In Pennsylvania, the Supreme Court has been asked to clarify questions surrounding if someone is receiving workers compensation disability, then how does one decide if they have retired.
Two recent cases from a divided, en banc panel of the Commonwealth Court of Pennsylvania have addressed this question. The answer from that court is, it depends. The majority of the divided court arrived at a "totality of the circumstances" test. One of the cases, Day, v. Workers' Compensation Appeal Board will be appealed to the Supreme Court, so even the answer "it depends" may depend on whether or not the Supreme Court agrees with the Commonwealth Courts reasoning.
Day v. WCAB
Melvin Day was a Pittsburgh garbage collector until he was injured on the job in 1992. After surgery, he returned to work, but could not continue, and was assigned modified, light-duty work by 1996. He was laid off by 2001. According to the court, after his unemployment compensation ran out, he began collecting his Social Security pension and total disability workers compensation benefits. By 2007, his employer sought to suspend his benefits, claiming he had retired and "voluntarily withdrawn from the workforce."
The Workers' Compensation Judge and the Workers' Compensation Appeal Board (WCAB) agreed, and Day appeal to the Commonwealth Court. That court, examining the various Supreme Court precedents on the topic, came up with a ruling that agreed with WACB, and decided that courts must review the totality of the circumstances to determine when an injured employee has retired.
How an Employer can Terminate Workers' Compensation Benefits
The court noted that generally, in order to suspend a claimant's WC benefits, an employer must meet the following requirements:
- The employer who seeks to modify a claimant's benefits on the basis that he has recovered some or all of his ability must first produce medical evidence of a change in condition.
- The employer must then produce evidence of a referral (or referrals) to a then open job (or jobs), which fits in the occupational category for which the claimant has been given medical clearance, e.g., light work, sedentary work, etc.
- The claimant must then demonstrate that he has in good faith followed through on the job referral(s).
- If the referral fails to result in a job then claimant's benefits should continue.
If the claimant voluntarily removes himself from the workforce, by retiring, and employer no longer needs to prove the availability of any jobs for the claimant. The court then goes to say:
"Under Henderson and its progeny, the Employer still bears the burden of showing that the claimant is no longer suffering from a loss of earning power due to his work-related injury."
The court goes on to indicate there is no specific facts or elements that need to be shown, "but by showing by the totality of the circumstances, that the claimant has chosen not to return to the workforce." Once they have done this, the burden shifts back to the claimant to show they have not "voluntarily withdrawn from the workforce."
Totality of the Circumstance
This test is often used by courts when they cannot identify any straightforward means of arriving at a decision. Its disadvantage is that the answer may not be obvious or easy to obtain, because each case will have a somewhat different circumstance, and therefore litigation is almost always necessary to determine what the "totality" is. This is opposed to a "Bright Line Test" where it is typically easy to determine an answer.
Day's attorney is appealing because he feels the Commonwealth Court "misconstrued" the record by stating that his client began collecting a pension and Social Security. Those benefits, he said were related to his disability status. The question may turn on how detailed the record is regarding the benefits Mr. Day received. Whatever the decision, it will control how courts answer the question of when is someone retired for workers' compensation disability benefits.