Employers and employees continue to battle over the amount of benefits that should be paid to injured workers. Whether workers’ compensation benefits should be reduced because an injured worker receives other benefits (i.e. pension) was addressed again in Consol Pennsylvania Coal Company/Bailey Mine Extension and East Coast Risk Management, LLC v. WCAB (Johnson).
The injured worker (“Claimant”) sustained a work injury. Claimant was awarded workers’ compensation wage loss benefits of $932 per week. Later, Claimant retired and began receiving employer-funded pension benefits. The Pennsylvania Workers’ Compensation Act (the “Act”) provides that an employer “may be entitled” to a retroactive offset of workers’ compensation benefits following receipt of information that an employee collected pension benefits. An offset is a reduction in the weekly benefit amount – which can also be used to recoup past alleged overpayments.
The Act also permits Employer to require Claimant to complete a “756 Form” to obtain information regarding the Claimant’s receipt of certain benefits, including pension benefits. In this case, Employer did not send a 756 Form until 14 months after Claimant retired – despite knowing in advance that Claimant intended to retire. The form advises a Claimant that failure to complete the form could result in suspension of benefits. The response of Claimant is also subject to penalties for perjury.
Claimant returned the form indicating that he had been receiving employer-funded pension benefits. Employer notified Claimant that his wage loss benefits would be reduced going forward. It also notified Claimant that his benefit would be further reduced to zero dollars for 39 weeks for Employer’s alleged overpayment of weekly benefits starting at the time of Claimant’s retirement through the present time. The benefits would remain at zero dollars until all alleged overpayments were recouped.
Claimant filed a petition arguing that Employer did not use due diligence when it waited 14 months before sending Claimant a 756 Form. Claimant asserted that for this reason, Employer was not entitled to any offset of any wage loss benefits paid to the Claimant.
The Commonwealth Court filed a memorandum opinion April 24, 2020. The Court found Employer failed to exercise due diligence in notifying Claimant of his duty to report his receipt of pension funds. For this reason, the Court found that the workers’ compensation judge correctly limited Employer’s retroactive offset of benefits paid starting on the date the Employer issued a 756 Form.
As evidenced by the nuances of this case, Worker’s Compensation cases are complex, time-sensitive, and challenging. If you are involved in a Workers’ Compensation matter rely on the experts at Leonard Sciolla. Attorneys Michael V. Tinari and Christopher P. Fleming have been successfully litigating Worker’s Compensation claims and can help you navigate this challenging and ever-evolving process.