Republic Services of PA, LLC v. R. Schaffer, Jr. (WCAB)

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Republic Services of :
Pennsylvania, LLC, :
Petitioner :
: No. 1118 C.D. 2020
v. :
: Submitted: April 9, 2021
Robert Schaffer, Jr. (Workers’ :
Compensation Appeal Board), :
Respondent :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge1
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE CHRISTINE FIZZANO CANNON, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE McCULLOUGH FILED: May 12, 2022
Republic Services of Pennsylvania, LLC (Employer) petitions for review
of the order of the Workers’ Compensation Appeal Board (Board) dated October 13,
2020, that affirmed the decision and order of a Workers’ Compensation Judge (WCJ)
granting the modification petition filed by Robert Schaffer, Jr. (Claimant) under the
Workers’ Compensation Act (Act).2 Employer raises several issues regarding its
1
This case was assigned to the opinion writer before January 7, 2022, when Judge Cohn
Jubelirer became President Judge.
2
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2710.
entitlement to a credit for previously paid disability benefits classified as partial per
the impairment rating evaluation (IRE) performed under Act 111.3
I. Background
Claimant suffered work-related injuries on September 21, 2004. See
WCJ Decision, 12/13/2019 at 3, Finding of Fact (F.F.) No. 1. A notice of temporary
compensation payable (NTCP) was issued, and Employer began paying temporary
total disability benefits at a rate of $690.00 per week on September 22, 2004. Id.
The parties agreed that the NTCP converted to a notice of compensation payable
(NCP). Id.
Employer has continued paying wage loss benefits to Claimant at the
rate of $690.00 per week since 2004. On June 1, 2011, Claimant underwent an IRE
performed by Dr. Pinsky, M.D., who applied the Fourth Edition of the American
Medical Association’s Guides to the Evaluation of Permanent Impairment (AMA
Guides) (First IRE). The First IRE stated that Claimant had a whole person
impairment rating of 17% related to the work injuries in accordance with former
Section 306(a.2) of the Act. Id., F.F. No. 3; Bd. Decision, 10/13/2020, at 1.
Thereafter, Employer filed a modification petition seeking to change Claimant’s
disability status. Claimant did not challenge the petition to modify, nor did he
challenge the constitutionality of the IRE at that time.
Instead, on May 25, 2012, Claimant signed a supplemental agreement
(2012 Agreement) that stated: “[a]n IRE of less than 50% of [C]laimant’s benefits are
modified to partial disability as of [August 22, 2011].” WCJ Decision, 12/13/2019,
3
Section 306(a.3) of the Act was added by the Act of October 24, 2018, P.L. 714, No. 111
(Act III). Act III repealed former Section 306(a.2) of the Act, added by the Act of June 24, 1996,
P.L. 350, formerly 77 P.S. § 511.2.
2
at 3, F.F. No. 4 (emphasis added). Thus, the 2012 Agreement resolved Employer’s
modification petition, and was approved by a WCJ.
Relevant here, in the interim, in 2015, this Court decided Protz v.
Workers’ Compensation Appeal Board (Derry Area School District), 124 A.3d 406(Pa. Cmwlth. 2015) (Protz I), aff’d in part and rev’d in part, 161 A.3d 827 (Pa. 2017)
(Protz II). Protz I held that the IRE provision found in former Section 306(a.2) of the
Act was an unconstitutional delegation of legislative powers “insofar as it [purported]
to adopt a new version of the [] [the AMA Guides]” without review. 124 A.3d at
417. On June 20, 2017, our Supreme Court issued Protz II, which struck down
Section 306(a.2) of the Act in its entirety and found that all IREs performed under the
AMA Guides were unconstitutional.4 Protz II, 161 A.3d at 841.
The legislature enacted Act 111 to address the constitutional infirmity of
former Section 306(a.2). However, prior to Act 111’s enactment, Claimant filed a
Reinstatement Petition, asking that his benefits be classified as total disability
benefits, not partial, based on the elimination of the IRE provisions. The parties
entered into a stipulation with the understanding that the basis for setting partial
benefits (i.e., the IRE process) was eliminated (2018 Stipulation). By decision dated
February 22, 2018, WCJ Leah Lewis adopted the 2018 Stipulation, and pursuant to
the parties’ agreement, reinstated Claimant to total disability status retroactive to
August 2011. See Reproduced Record (R.R.) at 292a, 311a.
On March 4, 2019, Claimant underwent a second IRE by Dr. Michael
Weiss, who found that Claimant’s impairment rating was 28% based on the AMA
4
By Act 111, the General Assembly adopted the Sixth Edition (second printing April 2009)
of the AMA Guides, thereby correcting the impermissible delegation of legislative authority that
had invalidated former Section 306(a.2) of the Act and reestablishing the IRE process.
3
Guides, Sixth Edition (Second IRE). Employer filed a Modification Petition in April
2019 based on the Second IRE, requesting the benefit status be modified to partial
disability. Following a hearing, WCJ Karl Peckmann granted the Modification
Petition as of the date of the Second IRE. See WCJ Dec., 12/13/2019, Claimant’s Br.
at Ex. A.
Initially, WCJ Peckmann concluded Employer met its burden to prove
that Claimant had a whole-body impairment rating of less than 35%, and so was
properly classified as partial disability status. Nevertheless, he concluded that
Employer was not entitled to credit for the weeks it paid partial disability benefits
since those provisions of the Act were found unconstitutional. WCJ Peckmann
modified the wage loss benefits to temporary partial disability pursuant to the 28%
rating in the Second IRE in regard to Claimant’s work-related injuries. He noted the
finding about the percentage of impairment was not refuted. F.F. No. 15.
However, WCJ Peckmann found the benefits prior to the date of the
Second IRE (March 4, 2019), should be classified as temporary total disability
benefits and not partial disability benefits, based, in part, on the 2012 Agreement.5
F.F. No. 16. The WCJ determined the wage loss benefits were to be modified from
temporary total disability to temporary partial disability benefits at the rate of
$690.00 per week effective March 4, 2019. Further, the WCJ ordered that all wage
loss benefits paid before March 3, 2019, “shall be considered temporary total
disability benefits.” WCJ Dec. at 6 (emphasis added).
5
WCJ Lewis issued a decision and order adopting the 2018 Stipulation that resolved the
Reinstatement Petition filed by Claimant, in which Claimant sought total disability benefits, and
reinstated Claimant’s disability status to total as of August 22, 2011.
4
Employer and Claimant both appealed to the Board. Employer
contended that the WCJ erred in failing to grant it a credit for previously paid weeks
of partial disability pursuant to the retroactivity clause of Act 111. Bd. Decision,
10/13/2020, at 2. Claimant argued that Act 111 was unconstitutional by violating the
Remedies Clause of the Pennsylvania Constitution, Pa. Const. art. I, § 11, and
depriving him of a vested right in paid benefits. Id. at 5.
The Board affirmed WCJ Peckmann’s decision on alternate grounds.
Specifically, the Board concluded the WCJ erred in his application of the retroactivity
clause of Act 111. See Bd. Op., 10/13/2020, Claimant’s Br. at Ex. B. The Board
reasoned the retroactivity provision in Section 3(2) of Act 111 did not apply because it
only provided a credit for weeks of partial disability compensation paid. There were
no such partial compensation weeks per Employer’s agreement in the 2018 Stipulation
and WCJ Lewis’s decision upholding same. Employer filed a petition for review and
sought a supersedeas from the Board’s order. This Court denied the supersedeas by
memorandum and order dated February 12, 2021. After briefing, we address the matter.
II. Analysis
On appeal,6 Employer posits that the 2018 Stipulation does not control
here because it was premised on our Supreme Court’s decision in Protz II (2017),
which Act 111 effectively abrogated. Additionally, Employer asserts that Claimant
did not raise the 2018 Stipulation as the basis for denying the credit before the
factfinder, resulting in waiver. Employer maintains that the 2018 Stipulation was not
6
This Court’s review is limited to determining whether the necessary findings of fact were
supported by substantial evidence, constitutional rights were violated, or errors of law were
committed. Borough of Heidelberg v. Workers’ Compensation Appeal Board (Selva), 928 A.2d
1006, 1009 (Pa. 2006). Where the issue presented involves a question of law, our standard of
review is de novo and our scope of review is plenary. Id.5
made part of the evidentiary record in the litigation of the Modification Petition, and
so may not constitute grounds for the Board’s decision. Notwithstanding the 2018
Stipulation, Employer contends that the retroactivity provision in Act 111 applies
such that it is entitled to a credit for indemnity benefits paid prior to the Second IRE.
In its view, all payments from August 2011 to the present should count toward the
Employer’s obligation to pay 500 weeks of partial disability benefits.
Despite that it set forth multiple appeal grounds,7 primarily, Employer
argues the Board erred in affirming the WCJ’s decision, which only allowed a credit
as of the Second IRE when it should have allowed a credit for all indemnity benefits
paid after the First IRE.
A. 2018 Stipulation
This matter turns on the 2018 Stipulation, in which Employer agreed that
Claimant’s disability was a total disability and not a partial disability as part of its
litigation of the Reinstatement Petition. In pertinent part, WCJ Lewis’s decision
adopting the 2018 Stipulation provides: “The parties are in agreement that the petition
should be granted reinstating Claimant’s benefits to total as of August 22, 2011.” See
WCJ Lewis Dec., 2/22/2018 (emphasis added); R.R. at 311a.
Importantly, Employer does not disclaim the existence or contents of the
2018 Stipulation. Nor does Employer dispute its agreement to classify Claimant’s
disability status as “total,” retroactive to August 2011 in lieu of litigating the
Reinstatement Petition before WCJ Lewis. Rather, Employer’s argument hinges on
7
Although Employer raised additional grounds in its petition for review and statement of
questions involved in its brief, Employer did not brief them. As such, those arguments, related to
reinstatement and the insurer’s entitlement to credit in questions D., E., F., and G. of the statement
of issues complained of on appeal, are waived pursuant to Pa.R.A.P. 2119. See City of Philadelphia
v. Workers’ Compensation Appeal Board (Grevy), 968 A.2d 830, 837 n.9 (Pa. Cmwlth. 2009).
6
the exclusion of the 2018 Stipulation from the Board’s consideration because it was
not made an exhibit submitted formally as evidence during the litigation of the
Modification Petition before WCJ Peckmann.
We turn first to the evidentiary challenge premised on Claimant’s failure
to submit the 2018 Stipulation as an exhibit in the hearings on the Modification
Petition that is the subject of the current appeal. There is no dispute that the Board
could take notice of WCJ Lewis’s February 2018 decision, in which she discussed the
2018 Stipulation.
Based on these circumstances, exclusion of the facts agreed upon in the
2018 Stipulation is not appropriate. This situation is more akin to recognition of
adjudicated facts than to judicial notice. This Court agrees with Employer generally
that neither the Board nor this Court may consider extra-judicial facts that are not
contained in the certified record. See, e.g., Martzen v. Workers’ Compensation
Appeal Board (Stores) (Pa. Cmwlth., No. 436 C.D. 2015, filed Aug. 2, 2016), slip op.
at 14-15, 2016 WL 4140845, at *7 (striking from the reproduced record transcripts
from subsequent proceeding in which claimant appealed medical condition as outside
the certified record) (unreported).8 However, unlike Martzen, this case does not
involve after-discovered evidence,9 or even evidence per se. The decision of WCJ
Lewis is alone sufficient to show the parties’ agreement in a prior adjudication to a
set of facts establishing Claimant’s disability status as total instead of litigating the
matter when faced with the uncertain status of IREs post-Protz. Employer now seeks
8
Pursuant to Section 414(a) of this Court’s Internal Operating Procedures, we may cite an
unreported opinion of this Court for its persuasive value. 210 Pa. Code §69.414(a).
9
Martzen v. Workers’ Compensation Appeal Board (Stores) (Pa. Cmwlth., No. 436 C.D.
2015, filed Sept. 8, 2015), slip op. at 3 (Colins, S.J., single-judge op.) (granting employer’s motion
to strike inclusion of certain transcripts in the reproduced record when they were not contained in
the certified record).
7
to disclaim the application of the adjudicated facts of the prior proceeding related to
reinstatement, (WCJ Dec. 2/22/2018), in the current proceeding. This it cannot do.
See Delaware County v. Workers’ Compensation Appeal Board (Browne), 964 A.2d
29, 35 (Pa. Cmwlth. 2008) (reasoning employer may not “recharacterize or disregard
the prior adjudicated facts in these serial petitions in order to realize a favorable
outcome”) (citing Folmer v. Workers’ Compensation Appeal Board (Swift
Transportation), 958 A.2d 1137 (Pa. Cmwlth. 2008)).
Moreover, Employer repeatedly acknowledges the existence of the 2018
Stipulation, and that therein “[Employer] agreed to classify Claimant’s benefits as
total disability benefits.” Employer’s Br. at 17 (emphasis added). Contrary to
Employer’s characterization, this Court does not construe Protz to have compelled all
employers to agree to classify all claimants as having a total disability. Employer
elected not to litigate the Reinstatement Petition, pure and simple. In lieu of litigating
whether Claimant was entitled to reinstatement at the total disability level, Employer
agreed to classify Claimant’s benefits as total disability benefits. While the
agreement to the classification as total disability benefits may have been motivated by
the uncertainty of the legal landscape of partial benefit classifications after Protz
declared the former delegation to the AMA Guides unconstitutional and before
enactment of a legislative solution, the agreement also resolved that uncertainty.
Pursuant to Section 131.91 of the Special Rules of Administrative
Practice and Procedure before WCJs, 34 Pa. Code § 131.91, the parties may resolve a
case by stipulation submitted to the assigned WCJ. The Board’s recognition of the
2018 Stipulation, adopted in the reinstatement adjudication, was thus permissible.
We agree with the Board that the legality of the 2018 Stipulation is not undermined
8
by this Court’s subsequent decisions.10 See Hrivnak v. Workers’ Compensation
Appeal Board (R&L Development), 791 A.2d 1281 (Pa. Cmwlth. 2002).
Because the 2018 Stipulation set forth facts that were the basis for a
subsequent adjudication, and made a part of that decision, it was not improper for the
Board to consider it. Employer was properly bound by its agreements. Hrivnak.
B. Credit Entitlement
Next, we consider the impact of the fact that Claimant had a total
disability status as of August 2011. Pursuant to Section 306(a.3), 77 P.S. § 511.3(2),
a claimant’s disability is classified as partial if an IRE rating is less than 35%. Here,
both the First IRE and the Second IRE established Claimant’s impairment ratings as
in the partial disability classification of 28% and 17%, respectively. Employer
assigns error in that the WCJ and the Board did not allow a credit for the indemnity
benefits paid from the date of the First IRE against Claimant’s entitlement to 500
weeks of partial benefits under the Act. In so doing, Employer ignores its agreement
that the benefits were reinstated to total benefits as of the date of the First IRE.
The Act limits a claimant’s recovery to 500 weeks of partial disability
benefits. See Section 306(b) of the Act, 77 P.S. § 512(1). As a matter of policy,
Employer makes a strong point: by allowing the 2018 Stipulation to set the disability
level, it will have paid well over 1,000 weeks, having made indemnity payments on the
10
This case is also distinguishable from our decision in Whitfield v. Workers’ Compensation
Appeal Board (Tenet Health System Hahnemann LLC), 188 A.3d 599 (Pa. Cmwlth. 2018) (en
banc). In Whitfield, this Court held that for a claimant to receive reinstatement of total disability
benefits based on a Protz decision and an unconstitutional IRE, a claimant must demonstrate the
continuation of disability from the work injury. Id. at 616. We held that with such a showing, a
claimant is entitled to reinstatement as of the date of filing the reinstatement petition. Id. However,
in this case, benefits were not reinstated as total disability benefits based on a Protz decision or a
deemed unconstitutional IRE; rather, the benefits were established as total disability pursuant to the
parties’ agreement in the 2018 Stipulation.
9
claim since 2011. Nevertheless, Employer likewise constructed its case on the facts
agreed upon in the 2012 Agreement, which deemed the benefits partial disability
benefits. The basis for the impairment rating in both instances is the parties’
agreement subsequently enforced through litigation of various petitions disputing the
level of Claimant’s impairment.
In relevant part, the retroactivity clause in Section 3(2) of Act 111
provides: “For the purposes of determining the total number of weeks of partial
disability compensation payable under [S]ection 306(a.3)(7) of the Act, an insurer
shall be given credit for weeks of partial disability compensation paid prior to the
effective date of this paragraph.” (emphasis added). This Court construed the
retroactivity clause in Rose Corp. v. Workers’ Compensation Appeal Board (Espada),
238 A.3d 551 (Pa. Cmwlth. 2020). Therein, we explained the legislature drafted the
provision such that it was selectively retroactive as follows:
an employer/insurer will be given credit for any weeks of partial
disability compensation paid prior to enactment of Act 111 “for the
purposes of determining the total number of weeks of partial disability
compensation payable under Section 306(a.3)(7) of the Act.” In short,
any weeks of partial disability previously paid will count towards the
500-week cap on such benefits.
Id. at 562 (emphasis added) (quoting Section 3(2) of Act 111). Regardless of whether
the amendment was substantive or procedural, the provision is explicit in its
application to partial disability benefits, which is not the classification of the type of
benefits for which Employer seeks a credit.
Based on the parties’ agreement as to Claimant’s disability status as total
starting in August 2011, there are no partial disability weeks for which Employer may
be entitled to credit under the Act. By its plain language, the Act does not allow a
10
credit for total disability weeks. See Section 1903 of the Statutory Construction Act
of 1972, 1 Pa. C.S. § 1903.
Ultimately, the Board did not err as a matter of law in holding Employer
to its agreement that the type of disability as agreed, and adjudicated as a fact, was
total and not partial. Because the credit provision applies solely to partial benefits,
Employer is not entitled to a credit for the weeks paid prior to the Second IRE.
III. Conclusion
For the foregoing reasons, we affirm the Board’s Order.
________________________________
PATRICIA A. McCULLOUGH, Judge
11
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Republic Services of :
Pennsylvania, LLC, :
Petitioner :
: No. 1118 C.D. 2020
v. :
:
Robert Schaffer, Jr. (Workers’ :
Compensation Appeal Board), :
Respondent :
ORDER
AND NOW, this 12th day of May, 2022, the order of the Workers’
Compensation Appeal Board dated October 13, 2020, is AFFIRMED.
________________________________
PATRICIA A. McCULLOUGH, Judge