Even an Application for Pension May Cause Impact to PA Workers’ Comp Benefits

Whether an injured worker in PA has “voluntarily withdrawn from the labor market” has been a frequent topic on this blog. There has been a great deal of litigation on this issue in the appellate courts over the past several years. We are seeing that the details and facts in each case really have great meaning for which way the courts may decide.

In City of Pittsburgh v. Workers’ Compensation Appeal Board (Marinack), we saw some additional clarification of the relative burdens of proof in this situation. Here, the injured worker, a firefighter, suffered a rotator cuff tear in his shoulder, an aggravation of degenerative disc disease in his lumbar spine, and anxiety and depression. The injured worker filed for a disability pension, but was ineligible because he was terminated for cause.

The workers’ comp insurance carrier filed a Petition for Suspension, alleging that the fact the injured worker filed for a disability pension meant that he was voluntarily leaving the labor market. In such a case, the workers’ comp insurance carrier would not be required to prove job availability to obtain relief. The Workers’ Compensation Judge (WCJ) agreed that Claimant had voluntarily left the labor market. Further, the WCJ found that the injured worker did not prove he was looking for work, so the WCJ granted the Suspension Petition.

On appeal, the Workers’ Compensation Appeal Board (WCAB) reversed the decision of the WCJ. The WCAB concluded that the WCJ had erred in finding that the injured worker had “retired.” The fact that the injured worker did not receive the disability pension meant that he did not “accept” the pension. Thus, since the injured worker did not retire, the burden remained on the workers’ compensation insurer to prove job availability. Since no job availability was shown, the Suspension Petition must be denied.

When the workers’ comp insurance carrier appealed to Commonwealth Court of Pennsylvania, it argued the WCAB had erred in finding that the injured worker’s attempt to collect the pension, whether successful or not, could show that the injured worker intended to leave the labor market, or, in other words, retire. Interestingly, the Court agreed with the employer, but, the result remained unchanged.

While the Court agreed the attempt to obtain a pension can be enough to trigger a withdrawal from the labor market, the pension in this case was a DISABILITY pension, as opposed to a RETIREMENT pension, and there is a vast difference in the effects of collecting each. Since this was a disability pension, the workers’ comp insurance carrier still had the burden to show the injured worker does not intend to return to work. No evidence was presented by the workers’ compensation insurance company in that regard, so the Suspension Petition still must fail. Note that when an injured worker accepts a retirement pension, there is a presumption that the injured worker has left the labor market, meaning the burden of proof shifts to the injured worker to prove that he or she is actually looking for work (or that he or she is totally disabled from all employment).