Tuesday, December 17, 2013

The PA Work Comp Act as the Exclusive Remedy of the Employee ...an additional Occupational Disease remedy

A New Rule for consideration of Employer Occupational Disease Liability
The Pennsylvania Workers' Compensation Act applies to all injuries occurring within the Commonwealth. (Section 101, 77 P.S. 1).

In 1972 the Workers' Compensation Act was amended to include injuries (not just "accidents") and occupational diseases (formerly covered under the Occupational Disease Act of 1939).

The Employer's liability to the Employee under Workers' Compensation Act, is said to be the Exclusive Remedy of the employee, on account of any injury or death or occupational disease. (Section 303(a), 77 P.S 481(a).

The recent decision of the Supreme Court of Pennsylvania at Tooey v. AK Steel Corporation, No. 21 WAP 2011 decided November 22, 2013, has altered our understanding of these Exclusive Remedy provisions and their application to remote Occupational Disease claims.

"The Holding"
Occupational Disease disability, which does not manifest within 300 weeks of the last date of employment, is not compensable pursuant to the time limitations in Section 301(c)(2) definition of injury.
HOWEVER, where an Occupational disease is not compensable under the Workers' Compensation Act, due to the expiration of the 300 week period...


The majority opinion of the Supreme Court (5-1), authored by Madame Justice Todd reversed the decision of the Superior Court which concluded that injury which resulted from workplace exposures and manifested more than 300 weeks after the last employment were not "compensable" and did not render the exclusivity provision inapplicable.

1. The Statutory Interpretation Argument
This Supreme Court opinion reflects a well-crafted, if not elegant,
The definition of injury (section 301(c)(2)) states that "the term injury ... as used in this act, shall include occupational disease as defined in section 108 of this act... provided that whenever occupational disease is the basis for compensation ... it shall apply only to disability or death resulting from such disease and occurring within 300 weeks after the last date of employment...".

There was an extended discussion of the Employee and Employer arguments regarding the meaning of the word: "it", in the above passage.
Employee argued that the word "it" refers to "this act".
Employer argued that the word "it" refers to "the basis for compensation".

2. What do these arguments mean?

"If I had a world of my own, everything would be nonsense. 
Nothing would be what it is, because everything would be what it isn't. 
And contrary wise, what is, it wouldn't be, it would. You see?" 
Lewis Carroll, Alice's Adventures in Wonderland & Through the Looking-Glass.

Employees read section 301(c)(2) to mean the Act only applies to injury or diseases occurring within 300 weeks ... the act does not apply to injury concurring more than 300 weeks later ... If the Act does not apply ... it cannot preclude one's rights, so Employees' can file a civil action against their Employer.

Employers read section 301(c)(2) to mean that the Act applies to all injuries and diseases, BUT compensation is available only for disability occurring within 300 weeks!

3. Revenge of the Nerds
YES all of you English majors can read about rules of grammar concerning restrictive and non-restrictive clauses and the significance of punctuation placement of the commas in the statutory interpretation.

The Court: "Upon review, we find [Employee's] interpretation of the language of Section 301(c)(2) to be the most reasonable one." slip opinion page 11).

The Act shall only apply to disability or death occurring within 300 weeks of the last employment
If the Act does not apply to disability or death manifesting beyond 300 weeks, the Act does not preclude a civil action remedy for the employee.

4. The Act as a replacement of the Common law Tort Actions
The traditional notion of the "bargain" of the Employer and Employee is discussed.
The Employee gives up the right to damages beyond wage loss and medical expense.
The Employer gives up its common law defenses.

The Employer assumes liability without considerations of fault, in exchange for relief from the possibility of larger damages.

Then We encounter the oft-repeated maxim:
... however the Act is " remedial in nature and intended to benefit the worker, and therefore must be liberally construed to effectuate its humanitarian purposes".
[ IMHO this phrase never adds anything to the discussion]

5. So how do we get around this exclusive remedy thing?  (ie. the good stuff)
If the employee is not able to seek compensation for disability from an injury/disease arising 300+ weeks later, then the "quid pro qou" of the Act cannot be effectuated!
The employee is giving up all of his rights, without any reasonable opportunity to any compensation.
The employer is granted full immunity, under the illusion that there is no-fault liability for work injuries.

6. If there is no determination of compensability available under the Act, then the Employee civil action is not barred by the exclusive remedy provisions of the Act. 
The Court cites prior cases where an employee did not have a work comp remedy and was allowed to pursue a civil action:
i. Lord Corp, where there was no work comp litigation of the disability and death from the employee's chemical exposures,
ii. Boniecke, where employee was denied relief under the Occupational disease Act,
iii. Greer, alleged pulmonary fibrosis, an occupational disease as a result of Employer negligence.

7. Conclusion: Because the claims are not compensable under the Act, the exclusive remedy provision of Section 303(a) does not bar the common law claims against the employer. (slip opinion page 15).

Employer argued there is a difference between coverage of the Act and compensability under the Act!
The Act applies to all work injuries ... but not every claimant wins!
An employee with an occupational disease manifesting disability more than 300 weeks later, cannot obtain workers compensation benefits, but he may have a civil remedy against non-employer defendants.

Employer unsuccessfully argued that the Act is the employee's exclusive remedy, even when compensation is not available. Several examples in support of this argument are:
i. Kline, claim for damages for impotency from a work fall,
ii. Moffett, partially disabled worker not entitled to OD Act benefits.

The Majority cites Section 305(d) which allows a civil action against an uninsured employer for the proposition that there exists a dual system of recovery ... whereas Employer's arguments for an exclusive remedy would result in no remedy for the employee.

"It is inconceivable that the legislature, in enacting a statute specifically designated to benefit employees, intended to leave a certain class of employees, who have suffered the most serious of work-related injuries, without any redress under the Act or at common law."

"... the legislature did not intend the Act to apply to claims for disability or death resulting from occupational disease which manifests more than 300 weeks after the last occupational exposure".

The dissent, authored by Mr. Justice Saylor provides a well reasoned response.
He notes the legislative "line-drawing" involved in drafting any time requirement for compensability.
He emphasizes the difference between coverage of the Act and the compensability of a claim under the Act.

Claims for disability occurring more than 300 weeks after the last employment are "covered" by the act, but they are not "compensable" under the Act. If desired, the legislature may amend this provision.

Practice Pointers:
1. The Supreme Court has spoken.
This is the law. For now. Perhaps the Legislature will review this issue at a future date.
This is another "exception" to the Workers' Compensation Act, as the exclusive remedy of the employee against one's Employer for "damages" alleged as a result of a work-related harm.

There have been other exceptions, but those exceptions have been for damages not covered by the act, such as the harm from the fraudulent misrepresentations of the employer, where the employee was exposed to lead (Martin v. Lancaster Battery) or the harm of defamation, from the employer's handling of the an employee's seemingly threatening statements (Urban v. Dollar Bank).

Can this exception lead to other exceptions?

2. The Majority opinion artfully interprets the statutory language at 301(c)(2), which heretofore was considered a limitation upon the extent of work comp liability for remote effects of occupational disease.
What was once a limitation, has now been interpreted to allow an additional remedy for civil liability and recovery.

3. In the end result, one would assume that the insurance costs will increase for employers in industry with potential exposure to hazardous exposures, as the liability for remote disability has moved from the category of "uncompensated work comp claim" to the "possible civil liability claim".

4. The remote nature of these potential claims poses a defense nightmare. Perhaps as many businesses move to a computer-based document retention world, the pertinent medical records should remain available for examination. Hopefully the documentation of workplace exposures remains equally available for review and consideration.

5. Industries involved with materials that may pose an remote occupational hazard are prudent to assure retention of pertinent work records, particularly regarding employee job assignments.

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