As a general rule, once workers’ compensation benefits are awarded to an injured worker in Pennsylvania, the insurance carrier cannot stop paying those benefits without permission from either the injured worker (signing a document such as a Supplemental Agreement or a Final Receipt) or from a Workers’ Compensation Judge (WCJ). Though there are of course exceptions, these are few and far between . . . we think.
A recent decision from the Commonwealth Court of Pennsylvania in Gelvin v. Workers’ Compensation Appeal Board (Pennsylvania State Police) has us wondering a bit. Here, the injured worker, a former trooper for the Pennsylvania State Police, was receiving workers’ compensation benefits for post-traumatic stress disorder as of 2006 (though benefits did not begin until a few years later, due to litigation of the entitlement to benefits). While receiving the workers’ comp benefits, she began also receiving a disability pension benefit from the Pennsylvania State Employees’ Retirement System (SERS) on February 29, 2012. The disability pension was retroactive to February 2011. (Both benefits can be received at the same time, the issue is whether there is a credit for the receipt of the pension benefits against the workers’ compensation benefits).
The Defendant Employer sent “verification forms,” including Employee Report of Benefits Form (LIBC-756) in December of 2010, December of 2011, and March of 2012. The injured worker declared the pension benefits on the form in March, 2012, since that is the first LIBC-756 she received after the receipt of pension benefits began. In response the Defendant Employer issued a Notice of Workers’ Compensation Benefit Offset on March 27, 2012, which purported to suspend her workers’ comp benefits from April 21, 2012 until March 5, 2013, to recoup the credit the carrier was due for the retroactive pension benefits.
A Petition for Penalties was filed by the injured worker, who noted that the loss of her workers’ compensation benefits for almost a year created an extreme hardship for her. In this litigation, the witness for the Defendant Employer agreed there was no order from a Workers’ Compensation Judge (WCJ) or agreement between the parties allowing the benefits to stop. After hearing the evidence, the WCJ ordered workers’ compensation benefits reinstated, and awarded penalties and attorney fees, since Defendant Employer “offered no viable evidence to justify its unilateral stoppage of benefits.” The WCJ also found that there could be no retroactive credit for the pension benefits.
On appeal to the Workers’ Compensation Appeal Board (WCAB), the decision of the WCJ was reversed. The WCAB concluded that “no statutory provision or regulation requires an employer to file a suspension petition in order to recoup workers’ compensation benefits paid to a claimant” in this pension offset situation. Also, since the Defendant Employer dutifully sent the LIBC-756 forms to the injured worker, they were indeed entitled to a retroactive credit for the pension benefits. This differed from a prior case, Maxim Crane Works v. Workers’ Compensation Appeal Board (Solano), decided in 2007, which held there was no retroactive credit for a Defendant/Employer who failed to send LIBC-756 forms every six months. This decision by the WCAB was affirmed by the Commonwealth Court of Pennsylvania in all respects.
As to the issue of the hardship of a complete credit, rather than a reduction of the workers’ compensation rate, the Court felt that “Claimant has never requested a reduction in the recoupment amount in order to reduce her alleged financial hardship. Moreover, Claimant incorrectly states that the WCJ found financial hardship in this case. Contrary to Claimant’s contention, the WCJ’s Finding of Fact No. 17 merely summarized Claimant’s testimony that she has experienced a ‘severe hardship,’ and such a summary does not constitute a finding.” It is unclear how the injured worker could have been more clear in her testimony (which was found credible by the WCJ), or what more she could have done than file the Petition for Penalties.
This latter part is the one that is truly troubling. The appellate courts in PA are always eager to point out that the Pennsylvania Workers’ Compensation Act is a “liberal and remedial” piece of legislation, which is to be read in accordance with those ideals. Yet, rather than have the case remanded and let the WCJ clarify what, clearly to this author, was a Finding of Fact that the 100% credit caused financial hardship, the Court decided to simply ignore that factor. Such a result is simply staggering in its disconnect with the intention and purpose of the Act.