BRIEF FOR APPELLANT: Jo Alice Van Nagell Lori V. Daniel Lexington, Kentucky BRIEF FOR APPELLEE MARIO HOLGUIN: Larry D. Ashlock Lexington, Kentucky
NOT TO BE PUBLISHED
PETITION FOR REVIEW OF A DECISION
OF THE WORKERS' COMPENSATION BOARD
ACTION NO. WC-12-01160
BEFORE: MAZE, MOORE, AND VANMETER, JUDGES. MOORE, JUDGE: Quad/Graphics, Inc. petitions for review of an opinion of the Workers' Compensation Board. At issue is whether Quad/Graphics is entitled to an offset for light duty wages it paid to an employee during a period for which he was also awarded temporary total disability benefits.
During the course of his employment at Quad/Graphics, Mario Holguin sustained a work-related injury when he caught his finger in a machine, severing the tip. The injury occurred on December 27, 2011. He underwent surgery the same day to reattach it and returned to work on light duty the next day. He continued on light duty through February 12, 2012, checking books, painting and performing odd jobs. The Administrative Law Judge (ALJ) found it was undisputed that none of the light duty tasks assigned to Holguin was necessary or significantly beneficial to the employer. Employees on light duty at Quad/Graphics were allowed to work a maximum of forty hours per week and were not permitted to work overtime. Holguin's average weekly wage before the injury was $725.75, and during the period of light duty $532.87. Quad/Graphics continued to carry the cost of Holguin's employee benefits during the light duty period.
The ALJ awarded Holguin temporary total disability (TTD) benefits in the amount of $483.83 per week from December 28, 2011, to February 12, 2012, because he had not reached a point of maximum medical improvement and was not physically able to perform his customary or pre-injury work during that period. The ALJ further held that the wages paid to Holguin during the light duty period did not qualify for a credit against the TTD benefits. The Board affirmed the opinion, award and order of the ALJ, and this petition for review by Quad/Graphics followed.
The function of further review of the WCB [Workers' Compensation Board] in the Court of Appeals is to correct the Board only where the Court perceives the Board has overlooked or misconstrued controlling statutes or precedent, or committed an error in assessing the evidence so flagrant as to cause gross injustice.
Western Baptist Hosp. v. Kelly, 827 S.W.2d 685, 687-88 (Ky. 1992).
The sole issue on appeal is whether the Board erred in affirming the ALJ's holding that Quad/Graphics was not entitled to an offset of the wages paid to Holguin.
"An employer seeking credit against its workers' compensation liability has the burden to show a proper legal basis for the request." Millersburg Military Inst. v. Puckett, 260 S.W.3d 339, 342 (Ky. 2008). Kentucky Revised Statutes (KRS) 342.730 provides for two circumstances in which an employer can receive a credit against its TTD benefits obligation. Subsection (5) permits an offset for unemployment insurance benefits paid during any period of TTD or permanent total disability. Subsection (6) requires an offset for payments made under a qualifying employer-funded disability or sickness and accident plan. The ALJ refused to award a credit because neither of these subsections was applicable in Holguin's case.
Quad/Graphics argued to the Board that an offset was nonetheless justified under Millersburg Military Inst. v. Puckett, 260 S.W.3d 339 (Ky. 2008). In that case, the claimant was injured, received voluntary TTD benefits, returned to work, received TTD again and returned to work until his employer cut his time down to two hours per day and assigned him tasks he could no longer perform. The ALJ found that he was permanently and totally disabled from the date of the injury and awarded him TTD benefits of $201.44 per week for two years from the date of the injury. The employer contended that the award should have been offset by the post-injury wages he had received during that period. The Kentucky Supreme Court disagreed, explaining that the employer had confused wages and benefits. "Wages are paid for performing labor; income benefits are paid for work-related disability. The claimant's wages were 'bona fide' because they were paid ostensibly for labor and because the evidence did not permit a reasonable finding that the employer intended to pay them in lieu of workers' compensation benefits." Puckett, 260 S.W.3d at 342. Quad/Graphics argues that it was entitled to an offset because the light duty wages it paid to Holguin were not for bona fide work and were paid to him in lieu of temporary total disability benefits.
The Board held, as a matter of law, that the wages paid to Holguin were bona fide wages. It stated that
[t]he fact an employee is performing "make work" is relevant to an analysis of whether the employee had returned to his customary employment, for purposes of qualifying for TTD benefits. It is not relevant to an analysis of bona fide wages.
Maynard [the safety coordinator at Quad/Graphics] testified Holguin would not have been paid if he did not report to work during the period in question. This
testimony was not rebutted. The undisputed testimony is Holguin was required to be present at Quad in order to receive his wages. The fact Quad did not have meaningful work for Holguin to perform within his restrictions does not change the nature of the wages paid.
Quad/Graphics contests the Board's conclusion, largely on public policy grounds, arguing that light duty wages are preferable to TTD benefits because the employee receives a full salary and his benefits continue to be paid by the employer. Quad/Graphics contends that the Board's broad definition of bona fide wages undermines the purpose of TTD benefits as income replacement.
It is undisputed that Holguin met the definition of TTD: "the condition of an employee who has not reached maximum medical improvement and has not reached a level of improvement that would permit a return to employment." KRS 342.0011(11)(a). There is no evidence that the light duty wages were not intended to be "bona fide" wages, but were paid to him with the intent that they would replace his TTD benefits.
Although Quad/Graphics' public policy arguments may be well founded, we must agree with the Board that the workers' compensation statutes simply do not permit a credit such as the one requested in this case. "[W]orkers' compensation is a statutory creation. Thus, the proper forum for the argument is the legislature." Rager v. Crawford & Co. 256 S.W.3d 4, 6 (Ky. 2008).
The opinion of the Workers' Compensation Board is affirmed.
ALL CONCUR. BRIEF FOR APPELLANT: Jo Alice Van Nagell
Lori V. Daniel
BRIEF FOR APPELLEE
Larry D. Ashlock