Special Workers' Compensation Alert - Pennsylvania
Dana Holding Corporation v. WCAB (Smuck); No. 44 MAP 2019; decided June 16, 2020; by Chief Justice Saylor.
This case concerned the retroactivity of Protz II (Protz v. WCAB (Derry Area School District), 639 PA 645, 161 A.3d 827 (2017)), for cases pending on appeal in which a constitutional challenge to an Impairment Rating Evaluation (IRE) was raised. In this case, following the claimant’s 2000 work-related injury to his back, the employer requested an IRE, which was performed in June of 2014. An impairment rating of 11% was given pursuant to the American Medical Association’s Guides to the Evaluation of Permanent Impairment (Guides), and the employer filed a Modification Petition to convert the claimant from total to partial disability status. The claimant responded with a Review Petition, on the basis that he had not reached maximum medical improvement (MMI). During litigation of the Petitions, Protz I was issued (Protz v. WCAB (Derry Area Sch. Dist.) 124 A.3d 406 (Pa. Cmwlth. 2015)). The Workers’ Compensation Judge (WCJ) ultimately granted the employer’s petition which the claimant appealed to the Workers’ Compensation Appeal Board (Board). The appeal before the Board was stayed, pending the Supreme Court’s decision in Protz II. After Protz II, the Board reversed the WCJ and the claimant’s total disability status was reinstated as of the date of the IRE. The employer then appealed to the Commonwealth Court and they affirmed the Board, holding that Protz II applies at least to all cases in which the underlying IRE was actively being litigated when the decision was issued.
The employer appealed to the Supreme Court and argued that the Commonwealth Court erred in applying Protz II to their case retroactive to the date of the IRE, instead of the date of the Protz II decision itself. The employer further argued that the failure to grant employer credit for the three years between the date of the 2014 IRE evaluation and the date of the Protz II decision violated the employer’s due course of law rights, under the Pennsylvania Constitution.
The Supreme Court rejected the employer’s arguments and dismissed their appeal. The Court held that the Commonwealth Court did not err in applying the Protz II standard to the case on appeal at the time of the Supreme Court’s decision, retroactive to the date of the IRE. According to the Court, a holding that a statute is unconstitutional will generally be applied to cases pending on direct appeal in which the constitutional challenge has been raised and preserved. The Court further affirmed the Commonwealth Court’s holding that the employer’s due course of law rights were not violated by a retroactive application of Protz II because a disability modification is not vested when it remains subject to a preserved challenge pursued by an aggrieved claimant.
Sidebar: For IRE cases that were on appeal at the time of the Protz II decision where the constitutional issue was properly preserved (and may remain pending), the employer will no longer be able to assert a credit for periods of partial disability dating back to the original IRE at issue, as the Supreme Court has pronounced that Protz II, which found the IRE provisions of the Act to be unconstitutional, applied retroactively to the date of the IRE. This decision, however, addresses only those cases on direct appeal at the time Protz II was decided. Further, the Commonwealth Court addressed in Patricia Weidenhammer v. WCAB (Albright College), decided May 14, 2020, that the constitutional issues of the IRE provisions do not allow a claimant full retroactivity; instead a reinstatement petition must be filed within three years of the last payment of compensation OR the case must be in litigation at the time of the the Supreme Court’s decision nullifying the IRE process was in place.
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