Monteson v. Workmen's Compensation Appeal Board

682 A.2d 776, 545 Pa. 632, 1996 Pa. LEXIS 1818

• Court: Supreme Court of Pennsylvania
• Decided: September 17, 1996
• Status: Published

Opinions

OPINION

ZAPPALA, Justice.

We granted allocatur to determine whether the referee¹ erred in concluding that Employer was entitled to a suspension of Claimant’s workers’ compensation benefits. For the reasons set forth below, we affirm.

Appellant, Gary Monteson (Claimant), suffered a work-related back injury on October 31, 1989, while working for Trinity Industries (Employer). Employer issued a notice of compensation payable dated November 22, 1989. On December 7, 1989, Claimant signed a final receipt and returned to work. On January 1, 1990, Claimant reinjured his back at work and benefits were reinstated pursuant to a supplemental agreement dated January 15,1990. Claimant’s treating physician released Claimant to work and on April 10,1990, a second final receipt was signed. However, Employer laid off Claimant and other workers with similar seniority effective April 5, 1990. Claimant then applied for and received unemployment compensation benefits from April 1990 to June 1990.

Claimant was subsequently hired by Greenwood Nissan as a car salesman on June 9, 1990. Two days later, Employer offered Claimant his pre-injury job. Claimant rejected this offer of employment. Two weeks later, Greenwood Nissan terminated Claimant’s employment due to his failure to sell cars. Claimant remained unemployed until March 1991, when he was hired as an independent agent by Sosmetal, Inc. to sell automotive repair materials. He was terminated by Sosmetal in October 1991.

On November 22,1991, Claimant filed a petition to set aside the April 10, 1990, final receipt. Claimant alleged that at the time he signed the final receipt he was not fully recovered from his work-related injury. Claimant sought reinstatement of his benefits as of April 10, 1990, when he was laid off upon his return to work.

The referee found that Claimant had not fully recovered from his original injury when he signed the April 10, 1990, final receipt and that he was still suffering from symptoms of the original injury. The referee granted the petition to set aside the final receipt, reinstated total disability benefits from April 10, 1990, to June 8, 1990, awarded Claimant partial disability benefits for June 9 and June 10, 1990, and suspended benefits as of June 11, 1990. The referee determined that Employer was entitled to a suspension of benefits because it had proven that Claimant voluntarily refused to accept its offer of employment for reasons unrelated to his work-related injury, citing Dugan v. WCAB (Fuller Co.), 131 Pa. Commw. 218, 569 A.2d 1038 (1990).²

On appeal, the Workmen’s Compensation Appeal Board held that the referee’s reliance on Dugan was misplaced, but the error was harmless. The Board held that Employer was entitled to a suspension of benefits as of June 11, 1990, because Claimant had refused a job offer from Employer for reasons unrelated to his disability and because the law does not require an employer to keep a job open indefinitely. The Board also found that the Claimant did not exercise bad faith in refusing Employer’s June 11,1990, job offer.

The Commonwealth Court affirmed. Utilizing the analysis set forth in Pieper v. Ametek-Thermox Instruments Division, 526 Pa. 25, 584 A.2d 301 (1990), the Commonwealth Court determined that Claimant was not entitled to reinstatement of benefits because his refusal of Employer’s offer of employment was unrelated to his work injury. The court noted that although Claimant continues to have some residual effects from his work-related injury, he admitted that his refusal of Employer’s offer was not related thereto.

The scope of review in workers’ compensation proceedings is limited to a determination of whether constitutional rights have been violated, an error of law has been committed, or any findings of fact are not supported by substantial evidence. JFC Temps, Inc. v. Workmen’s Compensation Appeal Board, 545 Pa. 149, 680 A.2d 862 (1996).

Initially, we note that it was within the referee’s authority to dispose of Claimant’s Petition to Set Aside the Final Receipt and Reinstate Compensation Benefits by awarding total and/or partial disability benefits for a specific time period and suspending benefits thereafter. It is clear that a referee’s decision may be based upon the evidence introduced when effectuating the rights of both parties, regardless of the specific relief sought. Inglis House v. W.C.A.B., 535 Pa. 135, 634 A.2d 592 (1993). Moreover, Section 413 of the Workers’ Compensation Act provides in relevant part:

A referee designated by the department may, at any time, modify, reinstate, suspend, or terminate a notice of compensation payable, an original or supplemental agreement or an award of the department or its referee, upon petition filed by either party with the department, upon proof that the disability of an injured employe has increased, decreased, recurred, or has temporarily or finally ceased, or the status of any dependent has changed....

77 P.S. § 772 (emphasis added).

Having concluded that the suspension of benefits was within the authority of the referee, we must now examine whether the suspension was proper. In Pieper, this Court addressed the issue of whether the Commonwealth Court committed an error of law by requiring the claimant to establish a causal connection between his prior work-related injury and his present disability in order to qualify for reinstatement of compensation. We determined that no causal connection had to be shown in a suspension of benefits situation. We then set forth the burden of proof for a claimant seeking reinstatement of suspended benefits:

A “suspension of benefits” is supported by a finding that the earning power of the claimant is no longer affected by his disability, whether it arises from his employer offering suitable replacement employment, or from the ability of the claimant to secure other suitable employment that provides equal or greater compensation. Should a claimant seek to have a suspension lifted, he is required to demonstrate only that the reasons for the suspension no longer exist. Simply, a claimant must show that while his disability has continued, his loss of earnings has recurred.

Id. at 33, 584 A.2d at 304. (Citations omitted).

We also stated that the law requires a claimant to prove two things in order to show that the reasons for the suspension no longer exist: first, that through no fault of the claimant his/her earning power is once again adversely affected by the injury, and second, that the injury which gave rise to the claimant’s original claim in fact continues.³ Id. at 34, 584 A.2d at 305.

Claimant initially asserts that his refusal of Employer’s job offer was not based on bad faith but was the result of his fear of reinjuring himself and his desire to continue a career as a car salesman. He concludes that he satisfied his burden under Pieper by establishing that through no fault of his own his employment with Greenwood Nissan and subsequently Sosmetal, Inc. was terminated. Thus, he asserts that his injury continued and his loss of earnings recurred.

The fatal flaw in this reasoning is that Claimant failed to establish that through no fault? of his own his earning power was adversely affected by the injury. Claimant’s loss of earnings did not result from his work injury but rather was due to the fact that he obtained alternative employment from which he was terminated.⁴ Claimant was released to return to his pre-injury position, without restrictions, by his treating physician. He worked until he was laid off for economic reasons. Although Claimant continued to suffer symptoms of the work injury, he admitted that his termination from subsequent employment was totally unrelated to his work injury and that his injury did not affect the work he had been performing.

We recognize, that a causal connection need not be established between the prior work injury and the present disability in a suspension of benefits case. This rule of law should not be construed to eliminate the requirement of a causal relationship between the work injury and the subsequent reduction in earnings. Otherwise, any reduction in income by a claimant who suffers from residual effects of a work injury would trigger reinstatement of at least partial benefits regardless of the reason why the loss in income arose. Such a conclusion is inconsistent with the purpose of the workers’ compensation law. Section § 413 states:

... That where compensation has been suspended because the employee’s earnings are equal to or in excess of his wages prior to the injury that payments under the agreement or award may be resumed at any time during the period for which compensation for partial disability is payable, unless it be shown that the loss in earnings does not result from the disability due to the injury.

77 P.S. § 772 (emphasis added). Pursuant to this section, the employer has the opportunity to establish that compensation should remain suspended despite a claimant’s loss in earnings because that loss was attributable to factors other than the work injury.

Although not controlling, our decision in Harle v. W.C.A.B. (Telegraph Press), 540 Pa. 482, 658 A.2d 766 (1995), supports the proposition that in order to be compensable a loss in earnings must result from the claimant’s work injury. In Harle, the claimant injured his thumb, received total disability benefits, and then was eventually released to return to his prior position. His employer, however, had ceased conducting business. The claimant later obtained a similar position elsewhere at a lower wage. The referee granted the employer’s termination petition on the ground that the claimant’s disability relative to his injury had ceased. The Board affirmed. Relying on medical testimony that the claimant continued to have a reduced range of motion in the joint of his thumb, the Commonwealth Court concluded that there was not substantial evidence to support the findings necessary for a termination of benefits, and therefore a modification of benefits to partial disability was appropriate.

In vacating the decision of the Commonwealth Court and ordering a suspension of benefits, we held that even if a residual physical impairment remains, a claimant is not entitled to benefits, including partial disability benefits based on the difference between his pre-injury and post-injury wages, unless that difference is related to the work injury.

Similarly, a relationship between the injury and the reduction in Claimant’s earnings is necessary in the instant case. As Claimant failed to establish the same, the referee properly suspended his workers’ compensation benefits. If Claimant’s earning power is affected in the future by the residual impairment from the work injury, he may seek reinstatement of workers’ compensation benefits at that time.

NIX, Former C.J., and NEWMAN, J., did not participate in the consideration or decision of this case.

CAPPY, J., files a dissenting opinion.

1 . This case was heard prior to the enactment of Act 44 of 1993 in which the title of referee was changed to "workers’ compensation judge." 77 P.S. § 701.

2 . In Dugan, the Commonwealth Court held that where a partially disabled employee voluntarily retires and testifies that he has no intention of returning to any form of work, that testimony supports a finding that Claimant has withdrawn from the job market, justifying a suspension of benefits.

3 . We affirmed the Pieper analysis in Dillon v. Workmen's Compensation Appeal Board (Greenwich Collieries) 536 Pa. 490, 640 A.2d 386 (1994), while recognizing that the term “disability” was imprecisely used in Pieper to signify physical injury rather than loss in earnings.

4 . The Board found that Claimant’s fear of reinjuxy upon returning to his prior position was unsupported by medical evidence. Therefore, his subjective fear does not create a causal connection between his injury and income loss.