Special Workers' Compensation Alert - Pennsylvania

In the recent case of Carl Sadler v. WCAB (Philadelphia Coca-Cola Company); No. 6 EAP 2020; decided Jan. 27, 2021; Justice Donohue, the claimant sustained a work injury on July 2, 2012, and the employer paid benefits pursuant to a Notice of Compensation Payable (NCP). On August 13, 2013, the claimant was charged with a crime in New Jersey and, because he could not post bail, remained in prison for 525 days until January 22, 2015, when he pled guilty. At sentencing, the claimant was given credit for time served and immediately released from custody.

Later, the claimant filed a petition to review his average weekly wage, and the employer filed a suspension petition, contending the claimant was not entitled to benefits during the period of time he was incarcerated. The employer requested that benefits be adjusted to prevent the claimant from being unjustly enriched for the amount he received while he was in prison. The Workers’ Compensation Judge granted the suspension petition, concluding that the employer was entitled to a reimbursement for benefits, but from the Supersedeas Fund and not as a credit against future benefits.

The employer and the claimant appealed. The Workers’ Compensation Appeal Board affirmed but modified the decision, permitting the employer to seek a credit against the claimant’s future payments. The Commonwealth Court, however, granted the claimant’s appeal and reversed the Board’s decision, holding that because the claimant spent no time in incarceration after his conviction, benefits were improperly suspended.

The employer appealed to the Supreme Court of Pennsylvania, and they affirmed the Commonwealth Court. The Supreme Court rejected the employer’s argument that once the claimant was convicted, the time he served in pre-trial detention converted to a period of incarceration served for his conviction, thereby entitling the employer to a suspension of the claimant’s benefits during that period. To the court, the clear language of § 306(a.1) of the Act authorizes the suspension of benefit payments only during periods of incarceration served after a conviction and makes no provision for suspending benefits during periods of incarceration served prior to a conviction. The court further rejected the employer’s argument that § 306(a.1) of the Act violated the Equal Protection guarantees of the Pennsylvania and United States Constitutions on the basis it impermissibly creates two classes of claimants convicted of crimes—those who continue to receive benefits and those who do not. The court held that § 306(a.1)’s distinction was reasonably related to achieving the state interest of denying benefits to those who have removed themselves from the work force due to their criminal conduct, but permitting a continuation of benefits to those presumed innocent and incarcerated because they cannot afford to make bail.

_{What’s Hot in Workers’ Comp is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2021 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact tamontemuro@mdwcg.com.}