For most companies, dealing with workers’ compensation claims comes with the territory of running a successful business. Even with appropriate safety policies and procedures in place, accidents happen, and even office workers and administrative staff can suffer job-related injuries or develop medical conditions over time. Under the Pennsylvania Workers’ Act, employees are entitled to payment of bills for medical treatment of their work injury, and weekly disability benefits if the employee is disabled from the injury.
With this in mind, companies that are subject to Pennsylvania’s workers’ compensation laws must be prepared to defend against employees’ claims for benefits effectively. While workers’ compensation is a “no-fault” system, and the Commonwealth’s workers’ compensation laws are designed to ensure that injured workers have the financial resources they need while recovering, employers may still have valid reasons to dispute individual employee’s claims for benefits. So, what do Pennsylvania employers need to know?
Litigating Disputed Claims for Workers’ Compensation Benefits in Pennsylvania
Let’s begin with an overview of the process, starting with the employee’s attempt to overcome a denial of workers’ compensation benefits through litigation.
In order to obtain workers’ compensation benefits through litigation, an employee must file a Claim Petition with the Pennsylvania Bureau of Workers’ Compensation (PBWC). Once the Petition has been filed, the PBWC will issue a Notice of Assignment to a Workers’ Compensation Judge, who is selected based on the location of the employee’s residence.
Once the claim has been assigned, the Workers’ Compensation Judge will schedule either a hearing or pretrial conference. From this point forward, the Workers’ Compensation Judge is granted discretion to set the trial schedule and the manner in which evidence will be presented, subject to certain limitations.
In order to demonstrate that he or she is entitled to disability benefits, the employee must prove three elements:
- The existence of an employment relationship during which an injury occurred within the scope of employment;
- That the injury prevented the employee from performing his or her job duties resulting in loss of earnings; and,
- If the employee is seeking ongoing disability benefits, that his or her disability has continued throughout the duration of the litigation.
In assessing each of these three elements, Workers’ Compensation Judges in Pennsylvania will consider evidence submitted by the parties and make credibility determinations regarding that evidence. Often, it is the credibility of the claimant that is the basis for an award or denial of disability benefits. In assessing the claimant’s credibility, the judge may consider evidence which undermines a claimant’s credibility such as:
- The employee’s duration of employment with the employer prior to his or her injury
- Whether the employee has a questionable employment history predating his or her current position
- A history of disciplinary problems involving the employee
- An extensive history of prior workers’ compensation claims filed by the employee
- A history of prior lawsuits alleging personal injury damages
- Whether the employee’s physical activities outside of work at the time of the injury could have been the true cause of the injury
- Testimony from fact witnesses contradicting the claimant’s version of the alleged injury
- Photographs of the premises where the accident occurred
- Site inspection reports and other relevant documents
- The employee’s medical treatment records (both pre-injury and post-injury)
- Testimony from medical experts
- Surveillance of the employee’s activities (post-injury)
After hearing all of the evidence, the Workers’ Compensation Judge will render a decision. Depending on the outcome, both the employer and the employee will have the option to appeal the judge’s determination to the Worker’s Compensation Appeal Board. The board will not reweigh the evidence, and will affirm the judge’s decision if supported by substantial competent evidence, and no errors of law were committed by the judge. If no appeal is filed, then the judge’s decision becomes final.
Petitioning for Termination, Modification or Suspension of Workers’ Compensation Benefits Post-Award
Once an award has been issued, an employer should continue to monitor its employee’s recovery so that a Petition for Termination, Modification, or Suspension can be filed at the appropriate time. Employers are entitled to seek a termination, modification, or suspension of workers’ compensation benefits in Pennsylvania when either:
- The employee is fully recovered from his or her job-related injury (allowing for termination of all benefits); or,
- The claimant has not recovered fully but has had some change in condition resulting in a decrease in his or her loss of earnings power.
With regard to this second, “decrease in a loss of earnings power” condition, employers have three ways to demonstrate that continued payment of total disability benefits is no longer warranted:
- by demonstrating that they are able to offer suitable work to the employee;
- by demonstrating that suitable work is available through another employer; or
- by establishing that the employee has sufficient earning power through a Labor Market Survey/Earnings Power Assessment.
If a suitable job is available, the employee has an obligation to resume work, and the employer is entitled to cease or reduce disability benefit payments (once a workers’ compensation judge makes an appropriate determination).
Resolving Workers’ Compensation Claims and Petitions for Modification or Suspension Through Mediation
While litigating any petition to conclusion will sometimes be necessary, it will often be in all parties’ interests (including the interests of the PBWC) for employers and employees to reach an amicable result through mediation. In fact, under Pennsylvania law, workers’ compensation judges have the authority to require mediation unless they believe that mediation would be futile. When a workers’ compensation judge orders mandatory mediation, another workers’ compensation judge will be assigned to serve as mediator.
Of course, even when a workers’ compensation judge submits a claim to mediation, the parties are not required to settle. If mediation proves unsuccessful, the claim will be sent back to the original workers’ compensation judge for resolution. However, if the parties reach an agreement, they will enter into a Compromise and Release Agreement. The agreement may resolve all or any part of a worker’s compensation claim. Voluntary resignations from employment are often obtained from the claimant as a part of the settlement. A worker’s compensation judge must approve the agreement before it is binding on the parties. A judge is required to approve the settlement if he or she finds the claimant understands the terms of the settlement.
Based on experience and anecdotal evidence, when claims are resolved through mediation, employees often receive between two and four years of benefits. However, these are rough figures that should not be used as guidelines in subsequent cases. Examples of factors that typically influence workers’ compensation settlements include:
- The applicable average weekly wage and weekly compensation rate
- The seriousness and permanence of the employee’s injury
- The employee’s expected future medical treatment needs
- The employee’s immediate and long-term employability
- The employee’s receipt of Social Security Disability or Social Security Retirement benefits (if any)
- The availability of pension benefits (if any)
- Evidence of a wage-earning capacity
An employer’s assistance and input in the litigation process can be invaluable, and more importantly, can ensure that the resolution of the claim includes the best interests of the employer, and not just the employee and the workers’ compensation insurance carrier.