May 2006 Email Newsletter
The BSH Email Newsletter
Concurrent Employment
Unemployment and Workers’ Compensation
Suspension of Benefits When an Employee Moves out of PA
Death and Settlement
Upcoming Seminars
The BSH Email Newsletter
The Blaufeld Schiller & Holmes, LLP Email Newsletter is our effort to better educate our union friends and clients about Workers’ Compensation and Social Security Disability issues. Each newsletter will include articles about a specific aspect of workers’ compensation or social security, as well as information on recent court decisions. The newsletter will also list upcoming seminars and dates when our attorneys will be in your area for consultation. Please note that if you, or one of your members, need to speak with our attorneys, we are always on hand at (800) 343-9384. Call anytime, as we would be more than happy to assist you. Local appointments are available.
Concurrent Employment
In this economy, it is not unusual for workers to hold down two jobs in order to make ends meet. What happens when that worker suffers a work injury?
Anyone who suffers a work injury with one employer must be certain to advise that employer about both jobs, so that all aspects of the two positions can be appropriately addressed in workers’ compensation documents and in the payment of the correct amount of compensation. The injured employee is entitled to have the average weekly wages from both positions included in the calculation of the average weekly wage, so long as he/she is employed in both positions at the time of the injury. The time of injury average weekly wage is calculated by reviewing the employee’s wages over the year prior to the date of injury, and averaging the three highest quarters. In the case of concurrent employment, this needs to be done with each of the two jobs; the wages from both the time of injury job and the wages from the additional job need to obtained, calculated out over the four quarters prior to the injury, and then the three highest quarters need to be averaged to come to the average weekly wage for each job. Then these two averages need to be added together in order to come up with the injured employee’s average weekly wage for both employments.
If an individual is disabled from both of the jobs he/she holds as a result of the work injury, the averaging of the pre-injury wages works to try to compensate that employee for the loss of earnings suffered at both positions. Therefore, it is essential that any injured employee who will lose time from both jobs be certain to have the wage information from the non-injury job provided to the workers’ compensation insurance carrier, or to that employee’s attorney, so that the second job’s earnings are also provided for.
What if the injured worker does not miss time from work in the second job? Many people have a night job that may not be as strenuous as the full time day position they hold (or vice versa). When the treating doctor releases that employee with light duty restrictions, the time of injury employer may not be able to make an accommodation for these restrictions. However, the employee may be able to work within those restrictions at the second job. Under this scenario, the average weekly wage from both jobs would be used as a baseline. Then, the wages earned from the second position would be deducted from that baseline, and two-thirds of the difference would be paid as a partial. This is the same general principle that gets applied when an individual works for only one employer, and is able to return modified duty or part-time work, but cannot earn as much as the pre-injury average weekly wage. This principle allows for partial workers’ compensation benefits to be paid to the employee.
There may be some temptation on the part of an injured employee to NOT report the second job, especially where the employee can still work at the second job. This is because the employee would be receiving a PARTIAL, which is only available for 500 weeks. However, we do not advise withholding information. Part of the employee’s obligation under the law is to inform the carrier of the receipt of any wages or benefits (besides the workers’ compensation payments). Failure to so inform the carrier equals FRAUD and some carriers do prosecute these individuals. Consider yourself warned!
If you have a work injury, and your treating doctor believes that a release to return to some level of work is appropriate, it is essential that you discuss with the doctor the physical demands of both jobs, and specifically discuss whether a return to either or both positions can be accomplished. Nothing is more detrimental to an injured employee than to be released to a modified level of duty, return to work with the non-injury employer, and then be terminated from the time of injury employer for failure to return to work. It is essential that the employee explore with the doctor and, if appropriate, with the time of injury employer, any modifications that can be made to his/her position. Additionally, if the employee was hurt on the “second job,” he/she should do all that he/she can to see whether any work restrictions can be accommodated by the primary employer.
Please understand that, unless there is some rule in the plant or union contract, employers do not necessarily need to accommodate an individual who is hurt while working at a second job; it would be the same to that employer as if the employee were hurt over the weekend or while pursuing a hobby or recreational activity. The workers’ compensation system is only interested in the time of injury employer making work available within restrictions, and does not require the concurrent employer to make the same effort. Unless the employee is protected by a collective bargaining agreement or can take advantage of the FMLA at the second job, there is no protection in the Workers’ Compensation Act for that employee’s position with the employer who did not, for lack of a better phrase, “cause” the injury. Therefore, an employee could be terminated or replaced at the non-injury job because of the injury that occurred, and have no recourse for this action (if there is no contract in place, and if the termination is not against the FMLA or other law protecting discrimination due to physical limitations).
As always, an individual who suffers a work injury needs to have an attorney who can assist with questions and problems. Two jobs and one injury can make matters complicated. We recommend that such an employee talk with counsel knowledgeable about workers’ compensation matters immediately after the injury, to be aware of the insurance carrier’s responsibilities and the employee’s rights. Please note that this consultation should occur even if the injury employer accepts the claim, and pays benefits based on a concurrent employment rate. There could be pitfalls in the future that would not be foreseen by an individual who has only one employer.
Unemployment and Workers’ Compensation
The receipt of unemployment compensation benefits can have a direct effect on the workers’ compensation benefits an individual receives. An injured worker whose injury occurred after August 31, 1993, is not entitled to the full amount of both workers compensation and unemployment that may be available. Individuals hurt prior to that date can receive both benefits in their full amount, so long as that injured employee was released to return to work at some level of duty. This is because unemployment is only available to individuals who are “ready, willing and able” to work. If an individual was considered totally disabled by his/her physician, that injured employee could collect workers’ compensation benefits, but not unemployment, because he/she did not meet the eligibility criteria. However, since the amendments in 1993 (by Act 44), the employer paying workers compensation and on whose account the unemployment is paid is entitled to a dollar-for-dollar credit against workers’ compensation for the unemployment benefits received.
The receipt of unemployment benefits prior to a work injury can also have an effect on the receipt of workers’ compensation benefits, but in a different (and not readily recognizable) way. Let’s suppose an employee of the XYZ Company is laid off during a slow period, which amounts to a quarter of the year. That individual’s employment with XYZ is not terminated, and that employee does not work elsewhere while laid off; rather, that individual receives unemployment compensation benefits for the lay-off period. The employee maintains seniority and the same job title at XYZ, but is simply not working. Let’s further suppose that, when the employee returns to work at XYZ, he/she works for a period of time, and then suffers a work-related injury. The insurance carrier accepts the injury as compensable, and provides a Notice of Compensation Payable and Statement of Wages that indicates what the compensation rate will be.
To calculate the average weekly wage on which workers’ compensation is based, the employer provides the carrier with wages for the year prior to the work injury. If the injured employee returned to work on March 1, 2005, and is injured on July 15, 2005, the employer must provide wages from July 15, 2004 (or the pay period in which that date is contained) through July 14, 2005, which are then divided into four quarters: July 15, 2004 through October 14, 2004; October 15, 2004 through January 14, 2005; January 15, 2005 through April 14, 2005 and April 15, 2005 through July 14, 2005. The average of the three highest quarters is the injured employee’s average weekly wage; compensation benefits are based on that figure.
How does the lay-off and receipt of unemployment benefits factor into the average weekly wage calculation? Plainly, if the injured employee was laid off for thirteen weeks or more, there is a substantial period of time—perhaps a full quarter, or perhaps parts of two quarters—where the wages paid to the injured employee are unfairly low. This will have a detrimental effect on the injured employee’s average weekly wage, because it will be lower than what the employee would have earned if he/she had not been laid off. It is essential to note that no benefits, including unemployment compensation, are considered when calculating the average weekly wage. Therefore, even if the XYZ employee had a full quarter of lay-off, and received unemployment benefits at the maximum amount available for those thirteen (13) weeks, that quarter on the Statement of Wages would be blank.
Unfortunately, the 1996 amendments to the law specifically addressed issues with respect to calculation of the average weekly wage and made these calculations less favorable to injured employees. Cases that have been decided since the amendments have made clear that, even though this may seem to be unfair to the employee, there is no method or calculation by which a higher average weekly wage will be permitted if an individual was off from work during a quarter or portions of quarters due to lay-off and received other benefits. The key to these cases is that the individual remains an employee of the company during the period of time in question even if they are not working during that time period. The average weekly wage calculation and Statement of Wages covers a period of employment. Therefore, even though on lay-off, the injured employee was still employed; however, the payment of unemployment benefits is not considered a wage payment and is not included in the calculation of wages.
Plainly, a period of lay-off is detrimental to an individual’s earnings. What is not as apparent, however, is that a lay-off in the year prior to a work injury can have a detrimental affect on the amount of workers’ compensation benefits that individual is paid. Anyone who has suffered a lay-off and is subsequently injured should consult with an attorney who is familiar with workers’ compensation law and the calculation of the average weekly wage to be certain that the appropriate calculation, and therefore the appropriate benefit amount, is being utilized.
Suspension of Benefits When an Employee Moves out of PA
Can Where an Employee Lives Affect Entitlement to Workers’ Compensation?
Facts: In Blong v. WCAB (Fluid Containment, et al), the claimant was awarded workers’ compensation total disability benefits for his carpal tunnel condition. He was notified that he was to attend a defense medical evaluation. His attorney advised that Mr. Blong would not attend the evaluation, because he had moved to New Zealand. The insurance carrier then filed a Petition to Suspend or Terminate Mr. Blong’s benefits on the basis that he had voluntarily removed himself from the work force, and that benefits should not be payable any longer. The claimant contended that he had moved there to live with his wife, who was a New Zealand native, and that he had not removed himself from the workforce.
Initial Ruling: The Workers’ Compensation Judge suspended Mr. Blong’s benefits on the basis that the claimant had voluntarily removed himself from the workforce, and that to require the employer to prove job availability or earning power where the claimant previously lived with “irrelevant and fruitless” because Mr. Blong was not returning there.
Appeal Board Ruling: The Board affirmed the WCJ’s suspension of benefits.
Court Rationale: On appeal, the claimant presented only the issue of whether the employer was required to show job availability in the area where he was injured, arguing that without proof of such job availability, his benefits could not be suspended. Citing to the case that has long been the precedent for work availability, Kachinski v. WCAB (Vepco Construction Company), the claimant argued that work availability must be shown. The Court rejected this argument, noting that the Supreme Court has held that an employer does not have to prove all of the Kachinski factors in every instance. The Court in Blong drew a parallel to Smith v. WCAB (Dunhill Temporary Systems), where the injured worker had joined the Peace Corps and moved to Africa. In that instance, the Court held that the worker clearly had removed himself from the workforce here, and that if a position were to be offered, he would not likely return to the area to accept it. Under those circumstances: “Much like a person who is incarcerated or a retiree, Claimant’s present loss of earning power is not a result of his disability but is because of his voluntary decision to join the Peace Corps and move to another continent.” Similarly, the Court in Blong reasoned that Mr. Blong was not available for jobs locally, when he was in New Zealand. Benefits were suspended.
This case is troublesome, because it does not discuss in any way the long line of cases that concern the fact that jobs must be offered and the reasons behind the claimant’s move then assessed. For example, in Motor Coils v. WCAB (Bish), an injured worker moved to Oklahoma to be with her husband who was working there, and a suspension petition was dismissed. Similarly, discussed in a prior newsletter were cases where the injured worker’s job availability depended on residency, and jobs were not considered to be available in the City of Pittsburgh where the individual had moved out of the City of Pittsburgh for good faith reasons.
This case illustrates that the WCJ who hears the case is critical to these factual determinations, because there are two distinctly different lines of case law to be applied under these factual circumstances, and the Judge ultimately determines which is applicable. This should not be the way that these matters are handled, but it clearly seems to be so at this point. The Motor Coils (Bish) case mentioned earlier in this article has been accepted by the Supreme Court for consideration; that is a concern because the Court may not accept it simply to approve and affirm its holding that a suspension is not proper where an individuals moves out of the area, even if in good faith. We may need to address this further in a future newsletter, but at this point there are two divergent lines of authority on whether an individual can move from the Commonwealth without concerns as to the continuation of benefits.
Death and Settlement
Can An Agreement to Settle a Workers’ Compensation Claim Be Enforced if the Injured Worker Dies Before a Hearing on the Settlement is Held?
Facts: In Fratta, as Administratrix of the Estate of Fratta, deceased v. WCAB (Austin Truck Rental), the injured worker received benefits for a work-related injury for approximately twelve years. A settlement was negotiated and the employer filed a Petition to Approve a Compromise and Release Agreement. The C&R Agreement itself was prepared, and signed by the claimant before a Notary. No representative of the Employer had signed it as of August 9, 2002, when a hearing notice was issued. The hearing was scheduled for August 30, 2002. Mr. Fratta died on August 15th from a condition not related to the work injury. The employer then advised the Workers’ Compensation Judge by letter of August 26, 2002 that it was withdrawing the Petition for C&R. A hearing was held on August 30, at which time the widow appeared and requested that the C&R Agreement be approved and payment made.
Initial Ruling: The Workers’ Compensation Judge concluded that a valid C&R Agreement did not exist, relying on case law that had failed to approve C&R Agreements which were unsigned by the injured worker at the time of death, and allowed the withdrawal of the C&R Petition by the employer.
Appeal Board Ruling: The Board affirmed without comment.
Court Rationale: On appeal, the Court assessed Mrs. Fratta’ argument that the law of “substantial performance” contained in contract law should be applied, since the C&R Agreement had been prepared and Mr. Fratta had signed it before a notary public. The Court noted that widow and widower are mentioned in the Act as individuals to testify, but the Court stated that consideration of testimony from those individuals is in cases where benefits that the widow or widower is receiving under a fatal claim are the benefits that are to be settled. The Court rationalized that the law did not contemplated a widow or widower testifying about the late spouse’s state of mind or understanding of the Agreement. The law requires testimony of the injured worker that he/she knew and understood what was involved in the settlement of the case, and the Court did not believe that the widow in this matter could testify as to her late husband’s understanding.
Mrs. Fratta also questioned whether the provision of the Act itself which allows settlements pursuant to C&R is constitutional, that is, whether it meets the requirements of our state Constitution for a piece of legislation, and therefore should be allowed to be applied. Mrs. Fratta argued that she and her late husband’s estate were not provided equal protection under the law because she was not allowed to participate in the settlement of the case. She argued that she was being unfairly treated when compared with widows of individuals who died of a work-related injury, because those individuals are granted fatal claim benefits, and therefore obtain payments or benefits due to the spouse’s death. The Court dismissed this argument, explaining that there was no discrimination in the statute as against those individuals who are beneficiaries of deceased claimants. An injured worker’s participation in the settlement process is what is the ultimate necessity for a Judge to approve a settlement, knowing that the injured worker whose benefits are being settled knows and understanding what is at stake.
Plainly, parties can agree to resolve a case, but the Act is very strict about the requirements that must be met before approval of the settlement by a Judge will be permitted. In this case, while the Judge might have wanted to allow the settlement to go through, the law as it is written simply does not permit him to do so. Arguably, the failure of the employer to sign the agreement could be “explained away” since the Agreement is prepared on behalf of the employer by its legal counsel; under those circumstances, it could be assumed and argued that, even without a signature, the employer’s wishes are being taken into consideration and effectuated. However, the law is clear that there must be a hearing and testimony obtained from the individual settling the claim that he/she knows and understands what the settlement is and what the ramifications of settling are. This is a clear requirement, and this case, along with others decided by the Court and discussed in other newsletters, show that all of the settlement requirements must be met—written and signed agreement and testimony—if there is in fact to be a settlement.
Upcoming Seminars
Open to Public Social Security Seminars:
| When | Where |
|---|---|
| May 19, 2006 9:30 am | Comfort Inn- Grove City 118 Garrett Drive Grove City, PA 16127 |
| May 22, 2006 1:30 pm | Days Inn- Meadville 18360 Conneaut Lake Road Meadville, PA 16335 |
Workers' Compensation:
| What | When | Where |
|---|---|---|
| USW Local 8183 | June 9, 2006 9:00-2:30pm | USW Local 8183 1445 Market Street Bridgewater, PA 15009 |
| UE Local 684 | June 20, 2006 1:00 to 2:00pm and 3:00 to 4:00pm | UE Local 684 115 Clay Street North East, PA |
Individual Consultations available at any time, in your local area, upon request. Call (800) 343-9384 for further information.
FREE Seminars for your union or group are also available.
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