Opinion
No. 696 C.D. 2014
07-30-2015
James Smale, Petitioner v. Workers' Compensation Appeal Board (Dana Corp. Torque Traction M), Respondent
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE ANNE E. COVEY, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE COVEY
James Smale (Claimant) petitions this Court for review of the Workers' Compensation Appeal Board's (Board) March 28, 2014 order affirming the Workers' Compensation Judge's (WCJ) March 20, 2012 decision, and its May 17, 2011 order affirming, reversing and remanding the WCJ's November 9 and 10, 2009 decisions. Claimant presents six issues for this Court's review: (1) whether the Notice of Temporary Compensation Payable (NTCP) converted to a Notice of Compensation Payable (NCP) as a matter of law; (2) whether Claimant established entitlement to Workers' Compensation (WC) benefits without presenting medical testimony; (3) whether Claimant waived the Yellow Freight System, Inc. v. Workmen's Compensation Appeal Board (Madara), 423 A.2d 1125 (Pa. Cmwlth. 1981) default admission of liability issue; (4) whether Claimant's average weekly wage (AWW) was properly calculated; (5) whether Claimant established that Dana Corporation Torque Traction Manufacturing Company (Employer) violated the Workers' Compensation Act (Act); and (6) whether Employer's contest was reasonable. After review, we affirm.
Although Claimant's brief only contains five issues for review in its Statement of Questions Presented, Claimant inserted a sixth issue concerning Claimant's average weekly wage as a separate argument in his Argument section. We also note there is no Summary of Argument included in Claimant's brief.
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2708.
On March 1, 2007, Employer issued an NTCP acknowledging that on February 14, 2007 Claimant sustained a work-related injury described as facial laceration, cervical strain, chest wall contusion, right shoulder sprain and cerebral concussion. On March 23, 2007, Employer filed a Notice Stopping Temporary Compensation Payable (NSTCP) and a Notice of Compensation Denial (NCD) with the WC Bureau alleging that, although an injury took place, Claimant was not disabled as a result, and Employer discontinued compensation as of March 2, 2007. On June 9, 2008, Claimant filed a claim petition (Claim Petition 1), alleging that on February 14, 2007 he suffered a work-related injury described as cervical sprain/strain, multiple cuts and head injuries, cerebral concussion, face bruises and head trauma. Claimant sought both full and partial disability benefits, as well as the payment of medical bills and counsel fees. On the same day, Claimant filed a second claim petition (Claim Petition 2), alleging that he sustained a disfiguring facial scar as a result of his work-related injury.
On February 2, 2009, Employer filed a petition to terminate WC benefits (Termination Petition) alleging that, as of October 6, 2008, Claimant had fully recovered from his cervical and right shoulder sprain injuries and that certain medical bills were unrelated to Claimant's work injury. Also on February 2, 2009, Employer filed a petition to suspend WC benefits (Suspension Petition) alleging that, as of July 5, 2008, any and all disability alleged by Claimant was the result of a non-work- related injury Claimant sustained in his home on July 4, 2008. The WCJ held hearings on September 11, 2008, January 6, 2009 and February 19, 2009. On July 10, 2009, Claimant filed a petition for penalties (Penalty Petition) alleging that Employer unilaterally stopped paying Claimant's WC benefits, failed to timely reinstate his WC benefits and failed to timely file an NCP, NCD and NSTCP.
There was an additional WCJ hearing on July 21, 2009, but that was for a work injury that occurred in February 2006.
By Decision and Order issued November 9, 2009, the WCJ granted Claim Petition 2, finding that Claimant suffered a disfiguring facial scar resulting from his work injury for which he was entitled to seven weeks of benefits. The WCJ also awarded Claimant attorney's fees due to Employer's unreasonable contest of Claim Petition 2. The WCJ denied and dismissed Claim Petition 1 because Claimant failed to prove he suffered any disability after February 14, 2007 or after July 4, 2008 as a result of his work injury. The WCJ granted Employer's Termination Petition, finding Claimant had fully recovered from his work injuries as of October 6, 2008. The WCJ dismissed Employer's Suspension Petition as moot. By separate Decision and Order issued on November 10, 2009, based on his November 9, 2009 Decision and Order, the WCJ dismissed Claimant's Penalty Petition as moot. Both parties appealed to the Board.
On May 17, 2011, the Board affirmed in part, reversed in part and remanded the matter to the WCJ. Specifically, the Board affirmed the WCJ's denial of Claimant's Penalty Petition and the WCJ's conclusion that because Employer timely and properly issued an NSTCP and an NCD, the NTCP did not convert to an NCP. The Board concluded that Employer proved that the NSTCP and NCD were timely and properly mailed, and Claimant failed to rebut the presumption that those documents were received. The Board affirmed the WCJ's denial of penalties because, while Employer violated the Act when it unilaterally reduced Claimant's WC benefits for a period of time, Claimant waived that argument by failing to raise it before the WCJ. The Board also affirmed the WCJ's decision not to award penalties because revocation of an NTCP by filing an NCD and NSTCP was not an illegal and unilateral benefit suspension. The Board affirmed the WCJ's denial of Claim Petition 1, agreeing with the WCJ that Claimant failed to show that he suffered any disability as a result of the work incident. The Board also affirmed the grant of Employer's Termination Petition because the WCJ found Employer's medical expert more credible than Claimant's medical expert, and Employer's medical expert's testimony constituted substantial, competent evidence supporting the grant of the Termination Petition.
Employer, in its Cross-Appeal, averred that the WCJ erred in finding that its contest of Claim Petition 2, regarding Claimant's disfigurement claim, was unreasonable. The Board agreed and reversed the attorney's fee award. The Board affirmed the WCJ's finding that Employer's contests as to Claim Petition 1 and Claim Petition 2 were reasonable. Finally, Claimant argued that Employer's contest of Claimant's AWW was unreasonable as it offered no proof in support of its contention that Claimant's AWW was $883.25. The Board disagreed that Employer's contest was unreasonable. However, the Board remanded the matter, directing the WCJ to make findings as to what the correct AWW should be and to explain how he came to such a conclusion. First, it determined that the WCJ failed to mention a Statement of Wages, which was relevant to a determination of Claimant's AWW, in his findings and, therefore, the Board was unable to tell if the WCJ considered that evidence. Second, the Board acknowledged that while a Statement of Wages was discussed at the hearing, there was no evidence that one was ever entered into the record. Further, the Board noted that the WCJ made no dispositive finding as to Claimant's AWW calculation.
On November 10, 2011 a remand hearing was held. By Decision and Order issued March 20, 2012, the WCJ concluded that during the May 15, 2006 to August 13, 2006 quarter, Claimant received a gross check in the amount of $2,957.77 as vacation pay for the period May 23, 2006 to May 29, 2006 and that, based on Bucceri v. Workers' Compensation Appeal Board (Freightcar American Corp.), 31 A.3d 985 (Pa. Cmwlth. 2011), such vacation pay is attributed to the entire year and, pursuant to Section 309(e) of the Act, 77 P.S. § 582(e), is prorated on a yearly basis in calculating the AWW, rather than allocating it to the quarter in which it was paid. The WCJ also found that Claimant received "SUB Pay" of $268.03 for the period of December 11, 2006 and December 17, 2006, and $536.06 for the period of December 18, 2006 and December 24, 2006 and concluded that said such payments were Supplemental Unemployment Benefits and, since they are in the nature of wages, should be included in Claimant's AWW calculation. The WCJ concluded that Claimant's AWW, based on the three highest quarters preceding the work incident, was $895.97 with a corresponding compensation rate of $597.31. The WCJ corrected the amount awarded for disfigurement benefits to reflect the new AWW. Claimant appealed to the Board. On March 28, 2014, the Board affirmed the WCJ's decision. Claimant appealed to this Court.
"On review[,] this Court must determine whether constitutional rights were violated, errors of law were committed, or necessary findings of fact were supported by substantial competent evidence." Stepp v. Workers' Comp. Appeal Bd. (FairPoint Commc'ns, Inc.), 99 A.3d 598, 601 n.6 (Pa. Cmwlth. 2014).
Claimant first argues that the NTCP converted to an NCP pursuant to Section 406.1 of the Act. Specifically, Claimant contends that Employer violated the five-day rule by either the untimely issuance and filing of the NSTCP, or the failure to establish that it was sent to Claimant. We disagree.
Added by Section 3 of the Act of February 8, 1972, P.L. 25, as amended, 77 P.S. § 717.1.
Section 717.1(d) of the Act provides in relevant part:
(5)(i) If the employer ceases making payments pursuant to a notice of temporary compensation payable, a notice in the form prescribed by the department shall be sent to the claimant and a copy filed with the department, but in no event shall this notice be sent or filed later than five (5) days after the last payment.77 P.S. § 717.1(d).
(ii) This notice shall advise the claimant, that if the employer is ceasing payment of temporary compensation, that the payment of temporary compensation was not an admission of liability of the employer with respect to the injury subject to the notice of temporary compensation payable, and the employe must file a claim to establish the liability of the employer.
(iii) If the employer ceases making payments pursuant to a notice of temporary compensation payable, after complying with this clause, the employer and employe retain all the rights, defenses and obligations with regard to the claim subject to the notice of temporary compensation payable, and the payment of temporary compensation may not be used to support a claim for compensation.
(iv) Payment of temporary compensation shall be considered compensation for purposes of tolling the statute of limitations under [S]ection 315 [of the Act].
(6) If the employer does not file a notice under paragraph (5) within the ninety-day period during which temporary compensation is paid or payable, the employer shall be deemed to have admitted liability and the notice of temporary compensation payable shall be converted to a notice of compensation payable.
77 P.S. § 602.
In the instant case, Employer issued a NTCP on March 1, 2007 for Claimant's February 14, 2007 work-injury. Because Claimant returned to work on March 2, 2007, on March 14, 2007, Employer sent Claimant a check making March 1, 2007 his last payment. Claimant asked Employer to stop payment on the check because he accidentally threw it away. Employer stopped payment and reissued the check on March 22, 2007. The Bureau received the NSTCP and NCD on March 23, 2007.
Claimant asserts that he never asked Employer to stop payment on his check and that he never received his NSTCP or NCD. However, at the January 6, 2009 WCJ hearing, Specialty Risk Services' (SRS) team leader/adjuster Michael Miller (Miller) testified that he is the records custodian for all of Employer's claims. At the February 19, 2009 WCJ hearing, Miller related: "According to the file notes, that [March 22, 2007] check was issued because [Claimant] called us on March 20th to indicate that he did receive the previous check but accidentally threw it out." Reproduced Record (R.R.) at 299-300; see also Notes of Testimony (N.T.), February 19, 2009, Ex. C-6 at 9. Thus, payment on Claimant's March 14, 2007 check was stopped, and his last check was issued on March 22, 2007.
Specialty Risk Services is the third-party administrator for The Hartford Financial Services Group, Inc., Employer's insurance carrier.
"Employer's stop payment on Claimant's check resulted in no 'payment' to [him] under Section 406.1 of the Act, therefore, the five-day time limit to issue a NSTC[P] under Section 406.1(d)(5)(i) was not applicable" to the March 14, 2007 check. Barrett v. Workers' Comp. Appeal Bd. (Vision Quest Nat'l), 989 A.2d 396, 399-400 (Pa. Cmwlth. 2009).
Claimant maintains that he did not cash the March 22, 2007 check. However, N.T., January 6, 2009, Ex. D-2 is a copy of the front and back of the cashed check.
Miller explained at the January 9, 2007 WCJ hearing that according to the printed version of the screen containing his electronically filed notes, the NSTCP and the NCP were generated on March 22, 2007, and the general procedure is as follows:
BY MS. CRISCI [Employer's Counsel]:
Q Now, when that -- those documents are generated, what is SRS's procedure after the forms are generated?
. . . .
THE WITNESS [Miller]: The attached documents are printed out. The adjust[e]r who generates the documents will then get the - - -R.R. at 188-190. The WCJ found "Miller's testimony credible." WCJ November 9, 2009 Dec. at 4. With respect to confirmation that the documents were actually mailed, the WCJ stated: "I can look at the Bureau records and see that a notice stopping and a denial were in fact received by the Bureau." R.R. at 193; see also N.T., September 11, 2008, Exs. J-2 (NSTCP), J-3 (NCD).
. . . .
THE WITNESS: The adjust[e]r will then get the documents from the printer, address the documents to the appropriate parties and then they will place them in the mail bin in which they are then mailed out that same day.
BY MS. CRISCI:
Q Okay. And who are the appropriate parties for each one of these forms?
A For each of these documents, a copy is sent to the Bureau of Workers' Compensation, the injured worker, their attorney if there is one on file, -
. . . .
THE WITNESS: - - the employer and a copy is placed in the file.
BY MS. CRISCI:
Q Once the envelopes are addressed, what happens?
A The adjust[e]r will place them in the mail bin in our mail room. . . .
Since Claimant's last WC payment was made on March 22, 2007 and the NSTCP and NCD were mailed on March 22, 2007, the notices were sent within "five (5) days after the last payment." 77 P.S. § 717.1(d)(5)(i). Further, because the notices were generated March 22, 2007, and the custom is to get the documents from the printer, address the documents to the appropriate parties, including the injured worker, and then place them in the mail bin from which they are mailed the same day, the evidence established that the notices were sent to Claimant. See In re Rural Route Neighbors, 960 A.2d 856, 862 (Pa. Cmwlth. 2008) ("Evidence concerning the customary procedures for mailing of letters is generally accepted as sufficient to establish that a letter was mailed.").
"Because the WCJ is the ultimate fact finder and determiner of credibility," and he found Miller credible, the Board properly concluded that Employer did not violate the five-day rule by either the untimely issuance and filing of the NSTCP, or by failure to establish that it was sent to Claimant. McCool v. Workers' Comp. Appeal Bd. (Sunoco, Inc.), 78 A.3d 1250, 1255 (Pa. Cmwlth. 2013) (quoting Washington Steel Corp. v. Workers' Comp. Appeal Bd. (Waugh), 734 A.2d 81, 84 (Pa. Cmwlth. 1999)). Moreover, pursuant to Section 406.1(d)(6) of the Act, "[i]f the employer does not file a notice [advising the claimant that it is ceasing payments of compensation] within the ninety-day period during which temporary compensation is paid or payable, the employer shall be deemed to have admitted liability and the [NTCP] shall be converted to a[n NCP]." 77 P.S. § 717.1(d)(6) (emphasis added). Here, the notices were sent within the required 90-day period. Accordingly, the NTCP did not convert to an NCP pursuant to Section 406.1 of the Act.
Claimant next argues that he presented the adjuster's log notes from February 16, 2007 to September 13, 2007 which established Employer's liability for WC benefits. See N.T., February 19, 2009, Ex. C-6. Specifically, Claimant contends:
This Court notes that Claimant's second argument is unclear as he continued to revert to his previous argument, i.e., untimely NSTCP. See Claimant Br. at 14-18.
Miller's testimony confirmed, and the log notes clearly established that [E]mployer KNEW — without a scintilla of doubt — that [C]laimant was medically restricted to light[-]duty work, and that Ms. Tepas knew he was suffering wage loss. However, although [E]mployer was permitted to 'wrangle' evidence into the record however it tried to do so, [C]laimant was not permitted to continue questioning [] Miller regarding the log notes which show, unequivocally, that [E]mployer knew [C]laimant had been out of work altogether for the first 15 days following the explosion. . . . At least as of 3/14/2007, [E]mployer knew [C]laimant was on restricted duty, and [Ms.] Tepas was going to look into whether he was suffering wage loss, and subsequently confirmed that he was, and calculated his benefit amount for the check she issued for TPD [temporary partial disability], but it was then ordered 'stop payment.' Those log notes went on to establish that Ms. Tepas on March 14, 2007, while preparing to issue a TPD check 'spoke with QTC and T/L [team leader]' and was 'not going to file modification forms' because she was 'hoping he goes back to work before 90 days is up, so that she can issue a notice stopping and notice of denial. . . .Claimant Br. at 14-15 (emphasis omitted).
Ms. Tepas is the adjuster who handled Claimant's claim. However, according to Miller's testimony at the WCJ hearing, she no longer works at SRS. See R.R. at 186-187.
The law is well-established that:
A claimant seeking disability benefits must prove that he has suffered a disability caused by a work-related injury. The claimant must show not only physical impairment, but also a loss of earning power. A 'disability' means a loss of earning power, not a physical disability caused by a work injury. If the claimant's loss of earnings is the result of the work injury, he is entitled to disability benefits[.]Brewer v. Workers' Comp. Appeal Bd. (EZ Payroll & Staffing Solutions), 63 A.3d 843, 848 (Pa. Cmwlth. 2013) (citations omitted). It appears Claimant is referring to the log entries on March 14, 2007 ("[E]mployer knew Claimant was on restricted duty") and March 21, 2007 ("[Ms.] Tepas was going to look into whether he was suffering wage loss, and subsequently confirmed that he was") to establish a loss of earning power caused by his work injury. Claimant Br. at 15. The March 14, 2007 log note provided in its entirety:
Signe @ acct states:N.T., February 19, 2009, Ex. C-6 at 10. The March 24, 2007 log note includes the following statement: "Employee has returned to work as of 03/02/07 with restrictions. He is currently at a wage loss and temporary partial checks will be issued accordingly." Id. at 8. However, a subsequent log note on March 22, 2007 specified:
I just found out that when [Claimant] RTW [returned to work] on 3/2/07 he has been doing restricted duty. I will submit weekly wage schedules to Sue. We originally thought he was doing his regular, full[-]duty job. But he informed me he hasn't been.
Diana @ acct got a[]hold of me - she states that [Claimant] shouldn't be at a wage loss as he is working his pre[-]injury [hours], etc. [T]he only reason his gross wages may appear to be less than [AWW] is [because Claimant] is not working overtime. [T]he overtime is offered and he can work it[], but he has chosen not to [because] the union is suggesting to all [employees] that they don't work overtime [because] of the hardships going on at [Employer]. [I] have pulled [TPD] check and will issue [a] stop pay on it. [W]ill also issue stop/denial at this point.Id. (emphasis added). The subsequent log note explains the reason the TPD check was pulled and the NSTCP and NCD were issued. "It is solely for the WCJ, as the fact finder, to assess credibility and to resolve conflicts in the evidence. It is solely for the WCJ, as fact finder, to determine the weight to give the evidence." Elliott Turbomachinery Co. v. Workers' Comp. Appeal Bd. (Sandy), 898 A.2d 640, 647 (Pa. Cmwlth. 2006) (citation omitted). Clearly, the WCJ gave more weight to the March 22, 2007 log note, than the notes presented by Claimant at the WCJ hearing, and resolved the conflict in the notes in favor of Employer. Thus, Claimant's notes did not establish his right to WC benefits.
Claimant also asserts that a March 14, 2007 log note
went on to establish that Ms. Tepas . . . while preparing to issue a TPD check 'spoke with QTC and T/L [team leader]' and was 'not going to file modification forms' because she was 'hoping he goes back to work before 90 days is up, so that she can issue a notice stopping and notice of denial[.]Claimant Br. at 15 (emphasis omitted). However, the actual log note stated:
[S]poke with qtc and t/l.. [sic] at this time [I] am not issuing any forms to show modification as we may be paying tpd now - only [because] this is still on tncp and we may be able to issue stop/denial once [Claimant] rtw f/d [full duty] at pre[-]injury wages as he may rtw before the 90 days is up. [W]ill monitor.N.T., February 19, 2009, Ex. C-6 at 10. Given that the purpose of the NTCP is to give Employer time to investigate the claim, the adjuster was acting within her duties in not issuing the forms until the necessary information was received. As explained by this Court:
Generally, an employer must issue an NCP or NCD within twenty-one days of notice of a work injury. Where an employer is uncertain whether a claim is compensable or is uncertain of the extent of its liability under the Act, the employer may comply with the Act by initiating compensation payments without prejudice and without admitting liability by issuing a NTCP[.]Potere v. Workers' Comp. Appeal Bd. (Kemcorp), 21 A.3d 684, 691-92 (Pa. Cmwlth. 2011) (citations omitted). Accordingly, the March 14, 2007 log note did not establish Claimant's entitlement to WC benefits.
Claimant next contends that he did not waive the Yellow Freight default admission of liability issue. Specifically, Claimant contends the WCJ prevented him from making the argument by "sua sponte consolidat[ing] the two actions [i.e., Claim Petition 1 and Claim Petition 2,] . . . and 'remedied' [E]mployer's failure to file an Answer to [C]laimant's Disability Petition . . . by stating 'your answer will be amended[.]'" Claimant Br. at 18.
Initially, the Yellow Freight Court held:
[T]he critical elements of Section 416 [of the Act] are as follows:
Within fifteen days after a copy of any claim petition or other petition has been served upon an adverse party, he may file with the department or its referee an answer in the form prescribed by the department.
Every fact alleged in a claim petition not specifically denied by an answer so filed by an adverse party shall be deemed to be admitted by him . . . If a party fails to file an answer and/or fails to appear in person or by counsel at the hearing without adequate excuse, the referee hearing the petition shall decide the matter on the basis of the petition and evidence presented. (Emphasis added.)
Yellow Freight, 423 A.2d at 1127 (footnote omitted; bold emphasis added). However,
In applying this Section, we must emphasize that the referee ruled that the employer's failure to file its answer, within 15 days of being served with the claim petition, constituted an admission of the allegations in the petition. That decision was tantamount to a ruling that the employer had not shown an adequate excuse for not meeting the filing deadline fixed by Section 416 [of the Act], and therefore lost its right to file an answer at all. In short, the case was in a posture as if the employer had filed no answer.
[i]n Dobransky v. Workers' Compensation Appeal Board (Continental Baking Company), 701 A.2d 597 (Pa.[]Cmwlth.[]1997), this Court held that the plurality opinion of DeMarco v. Jones & Laughlin Steel
Corporation, . . . 522 A.2d 26 ([Pa.] 1987), a case in which the Justices of our Supreme Court disagreed as to whether the doctrine of waiver applies to workers' compensation proceedings, is now the accepted view in this Commonwealth and that the strict doctrine of waiver is applicable to workers' compensation proceedings.Mearion v. Workers' Comp. Appeal Bd. (Franklin Smelting & Refining Co.), 703 A.2d 1080, 1081 (Pa. Cmwlth. 1997) (bold emphasis added).
Specifically, Dobransky held that an issue not raised before the WCJ has been waived.
77 P.S. § 821.
In the instant case, at the September 11, 2008 WCJ hearing, the WCJ explained:
Now under Bureau Claim Number 3340267, there is a Claim Petition that seeks total disability or partial disability from April - I'm sorry, from February 14, 2007 on-going. And it is alleging the balance of the injuries that are described in the [NTCP], that being the cervical, the chest wall, injury to the right shoulder and the cerebral concussion. From what I can tell from looking the Bureau documents in this Case, that Bureau Claim Number, 3340267 is the wrong Bureau Claim Number. What I am going to do is dismiss the Claim Petition that is filed under that Bureau Claim Number. That petition will be amended, then - well the petition under the remaining Bureau Claim Number that I discussed first will be amended to include all of the allegations so that nothing is going away, and we will proceed with one Claim Petition under 3105989, which contains the Bureau history. And that petition now seeks benefits for a facial scar, in the form of disfigurement benefits, as well as total or partial disability as it is being alleged from February 14, 2007 on-going for the other injuries as they are set forth in Judge's Exhibit 1 [NTCP]. That would seem to at least bring matters into play as they should be and we won't have to deal with dueling Bureau Claim Numbers. (Whereupon, the documents marked as Judge's Exhibit No. J-2 [NSTCP] and J-3 [NCD] for identification, and were received in evidence.)
MR. RENO [Employer's counsel]: Your Honor, now as far as our answer—
JUDGE PUHALA: Your answer will be amended, obviously, to deny, as it is now.R.R. at 28-30 (emphasis added). This would have been the appropriate time for Claimant to raise the Yellow Freight argument. "Indeed, [Claimant] could have raised this issue before the WCJ . . . after the WCJ [amended Employer's answer] . . . . However, [Claimant] voiced no objection. A review of the record indicates that [Claimant] had ample opportunity to raise its contention[.]" Pennsylvania Turnpike Comm'n v. Workers' Comp. Appeal Bd. (Collins), 709 A.2d 460, 463 n.10 (Pa. Cmwlth. 1998) (wherein Employer's issue was deemed waived on appeal for not having been raised before the Board). Claimant's counsel also could have objected to the amendment and asked that Claimant's resulting Claim Petition be deemed admitted. Instead, Counsel did neither. In fact, not only did Claimant fail to raise this issue at the initial WCJ hearing, he did not raise it at either of the following two WCJ hearings. See N.T., January 6, 2009, February 19, 2009. Because the Yellow Freight default admission of liability "issue [was] not raised before the WCJ[, it] has been waived." Mearion, 703 A.2d at 1081.
MR. RENO: Okay.
JUDGE PUHALA: So just to make sure that I'm clear, we are proceeding under Bureau Claim Number 3105969 only. That Claim Petition is amended on my motion to seek disfigurement benefits for a facial scar suffered on February 14, 2007 and disability from the same date ongoing for other alleged injuries including cervical strain, chest wall contusion, right shoulder sprain and cerebral concussion.
Technically, once the amendment was granted, this argument became moot.
Claimant next maintains that his AWW should have been calculated at $934.67. Specifically, Claimant contends that the WCJ accepted the AWW set forth in the NTCP as opposed to calculating it based on Claimant's submissions, i.e., Claimant's paystubs and calculations.
The WCJ found as a fact in his November 9, 2009 Decision: "Claimant's [AWW] for a 2/14/007 injury date is $883.25 . . . ." WCJ November 9, 2009 Dec. at 1, Finding of Fact No. 6; R.R. at 609. The WCJ footnoted this finding with a reference to Judge's Exhibit 1, the NTCP. However, the Board in its May 17, 2011 Decision opined:
In the instant case, the WCJ determined that Claimant's AWW was $883.25, but he did not explain how he arrived at that amount and why he rejected the amount Claimant alleged was his correct AWW. As such, we can not [sic] exercise meaningful review and we remand the matter and direct that the WCJ make findings as to what the correct AWW should be and explain how he came to such a conclusion.Id. at 24; R.R. at 648.
Thereafter, the WCJ held a remand hearing and, in his March 20, 2012 decision, determined that the "difference between the parties['] calculations is affected by . . . a $2,957.77 gross check Claimant received as 'vacation' pay for the period 5/23/2006 to 5/29/06;" [and] "two checks in December paying Claimant gross amounts of $268.03 for the period 12/11/2006 to 12/17/2006 and $536.06 for the period 12/18/2006 to 12/24/2006. These payments are designated as 'SUB Pay' instead of 'earnings' and are paid in separate checks for those periods from Claimant's earnings checks." Id. at 3-4; R.R. at 656-657. The Board concluded:
Vacation Pay is attributed to the entire year, and prorated on a yearly basis in calculating an average weekly wage instead of allocating it to the quarter paid. Therefore, the $2957.77 vacation pay paid to Claimant on June 8, 2006 should be spread over the year for a weekly amount of $56.88.Id. at 4 (footnote omitted); R.R. at 657. Based on the above, the Board ordered a corrected AWW in the amount of $895.97.
[] Supplemental Unemployment Benefits payments are in the nature of wages and are included in the calculation of an average weekly wage.
Section 309(e) of the Act provides, in pertinent part, that
the amount of any bonus, incentive or vacation payment earned on an annual basis shall be excluded from the calculations under clauses (a) through (d.2). Such payments if any shall instead be divided by fifty-two and the amount shall be added to the [AWW] otherwise calculated under clauses (a) through (d.2).77 P.S. § 582(e) (emphasis added). Further, this Court has held that "SUB payments received by Claimant should [be] included in the calculation of his AWW under [S]ection 309[e] of the Act[.]" Bucceri v. Workers' Comp. Appeal Bd. (Freightcar Am. Corp.), 31 A.3d 985, 992 (Pa. Cmwlth. 2011). Accordingly, we discern no error in the Board's AWW calculation.
Claimant next asserts that Employer violated the Act, thus Claimant is entitled to penalties. Specifically, Claimant contends that Employer failed to comply with the mandates of Section 717.1 of the Act.
Section 435(d) of the Act provides, in relevant part:
The department, the board, or any court which may hear any proceedings brought under this act shall have the power to impose penalties as provided herein for violations of the provisions of this act or such rules and regulations or rules of procedure:77 P.S. § 991(d). "The assessment of penalties, and the amount of penalties imposed are matters within the WCJ's discretion." Gumm v. Workers' Comp. Appeal Bd. (Steel), 942 A.2d 222, 232 (Pa. Cmwlth. 2008).
(i) Employers and insurers may be penalized a sum not exceeding ten per centum of the amount awarded and interest accrued and payable: Provided, however, That such penalty may be increased to fifty per centum in cases of unreasonable or excessive delays. Such penalty shall be payable to the same persons to whom the compensation is payable.
Added by Section 3 of Act of February 8, 1972, P.L. 25.
"However, 'a violation of the Act or its regulations must appear in the record for a penalty to be appropriate.'" Id. (emphasis added) (quoting Shuster v. Workers' Comp. Appeal Bd. (Pa. Human Relations Comm'n), 745 A.2d 1282, 1288 (Pa. Cmwlth. 2000)). "No penalty may be imposed under [Section 435] [of the Act] absent proof of a violation of the Act or the rules of the department or board." Id. (quoting Spangler v. Workmen's Comp. Appeal Bd. (Ford), 602 A.2d 446, 448 (Pa. Cmwlth. 1992)). "Further, a claimant who files a penalty petition bears the burden of proving a violation of the Act occurred. If the claimant meets his or her initial burden of proving a violation, the burden then shifts to the employer to prove it did not violate the Act." Id. (citation omitted).
Claimant cites Jordan v. Workers' Compensation Appeal Board (Philadelphia Newspapers, Inc.), 921 A.2d 27 (Pa. Cmwlth. 2007) to support his position that Employer violated the Act. In Jordan, this Court found the employer violated the Act by issuing an NSTCP and NCP while acknowledging a compensable injury at the same time. Specifically, the Jordan Court held that "an injury was accepted and the only reason that the injury did not result in disability was Claimant's use of his salary continuation benefits[;]" thus, an NCP should have been issued. Id. at 41.
Here, Employer never acknowledged a compensable injury. An NTCP was issued specifically stating that it "is not an admission by your employer that it is responsible for your injury." N.T. September 11, 2008, Ex J-1 (emphasis in original). Thereafter, an NSTCP was issued stating: "WE HAVE DECIDED NOT TO ACCEPT LIABILITY . . . ." N.T. September 11, 2008, Ex. J-2. An NCP was issued contemporaneously stating: "Although an injury took place, the employee is not disabled as a result of this injury . . . ." N.T. September 11, 2008, Ex. J-3. Clearly, a compensable injury was never acknowledged.
Claimant contends the March 14, 2007 note stating Claimant was working restricted duty evidences Employer's acknowledgement of a compensable injury. However, as explained above, the March 22, 2007 log note explained that the statement was incorrect and Claimant was in fact earning his full-time salary. Thus, "the Employer complied with the statute, and the [NTCP] was not converted to a[n NCP]." Gereyes v. Workers' Comp. Appeal Bd. (New Knight, Inc.), 793 A.2d 1017, 1021 (Pa. Cmwlth. 2002). As Claimant did not prove a violation of the Act, and after review a violation of the Act does not appear in the record, he failed to prove his entitlement to penalties.
Claimant further asserts that he is entitled to penalties because Employer violated the Act when it issued a check in the amount of $84.12 as partial payment after Claimant returned to work. We acknowledge that because this payment was issued before the issuance of the NSTCP and the NCD, it was a clear violation of the Act. See Gereyes. However,
[n]ot only does a reading of Section 435 [of the Act] in its entirety indicate the Legislature's intention that notice and hearing be provided on the issue of violations, an interpretation which would allow the imposition of penalties for asserted violations without notice and opportunity to be heard would render the proceedings unfair and therefore constitutionally infirm. We . . . hold that an apparent offender may not be penalized under subsection (d) without notice and an opportunity to be heard on that issue.Jones v. Workmen's Comp. Appeal Bd. (U.S. Steel Corp.), 442 A.2d 37, 39 (Pa. Cmwlth. 1982) (emphasis added) (quoting Crangi Distributing Co. v. Workmen's Comp. Appeal Bd., 333 A.2d 207, 210 (Pa. Cmwlth. 1975)). In the instant case, Claimant did not raise this issue until he filed his July 10, 2009 penalty petition, which was after the record was closed. Thus, Employer did not have an opportunity to be heard on this matter. Accordingly, Employer cannot be penalized for this action.
Employer could have argued as it did in its brief that because Claimant's Claim Petition was denied no compensation was payable. Thus, no compensation was unpaid or untimely as a result of any violation of the Act. As penalties are discretionary with the WCJ, it would have been within the province of the WCJ to resolve the penalty issue. See Gumm.
Lastly, Claimant argues that because he successfully established his claims in Claim Petition 1, i.e., a compensable scar, he is entitled to costs.
Pursuant to Section 440(a) of the Act, 77 P.S. § 996, in any contested case where an insurer contests liability in whole or in part, a WCJ shall award counsel fees to an employee in whose favor the matter has been finally adjudicated unless the employer provides a reasonable basis for the contest. 'Section 440 [of the Act] . . . is intended to deter unreasonable contests of workers' claims and to ensure that successful claimants receive compensation undiminished by costs of litigation.' Eidell v. Workmen's Comp. Appeal Bd. (Dana Corp.), . . . 624 A.2d 824, 826 ([Pa. Cmwlth.] 1993) (citation omitted).Dep't of Transp. v. Workers' Comp. Appeal Bd. (Clippinger), 38 A.3d 1037, 1049 (Pa. Cmwlth. 2011) (footnote and citation omitted; emphasis added). The law is well-settled that "[w]hether a residual injury is serious or unsightly is a question of fact to be determined upon a personal view of the claimant. The WCJ has the first opportunity to do this personal view of the injury to determine its seriousness and unsightliness." Walker v. Workers' Comp. Appeal Bd. (Health Consultants), 42 A.3d 1231, 1236 (Pa. Cmwlth. 2012) (citation omitted).
The issue of whether an employer's contest is reasonable is a legal conclusion based on the WCJ's findings of fact. The reasonableness of an employer's contest depends on whether the contest was prompted to resolve a genuinely disputed issue or merely to harass the claimant.
Added by Section 3 of Act of February 8, 1972, P.L. 25. --------
As aptly opined by the Board:
Because Claimant was required to prove the unsightliness of his disfigurement in order for it to be compensable, and because the length for which benefits were payable was in question, even if [Employer] had accepted the scars as work-related, resolving the disputed issues of unsightliness and the appropriate number of weeks of compensation necessarily required the WCJ to view Claimant's scar. Therefore, because the [Employer's] Answer, at least by implication, raised genuine issues as to the unsightliness of Claimant's disfigurement and the number of weeks of compensation that should be awarded, [Employer's] contest was not unreasonable because those contested issues, and not any improper action on [Employer's] part, prompted the disfigurement-related litigation.Board May 17, 2011 Op. at 22; R.R. at 725. We agree with the Board's reasoning and hold that Employer's contest was prompted to resolve a genuinely-disputed issue, and not merely to harass Claimant. Accordingly, Claimant is not entitled to costs.
For all of the above reasons, the Board's orders are affirmed.
/s/_________
ANNE E. COVEY, Judge
ORDER
AND NOW, this 30th day of July, 2015, the Workers' Compensation Appeal Board's March 28, 2014 and May 17, 2011 orders are affirmed.
/s/_________
ANNE E. COVEY, Judge