D. Smuck v. Dana Holding Corp. (WCAB) ( 2023 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
David Smuck, :
Petitioner :
:
v. : No. 1215 C.D. 2021
: Submitted: January 27, 2023
Dana Holding Corporation (Workers’ :
Compensation Appeal Board), :
Respondent :
BEFORE: HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE STACY WALLACE, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE WALLACE FILED: March 22, 2023
David Smuck (Claimant) petitions for review of the order of the Workers’
Compensation Appeal Board (Board) dated October 5, 2021, which affirmed the
decision and order of the Workers’ Compensation Judge (WCJ), circulated
December 8, 2020 (WCJ’s Decision). The WCJ’s Decision granted the Modification
Petition filed by Dana Holding Corporation (Employer) and changed Claimant’s
disability status from total to partial based upon a February 13, 2020 Impairment
Rating Evaluation (IRE). Claimant challenges as unconstitutional the retroactive
application of Act 111 of 2018 (Act 111), which added Section 306(a.3) of the
Workers’ Compensation Act (Act).1 Claimant asserts the Board erred in applying
Act 111 in his case because his work injury occurred before Act 111’s effective date.
Upon review, we affirm.
I. Background
Claimant sustained a work-related injury on April 6, 2000. WCJ Dec. at 3;
Certified Record (C.R.), Item No. 4. Employer issued a Notice of Compensation
Payable and began paying Claimant temporary total disability (TTD) benefits of
$449.60 per week. Id. On February 13, 2020, Claimant underwent an IRE, which
demonstrated a 10% impairment rating based on the 6th edition of the American
Medical Association Guides to the Evaluation of Permanent Impairment (6th edition
AMA Guides). Id. Employer filed its Modification Petition on June 4, 2020,
requesting Claimant’s disability status be changed from TTD to temporary partial
disability (TPD) benefits as of the IRE date. C.R., Item No. 2.
The WCJ held a hearing on Employer’s Modification Petition, wherein
Claimant raised and preserved a constitutional challenge to Act 111. Claimant did
not present any medical evidence to rebut Employer’s IRE nor dispute the findings
in the IRE. C.R., Item No. 4. The WCJ concluded Employer met its burden of proof
under Act 111 and granted Employer’s Modification Petition, modifying Claimant’s
benefits from TTD to TPD effective February 13, 2020. Id. On October 5, 2021,
the Board affirmed the WCJ’s Decision. C.R., Item No. 7. On November 14, 2021,
Claimant filed his Petition for Review (Petition) with this Court appealing the
Board’s decision.
1
Act of June 2, 1915, P.L. 736, as amended, added by Act of October 24, 2018, P.L. 714, No. 111,
77 P.S. § 511.3.
2
II. Issue
Claimant’s sole claim on appeal is that the Board “erred as a matter of law in
holding that Act 111 is to be applied retroactively to cases wherein the cause of
action accrued/work injury occurred prior to the enactment of Act 111 . . . .”
Claimant’s Br. at 4. Claimant asserts retroactively applying Act 111’s IRE
mechanism, effective October 24, 2018, to modify benefits awarded for an April 6,
2000 injury is unconstitutional. Id. Claimant maintains he “had a vested interest in
the continuation of his TTD benefits until he is found to be ineligible under a valid
statute.” Petition ¶ 9. He argues because “Section 306(a.2) was declared null and
void by the Pennsylvania Supreme Court it is unenforceable; therefore, the Claimant
continues to have a valid, vested right in his continuation of TTD workers’
compensation benefits.” Id. Claimant requests this Court “reverse the Decision and
Order of the Board dated October 5, 2021, which affirmed the Decision and Order
of the WCJ circulated December 8, 2020[,] which granted the Employer’s
Modification Petition.” Id. ¶ 10.
III. Discussion
Our review in this case is limited to “determining whether the WCJ’s findings
of fact were supported by substantial evidence, whether an error of law was
committed, or whether constitutional rights were violated.” Pierson v. Workers’
Comp. Appeal Bd. (Consol Pa. Coal Co. LLC), 252 A.3d 1169, 1172 n.3 (Pa.
Cmwlth.), appeal denied, 261 A.3d 378 (Pa. 2021).
In response to our Supreme Court’s decision in Protz v. Workers’
Compensation Appeal Board (Derry Area School District), 161 A.3d 827 (Pa. 2017),
in which the Court held the IRE provisions contained in Section 306(a.2) of the Act,
formerly 77 P.S. § 511.2, violated the nondelegation doctrine of the Pennsylvania
3
Constitution, the General Assembly enacted Act 111 on October 14, 2018. Act 111
repealed Section 306(a.2) of the Act, formerly 77 P.S. § 511.2, and added Section
306(a.3) of the Act, 77 P.S. § 511.3, reestablishing the IRE process.
While the IRE process remains substantially the same as it was before, Act
111 requires a physician use the 6th edition AMA Guides when performing an IRE
and permits modification to partial disability status if a claimant has a whole-body
impairment of less than 35%. Specifically, Act 111, Section 306(a.3) of the Act,
states:
(1) When an employe has received total disability compensation . . . for
a period of one hundred and four weeks, unless otherwise agreed to, the
employe shall be required to submit to a medical examination which
shall be requested by the insurer within sixty days . . . to determine the
degree of impairment due to the compensable injury, if any. The degree
of impairment shall be determined based upon an evaluation by a
physician who is licensed in this Commonwealth, who is certified by
an American Board of Medical Specialties-approved board or its
osteopathic equivalent and who is active in clinical practice for at least
twenty hours per week, chosen by agreement of the parties, or as
designated by the department, pursuant to the [6th edition AMA
Guides].
(2) If such determination results in an impairment rating that meets a
threshold impairment rating that is equal to or greater than [35%]
impairment under [6th edition AMA Guides], the employe shall be
presumed to be totally disabled and shall continue to receive total
disability compensation benefits . . . If such determination results in an
impairment rating less than [35%] impairment under the [6th edition
AMA Guides], the employe shall then receive partial disability benefits
. . . Provided, however, [t]hat no reduction shall be made until sixty
days’ notice of modification is given.
(3) Unless otherwise adjudicated or agreed to based upon a
determination of earning power . . . the amount of compensation shall
not be affected as a result of the change in disability status and shall
remain the same. An insurer or employe may, at any time prior to or
4
during the five hundred-week period of partial disability, show that the
employe’s earning power has changed.
(4) An employe may appeal the change to partial disability at any time
during the five hundred-week period of partial disability; Provided,
That there is a determination that the employe meets the threshold
impairment rating that is equal to or greater than [35%] impairment
under the [6th edition AMA Guides].
(5) Total disability shall continue until it is adjudicated or agreed . . .
that total disability has ceased or the employe’s condition improves to
an impairment rating that is less than [35%] of the degree of impairment
defined under the [6th edition AMA Guides].
(6) Upon request of the insurer, the employe shall submit to an
independent medical examination in accordance with the provisions of
section 314 to determine the status of impairment: Provided, however,
That for purposes of this clause, the employe shall not be required to
submit to more than two independent medical examinations under this
clause during a twelve-month period.
(7) In no event shall the total number of weeks of partial disability
exceed five hundred weeks for any injury or recurrence thereof,
regardless of the changes in status in disability that may occur. In no
event shall the total number of weeks of total disability exceed one
hundred and four weeks for any employe who does not meet a threshold
impairment rating that is equal to or greater than [35%] impairment
under the [6th edition AMA Guides].
Section 306(a.3) of the Act, 77 P.S. § 511.3. Further, Section 3 of Act 111 provides,
in pertinent part:
(1) For the purposes of determining whether an employee shall submit
to a medical examination to determine the degree of impairment and
whether an employee has received total disability compensation for the
period of 104 weeks under [S]ection 306(a.3)(1) of the [A]ct, an insurer
shall be given credit for weeks of total disability compensation paid
prior to the effective date of this paragraph. This [S]ection shall not be
construed to alter the requirements of [S]ection 306(a.3) of the [A]ct.
(2) For the purposes of determining the total number of weeks of partial
disability compensation payable under [S]ection 306(a.3)(7) of the
5
[A]ct, an insurer shall be given credit for weeks of partial disability
compensation paid prior to the effective date of this paragraph.
Act 111, § 3(1), (2).
Claimant asserts Act 111’s application to his case is improperly retroactive
because his work injury occurred before the enactment date of Act 111. A
retroactive law is:
One which relates back to and gives a previous transaction a legal effect
different from that which it had under the law in effect when it
transpired. . . . A law is given retroactive effect when it is used to
impose new legal burdens on a past transaction or occurrence.
Whitfield v. Workers’ Comp. Appeal Bd. (Tenet Health Sys. Hahnemann LLC), 188
A.3d 599, 616 (Pa. Cmwlth. 2018) (quoting Dep’t of Lab. & Indus., Bureau of Emp.
Sec. v. Pa. Eng’g Corp., 421 A.2d 521, 523 (Pa. Cmwlth. 1980)). “[T]he Remedies
Clause prohibits the enactment of retroactive legislation if the application . . . would
extinguish a vested right.” Konidaris v. Portnoff Law Assocs., Ltd, 953 A.2d 1231,
1235 (Pa. 2008). “A ‘vested right’ is one that ‘so completely and definitely belongs
to a person that it cannot be impaired or taken away without the person’s consent.’”
Pierson, 252 A.3d at 1179 (citation omitted). In Pierson, we explained that there
are no vested rights in workers’ compensation benefits as calculated at the time of
the injury because there are reasonable expectations under the Act that benefits may
change over time. Id. Where there is no vested right involved, an act is not
retroactive simply because it applies to a condition existing on its effective date. Id.
This Court has previously considered and rejected arguments similar to
Claimant’s regarding the retroactive application of Act 111. In Pierson, 252 A.3d
1169, the claimant argued applying Act 111 to injuries occurring before its
6
enactment would impair a claimant’s vested rights. In rejecting this argument, this
Court explained:
While [the claimant] argues that he has a right to benefits as calculated
at the time of injury, there are reasonable expectations under the Act
that benefits may change. We acknowledge that a claimant retains a
certain right to benefits until such time as he is found to be ineligible
for them. However, claimants, such as the one in the matter before us,
did not automatically lose anything by the enactment of Act 111. Act
111 simply provided employers with the means to change a claimant’s
disability status from total to partial by providing the requisite medical
evidence that the claimant has a whole body impairment of less than
35%, after receiving 104 weeks of TTD benefits.
As this Court opined in Rose Corporation [v. Workers’ Compensation
Appeal Board (Espada), 238 A.3d 551, 561 (Pa. Cmwlth. 2020)], the
General Assembly made it clear in Act 111 that weeks of TTD and
partial disability paid by an employer/insurer prior to the enactment of
Act 111 count as credit against an employer’s new obligations under
Act 111. In Rose Corporation, we said, in reference to Act 111:
The plain language of Section 3 establishes a mechanism
by which employers/insurers may receive credit for weeks
of compensation previously paid. First, Section 3(1)
provides that an employer/insurer “shall be given credit
for weeks of total disability compensation paid prior to the
effective date of this paragraph” for purposes of
determining whether the 104 weeks of total disability had
been paid. This 104 weeks is important because, under
both the former and current IRE provisions, a claimant
need not attend an IRE until after the claimant receives
104 weeks of total compensation. 77 P.S. §[511.3(1)] . . . .
See Section 3(1) of Act 111. Therefore, pursuant to
Section 3(1), an employer/insurer will receive credit
towards this 104 weeks for any weeks of total disability
benefits that were previously paid prior to Act 111’s
enactment. Second, an employer/insurer will be given
credit for any weeks of partial disability compensation
paid prior to enactment of Act 111 “[f]or the purposes of
determining the total number of weeks of partial disability
compensation payable under [S]ection 306(a.3)(7) of the
7
[A]ct.” Section 3(2) of Act 111. In short, any weeks of
partial disability previously paid will count towards the
500-week cap on such benefits.
Rose Corp., 238 A.3d at 561-62.
....
[A]s we made clear in Rose Corporation, the 104-week and credit
provisions of Act 111 were explicitly given retroactive effect by the
clear language used by the General Assembly.
[The c]laimant, herein, argues that the General Assembly cannot take
away his “vested rights” and that it did not explicitly express an intent
to apply the provisions of Act 111 in any sort of a retroactive fashion .
. . As we noted above, [the c]laimant’s “vested rights” have not been
abrogated by Act 111. Further, we believe it is clear that the General
Assembly intended for the 104-week and credit weeks provisions of
Act 111 to be given retroactive effect, where, as we noted in Rose
Corporation, it stated in plain language it was doing so.
Pierson, 252 A.3d at 1179-80. Similarly, in Hutchinson v. Annville Township
(Workers’ Compensation Appeal Board), 260 A.3d 360, 366 (Pa. Cmwlth. 2021),
relying on our precedent in Pierson, we rejected a claimant’s assertion that applying
Act 111 to injuries predating its enactment renders it improperly retroactive.
Here, as in Pierson and Hutchinson, the application of Act 111 did not
automatically change Claimant’s disability status or otherwise deprive him of vested
rights under the Act. Claimant had no vested right in his benefits as calculated at
the time of his injury because there are reasonable expectations under the Act that
benefits may change over time. Thus, Act 111’s application to Claimant’s case was
not retroactive simply because it applied to a condition that existed on its effective
date. Act 111 merely provided a mechanism for Employer to pursue a change in
Claimant’s disability status. Act 111 contains no limiting language regarding the
date of injury or disability award. In fact, Act 111’s IRE mechanisms apply only
8
after an employee has received 104 weeks of total disability benefits, which
necessarily contemplates application to injuries predating Act 111. Thus, Claimant’s
argument that Act 111 is not applicable to his case because his injury occurred before
Act 111’s enactment lacks merit.
IV. Conclusion
Based on the above, and consistent with this Court’s precedent, this Court
rejects Claimant’s constitutional challenge to Act 111. Accordingly, we affirm the
Board’s order.
______________________________
STACY WALLACE, Judge
9
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
David Smuck, :
Petitioner :
:
v. : No. 1215 C.D. 2021
:
Dana Holding Corporation (Workers’ :
Compensation Appeal Board), :
Respondent :
ORDER
AND NOW, this 22nd day of March 2023, the order of the Workers’
Compensation Appeal Board, dated October 5, 2021, is AFFIRMED.
______________________________
STACY WALLACE, Judge