Opinion
No. 1707 C.D. 2011
06-08-2012
School District of Philadelphia, Petitioner v. Workers' Compensation Appeal Board (Hyman), Respondent
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE JAMES GARDNER COLINS, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE COHN JUBELIRER
The School District of Philadelphia (Employer) petitions for review of the Order of the Workers' Compensation Appeal Board (Board) that, in relevant part, reversed the determination of a Workers' Compensation Judge (WCJ) granting Employer's Petition to Modify Workers' Compensation (WC) Benefits (Modification Petition). Employer argues that the Board erred in concluding that Robert Hyman (Claimant) did not act in bad faith when he responded to two job referrals with a request for a salary significantly higher than advertised for the position based on M & M Lawn Service v. Workmen's Compensation Appeal Board (Goggin), 630 A.2d 503, 505 (Pa. Cmwlth. 1993). In M & M Lawn Service, this Court held that, without more, "an employee's attempt to negotiate a higher salary . . . does not indicate that the employee was willfully seeking to sabotage a potential job." Employer argues that applying M & M Lawn Service in this case is inconsistent with the Workers' Compensation Act (Act) and its holding should be reconsidered by this Court.
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1 - 1041.4, 2501 - 2708.
Claimant, a high school special education teacher, was injured on October 9, 1991, after an altercation with students. Claimant's left shoulder and chest wall contusions, depression, acute phobia, and anxiety disorder were accepted pursuant to a Notice of Compensation Payable (NCP) and an amended NCP. On April 1, 1994, Employer filed a Modification Petition asserting that, as of May 24, 1993, Claimant was capable of gainful employment. Claimant filed an answer denying the material allegations, and the matter was assigned to the WCJ for hearings. (Findings of Fact (FOF) ¶ 1.)
This matter has been ongoing due to the filing of multiple petitions that have either been withdrawn, resolved or unappealed, and the loss, at one point, of the original record, which has since been recovered.
Employer argued, in relevant part, that Claimant, who had been referred to seven available positions by Target Rehabilitation (Target), failed to follow through on two of those referrals in good faith and, therefore, his WC benefits should be modified. According to Employer's witness, Romy Seiss, M.Ed., a vocational supervisor at Target, Claimant was referred to positions with, inter alia, Pierce Junior College (PJC) and JFK MH/MR (JFK). Ms. Seiss indicated that, in Claimant's cover letter to these potential employers, Claimant requested a yearly salary of $45,000 plus benefits, despite the fact that the salaries listed for PJC and JFK were $31,000 and $25,000 to $29,0000, respectively. Ms. Seiss testified that Target has a Job Development Handbook, which was forwarded to Claimant, in which applicants are told not to ask for a salary that is too high. Ms. Seiss indicated that Claimant did not receive any interviews from the seven referrals. Ms. Seiss stated that Claimant's salary request may have decreased his chances of obtaining a position. (FOF ¶¶ 8-10.)
Claimant testified that he met with a subordinate of Ms. Seiss, who no longer worked for Target, and prepared a resume. Claimant explained that he prepared and sent cover letters to all seven referrals from Target and that, for two of the positions, he requested a salary of $45,000, which was his time-of-injury salary. Acknowledging that his requested salary was higher than the range indicated, Claimant stated that he asked for this salary because the job flier sent with the referral asked for his salary requirement, he thought that he should earn a salary equal to that which he was making with Employer, and the positions asked for a masters or doctoral degree. Claimant indicated that he was unaware that he would receive partial WC benefits if he returned to work in a position that paid less than his time-of-injury position, a statement that the WCJ questioned because Claimant was represented by counsel during this process. Claimant testified that he has not looked for work on his own based on a statement on the back of his WC check, which indicated that he would be subject to a penalty if he received wages and WC benefits. (FOF ¶¶ 11-14; WCJ Hr'g Tr., March 11, 1998, at 29-31, 34-36, 52-54, 57-59, R.R. at 861a-63a, 866a-68a, 884a-86a, 889a-91a.)
The WCJ found that, "[b]y placing his salary requirement on at least two of his cover letters," Claimant disregarded Target's advice to not ask for too high of a salary and that "Claimant knew the approximate salaries yet requested a more inflated salary in at least two of his letters." (FOF ¶ 12.) The WCJ found that, "although Claimant sent a resume and cover letter to each job referred by [Target], Claimant requested . . . a salary of at least $45,000" without "consult[ing] with Target . . . before adding this salary requirement. The two jobs [PJC and JFK] both paid significantly less than $45,000 and Claimant was aware of this." (FOF ¶ 23.) Thus, the WCJ determined that "Claimant did not act in good faith in applying for these jobs," granted the Modification Petition, and modified Claimant's WC benefits as of September 5, 1993, in accordance with the wages he would have earned at PJC. (FOF ¶ 23; Conclusion of Law (COL) ¶ 2.)
Claimant appealed to the Board, arguing that this matter is akin to M & M Lawn Service and the WCJ erred in concluding that Claimant's request for a higher salary, by itself, constituted bad faith. A majority of the Board agreed that, pursuant to M & M Lawn Service, Claimant's inclusion in his letters of a request for a salary of $45,000 "because that was the salary that he earned at his pre-injury job," did not appear to be a "willful[] attempt[] to sabotage his chances of obtaining the jobs with those two employers." (Board Op. at 11.) Chairman Frioni, in a concurring opinion, agreed that the Board properly applied M & M Lawn Service in reversing the WCJ's determination, but wrote separately to "disagree that the application of M & M Lawn Service . . . is consistent with the intent of the [Act]." (Concurring Op. at 1.) While acknowledging that Claimant "did not actually refuse" any of the positions, Chairman Frioni questioned whether any employer would extend serious consideration to an applicant "that requested a salary of $22,000 over the base salary range. Because the requested salary differential is so large, it cannot by a reasonable person standard be considered an application submitted in good faith." (Concurring Op. at 1.) Additionally, Chairman Frioni noted that, had Employer offered Claimant a lower-paying position, Claimant would have been obligated to accept the position and this factor could lead to inconsistent results. (Concurring Op. at 1.) Employer now petitions this Court for review.
"Our review is limited to determining whether an error of law was committed, whether necessary findings of fact are supported by substantial evidence and whether constitutional rights were violated." Moberg v. Workers' Compensation Appeal Board (Twining Village), 995 A.2d 385, 388 n.1 (Pa. Cmwlth. 2010).
Employer argues that M & M Lawn Service should be reconsidered because an employee cannot be found to have acted in good faith where he "requires a salary substantially higher than the one offered by the referred job and that salary requirement prevents the injured employee from being considered for the referred job." (Employer's Br. at 5.) In making a salary request that was too high, Employer contends that Claimant "might as well not have submitted any applications to [PJC] or [JFK]." (Employer's Br. at 9.) Employer contends that Claimant was not attempting to negotiate a higher salary as was the situation in M & M Lawn Service. Moreover, Employer asserts that, had it offered Claimant a position that paid substantially less than Claimant's pre-injury earnings, Claimant would have been obligated to accept the position under Kachinksi v. Workmen's Compensation Appeal Board (Vepco Construction Co.), 516 Pa. 240, 532 A.2d 374 (1987), superseded in part by statute, see Riddle v. Workers' Compensation Appeal Board (Allegheny City Electric, Inc.), 603 Pa. 74, 981 A.2d 1288 (2009), and that Claimant's actions here are equivalent to rejecting a position with Employer in bad faith.
Because Claimant's injury occurred in 1991, the standard set forth in Kachinski still applies in this matter, Riddle, 603 Pa. at 82 n.8, 981 A.2d at 1292 n.8, which requires:
1. The employer who seeks to modify a claimant's benefits on the basis that he has recovered some or all of his ability must first produce medical evidence of a change in condition.Kachinski, 516 Pa. at 252, 532 A.2d at 380 (emphasis added). The employer's referrals "must be tailored to the claimant's abilities . . . and be made in a good faith attempt to return the injured employee to productive employment, rather than a mere attempt to avoid paying compensation." Id. (citation omitted). Moreover, the claimant "must make a good faith effort to return to the work force when they are able, and their benefits can be modified for failure to follow up on referrals or for willfully sabotaging referrals." Id. "[W]hether Claimant responded in good faith to the job referrals . . . . [is a] determination . . . of fact to be determined by the WCJ." J.E. Houck Ambulance Service v. Workers' Compensation Appeal Board (Bowser), 719 A.2d 840, 842 (Pa. Cmwlth. 1998).
2. The employer must then produce evidence of a referral (or referrals) to a then open job (or jobs), which fits in the occupational category for which the claimant has been given medical clearance, e.g., light work, sedentary work, etc.
3. The claimant must then demonstrate that he has in good faith followed through on the job referral(s).
4. If the referral fails to result in a job then claimant's benefits should continue.
In M & M Lawn Service, the employer sought to modify the WC benefits of the claimant on the basis that she had acted in bad faith when, in responding to three job referrals from the employer, she requested $5.00 to $7.00 per hour when she knew the positions paid $3.70 per hour. M & M Lawn Service, 630 A.2d at 504. The claimant, who had been earning $8.20 per hour prior to her injury, believed that her wage requests were reasonable. Id. The employer argued that the claimant's request for a higher hourly wage "was tantamount to refusing the positions" in bad faith. Id. Noting that the claimant testified that the employment application she was given asked what salary she desired, she would not have provided a salary request if the application did not request this information, and there was no evidence in the record that she "intentionally demanded a higher salary in order to sabotage her chances of being hired," this Court affirmed the denial of the employer's modification petition. Id. at 505. We concluded that the "[c]laimant's salary request was no more than an honest response to a question on . . . [the] employment application." Id. Moreover, we disagreed with the employer's argument that the claimant's request "was, in itself, tantamount to refusing the positions," holding that "an employee's attempt to negotiate a higher salary, without more, does not indicate that the employee was willfully seeking to sabotage a potential job." Id. (emphasis added).
According to Employer, Claimant, unlike the claimant in M & M Lawn Service, was not making his salary request in an effort to negotiate a better salary and this Court should look at the whole picture, not just Claimant's salary demand, in determining whether Claimant acted in good faith. The question here is whether Claimant's actions constituted the "more" determined to be missing in M & M Lawn Service, such that Claimant's request for a higher salary is distinguishable from that of the claimant in M & M Lawn Service. Here, Target presented Claimant with seven job referrals, to which Claimant responded with cover letters and resumes. As in M & M Lawn Service, Claimant provided the amount he desired, which he testified that he thought was reasonable for the advertised position and his experience. (WCJ Hr'g Tr. at 30-31, 52-54, R.R. at 862a-63a, 884a-86a.) For those referrals that did not request a salary requirement, Claimant did not submit a specific salary amount. (WCJ Hr'g Tr. at 30-31, 52-54, R.R. at 862a-63a, 884a-86a.) The amount Claimant requested was based on his prior earnings as a teacher with a master's degree in education, a salary, as in M & M Lawn Service, that was related to Claimant's employment history. However, unlike in M & M Lawn Service, where the claimant did not ask for the full salary that she had earned prior to her injury, thereby taking into consideration the lower wages offered by potential employers, Claimant here asked for his full salary, without adjustment. Moreover, unlike in M & M Lawn Service, the evidence here establishes that Claimant was advised by Target, through its Job Development Handbook, not to have "salary expectations [that] are too high," not to be "interested only in [the] best dollar offer," and to obtain as many interviews as possible, despite dissatisfaction with initial salary numbers. (Job Development Handbook at 2, 10, 11.) Given these factors and Chairman Frioni's observation that Claimant's salary request was so large, $22,000 over the base salary range, that "it cannot by a reasonable person standard be considered an application submitted in good faith," (Concurring Op. at 1), we agree with Employer that the whole picture reveals that Claimant's conduct constitutes "more" than simply attempting to negotiate a higher salary rendering M & M Lawn Service inapplicable. We conclude, therefore, that the WCJ's finding of bad faith in this matter was supported by substantial evidence and was not erroneous.
Because we conclude that M & M Lawn Service is factually distinguishable from this matter, it is not necessary for this Court to reconsider its holding in M & M Lawn Service as Employer requests. --------
Claimant argues that the Board's Order should be affirmed, alternatively, because: (1) Employer failed to establish that Claimant had a change in his condition that would enable him to return to modified-duty work; and (2) the WCJ erred in relying on the impermissible hearsay testimony of Ms. Seiss. However, having concluded that M & M Lawn Service required reversal, the Board did "not consider Claimant's remaining arguments with respect to the merits of that Petition." (Board Op. at 11 n.4.) Therefore, we must remand to the Board to consider Claimant's other arguments. Dowhower v. Workers' Compensation Appeal Board (Capco Contracting), 934 A.2d 774, 778-79 (Pa. Cmwlth. 2007) (stating that "[t]he Board, not this Court, must review the various decisions of the WCJ before this Court can undertake its appellate review" because "this Court is charged with reviewing Board decisions, not WCJ decisions.").
Accordingly, the Board's Order is reversed, and this matter is remanded to consider Claimant's remaining arguments regarding why the WCJ erred in granting Employer's Modification Petition.
/s/ _________
RENÉE COHN JUBELIRER, Judge Senior Judge Colins dissents. ORDER
NOW, June 8, 2012, the Order of the Workers' Compensation Appeal Board (Board) in the above-captioned matter is hereby REVERSED, and this matter is REMANDED to the Board to consider Robert Hyman's remaining arguments that the Workers' Compensation Judge erred in granting the School District of Philadelphia's Petition to Modify Workers' Compensation Benefits.
Jurisdiction relinquished.
/s/ _________
RENÉE COHN JUBELIRER, Judge