.pa.us.

This portal includes facts and information on filing claims, litigating claims, as well as information regarding hearing procedures before WCJs. 

Several workers’ compensation petitions are utilized to litigate claims, to include: 

·         Claim Petition (filed by employee alleging injury and seeking workers’ compensation benefits);

·         Review Petition (filed by either employee or employer, seeking administrative review of compensation claim);

·         Reinstatement Petition (filed by employee seeking reinstatement of wage or medical compensation benefits);

·         Termination Petition (filed by employer, seeking termination of compensation benefits, both wage and medical, with evidence that employee is fully recovered from work injury);

·         Suspension Petition (filed by employer, with evidence that the employee is sufficiently recovered from work injury to be able to return to work at wages equal to pre-injury wages);

·         Modification Petition (filed by employer, with evidence that the employee has sufficiently recovered from work injury to be able to return to work at wages less than pre-injury wages);

·         Petition to Seek Approval of a Compromise & Release Agreement (filed by either employee or employer, seeking WCJ approval of a settlement agreement);

·         Penalty Petition (filed by employee, seeking penalties against employer/insurer for alleged violation of the Act) (maximum penalty equals 50% of benefits that were payable in absence of alleged violation).

Petitions are filed electronically with the Bureau, which assigns the petitions to WCJs, with assignments typically based on the employee’s hearing district residence.

Following petition assignments to WCJs, the WCJs conduct hearings on either a serial hearing scheduling basis, or on a 1 day trial scheduling basis, with WCJs directed to follow the Special Rules before WCJs, in terms of all case management scheduling guidelines, as well as to seek closure of the evidentiary record within 12 months of the date of assignment to the Judge.

Closure of the record by the WCJ results in WCJ directing the submission of Proposed Findings of Fact and Conclusions of Law. 

Petition-filing party typically charged with the burden of proof as to the allegations raised, either in terms of the benefits or change in status sought.

Decisions issued by WCJs are circulated by the Bureau, and are appealable for 20 days post-circulation.

Statutorily-mandated mediation is required for all litigated Pennsylvania Workers’ Compensation claims.

Appeals from WCJ decision are filed with the Workers’ Compensation Appeal Board which permits the employee and employer to argue the appeal orally as well as in briefs.

The Appeal Board typically rules on appeals within 6-12 months of the appeal being filed. 

Appeals from Appeal Board ruling are subject to appeals for 30 days post-issuance.

Appeals from the Appeal Board are filed, via Petition for Review, with the Commonwealth Court. 

The Commonwealth Court has jurisdiction over all appeals from Pennsylvania administrative agencies.

The Commonwealth Court typically rules on appeals within 6-12 months of their filing, permitting argument both orally and by briefs.

Commonwealth Court rulings are appealable to the Pennsylvania Supreme Court within 30 days of issuance, subject to allocator being petitioned for before the Supreme Court. 

The Pennsylvania Supreme Court typically only averages between 1-4 workers’ compensation decisions per year, typically denying allocator, in the absence of the following:

·         Cases of first impression;

·         Cases involving public policy consideration;

·         Cases involving precedential uncertainty or confusion at the Commonwealth Court level.

D.        SETTLEMENTS:

Since 1996, Pennsylvania has permitted workers’ compensation claims to be settled, utilizing a Compromise and Release Agreement.

The settlements must be approved by a WCJ.

The procedure for settling a workers’ compensation claim, after the settlement agreement has been negotiated, is to either amend a pending petition to be a Petition to Seek Approval of a Compromise and Release Agreement, or to file a petition seeking approval of C&R.

The WCA specifically prohibits settlements of workers’ compensation claims, absent a WCJ approving the settlement under a C&R.

For a WCJ to approve a C&R, the WCJ must determine that the employee settling their workers’ compensation claim understands the “legal significance” of the settlement agreement, with the WCJ having no responsibility to determine if the settlement agreement is in the “best interest” of the employee.

The parties are permitted to settle all workers’ compensation benefits, to include wage loss, specific loss, death benefits, medical benefits, penalties, attorneys’ fees, and any other benefit or claim under the jurisdiction of the WCJ, and within the scope of the WCA.

Typically, settlement agreements are also conditioned upon resignations, although the WCJ has no authority to rule on any employment law issues, to include resignations, as well as any issues with respect to the ADA, the FMLA, EEOC, and/or ADEA.

E.        LIENS:

Pennsylvania recognizes the right of the employer to subrogate against an employee’s third-party personal injury/tort recovery.

Subrogation is empowered under Section 319 of the WCA.

Relevant factors are:

            Employer payment of workers’ compensation benefits;

            Work injury caused by third-party negligence;

            Employee recovers third-party settlement/award;

Employer/insurer entitled to recover payments of wage loss and medical compensation benefits, subject to pro rata attorneys’ fees and expenses.

The BWC requires the filing of a Third Party Settlement Agreement (LIBC-380) to record the following for subrogation lien recoveries:

 ·         Third-party recovery;

·         Workers’ compensation lien;

·         Expenses of recovery;

·         Balance of recovery;

·         Pro rata attorneys’ fees and expenses;

·         Reimbursement percentage rate;

·         Net subrogation lien recovery;

·         Grace period reimbursement rate.

Pennsylvania permits employer/insurers to intervene via interpleader in third-party action, and the Supreme Court has recognized direct subrogation actions by employers/insurers against third-parties.

VII.     MAJOR REFORM TIMELINES:

1915:               WCA enacted.

1972:               Requirement of proving a work accident eliminated, with post 1972 focus on proving a work-related injury, opening the door for repetitive/cumulative trauma injury claims.

1993:               Overhaul of provisions dealing with medical compensation benefits, implementing utilization review and medical fee schedules based on Medicare reimbursements.  Instituted concepts of panel providers, temporary compensation benefits without formal acceptance of claim.

1995:               Reform of hearing loss provision, implementing baseline testing and utilization of AMA Guidelines to prove binaural hearing loss.

1996:               Established temporary compensation period at 90 days, true also for panel treatment.  Instituted Compromise & Release Agreements, Special Supersedeas, and Notification of Suspension/Modification provisions.

2007:               Mandated Mediation, instituted security fund for uninsured employers.

VIII.    LINKS:

• National Workers’ Compensation Defense Network: www.nwcdn.com
• Workers’ Compensation.com: www.workerscompensation.com
• Pennsylvania Department of Labor & Industry: www.dli.state.pa.us
• Pennsylvania Office of Adjudication: www.portal.state.pa.us
• Risk Insurance Management Society: www.rims.com

IX.       CONTACTS:

·         Kevin L. Connors: kconnors@connorslawllp.com

·         Kate A. O’Dell: kodell@connorslawllp.com

·         Jeffrey D. Snyder: jsnyder@connorslawllp.com

·         John J. Muldowney: jmuldowney@connorslawllp.com

·         Lisa A. Miller: lmiller@connorslawllp.com

ConnorsLaw LLP

Trust us, we just get it!  It is trust well spent!

Defending workers’ compensation claims throughout Pennsylvania for employers, self-insureds, insurance carriers, and third party administrators, our 100+ years of cumulative experience defending our clients against compensation-related liabilities, empowers our workers’ compensation practice group attorneys to be more than mere claim denials, entrusting us to create the factual and legal leverage to expeditiously resolve claims, in the course of limiting/reducing/extinguishing our clients’ liabilities under the Pennsylvania’s Workers’ Compensation Act.

With every member of our workers’ compensation practice group being AV-rated, our partnership with the NWCDN magnifies the lens through which our professional expertise imperiously demands that we always be dynamic and exacting advocates for our clients, businesses, corporations, and insurance carriers, seeking our trial and compensation acumen, navigating the frustrating and form-intensive minefield pervasive throughout Pennsylvania workers’ compensation practice and procedure. 

NWCDN VIRGINIA WORKERS’ OMPENSATION UPDATE

New compensation rates as of July 1, 2012:

As of July 1, 2012, the new maximum compensation rate is $935.00 and the new minimum compensation rate is $233.75.  The mileage reimbursement rate remains $.555 per mile.  On October 1, 2012, the COLA rate was set at 3.1%.

Commission Update:

New Member of the Full Commission

Effective March 1, 2013, R. Ferrell Newman, Esq. became the “neutral” representative on the Full Commission.  The Virginia Workers’ Compensation Commission is comprised of one employers’ representative, one claimants’ representative and one “neutral” member.  Before his appointment, Commissioner Newman was a longtime workers’ compensation attorney who has represented both claimants and employers.

Commission announces Alternative Dispute Resolution Pilot Program

The Commission has announced an Alternative Dispute Resolution (“ADR”) pilot program. This program will, initially, only apply to change in condition applications where both parties are represented by counsel.  If a claim meets this criteria, Commission staff may contact the parties in order to determine whether the dispute, if any, can be promptly resolved.  As part of this process, the parties can agree to a joint telephone conference call where they outline their respective positions or have a Commission staff member act as a “go-between” and the parties will not speak directly to one another.  If this avenue is not successful, the next step is an “Issue Mediation.”  At mediation, Deputy Commissioner Blevins will, similarly, attempt to find common ground and broker an agreement.  This mediation can be done either telephonically or in-person.  If successful, this program is likely to be expanded to cover initial Claim for Benefits applications and other contested issues in order to reduce the time and expense of proceeding to hearing.

Expedited Review Pilot Program

Starting with Requests for Review filed on or after January 2, 2013, the Commission will ascertain whether the parties agree to participate in the Expedited Review Pilot Program, provided the parties are represented by counsel.  If the parties agree, a Notice of Written Statements and Oral Argument will be promptly issued and the appealing party will have twenty days to file its position statement with the Commission.  The responding party will, then, have ten additional days to file its responsive pleading.  Briefs submitted by either party are limited to ten pages.  After position statements are filed, the Commission will set oral argument for no later than twenty days after the deadline for the last written statement and will aim to issue a decision within twenty days following argument. 

Recent Case Law Developments

Prince William County School Board v. Rahim, 284 Va. 316, 733 S.E.2d 235 (2012), is a

case that has generated much interest throughout the workers’ compensation community and concerns the statute of limitations for change in condition applications.  InRahim, the claimant filed a Claim for Benefits on November 15, 2007 asserting that she suffered a workplace accident on January 17, 2007, but did not seek any specific benefits with that filing.  On September 8, 2008, she filed an Amended Claim for Benefits in which she sought both wage loss benefits and an award for lifetime medical benefits.  On June 18, 2009, the parties entered into a Stipulated Order which agreed to the compensability of the workplace accident and a lifetime medical award, but which stated that the claimant suffered no wage loss since she had been provided light duty work by the employer at a wage rate equal to or greater than her pre-injury weekly wage.  Accordingly, a “Medical Only Award” was entered.  

            Subsequently, on October 7, 2009, the claimant filed a change-in-condition application in which she sought temporary total disability benefits from August 11, 2009 to the present and continuing.  The defense defended the application on the grounds that since there had not been a previous award of compensation by the Commission, the claimant’s wage loss claim was time-barred as it was filed more than twenty-four months after the workplace accident.  The Supreme Court of Virginia unanimously affirmed the Court of Appeals’ 5-4 decision and found that the change-in-condition application was timely filed.  In its decision, the Court held that, starting from the date of the medical award, the claimant had two years from the date compensation was last paid to file a change-in condition application.  In this case, since the medical award was entered on June 18, 2009, the claimant had until at least June 17, 2011 to file her application.  More specifically, the Court found that the language in Va. Code Sec. 65.2-708(a), which governs change in condition applications, encompasses medical only awards because the section states that “any award” can be reviewed, not just those awards which order payment of wage loss benefits.  Importantly, the Court also noted that under Va. Code Sec. 65.2-708(c), the payment of light duty wages by the employer after the June 18, 2009 medical award would constitute payment of compensation and could act to toll the statute of limitations until compensation ceased.

2012 Legislative Changes

HB 137- Revises the language contained in § 65.2-105 regarding the statutory presumption that certain injuries arose out of and in the course of the claimant’s employment.  The legislative enactment applies to situations where the injured worker is physically or mentally unable to testify and there is un-rebutted prima facie evidence that the injury arose out of and in the course of the claimant’s employment.  In these instances, there is now a presumption that the injury “arose out of and was in the course of employment,” even though the claimant is not able to testify as to causation, unless there is a preponderance of the evidence to the contrary.  The revised language strikes the previous statutory provision which presumed that the injury was “work related.”

HB 153- Any employee who suffers an injury on or after July 1, 2012 is excluded from coverage under the Virginia Workers’ Compensation Act if there is jurisdiction under the Longshore and Harbor Workers’ Compensation Act or the Merchant Marine Act of 1920. 

HB 453- Excuses the Commonwealth of Virginia from penalties associated with failure to pay wage loss benefits pursuant to an Award if the Commonwealth has made a payroll payment to the injured worker in lieu of compensation for at-issue disability period.  

HB 1169- The Virginia Workers’ Compensation Commission will retain jurisdiction over claims in connection with disputes over partially paid medical bills even in instances where partial payment has been made by an entity other than the employer, insurer, guaranty fund or uninsured employer’s fund.

SB 576- Until July 1, 2015, the maximum .5 percent tax rate may be assessed against uninsured employers or self-insured employers.  The revenue generated by said tax funds benefits that are awarded against employers from the uninsured employer’s fund.

SB 577-  States that a majority of Commissioners constitutes a quorum enabling the Virginia Workers’ Compensation Commission to take judicial and legislative action when there is a vacancy on the Full Commission.  The Chairman of the Full Commission has the discretion to appoint a deputy commissioner to hear a review request when all Commissioners are unable to hear a review request.

For more information, please contact Lynn Fitzpatrick at 703-793-1800 or lfitzpatrick@fandpnet.com

VIRGINIA WORKERS’ COMPENSATION UPDATE

New compensation rates as of July 1, 2012:

As of July 1, 2012, the new maximum compensation rate is $935.00 and the new minimum compensation rate is $233.75.  The mileage reimbursement rate remains $.555 per mile.  On October 1, 2012, the COLA rate was set at 3.1%.

Commission Update:

New Member of the Full Commission

Effective March 1, 2013, R. Ferrell Newman, Esq. became the “neutral” representative on the Full Commission.  The Virginia Workers’ Compensation Commission is comprised of one employers’ representative, one claimants’ representative and one “neutral” member.  Before his appointment, Commissioner Newman was a longtime workers’ compensation attorney who has represented both claimants and employers.

Commission announces Alternative Dispute Resolution Pilot Program

The Commission has announced an Alternative Dispute Resolution (“ADR”) pilot program. This program will, initially, only apply to change in condition applications where both parties are represented by counsel.  If a claim meets this criteria, Commission staff may contact the parties in order to determine whether the dispute, if any, can be promptly resolved.  As part of this process, the parties can agree to a joint telephone conference call where they outline their respective positions or have a Commission staff member act as a “go-between” and the parties will not speak directly to one another.  If this avenue is not successful, the next step is an “Issue Mediation.”  At mediation, Deputy Commissioner Blevins will, similarly, attempt to find common ground and broker an agreement.  This mediation can be done either telephonically or in-person.  If successful, this program is likely to be expanded to cover initial Claim for Benefits applications and other contested issues in order to reduce the time and expense of proceeding to hearing.

Expedited Review Pilot Program

Starting with Requests for Review filed on or after January 2, 2013, the Commission will ascertain whether the parties agree to participate in the Expedited Review Pilot Program, provided the parties are represented by counsel.  If the parties agree, a Notice of Written Statements and Oral Argument will be promptly issued and the appealing party will have twenty days to file its position statement with the Commission.  The responding party will, then, have ten additional days to file its responsive pleading.  Briefs submitted by either party are limited to ten pages.  After position statements are filed, the Commission will set oral argument for no later than twenty days after the deadline for the last written statement and will aim to issue a decision within twenty days following argument. 

Recent Case Law Developments

Prince William County School Board v. Rahim, 284 Va. 316, 733 S.E.2d 235 (2012), is a

case that has generated much interest throughout the workers’ compensation community and concerns the statute of limitations for change in condition applications.  InRahim, the claimant filed a Claim for Benefits on November 15, 2007 asserting that she suffered a workplace accident on January 17, 2007, but did not seek any specific benefits with that filing.  On September 8, 2008, she filed an Amended Claim for Benefits in which she sought both wage loss benefits and an award for lifetime medical benefits.  On June 18, 2009, the parties entered into a Stipulated Order which agreed to the compensability of the workplace accident and a lifetime medical award, but which stated that the claimant suffered no wage loss since she had been provided light duty work by the employer at a wage rate equal to or greater than her pre-injury weekly wage.  Accordingly, a “Medical Only Award” was entered.  

            Subsequently, on October 7, 2009, the claimant filed a change-in-condition application in which she sought temporary total disability benefits from August 11, 2009 to the present and continuing.  The defense defended the application on the grounds that since there had not been a previous award of compensation by the Commission, the claimant’s wage loss claim was time-barred as it was filed more than twenty-four months after the workplace accident.  The Supreme Court of Virginia unanimously affirmed the Court of Appeals’ 5-4 decision and found that the change-in-condition application was timely filed.  In its decision, the Court held that, starting from the date of the medical award, the claimant had two years from the date compensation was last paid to file a change-in condition application.  In this case, since the medical award was entered on June 18, 2009, the claimant had until at least June 17, 2011 to file her application.  More specifically, the Court found that the language in Va. Code Sec. 65.2-708(a), which governs change in condition applications, encompasses medical only awards because the section states that “any award” can be reviewed, not just those awards which order payment of wage loss benefits.  Importantly, the Court also noted that under Va. Code Sec. 65.2-708(c), the payment of light duty wages by the employer after the June 18, 2009 medical award would constitute payment of compensation and could act to toll the statute of limitations until compensation ceased.

2012 Legislative Changes

HB 137- Revises the language contained in § 65.2-105 regarding the statutory presumption that certain injuries arose out of and in the course of the claimant’s employment.  The legislative enactment applies to situations where the injured worker is physically or mentally unable to testify and there is un-rebutted prima facie evidence that the injury arose out of and in the course of the claimant’s employment.  In these instances, there is now a presumption that the injury “arose out of and was in the course of employment,” even though the claimant is not able to testify as to causation, unless there is a preponderance of the evidence to the contrary.  The revised language strikes the previous statutory provision which presumed that the injury was “work related.”

HB 153- Any employee who suffers an injury on or after July 1, 2012 is excluded from coverage under the Virginia Workers’ Compensation Act if there is jurisdiction under the Longshore and Harbor Workers’ Compensation Act or the Merchant Marine Act of 1920. 

HB 453- Excuses the Commonwealth of Virginia from penalties associated with failure to pay wage loss benefits pursuant to an Award if the Commonwealth has made a payroll payment to the injured worker in lieu of compensation for at-issue disability period.  

HB 1169- The Virginia Workers’ Compensation Commission will retain jurisdiction over claims in connection with disputes over partially paid medical bills even in instances where partial payment has been made by an entity other than the employer, insurer, guaranty fund or uninsured employer’s fund.

SB 576- Until July 1, 2015, the maximum .5 percent tax rate may be assessed against uninsured employers or self-insured employers.  The revenue generated by said tax funds benefits that are awarded against employers from the uninsured employer’s fund.

SB 577-  States that a majority of Commissioners constitutes a quorum enabling the Virginia Workers’ Compensation Commission to take judicial and legislative action when there is a vacancy on the Full Commission.  The Chairman of the Full Commission has the discretion to appoint a deputy commissioner to hear a review request when all Commissioners are unable to hear a review request.

For more information, please contact Lynn Fitzpatrick at 703-793-1800 or lfitzpatrick@fandpnet.com

STONE LOUGHLIN & SWANSON, LLP

TEXAS LAW ADVISORY

jstone@slsaustin.com jloughlin@slsaustin.com dswanson@slsaustin.com eshanley@slsaustin.com

eholmes@slsaustin.com dprice@slsaustin.com sgatlin@slsaustin.com

512-343-1300

April 2013 Workers’ Compensation Law Update

More Bills Related to Workers’ Compensation

Last month, we provided you with a summary of the more important bills the Legislature is considering which make substantive changes to comp. And keep your eye on the following additional bills—

• SB 1550/HB 2787 - Allows claimants to recover attorneys’ fees if they prevail on judicialreview of a medical necessity dispute, irrespective of whether the appeal was filed by the claimant or the carrier.

• HB 1762 - Provides that a certificate of insurance showing a temporary employment service maintains comp insurance constitutes proof of workers’ compensation coveragefor both the service and all employees of the service assigned to a client company.

• HB 287 - Requires an IRO or URA, on written request by a party to a reviewed medical dispute, toprovide the name and qualifications of the healthcare providerwho performed the review.

In Addition, Bill Would Make Use of Name or Symbols Related to "Texas" and "Workers’ Compensation" Illegal Only When Used in Deceptive Manner

Currently, the Texas Labor Code makes it illegal to use the terms "Texas" and "Workers’ Compensation" in a business name or document when related to a product or service concerning workers’ compensation coverage or benefits. SB 381 would amend Texas Labor Code §§419.001 and 419.002 and only make the use of the terms illegal if they are used in a "deceptive manner." The amendment explains that "deceptive manner" means a person knows the use of the terms would or could convey the "false impression" that someone, something, or some speech is endorsed or authorized by the DWC.

OIEC Budget on the Chopping Block?

In a recent floor amendment, freshman State Rep. Craig Goldman sought to eliminate $8.2 million of yearly funding to the Office of Injured Employee Counsel. While the signs indicate the amendment will not pass, it is interesting to see that OIEC is again the target of budget cuts.

Tip on Filling Out Form DWC 32: Multiple Certifications

A recent article by Erika Copeland at DWC reminded system participants that multiple certifications taking into account different outcomes for an extent of injury determination will only be provided by a designated doctor when the doctor is ordered to address MMI, IR, and extent of injury. If only MMI and IR is requested, multiple certifications will not be provided. This means adjusters should request the DD address extent of injury, in addition to MMI and IR, if multiple certifications are desired. It is not clear whether the opinion on extent and the opinion on MMI/IR have to be by the same doctor, or can be different doctors, or if the reviews have to be at the same time.

Workers’ Compensation? Worker’s Compensation? Or Workers Compensation?

There is an ongoing debate among pedantic system participants like us about the proper use of an apostrophe in the term, "worker[’]s[’] compensation." We invite you to join the debate. Stone Loughlin & Swanson will provide a $25 Starbucks gift card to the first person to e-mail Jane Stone at

jstone@slsaustin.com with the correct punctuation. Twitter-speak not allowed.

Bobby Anglin, a South Carolina resident, suffered a compensable automobile accident while working for his North Carolina employer, Dunbar Armored, Inc. Anglin received benefits pursuant to the North Carolina Workers’ Compensation Act from Defendants and later settled his third-party claim against the other driver in the South Carolina accident for $92,712.55. After this settlement, Defendants agreed to resolve their workers’ compensation lien against the liability settlement for one third of the lien value or $10,613.16. Anglin also reached a settlement with his under insured motorist (UIM) carrier; however, Defendants were not aware of the UIM settlement when the workers’ compensation lien was settled.

Subsequently, Anglin filed suit in Superior Court seeking a declaration eliminating Defendants’ workers’ compensation lien pursuant to N.C.G.S. § 97-10.2. He contended that South Carolina law applied to the determination of Defendants’ subrogation interests in the UIM settlement because it was paid pursuant to a South Carolina policy. He also contended that since South Carolina law does not allow subrogation of UIM funds, Defendants’ lien should be eliminated. Finally, Anglin argued that Defendants lien was already satisfied by their previous agreement to accept one third of the lien value. The trial court disagreed, applied North Carolina law, held there was no accord and satisfaction of the lien with the previous settlement as Defendants were not aware of Anglin’s UIM settlement at the time of the previous lien settlement, and awarded Defendants the remaining $21,206.31 of their workers’ compensation lien. Anglin appealed.

On April 2, 2013, in Anglin v. Dunbar Armored, Inc., the North Carolina Court of Appeals affirmed the decision of the trial court, upholding the award to Defendants in satisfaction of their workers’ compensation lien. The court noted that where a party seeks a determination of a workers’ compensation lien pursuant to N.C.G.S. § 97-10.2 it is seeking "remedial" or "procedural" relief and, as such, the law of North Carolina, as the forum state, applies. Since North Carolina law does not prohibit subrogation of UIM funds, the trial court did not improperly award Defendants a portion of Anglin’s UIM settlement in satisfaction of the remainder of their workers’ compensation lien.

Risk Handling Hint: Where Defendants have a particular interest in recovering from an injured workers’ third-party settlement to satisfy their subrogation lien, special consideration should be given to bringing an action in North Carolina’s courts, pursuant to N.C.G.S. § 97-10.2, to avoid the potential application of unfavorable subrogation laws in other states.

Rayford H. Taylor
Of Counsel
Casey Gilson P.C.
Six Concourse Parkway, Suite 2200
Atlanta, Georgia 30328
770-512-0300 -Ext. 529
770-512-0070 -Fax
rtaylor@caseygilson.com
www.caseygilson.com

SunTrust Bank v. Travelers Prop. Cas. Co. of Am., (03/28/2013)

An insurer cannot have its timely workers' compensation lien extinguished merely by the employee and the tort defendant agreeing the employee was not fully compensated

The worker was injured in the course of his employment following a motor vehicle collision.  He received workers' compensation benefits before filing suit against two third-party tortfeasors.  Although the insurer timely intervened in the suit to protect its workers' compensation subrogation lien, the worker and the tortfeasors settled the case for a confidential lump sum without the insurer's knowledge, participation or consent.  Among other terms, the settlement agreement included a conclusory statement that the proceeds of the settlement did not fully and completely compensate the worker for his injuries.  The insurer filed its motion to enforce its subrogation lien, which the trial court granted. 

On appeal, the estate administrator contended the trial court erred in finding the terms of the settlement agreement did not extinguish the insurer's right to enforce its subrogation lien.  The court disagreed and held the insurer had the right to intervene and the trial court was required to conduct a hearing on whether the worker was fully compensated, so that the insurer could attempt to enforce its subrogation lien.

720428-1

Rayford H. Taylor
Of Counsel
Casey Gilson P.C.
Six Concourse Parkway, Suite 2200
Atlanta, Georgia 30328
770-512-0300 -Ext. 529
770-512-0070 -Fax
rtaylor@caseygilson.com
www.caseygilson.com

Zheng v. New Grand Buffet, Inc., (03/20/2013)

The appellate court ruled the employee could not unilaterally change her treating physician before asking the State Board for such authority when there is a valid physician panel in place for that employer

Zheng sustained a compensable injury on May 27, 2010, and began receiving medical care and income benefits.  Her employer suspended Zheng's income benefits on October 1, 2010, asserting that Zheng  underwent a change in condition for the better based on a regular duty work release from her authorized treating physician ("ATP").  Zheng disputed that she had undergone a change in condition for the better and sought reinstatement of her income benefits, payment of certain medical expenses, permission to change her ATP, a late penalty, and an assessment of attorney fees.

The administrative law judge ("ALJ") found the employer's suspension of benefits "was not improper" in view of an August 24, 2010, statement from the ATP that he anticipated she would be able to return to work on August 31, 2010.  The work release was prospective, however, depending on test results and an evaluation, and Zheng did not return to the doctor on August 31, 2010, as scheduled.  Instead, Zheng elected to see another physician of her own choosing.  After reviewing evidence from the physicians who saw Zheng before and after, the ALJ reinstated Zheng's income benefits as of October 1, 2010, concluding that the employer did not establish by a preponderance of the evidence that she had a change in condition for the better that allowed her to return to work without restrictions.

The ALJ also found the employer had a panel of physicians and that the employer's manager had explained the panel's function to Zheng when she had been rehired two months before she was injured.  Zheng had received treatment from the three physicians on the panel:  Dr. Chang, Dr. Wu, and Dr. Armstrong.  However, instead of returning to Dr. Armstrong, she changed physicians on her own without Board approval.  Because the employer had been providing appropriate medical treatment, it did not lose control of her treatment and was not responsible for paying the new physicians' expenses.  The ALJ denied Zheng's request that one of her new physicians be designated as her ATP, finding that the employer should first have the opportunity to offer treatment by another physician of the employer's choice.  Finally, finding that the case was closely contested on reasonable grounds, the ALJ denied the employee's request for attorney fees and penalties.

Both sides appealed the ALJ's decision to the Appellate Division of the State Board of Workers Compensation, which adopted the ALJ's findings of fact and conclusions of law.  Both parties appealed this decision to the superior court, which conducted a hearing.  The superior court did not issue an opinion within 20 days of the hearing, and thus the Board decision was affirmed by operation of law.

On appeal, the appellate court affirmed the ALJ's rulings because there was evidence of a valid panel, the panel had been explained to the employee, and she went to an unauthorized physician without permission of the employer/carrier.  The employee's remedy was to petition the State Board for a change, rather than seeking treatment on her own.

720425-1

Rayford H. Taylor
Of Counsel
Casey Gilson P.C.
Six Concourse Parkway, Suite 2200
Atlanta, Georgia 30328
770-512-0300 -Ext. 529
770-512-0070 -Fax
rtaylor@caseygilson.com
www.caseygilson.com

Garcia v. Shaw Indus., Inc., (03/29/2013)

Employer found not liable for intentional infliction of emotional distress and defamation for reporting employee's possible fraud to State Board of Workers' Compensation

A former employee filed an action against a former employer for intentional infliction of emotional distress (IIED) and defamation.

The employee was not a citizen of the United States, but entered the country legally with a border-crossing card.  The employee was not authorized to work in the United States, but obtained employment using the name, Social Security number, and personal information of another person, whose identity the employee paid to use. 

The employee fell and injured her back at work.  After treatment, she returned to light duty work and filed a claim for benefits.  During that period, the employer became aware of the employee's situation and immigration status.  The employer terminated the employee, but continued to provide medical treatment and TPD benefits.

The employer filed a complaint with the State Board's fraud and compliance unit.  The employee was later arrested on warrants for forgery and possession of fraudulent documents after her deposition in the workers' compensation case was completed.  The employer cooperated with the State Board, and arranged for the State Board to arrest her after the deposition.  The employee filed her IIED suit, which was dismissed.

On appeal, the employee contended the trial court erred in granting summary judgment to the employer on her IIED claim, because there was evidence the employer set her up for arrest causing her severe emotional distress.  The appellate court concluded the employer's conduct did not rise to the level of extreme and outrageous conduct necessary for an IIED claim.  Even if the employer knew the employee was operating under an alias, it was not malice for the employer to want to bring the illegal behavior to an end.  In addition, when the employer filed an administrative fraud complaint with the Georgia State Board of Workers' Compensation, it truthfully and accurately related the facts.

720424-1