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By Rhonda A. Rudman, Esquire
There are many unanswered questions regarding earning power assessments performed under Section 306(b)(2) of the Workers Compensation Act. Is earning power an average of potential wages or the highest potential wage? What does an Employer need to prove regarding its burden to offer work to the Claimant? Practitioners have been waiting for the Appellate Courts to address these questions and a multitude of others raised by Act 57 Amendments.
In Caso v. WCAB (School District of Philadelphia), No. 1416 C.D. 2001 (PA Commw.), the Commonwealth Court has addressed for the first time Section 306(b)(2). However, the issue before the Court was quite limited and the case raises more questions than it answers.
In Caso, the Employer filed a Petition to Compel Expert Interview under Section 306(b)(2).The Workers' Compensation Judge concluded that the Bureau of Workers' Compensation had not compiled a list of vocational experts approved by the department in accordance with the Act so that Claimant was not required to submit to a vocational interview. The Workers' Compensation Judge further concluded that he lacked the jurisdiction to approve vocational experts. The Workers' Compensation Appeal Board reversed the Judge's decision, but surprisingly the Commonwealth Court reversed the Board and affirmed the Workers' Compensation Judge.'
The Commonwealth Court cited the language of Section 306(b)(2):
In order to accurately assess the earning power of the employee, the insurer may require the employee to submit to an interview by an expert approved by the department and selected by the insurer.
However, the reasoning of the Court is odd. The Court stated that the legislature did not intend an absurd result. The Court explained:
First, the language of the Section clearly mandates that the vocational experts be approved by the Department prior to the time when the insurer requires the employee to submit to an interview by the expert. Therefore, a process by which a WCJ certifies the vocational expert after the insurer has required the employee to submit to the interview cannot reasonably satisfy Section 306(b)(2)....
Second, the Board's interpretation effectively divests insurers of the authority granted to them by Section 306(b)(2).Instead of having the authority to require employees to submit to an interview, insurers must Petition the WCJ to certify a vocational expert on a case by case basis. Third, the Bureau and WCJ's are not synonymous with the Department....
The impact of Caso is not clear. Under the Caso holding, the WCJ would not have authority to grant a Petition to Compel Expert Interview with a vocational counselor under Section 306(b)(2).Claimant's attorneys are already taking the position that earning power assessments are not valid. However, this conclusion is certainly open to attack.
Section 306(b)(2) indicates only that the insurer may require the employee to submit to an interview by an expert approved by the department and selected by the insurer. This Section does not specifically require that earning power be determined by an approved expert. Arguably then if the Claimant submits to an expert interview or if an expert is able to give an opinion without an interview, an earning power assessment would be valid. We will argue that where Claimant has submitted to an interview there is an effective stipulation regarding the expert and that any argument regarding Department approval has been waived. Moreover, the Caso case may finally spur the Bureau into promulgating a list of approved experts. Finally, this case was only recently decided on January 11, 2002. The appeal period has not yet expired and if an appeal is made, the Pennsylvania Supreme Court may address this issue of first impression. Additionally, the school district could ask for reconsideration by the Commonwealth Court itself.
We at Fried, Kane, Walters, Zuschlag & Grochmal will continue to monitor the situation and provide you with updates. However, earning power assessments have already proved a valid tool and you should continue to consider their utilization on a case by case basis. Where a petition has already been filed, we must consider the cost already expended on an earning power assessment and litigation, potential savings where supersedeas may have been granted and that the Judge may find in the employer's favor versus the risk of penalties or an assessment of counsel fees for an unreasonable contest. The workers' compensation judges have only begun to address this issue as well and consideration can be given to bifurcating this issue before the Judge. Where a case is not in litigation, consideration of obtaining an earning power assessment or filing a petition must address whether there are alternative means of resolution. We can certainly anticipate that the Claimant's bar will be quickly educated regarding this issue and that Claimant's that are represented will not voluntarily submit to an interview. In this situation, Kachinsky job development can be considered as well as settlement and/or conducting an earning power assessment without an interview. We welcome your questions regarding these issues.