Labor Market Surveys and Earning Power Assessments When The Injured Worker Lives Outside Pennsylvania

In year’s past, before 1996, when a workers’ compensation insurance carrier wanted to reduce an injured worker’s benefits in PA, the insurance carrier had to refer the injured worker to jobs, which then had to be open and available to the injured worker. This process was set forth not by the Pennsylvania legislature, but by the Supreme Court of PA in Kachinski v. Workers’ Compensation Appeal Board, decided in 1981.

This process changed in 1996, when the PA legislature amended the Pennsylvania Workers’ Compensation Act. No longer does a workers’ comp insurance company have to actually refer an injured worker to a then-open job. Instead, the PA legislature opted for a system more like that used by the Social Security Administration in Social Security Disability cases. All that is required to be proven to modify workers’ compensation benefits is that suitable employment is generally available to the injured worker in the injured worker’s usual employment area.

This involves the use of “Labor Market Surveys (LMS),” also known as “Earning Power Assessments (EPA).” The injured worker is not referred to any specific job at all. The vocational expert retained by the workers’ comp insurance company just gathers data of jobs generally available in the geographic area of the injured worker. The premise is that if the injured worker wanted to look for work, these are the types of jobs the injured worker could find.

Recently, the Supreme Court of Pennsylvania addressed this issue again, in Riddle v. Workers’ Compensation Appeal Board (WCAB). More specifically, the Court addressed what geographic area must be used for the LMS or the EPA, if the injured worker resides out of the State of Pennsylvania.

In the Riddle case, the injured worker lived in West Virginia, but listed an Ohio address on his driver’s license. Mr. Riddle actually worked in Pittsburgh, which is where the injury took place. The vocational expert created a LMS/EPA focusing on where the injured worker was living, rather than where the injury took place. No jobs listed in the LMS/EPA were located in Pittsburgh.

The Workers Compensation Judge (WCJ) granted the workers’ comp insurance carrier’s Petition to Modify Benefits, based on the LMS/EPA. This was affirmed by both the WCAB and the Commonwealth Court of Pennsylvania. However, on appeal, the decision was reversed by the Supreme Court of PA.

Using the actual language of the Pennsylvania Workers’ Compensation Act, the Court found that if an injured worker resides out of PA, “the usual employment area where the injury occurred shall apply.” Since the injury occurred in Pittsburgh, Pennsylvania, the LMS/EPA, which focused on West Virginia, was insufficient, as a matter of law, to justify a modification of benefits. As such, the decision granting the Modification Petition was reversed.