October 2005 Email Newsletter
The BSH Email Newsletter
Negotiating Workers’ Compensation Issues
Delayed or Progressive Symptoms
Supreme Court Allows Severance Credit
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.
Negotiating Workers’ Compensation Issues
Can a union, when addressing other issues at the bargaining table, make workers’ compensation part of negotiations? The answer is a resounding "yes," and the importance of considering workers’ compensation issues when negotiating contracts cannot be overstated, particularly where so many others are attempting to minimize a workers’ "rights" when injured. When amending the law in 1996, the Legislature specifically provided for negotiation on workers’ compensation topics in Section 450. This section of the law provides that collective bargaining can establish certain binding obligations and procedures relating to workers’ compensation, but limits the scope of those negotiations to supplemental benefits, an alternative dispute resolution system, the use of a list of providers, either for medical treatment or as "impartial" physicians, modified duty programs, safety committees or a vocational rehabilitation and/or retraining program. Section 450 specifically states that nothing in the section can affect the parties if no agreement is reached in collective bargaining, nor can the negotiation in any way diminish an employee’s entitlement to benefits as provided in the Act itself. Therefore, the parties cannot lessen an individual’s entitlement under the law--only "fine tune" it.
In the past, we have always recommended that the list of physicians for medical treatment be the priority for negotiations. This will be even more important should the Legislature decide to pass an amendment requiring treatment with the company designated doctors for 180 days, as is currently in discussion. As you are clearly aware, the physicians and other medical providers on this list directly affect an individual’s entitlement to compensation and medical care for these important first months. Doctors who are unwilling to order diagnostic testing because of the cost, or who refuse to take an injured employee out of the plant for the time necessary to assist that individual’s recovery, are the biggest impediment to an individual’s return to work without residuals.
A negotiated list, where the union has provided recommendations for designated physicians, may assist an injured employee in obtaining adequate treatment, which in turn may allow for a quicker rehabilitation process. Plainly, this is to the employer’s advantage as much as it is the injured employee in many instances, but companies are loathe to have providers who are little more than "yes-docs" for the human resources department of the employer. Explaining that a safe and expeditious return to work benefits all parties may be some of the best negotiating ever undertaken by a union committee. Additionally, negotiating the list of designated physicians may allow choices of providers that are actually relevant to your members and the types of injuries they sustain--chiropractors, hand specialists, knee specialists, pain management specialists--rather than the same old tired list of orthopedic surgeons who are disinterested in the day-to-day care of small work injuries, and view the pool of injured employees as nothing more than office visits to bill and collect. Panel providers often see injured workers in stark contrast--surgical candidates or fully recovered, with no middle ground or thought to conservative care. Unfortunately, because many injured workers would prefer not to jump into surgery, this puts them out as "fully recovered," even though that is clearly not the case. A negotiated list may avoid this problem.
Where do you get recommendations for a company list? Previously injured employees can be a gold mine for potential names to add to the designated provider list. Similarly, those doctors who cannot seem to find time for appointments, who do not return calls or whose staff does not go the extra few steps to call in medications or get paperwork completed promptly, should be "voted off the list" if possible. Don’t be afraid to "poll the delegation" for good and bad experiences before negotiations!
Another key issue for negotiations is a light or modified duty program, and the requirements of that program, both in the physical nature of the jobs themselves, and the manner in which they are to be assigned. While some may feel that negotiating a light duty program may play into the employer’s hands by giving the company the "freedom" to return people to light duty work and thereby avoid workers’ compensation liability, this is far from the truth if the union can have some say over what will be appropriate light duty and how that light duty will be parceled out to injured employees. By making the light duty program a part of the collective bargaining process, the union can have some say in what types of jobs are going to be available to injured employees; again, based on the union’s experience in what types of injuries are sustained in the plant, input into the types of jobs to which an individual will be returned can be important in making the return to work an effective one, which benefits the injured employee. Many companies assign injured workers to the worst possible jobs, which may fall within the individual’s restrictions, but be inappropriate for other reasons. Under these circumstances, modified duty is more of a "punishment" than a meaningful attempt to return an individual to productive work. The union can negotiate about these types of jobs, and whether and to what extent they can be used. Moreover, some companies bring injured folks back to work to avoid the assessment of compensation against the company account, but have the injured worker sit and do nothing; this can be degrading to that person, and create morale problems with other workers. The union can attempt to make these positions a thing of the past and negotiate them out of existence.
Additionally, the number of modified duty jobs available and the manner in which they are to be assigned--i.e., by seniority, date of injury, and length of anticipated disability from full duty--can and should be discussed in negotiations. This can make a union’s job easier in the long run, and minimize complaints about why "some people" get to return to light duty and others do not. Wage rates for light duty may also be an appropriate topic for negotiation; this will help the union explain to those injured why they are not earning the same rate--or why they are--and what the ramifications of that amount of wages will be with respect to additional benefits due from the insurance carrier. These issues, if addressed at negotiations, can help make light duty easier to manage, and maybe even satisfy everyone.
When the union decides to make workers’ compensation issues a part of the bargaining process, it can strengthen the rights of injured workers, and make the burden of a work injury less. Discussion of these issues with attorneys who deal with workers’ compensation litigation on a daily basis will enhance any union’s effectiveness in addressing these concerns at the bargaining table. Since the Legislature has invited unions and employers to negotiate over some aspects of workers’ compensation, unions should make the most of this suggestion.
Delayed or Progressive Symptoms
Not all work injuries are immediate problems. Some injuries do not seem to be much at the time, so an injured worker does not report it and/or seek any immediate medical treatment. When the problems still exist a month later, what is an injured worker to do?
First and foremost, any and all injuries- no matter how small- should be reported immediately to prevent problems with notice (120 day time limit). If no injury was ever reported, that is the first thing you must do! Give notice to a supervisor and let him/her know the date you first experienced symptoms and explain the progression or ongoing nature of your symptoms since that time. If an injury was reported, but no medical treatment was received, return to the person to whom the injury was reported and advise that the injury has never "gone away" or "gotten better" and that now medical treatment is needed. Request an appointment with a company physician if the company has an appropriate medical provider list, but please remember that there is no requirement that the company makes these appointments for injured employees. If the injured worker has the accident report--OF COURSE a copy was requested when the injured worker completed it--he/she can take that accident report to the company doctor when the appointment is made. The worker may wish to check to be sure the injury was reported to the compensation carrier, but there is a good possibility the accident report never went any further than the company if the worker did not start to treat right away.
If the company refuses to allow the appointment with the company physician, will not provide information about panel physicians, or cancels any appointment the injured employee makes with a company-designated physician, then the injured employee should get to his/her primary care physician immediately. The injured worker should take a copy of the accident report to that appointment and be certain to explain to that doctor how the original injury occurred and how the symptoms have progressed since that injury. The injured worker should also describe the job duties he/she has been performing since the time of the accident. This gives the PCP two alternatives: (1) the doctor can say that the original work injury is and remains the cause of the problem; or (2) the doctor can opine that the injured worker aggravated, exacerbated and made worse the original work-related injury by continuing to work at his/her regular job, performing all of the usual duties required in that job.
If the employee’s PCP believes that the complaints the worker is now suffering are related to the original work injury, the injured employee should again notify the company, provide the slip indicating this, in writing, from the doctor, and advise again that he/she is going to a panel physician for treatment of this work injury. If the employee’s own physician says that the injured worker made the condition worse by continuing to work after the injury, then a new accident report should also be filed, noting an aggravation of the pre-existing injury/condition as a result of continuing work duties, up through the date of the PCP’s evaluation. Again, the injured worker should schedule an evaluation with the panel physician, and take both accident reports and discuss his job duties with the panel physician. If the company refuses to acknowledge the injury, or issues a denial, then the injured worker should return to his PCP for treatment and, if necessary, a referral to a specialist.
We actually have several cases like this in our office right now. In each of them, the injured worker had only minor pain at the time of the injury itself, and believed that the pain would just go away in a couple of days. In one, an accident report was completed, and no treatment was obtained at the time. In another, the claimant listed the injury as a hip injury, and he treated initially for hip complaints--went to the hospital, had an x-ray, and saw the panel doctor once. After that, there was no additional treatment, and when his complaints worsened, it was determined that he had a back injury, not a hip problem. In both of these cases, because of the delay between the injury and the medical treatment, or the delay between the injury and initial treatment and the subsequent treatment to a different part of the body, the compensation carriers denied the injury. These cases will usually require litigation.
Please understand that, so long as there is a physician who will provide an opinion within reasonable medical certainty that the injured worker’s current complaints are related to that earlier injury--even if it was six or eight months ago--there is a reasonable basis to file a worker’s compensation case (so long as notice of the injury was originally provided at the time of the injury). If there has been a lapse of more than 120 days between the injury and the current treatment, and the injury was not observed by a supervisor--actual knowledge--then the doctor may need to say that the injured worker’s continued performance of his/her job duties aggravated the pre-existing condition, to get around the hurdle of timely notice.
Not all work injuries result in immediate pain or immediate medical treatment and/or disability. Indeed, many workers try to "work through" the pain, only to learn later that their condition is worse than originally believed and that medical treatment will be required and disability may become an issue. These injured workers may be able to pursue a workers’ compensation claim, but it may require the assistance of an attorney and the filing of a Petition.
Supreme Court Allows Severance Credit
Are Only Self-Insured Employers Entitled to a Credit for Severance Benefits Paid When an Employee Receives Workers’ Compensation Benefits?
Facts: In Kramer v. WCAB (Rite-Aid Corporation), the injured worker received total disability and partial disability workers’ compensation benefits. She was working on modified duty and receiving a partial when the company moved its facility from Pennsylvania to Maryland. She was reinstated to total disability benefits and, as a member of the class of displaced employees, also received a severance benefit pursuant to a severance agreement which was part of the union’s collective bargaining agreement. After the net severance benefit was received by Ms. Kramer, the employer sent a Notice of Compensation Benefits Offset informing her that a credit was going to be taken against her workers’ compensation. Ms. Kramer received no benefits whatsoever from June 5, 1999 through August 9, 1999 while the severance amount was recouped from her benefits.
Ms. Kramer filed an Offset Review Petition, arguing that the offset was not timely taken, was unconstitutional, and that the benefits were not "really" a severance benefit, as that term is defined by the Act.
Initial Ruling: The Workers’ Compensation Judge dismissed the Petition, finding that the employer’s offset was proper. The Judge concluded that he had no jurisdiction over any constitutional arguments.
Appeal Board Ruling: The Board affirmed the Judge’s decision, and also concluded that it lacked the authority to rule upon Ms. Kramer’s constitutional challenge to the offset.
Commonwealth Court Ruling: Ms. Kramer appealed to Commonwealth Court arguing that the severance was "otherwise earned income," and that even if it was a severance benefit, the employer, which was not self-insured, was not "directly liable" for payment of her workers’ compensation benefits because her benefits were paid through a workers’ compensation carrier. Ms. Kramer again raised her constitutional challenge to Section 204(a) of the Act which allowed the offset of severance, arguing that it violated equal protection.
The Commonwealth Court reversed the decision of the Judge and Board, and found that the employer was not entitled to the severance offset based on the argument by the claimant that the employer was not "directly liable" for her compensation. When the law was amended to allow the severance credit, the Court explained, the payment is coming out of the same pocket, that is, the self-insured employer’s pocket. When there is a compensation carrier making the workers’ compensation benefit payment, the employer is not "directly liable" for the compensation. The Court explained that the offset inures to the employer, not its private insurance carrier, and that the Workers’ Compensation Act does not use the terms "employer" and "insurer" interchangeably and they should not be interpreted as one and the same. The Majority Opinion held that, since Rite Aid did not pay Ms. Kramer’s compensation, it was not entitled to the offset under the Act. The Concurring Opinion held that no offset was proper, but for a different reason, as that Judge found that the payment to Ms. Kramer was not a severance payment, but was "otherwise earned income."
Supreme Court Rationale: In a decision published September 28, 2005 (nearly two years after its argument date of December 2, 2003), the Supreme Court reversed the decision of the Commonwealth Court, and allowed the offset for the severance paid to Ms. Kramer by Rite Aid.
The Court first addressed the employer’s argument that Section 204(a) of the Act did not specifically say "self-insured" employers were entitled to the credit only, but rather used the term "employer." Therefore, all employers are entitled to the credit even if a private insurance company pays the injured employee’s workers’ compensation benefit. The employer argued that the amendments to the Act were part of a legislative determination that a claimant should not receive "duplicate benefits for the same loss of earnings," that is, both severance and workers’ compensation.
While noting that the basic premise in workers’ compensation is to "benefit the worker," the Supreme Court agreed with the employer that Section 204(a) was ambiguous as to whether all employers or only self-insured employers are entitled to the offset for severance benefits. Reaching back to a 1969 case, Brown v. Travelers Insurance Company, the Court referenced "the Act’s apparently divergent definitions of employer," and treated that case as "binding authority" that the term "employer" in some sections of the Act is meant to include "insurer." While the Section at issue in Brown was a different section (not 204), the Court determined that both sections have to do with remedies under the Act and "specifically with the rights afforded to employers who participate in the workers’ compensation system and their insurers." The Court considered this rationale to be "convincing and ultimately controlling," and found that for purposes of the offset for severance, there was no distinction between employers who are insured or self-insured for workers’ compensation purposes.
The Court further explained that its "interpretive conclusion" means that the use of the phrase "employer directly liable for compensation" accounts for situations where a claimant has more than one employer; in that circumstance, the employer who is responsible for the workers’ compensation benefits and the severance payment would be entitled to a severance offset so that "[d]ouble recovery for the same loss is thus avoided." The Court noted that, under the Commonwealth Court’s decision, insurance carriers would pay benefits above and beyond that which the policyholders/employers would pay if they were self-insured.
The Supreme Court also addressed Ms. Kramer’s constitutional argument, that is, whether Section 204(a) violates equal protection under the Pennsylvania or U.S. Constitution. The claimant’s argument on these grounds is that there is an unconstitutional differentiation made between injured and non-injured employees with respect to severance, that is, those who are injured do not get to retain the benefit of their severance pay upon lay-off, while those who did not suffer the misfortune of an injury keep their entire severance. Employer countered this argument with the statement that Ms. Kramer received her severance, just as her non-injured co-workers did, but her workers’ compensation benefits, which her non-injured co-workers did not receive, were reduced by this amount. The Employer argued that the Act does not in any way impede an injured worker’s right to receive severance.
The Court quoted the Equal Protection Clause of the U.S. Constitution ["no state shall...deny to any person within its jurisdiction the equal protection of the laws."] and the Pennsylvania Constitution ["All men are born equally free and independent, and have certain inherent...rights..."] and noted that the law is to be applied to be certain that "like persons in like circumstances will be treated similarly." The Supreme Court then explained that this is not absolute, and that the prohibition against treating people differently does not apply when people have different needs, but that any such classification must be "reasonable rather than arbitrary and bear a relationship" to the reason for the legislation.
The Court rejected Ms. Kramer’s argument, finding that Section 204(a) does not draw a distinction between injured and non-injured workers who receive severance benefits. Moreover, while Ms. Kramer’s argument was that the severance payment was a fundamental right, the Court noted that she was not deprived of the severance payment, in that she received a check in payment of her severance. The Court held that the offset "merely...reduce[d] claimant’s workers’ compensation benefits," which did not have an effect on Ms. Kramer’s rights, but on a social welfare benefit, which is not considered to rise to the level of a fundamental right, nor a contractual right.
The Supreme Court also rejected Ms. Kramer’s argument there was no "double recovery" if an injured worker received both workers’ compensation benefits and severance, because these benefits compensate different losses. In the case of a self-insured employer, the Court explained, the offset "directly reduces the employer’s costs." Extrapolating that to the employer who is covered by a policy of workers’ compensation insurance, the Court held that "there is nothing irrational or arbitrary" in allowing the offset to all employers. The decision explains that the workers experience only one loss of earnings, and that does not disadvantage the injured worker with respect to his uninjured co-workers because the uninjured workers do not receive a double benefit, that is, both workers’ compensation and severance.
Under the Supreme Court’s decision, any severance received by the employee who has the misfortune of being injured and laid off will be offset against the workers’ compensation benefits received. Therefore, those employees who do receive a severance package would do well to set aside some, if possible, to meet monthly expenses while the offset is being taken against workers’ compensation benefits. Obviously, employees may ask how the insurance carrier will "find out" if the employer is not self-insured. Generally speaking, a plant closing is reported to the insurers, as there are many cases with "loose ends" that will need to be wrapped up at the time of the plant closure, and many other avenues open to the insurance carrier to place injured employees in other jobs or move to cut down on total disability benefits. However, there are also the fraud provisions of the Workers’ Compensation Act, which forbid an employee from withholding such information, as punishable by jail time and restitution.
Upcoming Seminars
Consultations:
| When | Where |
|---|---|
| October 11, 2005 from 1:30-4:00pm | Meadville USW Office 287 ½ Chestnut Street, Second Floor Meadville, PA 16335 |
| December 13, 2005 from 1:30-4:00pm | Meadville USW Office |
Open to Public Social Security Seminars:
| When | Where |
|---|---|
| October 6, 2005 at 10:00am | Quality Inn Erie 8040 Perry Highway Erie, PA 16509 |
Workers' Compensation:
| What | When | Where |
|---|---|---|
| Erie USW Basic and Advanced Workers’ Comp Course | October 11, 2005 4:00-6:00pm | USW Union Hall 703 French Street, Erie |
| Erie USW Basic and Advanced Workers’ Comp Course | October 18, 2005 4:00-6:00pm | USW Union Hall 703 French Street, Erie |
| USW Linden Hall | October 19, 2005 9:00-12:00pm | USW Linden Hall 432 Linden Hall Road Dawson, PA 15428 |
| Porreco Center | October 26, 2005 6:45-9:15pm | Porreco Center 2951 West 38th Street, Erie |
| USW Seminar | November 18, 2005 9:00-3:00pm | Tonidale Restaurant- Route 22 Oakdale, 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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