PA Supreme Court reverses $1.2 million Jury Verdict based on Statutory Employer Immunity

In construction related injury cases, the concept of the "Statutory Employer" status of the general contractor can be decisive of liability issues.

The General Rule (no pun intended) is that a General Contractor has secondary liability for worker compensation benefit payments to the injured employee of it's subcontractors. If the subcontractor does not have work comp insurance coverage for its employees, then the General Contractor is responsible for benefit payments. The Legislative purpose for imposing this responsibility upon General Contractors was remedial, they wanted to ensure payment of work comp benefits to injured workers, in the event of a default by the subcontractor, who should have been primarily responsible. See: Section 302(b), 77 P.S. 462.
Qualp v. James Stewart Co,. 109 A. 780 (Pa. 1920) [cited by Patton at slip opinion page 2].

The Statutory Employer enjoys the same immunity (as a traditional employer would) from liability in tort, related to the work injury. The Workers' Compensation Act is the exclusive remedy of the injured worker against one's employer. This immunity will apply, even where the Statutory Employer has not been required to make any actual benefit payments.
 See: Fonner v. Shandon, Inc., 724 A.2d 903 (Pa. 1999). 

What are the limits, if any, of this Statutory Employer Doctrine?

Patton v. Worthington Associates Inc., No. 32 MAP 2013, a recent opinion of the Supreme Court of Pennsylvania authored by Mr. Justice Saylor on March 26, 2014 addressed this question.


Factual and Procedural Background
The facts in Patton are rather straightforward.
Patton fell and injured his back while working at a construction site in October 26, 2001.
Nearly 12 1/2 years later, we have a final decision in this litigation.

Patton was the sole employee (and principal) of Patton Construction Inc.
Patton Construction Inc. entered into a standard subcontract agreement with Worthington Associates, Inc., to perform carpentry work at a Levittown Church. Worthington was the general contractor at this job.

Patton filed civil action against Worthington asserting that they failed to maintain safe conditions at this jobsite. At trial, Worthington moved for Summary Judgment on the basis that is was Patton's statutory employer and was immune from civil suit. This Motion was denied, as were subsequent motions.

Trial court identified the issue in controversy and determined that a general contractor is not a statutory employer, relative to employees of an independent contractor.

Question: was Patton an independent contractor or employee with respect to Worthington?
This  interrogatory was submitted to the jury. The jury returned a verdict in the amount of $1.5 million. (also finding Patton 20% comparatively negligent).

Superior Court affirmed in a divided opinion.

Supreme Court Reversal of Superior Court affirmation of Trial Court. 

The Supreme Court opinion "paused to observe" that:

•  Worthington contracted with Patton Construction Inc, not Patton in his personal capacity.
• Patton, himself had no contract with Worthington and accordingly he could not be considered an independent contractor, or even a contractor for purposes of Sections 203 or 302(b) of the Workers' Compensation Act.
• Patton was not a common law employee of Worthington, he was an employee of Patton Construction Inc.

The Supreme Court noted that the Trial Court set up an errant dichotomy for the jurors, by requesting their response to the "independent contractor versus employee" question.

In terms of Patton's relationship with Worthington, as an individual, Patton was not in either category!

As correctly stated by Worthington in its appeal, the only accurate answer is that: 

Patton is an employee of Patton Construction Inc.

Patton Construction Inc. stands as a subcontractor in its relationship to Worthington. 

The Supreme Court opinion reviewed the historical interpretation of the Statutory Employer concept.

Conventional subcontractors are dependent contractors, not independent contractors, for purposes of the Workers' Compensation Act, Sections 203 and 302(b). 

Their employees are not contractors at all, nor, at least in the absence of special circumstances, are they employees of the general contractor. Patton, slip opinion page 9.

Patton's status as the principle owner of Patton Construction Inc. does not alter the analysis or outcome. 

The jury verdict was reversed as Worthington has statutory employer status under these facts.

Worthington has immunity from the civil tort action of Patton.

Practice Pointers:

1. This case discusses legal concepts, which are difficult for the non-workers compensation professionals. The Statutory Employer concept and liability issues must be reviewed by legal counsel, experienced in workers' compensation matters. The issue of  immunity for civil litigation is significant. In this case it was decisive.

2. When addressing a construction related injury, it is prudent to interview the parties and review the contracts to develop a correct outline and analysis of the relationship of each party to the other. 

3. Cudos to Worthington for persevering and confirming the correct method of analysis of this Statutory Employer issue. Mr Justice Saylor has authored an opinion that provides clear legal reasoning for our future assessment of this issue.

Impairment Rating Evaluation as the Employer's "Best" Remedy

Limiting the Duration of Total Disability Benefits via an Impairment Rating Evaluation.

The Employer and Workers' Compensation Insurer have a remedy to limit the duration of total disability benefits, via the scheduling of an Impairment Rating Evaluation (IRE) pursuant to Section 306 (a.2).

The requirements are straight forward. After an Employee receives 104 weeks of total disability benefits, the Employer may file a Request for Impairment Rating Evaluation LIBC-766 with the Bureau of Workers' Compensation.

The Bureau assigns the request to a medical expert, who is licensed in Pennsylvania and Board Certified in a Specialty. This physician must also be active in clinical practice, for at least 20 hours per week.

The examining medical expert must determine that the Employee has reached "Maximum Medical Improvement", before an evaluation can take place.
The medical expert must utilize the latest edition of the American Medical Association "Guides to the Evaluation of Permanent Impairment". 

If the degree of impairment is equal to or greater than 50% , in accord with the AMA Guides, then Employee is presumed to be totally disabled. 

If the degree of impairment is less than 50%, then Employee shall receive partial disability benefits. Partial disability status is for a maximum duration of 500 weeks.

Benefit status is changed by the filing of an LIBC-764, Notice of Change of Workers' Compensation Disability Status.
The rate or dollar amount of the benefits is not changed by the IRE. The "status" of the Employee benefits is changed, from a potential lifetime duration of total disability, to a limited duration of 500 weeks.

Question: What happens when an employee has an IRE, is placed on partial status and then undergoes work-related surgery ... which is totally disabling in nature?

Wingrove v. WCAB (Allegheny Energy), No. 1151 C.D. 2013,  is a reported decision of  a panel of the Commonwealth Court of Pennsylvania, authored by Judge Leavitt on January 3, 2014. The disability status of employee after surgery was addressed.

Factual and Procedural Background

Employee injured his low back while working as a laborer in November 2002.
An NCP was issued for a low back "strain".
He continued to work, until May 2003 when he underwent surgery. His low back pain worsened and he remained off work on total disability.

After payment of two (2) years of total disability benefits, Employer requested an IRE.
A May 1, 2005 evaluation by medical expert Jon B. Tucker, M.D. determined Employee was 11% impaired, in accord with the AMA Guides.
A Notice of Change of Disability Status was issued.

This change of status was automatic and self-executing as the IRE was requested within 60 days of the Employee's receipt of 104 weeks of compensation.
[See: Pa Supreme Court Decision at Gardner v. WCAB (Genesis Health Ventures) 585 A.2d 366 (Pa. 2005)]

May 18, 2009 ... Four (4) years later Employee filed two (2) petitions
In 2010, a Third Petition followed...

1. Review Description of Injury. This petition asserted, the 2002 NCP should be amended to include:

•   mood disorder with depressive, psychotic and hypomanic symptomatology;
•  a moderate to severe treatment-resistant pain disorder; 
• chronic severe low back pain.

2..Review IRE The IRE was defective as it did not take into account the above psychiatric problems.

3. Review Petition (2010) Lumbar fusion surgery of March 2010 rendered Employee more than 50% disabled, pursuant to the AMA Guides. Amendment of the NCP was requested to include:

•  post laminectomy syndrome and chronic L5 radiculopathy.

NOTE: In January 2011, during the WCJ litigation, the parties entered into a stipulation and agreed that Employee became totally disabled as of the date of the March 24, 2010 surgery, until November 29, 2010. As of November 30, 2010, Employee was returned to partial disability status. 

The parties agreed the execution of this stipulation (Supplemental Agreement) would not have any effect on any pending petitions or any future petitions. 

WCJ January 2012 Decision and WCAB Affirmation

A. Review Description of Injury
 Granted as to:

• chronic radiculopathy,
• post-laminectomy syndrome,
• chronic back pain,
• depression

Denied as to : psychosis.

B. Review IRE Petition

• Denied. Employee did not challenge the IRE within 60 days of the Notice of Change in Disability Status. 
• Expansion of the NCP did not negate the validity of the Dr. Tucker 2005 IRE.
• 2011 Supplemental Agreement did not render the 2005 IRE a nullity.

C. Review Petition 50% Impairment Argument

• Denied, Employee had the burden to prove that the additional recognized work injuries established a whole body impairment in excess of 50%. He did not meet this burden.

Commonwealth Court Affirmation and Reasoning

Employee argued:

 (1)  there was an error of law, once Employee became totally disabled, Employer had the burden of proof to re-establish Employee was partially disabled before they could change his disability status. 

(2) The Workers' Compensation Act violates the Pennsylvania Constitution.

Why does Employee lose this Appeal?

i.  Employee may challenge an IRE, on its merits, within 60 days of receipt of the Notice of Change form. After 60 days, the IRE is beyond challenge! He waited four (4) years. 

ii. Employee may obtain a new IRE after 60 days (within the 500 week partial disability status).

BUT to change his status from partial to total, he must establish an impairment of 50% or more. 

He did not obtain a new IRE.

iii. The 2012 WCJ decision amending the NCP did not render Dr. Tucker's 2005 IRE determination invalid. 

After 60 days it was fixed and beyond challenge.

iv. The burden of proof shifted to Employee to show that his addition of depression to the NCP rendered him at least 50 % impaired.

 Section 306 (a.2)(4) allows a change in disability status, but only where an impairment rating determination is equal to or greater than 50%. Employee did not do this. Employee did not meet his burden of proof. 

The Court rejected Employee argument that the Employer had the burden of proof to establish partial disability, after the Supplemental Agreement placed him on total disability status. 

[Recall: that agreement stated it would not have any effect on the pending or future petitions].

v. Constitutional Argument. Questions of the validity of a Statute may be raise on appellate review, even where not raised before the WCJ and/or WCAB. [Pa. R.A.P. 1551].

Employee argued that" in some circumstances his client would have been consider to be more than 50% impaired" ... but he did not assert a change in an edition of the AMA Guides which affected HIS 2005 IRE!

The term, "most recent edition" of the AMA Guides has been interpreted to mean the edition in effect at the time the IRE is conducted. See: Standish v. WCAB (James J. Anderson Construction Co.) 11 A.3d 569 (Pa. Cmwlth. 2010).

Employee did not "develop" his constitutional argument. slip opinion page 10. 

Practice Pointers:

1. Once again I emphasize, the IRE remedy is a relatively low-cost, low-effort remedy to limit the duration of workers' compensation indemnity wage loss benefits.

 EVERY work comp file should be diaried for payment of 104 weeks of total disability, for the prompt request of an IRE.

2. Another available remedy (available even before the payment of 104 weeks of total disability) is the remedy to establish a post-injury earning capacity via a Medical Expert Examination ...

... followed by an Employer job offer AND/OR a Labor Market Survey by a qualified vocational expert, leading to an Earning Power Assessment ... and a prima facie case for modification of total disability benefit payments. 

These are two remedies that should be employed in every workers' compensation case. 

These are the remedies available ... use them.

When is a NARTW required by the Employer?

*NARTW = Notice of Ability to Return To Work, LIBC-757.

The 1996 amendments to the Pennsylvania Workers' Compensation Act included the introduction of a "new" remedy for Modification of total disability wage loss benefits, based upon Vocational Expert Opinion Evidence of the post-injury earning capacity of the injured worker. This remedy supplemented the remedy of Modification via "proof of a job offer" ala "Kachinski".

[Kachinski is the name of the Pennsylvania Supreme Court decision which espoused a 4-part standard for the Employer burden of proof in a modification/suspension based upon evidence of a job offer. See: Kachinski v. WCAB (Vepco Construction Co.) 532 A.2d 374 (Pa. 1987).].

Section 306 was amended to require the Employer provide Employee prompt written notice, when medical evidence is received of Employee's ability to return to work in any capacity.
306(b) (3), 77 P.S. 512(3).

The LIBC-757, Notice of Ability to Return to Work, was created to fulfill this notice requirement.

Is a NARTW form required in every instance of Employer job offer to Employee?

School District of Philadelphia v. WCAB (Hilton), No. 598 C.D. 2013, a published decision of a panel of the Commonwealth Court authored by Judge Leadbetter on January 7, 2014, addressed this issue.

Factual and Procedural Background
Employee was a 2nd grade teacher at Pastorius Elementary School from November 2008 to March 2009.
On March 3 she suffered heart palpitations, headaches, dizziness and nausea, alleged as a result of a "particularly difficult day with her challenging classroom". [ 2nd graders, 8-9 years old?].

After her regularly scheduled Physician appointment, the Employer was notified by the physician office, Employee would not be returning to work, due to the school's overly stressful environment.

Employer panel physician examined and released Employee to return-to-work at her regular job at Pastorius. Employee worked 4 days in May, 2009.
Employer issued a Notice of Workers' compensation Denial LIBC-496 on May 29, 2009.

June 2009, Employer re-assigned Employee to teach at Jay Cooke Elementary School.
Employee met with the principal, toured the school. She later testified Cooke was the opposite of Pastorius, it was quiet, with "excellent teaching going on".

September 2009, Employee did not return-to-work at Cooke, as she was still undergoing treatment for her work-related stress.

October 2009 Claim Petition was filed, averring stress from abnormal working conditions.
[compare to the PA State Trooper in Payes for a gut-check on "abnormal"!].
She alleged a vocal cord injury and an aggravation of her pre-existing conditions, lupus and a heart murmur.

WCJ Claim Petition Decision 
... it's Pennsylvania ... so she received an award of benefits ... but the WCJ limited wage loss benefit to a period ending September 30, 2009 when the Cooke job was available.

The WCJ found credible the Employee medical expert testimony that Employee was not able to teach at Pastorius, however, she could return-to-work as a teacher, but not in that environment.

Both Employee and Employer appealed!

WCAB Decision
Affirmed grant Claim Petition.
Reversed on limitation of Award.

Commonwealth Court Appeal of Employer
Employer argued:
1. Employee medical expert was not legally competent to testify;
2. Employee only established disability through the date the Cooke position was available;
3. Employer was not required to provide Employee with a NARTW form.

Commonwealth Court Decision
1. Employee Medical Expert was legally competent to testify regarding causation.
2. Employee did meet her burden to establish a disabling injury.
3. Employer was not required to provide Employee with a NARTW form.

1. Competency of Medical Witness to testify
Employee has the burden of proof to establish all of the necessary elements for an award, including a casual relationship between work and the alleged disability, including the extent and duration of disability.

Employer argued Employee medical expert Dr. Baugh was not legally competent to testify (i)  regarding an exacerbation of lupus and (ii) regarding a causal relationship between psychological stressors and the alleged exacerbation.

Dr. Baugh was no longer board-certified in internal medicine.
She was not an expert in psychology, rheumatology, cardiology or otolaryngology.
However, in general, a physician is competent to testify as to specialized areas of medicine, even though he or she is not a specialist or board-certified in that area.

Objections and challenges of the Medical Expert, go to the weight or credibility of the testimony.
The WCJ is free to accept opinion testimony. Great credence may be given to a treating physician, as compared to an examining physician. citing: D.P. "Herk" Zimmerman Jr. Inc. v WCAB (Himes) 519 A.2d 1077 (Pa. Cmwlth. 1987).

Here the WCJ did not err. Dr. Baugh was a long standing treating physician. She was familiar with Employee's baseline lupus condition. Her opinion that Employee had an aggravation from work-related stress [and the corresponding finding of fact] was based upon substantial evidence. slip opinion page 6.

2. Employee met her burden of proof to establish a work injury.
Just as the medical opinions of Dr. Baugh were legally competent, these opinions also provide substantial credible evidence in support of the claim petition. Employee has the burden of proof of each element of the claim. Dr. Baugh provided evidence of the "aggravation" and she provided  evidence of the causal relationship to the work environment.

3. Employer was not required to provide a NARTW.
The Commonwealth Court reversed the decision of the WCAB .
The Appeal Board denied a suspension to the Employer, on the basis that Employee must receive a NARTW form, from the Employer, before any job offer.

The Court reasoned that:
1. Employee Medical Expert evidence (found credible by the WCJ) did not disable Employee from returning to any work as a teacher ... she was disabled from returning to position like Pasotrious.
2. Employee testified Cooke was unlike Pastorious.
3. Employer established a position was available to Employee at Cooke on September 30, 2009.

4. A NARTW form is required when Employer attempts to change a workers benefit status on the basis of medical evidence. It is a part of the earning power assessment process.

 Section 306(b)(3) outlines the Employer's duty to provide employee a "notice" -

                    "(3) If the insurer receives medical evidence that the claimant is able to return to work in any
                          capacity, then the insurer must provide prompt written notice, on a form prescribed by
                          the department, to the claimant, which states all the following..."

"The clear purpose of Section 306(b)(3) is to require the employer to share new medical information about a claimant's physical capacity to work and its possible impact on existing benefits".
Struthers Wells citing: Burrell v. WCAB (Philadelphia Gas Works). (Pa. Cmwlth. 2004).

Section 306(B)(3) presumes:
 (i) that an injury has caused disability;
(ii) a claim has been acknowledged as compensable and
(iii) employer seeks to reduce its existing liability of benefits payable.

NONE of these prerequisites for issuance of a notice are present here!

In this case, Employer filed a Notice of Denial.
Employee had not filed a claim petition, at the point in time when she argues a notice was required.

We conclude Employer was not required to issue a NARTW to Employee, in the claim petition setting.
 slip opinion pages 9-10.

Practice Pointers:
1. This ruling make good sense as the "job offer" in a pre-litigation setting may arise from within the employers office, after receipt of updated information from their employee. The attorneys and insurer are often not involved at this stage. It is more likely an "employment matter".  

2. In the context of an existing workers compensation matter, a NARTW is typically required. 
Burrell is the exception, that is, where an employee is discovered to be already actually working!

3. At times, there may be some confusion as to "which" member of the team will be responsible to issue the NARTW form.

Communicate! 
Often we suggest legal counsel prepare and serve this form upon claimant and claimant counsel. This contact may prompt a discussion regarding case resolution. 

The Limited Scope of Medical Fee Review Proceedings - Selective Insurance Co. revisited

The Limited Scope of Medical Fee Review Proceedings.

On December 6, 2013, the Commonwealth Court of Pennsylvania issued an opinion and order in an insurer's appeal, in a Medical Fee Review Petition reported at:
Selective Insurance Company of America v. Bureau of Workers' Compensation Fee Review Hearing Office (The Physical Therapy Institute).
[blog entry December 31, 2013].

The December 6, 2013 opinion concluded that a Medical Fee Review Request is not the appropriate forum to litigate and to determine if a billing company, such as "PTI" a/k/a/ the Physical Therapy Institute, is a medical services "provider", for the purpose of workers' compensation reimbursements and medical fee review remedies.

The Commonwealth Court held that the issue of whether PTI is a "provider" of physical therapy is beyond the scope and jurisdiction of these administrative fee review proceedings. The Fee Review is a simple process with a narrow scope, dealing with the issues of the timeliness or correctness of the amount of reimbursement paid.

The issue of whether PTI is a "provider" entitled to any reimbursement, is a complex issue for a Workers' Compensation Judge to decide. As the Bureau did not have jurisdiction, the Fee Review Determinations were vacated.

The Commonwealth Court granted the PTI Request for Reargument and withdrew the December 6, 2013 opinion and order.

HOWEVER, when the Commonwealth Court issued its final decision on February 4, 2014, the opinion was identical, but for the addition of footnote #9.

Footnote #9 addressed the argument of PTI, that the provider's only recourse is to file a Medical Fee Review Request, as a provider cannot file other types of petitions. Without a Medical Fee Review remedy, the provider would be without any appropriate work comp remedy.

In response, the Court noted that the Work Comp Claimant will often file a petition for Review and/or Penalty, in order to raise the issue of medical expense reimbursements and Employer/Insurer liability to pay.
The Court referenced other known instances where claimants filed a petition to litigate the instant issue of PTI's status as a provider.

The absence of a direct statutory remedy for providers does not mean the Court may expand the scope of review to create a remedy. That is a matter for the legislature.

PRACTICE POINTERS

1. Have an experienced Work Comp Professional review medical billing statements for the presence of any legal argument regarding the "status" of the billing company as a "provider" within the intent and meaning of the Work Comp Act. 

2. Perform a cost - benefit analysis... is the amount in controversy sufficient to justify the time and expense of litigation... is it a recurring charge ... is there a significant difference between the Medicare A and Medicare B reimbursement rates?

 In Selective, the bills involved were $2,080 and $810. I would hazard a guess that these are recurring expenses, justifying this review and challenge.

Hurry up ... then wait! Is there Any Remedy for Work Comp Litigation Delays?

A good number of workers' compensation  practitioners limit their legal practice, solely to the area of Workers' Compensation. This is true of many Employee and Employer counsel.

With a volume of cases and the corresponding number of hearings and depositions, there is always the possibility of a scheduling conflict. When legal issues of causation and disability necessitate the involvement of medical experts ... and the corresponding task of records production ... there may be further occasions for delay and scheduling conflicts.

Overall, the work comp system runs rather smoothly ... a testament to the congeniality,  flexibility and professionalism of many participants. At times, conflict arises.

Each party desires a prompt, well-reasoned resolution of their case.
When there are delays in litigation, there are corresponding delays in obtaining a final result.
A party may believe their position is compromised by this delay.

The Special Rules of Administrative Practice and Procedure before Workers' Compensation Judges provide specific time frames for the production of documents, medical examinations and witness testimony.
However, there is some flexibility in these time deadlines as the WCJ may, for good cause, waive or modify these time deadlines. See: 34 Pa. Code Section 131.3(a).

Wagner v. WCAB (Ty Construction Co. Inc.), No. 1202 C.D. 2013 is a published decision of a panel of the Commonwealth Court of Pennsylvania, authored by Judge Leavitt on January 3, 2014.
The issue of delay and the remedies of the parties are addressed in a well reasoned opinion.

Factual and Procedural Background
In March 2011, Employee filed a claim petition for disability  due to a diagnosis of small cell lung cancer, alleged as a result of work-related exposure to paint chemicals.
[diagnosis was in January 2011].

The chronology of events, is noteworthy...

April 2011, at the initial hearing the WCJ told counsel to start getting their medical evidence as "it's going to be a long case", recognizing the complexities of this type of litigation.

June 2011, at this hearing (before another WCJ), Employee counsel deferred a medical expert report until documents of the employer work site chemicals were available for review.
Employer counsel agreed to provide this documentation.
The parties agreed Employer would defer a medical exam, until after receipt of Employee's medical expert report.

July 2011, one month later, at this hearing, Employer made a motion for dismissal of the claim petition as Employee failed to produce a medical expert report.
Employee counsel explained that he learned one week earlier that Employee's treating oncologist declined to participate in any legal proceeding. Counsel set out to identify another medical expert.

WCJ denied the motion for dismissal and directed Employee counsel to schedule a deposition of a medical expert with the month.

August 2011, at this hearing, Employer renewed the motion for dismissal.
WCJ granted another 30 days for Employee to obtain a medical expert report, no later than September 24, 2011 or face dismissal of the petition. 

*September 22, 2011 Employee obtained a medical expert report.
*Employer scheduled the medical expert deposition for October 2, 2011. 

May 2012, the next hearing [footnote 2, the WCJ was on medical leave from January to May of 2012],
The parities "recapped" the events.
Employee Expert deposition was scheduled and postponed so Employer could obtain a medical exam.
Employer medical exam was accomplished in January 2012.
Employee had difficulty rescheduling the October 2011 deposition, due to the Expert's schedule.

Employee requested to defer his medical expert deposition until after the employer witness testified regarding the chemicals used in his business.

WCJ Decision
WCJ granted Employer's renewed Motion for Dismissal, as Employee failed to present evidence within the time limit set by the WCJ.

WCAB affirmed WCJ.

Commonwealth Court Decision
REVERSED WCJ and WCAB.
Case was remanded for further proceedings on the merits of Employee's claim petition.

Employee argued:

• There was no evidence that Employer was prejudiced by the unforeseen delay in submission of Employee's medical evidence.
• Part of the delay in the litigation was occasioned by Employer.

• Employee used best efforts to meet the WCJ deadlines and his inability to comply was not his fault, the delay was caused by a third party.

Employer argued:

•  Employee was given ample opportunity 
•  it is irrelevant whether Employer was prejudiced

Court Reasoning:
 The Special Rules of Administrative Practice ad Procedure before Workers' Compensation Judges govern procedures, promote orderly and expeditious proceedings, consistent with fairness and due process.
[see: 34 Pa. Code 131.1(a)].

The WCJ may, for good cause, waive or modify time deadlines, including the deadline for submission of medical evidence:
                          " the deposition of a medical expert testifying for the moving party shall be taken
                            within 90 days of the date of the first hearing scheduled unless the time is 
                            extended or shortened by the [WCJ] for good cause shown."
                            [34 Pa. Code 131.63(c)].

Delay cause Prejudice to a Party?
When dealing with the dismissal of a case, the WCJ should not dismiss a case, in the absence of prejudice shown by the moving party. [citing David B. Torrey and Andrew E. Greenberg, Workers' Compensation  Law and Practice, Section 13:119 (West 2008).]

A WCJ dismissal of a case can be set aside for an abuse of discretion.
[Baird v. WCAB (MCTEL), (Pa. Cmwlth. 1992).]

Baird involved a claim petition where the worker did not submit medical evidence over 2 years.
There was an indefinite postponement during the litigation of a related civil claim.
 Employer sought reactivation when Employee did not provide medical reports, as directed by the WCJ.
The worker did not appear for a hearing and the WCJ dismissed the claim!

On appeal the Commonwealth Court reversed, holding, based upon the harshness of this action,
dismissal is only appropriate where prejudice shown by Employer. In Baird there was no prejudice.

A different result was reached in US Airways v. WCAB (McConnell) (Pa. Cmwlth. 2005).
A claim petition was dismissed as claimant failed to attend 3 IME's scheduled by Employer and ordered by the WCJ. The Employer position was prejudiced as they were unable to obtain a pre-surgical IME!

Claim Petition Denial was affirmed on appeal, as the WCJ found prejudice AND the WCJ has discretion to control his docket and order parties to pursue litigation in a timely manner.

Here, Employee argued Baird and US Airways controlled, there must be a finding of prejudice, before there can be a claim dismissal.

Disregard of WCJ direction's
Employer argued Cipollini controls! A finding of "prejudice" is irrelevant.
They believed Cipollini appropriately focused upon the failure of Claimant to present medical evidence, even where directed to do so, by the WCJ.

In Cipollini, Employer objected to the several continuances granted to allow Claimant Attorney to schedule medical expert and fact witness testimony. Counsel failed to do so, despite warnings of closure of the record. The WCJ dismissed the claim because of "counsel's obvious lack of trying".

Dismissal was affirmed, even though claimant's misfortune arose solely from the non-action of her counsel.
Cipollini did not establish that "prejudice" is an irrelevant consideration.
Cipollini was based upon the lack of counsel attempting to comply with directives.

In the instant case, Employee counsel did not ignore WCJ directions, he attempted to comply, even when faced with an unforeseen circumstance, the medical expert refusal to participate in litigation.

The sole factual finding in support of the WCJ claim petition dismissal, is that Employee failed to abide by the WCJ order to schedule a medical deposition by August 19.

This finding was erroneous for 3 reasons:
1. the WCJ had extended this deadline to September 24.
2. Employer agreed Employee met that deadline, the deposition was scheduled , to take place on October 2.
3. This Employee deposition did not take place as Employer counsel requested a continuance!

Reconciling the Rules of law
In Cipollini the delays were caused by claimant counsel.
In contrast, here Employee counsel  met the WCJ deadline.
He scheduled his medical expert and was actively trying to reschedule this deposition ... which was postponed as a courtesy to Employer counsel!

        "Cipollini was not intended to relieve attorneys of the need to be professional
          and respectful of opposing counsel's challenges". slip opinion page 10.

Baird established that a claim petition will not be dismissed for lack of prosecution without evidence of prejudice to the employer.
Cipollini established an exception, where the employee counsel "is not trying".
On these facts, the Cipollini exception does not apply.
Given the lack of prejudice to Employer, the WCJ abused his discretion by dismissing this claim petition.

PRACTICE POINTERS
1. Yes, I have made motions for dismissal.
2. Yes there have been delays in scheduling events in my cases.
3. Yes, at time both attorneys contribute to some delay. 

IMO motions for dismissal are "judgment calls" which must be balanced with the instructions of the client and the existence of "real" prejudice (like US Airways case). 

4. As a general rule, both Employees and Employers want the case to move towards a conclusion. 
This case illustrates the value of case management and keeping the file on your diary ... 
to get things scheduled. 
This remains my New Year's resolution for 2014.

The Employer's "job offer obligation" and Vocational Expert Evidence

The Employer has a "job offer obligation" as a precursor to the Modification based upon a Vocational Expert Earning Power Assessment.

Prior to the 1996 Amendments to the Pennsylvania Workers' Compensation Act, an Employer could seek a modification of indemnity wage loss benefit payments via an actual job offer to an injured Employee.  
An employer had to produce evidence of  referral(s) of employee to a then-open job, that fit the occupational category, for which the employee received medical clearance. See: Kachinski v. WCAB (Vepco Construction Company) (Pa. 1987).

In 1996, Section 306(b)(2) of the Act was amended to allow modification of indemnity wage loss benefits based upon a Vocation Expert report of the Earning Power Assessment of the injured Employee.

For over 17 years, many workers' compensation professionals believed that the post-injury earning capacity was to be based upon vocational expert opinion evidence. This supposition was based upon the Legislative amendment, that contained this specific unambiguous language:
      " Earning power shall be determined by the work the employee is capable of performing
        and shall be based upon expert opinion evidence...".

Recently the Pennsylvania Supreme Court interpreted this statutory language to require consideration of the employee's opportunity and effort to seek and apply to job positions included in the Vocational Expert opinion evidence. See: Phoenixville Hospital v. WCAB ( Pa. November 21, 2013).
[See: PaWCdefense entry at December 9, 2013].

Reichert v. WCAB (Dollar Tree Stores) No. 42 C.D.2013, is a recently reported decision of a panel of the Commonwealth Court of Pennsylvania, authored by Judge Brobson on November 8, 2013 ...
just a few weeks before the Supreme Court decision in Phoenixville Hospital.
[Reichert Application for Reargument before the Commonwealth Court was denied January 3, 2014].

Th Commonwealth Court decision in Reichert looked at the Employer's obligation to offer a job position to an injured worker, in the context of the Employer pursuing a modification remedy based upon a Vocational Expert Earning Power Assessment.

Factual and Procedural Background
Employee suffered a work injury in 2001.
About 8 years later, the Employer filed a Modification petition in March 2009, which alleged work was generally available to this Employee within his vocational and physical capabilities.

Employer Medical Evidence
This petition was based upon the medical expert opinion testimony of David Baker M.D. that employee was capable of performing work within a light duty capacity.
 [generally, lifting of 1-10 lbs frequently; 11-20 lbs occasionally].

Employer Vocational Expert Evidence
John W. Dieckman provided Vocational Expert opinion evidence on behalf of the Employer.
Dieckman stated that he conducted a vocational interview with Employee. He typically will contact the Employer after this interview to determine IF a job offer is possible or feasible with the Employer.

In this case, a representative of Specialty Risk Services, the insurance Third Party Administrator (TPA) for Employer advised Dieckman that Employer was not able to offer employment, consistent with Employee's physical limitations.

Based upon this information from the TPA, he conducted a labor market survey (LMS), in preparation of his Earning Power Assessment (EPA) of Employee. He prepared vocational analysis of 11 job positions, which were reviewed and approved by Dr. Baker.

On cross-examination, Dieckman admitted he did not directly speak with Employer regarding any possible job openings prior to conducting his LMS. He only spoke with the TPA to assess job availability with the Employer. [not a "best practice"].

Employer Supervisor Testimony
Gerald Joka, the Employer's District Manager for 8 years, testified he is in charge of sales, hiring, firing, "pretty much everything to do" with 10 local stores in his district.

He is routinely aware of available, open positions within his 10 stores and he generally described available positions within the retail stores to include: cashiers, stockers, assistant managers, managers, district managers.

Joka testified ALL of these positions are going to require a lot of physical movement.
There is very little "office" work.

Open positions are advertised through a computer based system, which allows on-line applications.
[did this Employee apply to any positions?].

Joka testified he reviewed Dr. Baker's report and the physical restrictions upon Employee.
He stated the Employer did not have ANY open positions-
* from July 28, 2008 ( the date of the LIBC Notice of Ability to Return-to-Work form)
*until March 10, 2009 (the date after the Modification petition was  filed)
- that could have comported with Dr. Baker's "extreme" physical limitations for Employee.

[*note:  this mirrors the time frame of the employer's job offer obligations as per Regulation 123.301 (b).].

On cross examination, Joka admitted no one asked him to look for a job for this Employee and he was never contacted by the vocational Expert.

Employee Vocational Expert  Evidence
Gary A. Young testified on behalf of Employee that all of the jobs in the Dieckman labor market survey were not appropriate for Employee.

Young opined Dieckman has a "mandatory" duty to contact Employer regarding any open and available positions in Employer's retail stores, prior to conducting the labor market survey.

Young testified there were 56 Employer retail locations (within a 50 mile radius of Employee's residence) to illustrate that Joka's testimony regarding positions "open and available" was limited to the 10 stores he supervised, rather than all of the Employer's locations.

Young testified "at the time of my evaluation", the Employer was actively recruiting for workers in various areas.[a rather non-specific assertion!].

On cross-exam Young admitted the Employer website did not list any specific jobs.
Young conceded that Employee likely would NOT be capable of driving a 50 mile radius.
[good cross!].

WCJ Decision in Employer Modification Petition.
Granted!

Employer witness Joka was credible:
(i) all of Employer's jobs require physical activity
(ii) Employer has a return-to-work program for injured workers, but Dr. Baker's physical limitations upon Employee were too extreme,
(iii) he did not have a job position to offer Employee within Dr. Baker's restrictions,
(iv) Joka was aware of the physical demands of the jobs within Employers stores, Joka was aware how jobs may be modified, yet the Employer jobs did not to fit Employee's restrictions.

Accordingly, there were NO open positions with Employer during the timeframe of Employer's job offer obligations.

Employer Vocational Expert Dieckman was credible.
Employee Vocational Expert Testimony was not credible.
Young did not record any of his communications or contacts with various employers (in the LMS/EPA).

Young contacted these Prospective Employers after the LMS was complete and much after the jobs were identified as being available.  
[the Phoenixville Hospital issue!].

Young did not visit the Employer website until April 22-29 of 2009.
- AFTER the Modification Petition was filed!
Filing the Petition, concludes the time period of the Employer's job offer obligation!
See: Regulation 123.301 (b)

Young implied Employer could have offered a job to Employee.
BUT, Young conceded on cross, he did not know which positions employer was recruiting for
and he did not know the locations of those jobs.
[ ... again, good cross-exam ... poor rebuttal evidence].

Commonwealth Court Appeal of Employee
Employee argued Employer did not meet its prima facie burden of proof.
Employer failed to establish the absence of open and available positions at Employer's retail stores.
[? Employer burden is to prove a negative?]

Employer Vocational Expert failed to contact the Employer to determine if Employer had any open and available positions for employee PRIOR to conducting the LMS/EPA.
On this basis, Employee argued Employer violated the requirements of Section 306(b)(2) and Regulation 123.310. As a result, the LMS must be declared void ab initio.

Commonwealth Court Decision
Modification Affirmed!
The Court explained the elements of Employer's burden of proof and the Employee's right to submit evidence.

1. The Employer does not have the burden of proving the non-existence of available work at its facility as a necessary element of the Modification Petition.
citing Rosenberg (Pa. Cmwlth. 2008) and Kleinhagen (Pa. Cmwlth. 2010).

2. To the contrary, Employee may present evidence that during the period of the Employer's job offer obligation, that Employer had a specific job vacancy it intended to fill which employee was capable of performing.

3. Upon presentation of Employee's  evidence, the burden of proof shifts to Employer to rebut employee's evidence.

4. Here Employer's witness Joka provided undisputed credible testimony of the job demands of Employer's positions and the absence of any available positions within Employee's limitations.

5. Employee may rebut the testimony regarding the availability of positions with Employer...
by demonstrating:
(i) during the period in which employer has a duty to offer a specific job,
(ii) employer is or was actively recruiting for a specific job vacancy,
(iii) that employee is capable of performing, or
(iv) employer posted or announced the existence of a specific job vacancy, that the employee is capable of performing,
(v) which employer intends to fill.

[see: Regulation 123.301(f)].

Here, Employee did not establish by (credible) evidence that Employer was actively recruiting for a specific job vacancy or the Employer posted the existence of a specific job vacancy. 

Employee did not rebut Employer's testimony with the non-credible testimony of his vocational expert.

In dicta, the Court notes that Employer's Vocational Expert was not required to contact Employer prior to conducting the LMS/EPA, to determine if there were open and available positions Employee was capable of performing

ALTHOUGH THE COURT NOTES THE VOC EXPERT WAS NOT REQUIRED TO CONTACT THE EMPLOYER, PRIOR TO CONDUCTING THE EPA/LMS, 
in my opinion, best practices would dictate otherwise.

PRACTICE POINTERS:
1. It remains my recommendation to have the Vocational Expert "quarterback" the LMS/EPA process, meaning, the Vocational Expert should:

(a) identify an appropriate employer contact for these job availability issues,

(b) contact the employer immediately, upon assignment of the vocational referral as the "employer job offer obligation" commences with the filing of the LIBC 757 "Notice of Ability to Return to Work",

(c) continue periodic contact with the employer rep during the LMS/EPA preparations,

(d) contact the employer rep immediately before the petition is filed... which may be a date after the completion of the LMS/EPA.

These recommendations serve to limit the prospects that the time, effort and expense of a LMS/EPA may be inadvertently defeated by the Employer's job advertising or recruitment efforts, which are efforts that are typically separate and apart from the work comp case litigation efforts. 
These 2 worlds may collide and create an adverse result.

Through communication, the parties working on behalf of the Employer may increase the opportunities for a successful litigation (or negotiated settlement) result.

New Maximum Pennsylvania Workers' Compensation Rate for 2014

New Maximum Pennsylvania Workers' Compensation Wage Loss Benefit rates for 2014.

The Department of Labor and Industry of Pennsylvania, Bureau of Workers" Compensation has announced a Maximum wage loss benefit rate of $932.00 for any work injury occurring on or after January 1, 2014.

Employees earning  $1,398.01 or more, will be entitled to this weekly total disability rate (TTD).

Employees earning between $699.01 and $1,398.00 a week, will be entitled to a TTD rate at 66 2/3% of their average weekly wage.

Employees earning between $517.78 and 699.00 a week, will be entitled to a TTD rate of $466.00 per week

Employees earning $517.77 or less will be entitled to a TTD rate based upon 90% of their average weekly wage.

For purposes of calculating the update to payments for medical treatments rendered on and after January 1, 2014, the percentage increase in the Statewide Average Weekly Wage is 1.6%