State of Connecticut Workers' Compensation Commission, John A. Mastropietro, Chairman
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Lizcano v. Holiday Inn Crowne Plaza

CASE NO. 4036 CRB-07-99-04

COMPENSATION REVIEW BOARD

WORKERS’ COMPENSATION COMMISSION

MAY 24, 2000

JOSE LIZCANO

CLAIMANT-APPELLEE

v.

HOLIDAY INN CROWNE PLAZA

EMPLOYER

and

GALLAGHER BASSETT SERVICES

INSURANCE ADMINISTRATOR

RESPONDENTS-APPELLANTS

CROSS-APPELLEES

and

SECOND INJURY FUND

RESPONDENT-APPELLEE

CROSS-APPELLANT

APPEARANCES:

The claimant was not represented at oral argument. Notice sent to Judith Rosenberg, Esq., Wofsey, Rosen, Kweskin & Kuriansky, 600 Summer Street, Stamford, CT 06901.

The respondents were represented by Kevin Blake, Esq. span class="italic">formerly Cotter, Cotter & Sohon now Berchem, Moses & Devlin, 75 Broad Street, Milford, CT 06460.

The Second Injury Fund was represented by Mee Carolyn Wong, Esq., Assistant Attorney General, 55 Elm Street, P.O. Box 120, Hartford, CT 06141-0120.

These Petitions for Review from the April 16, 1999 Finding and Award of the Commissioner acting for the Seventh District were heard December 3, 1999 before a Compensation Review Board panel consisting of the Commission Chairman John A. Mastropietro and Commissioners Angelo L. dos Santos and Stephen B. Delaney.

OPINION

JOHN A. MASTROPIETRO, CHAIRMAN. The respondents and the Second Injury Fund have both petitioned for review from the April 16, 1999 Finding and Award of the Commissioner acting for the Seventh District. The Fund argues on appeal that the trier erred by ordering it to reimburse the respondents for cost-of-living adjustments (COLAs) paid on the portion of the claimant’s wages attributable to § 31-310 C.G.S. concurrent employment, while the respondents argue that the trier erred in calculating the amount of that payment. We affirm the trial commissioner’s decision, which in our view does not purport to set the amount of the reimbursement.

The claimant injured his left ankle and low back while working for the respondent Holiday Inn Crowne Plaza on October 6, 1988. At that time, he was also working for another employer, the Inn at Mill River. In accordance with a January 16, 1991 voluntary agreement, the claimant’s base weekly compensation rate was set at $313.45. The respondents were statutorily liable for $103.43 of that amount, as the remaining $210.02 was attributable to the claimant’s employment with the Inn at Mill River, and qualified under § 31-310 as a concurrent employment benefit payable by the Second Injury Fund. Section 31-310 (Rev. to 1988) provides:

Where the injured employee has worked for more than one employer at the time of injury and the average weekly wage received from the employer in whose employ he was injured, as determined under the provisions of this section, are insufficient for him to obtain the maximum weekly compensation rate from such employer under section 31-309 prevailing at the time of his injury, his average weekly wages shall be calculated upon the basis of wages earned from all such employers in the period of such concurrent employment not in excess of twenty-six weeks prior to the date of the injury, but the employer in whose employ the injury occurred shall be liable for all medical and hospital costs, a pro rata portion of the compensation rate based upon the ratio of the amount of wages paid by him to the total wages paid the employee in such average week but not less than an amount equal to the minimum compensation rate prevailing at the time of injury and, if he is totally incapacitated, the applicable dependency allowance, if any, due under section 31-308b. The remaining portion of the applicable compensation rate shall be paid from the second injury and assurance fund.

On or about January 16, 1996, a workers’ compensation commissioner signed a Form 44-68 ordering the Fund to reimburse the respondents for its prorated share of the claimant’s benefits. The form listed the amount as “$210.02 for * weeks, a total of $41,447.11” payable to the insurance administrator Gallagher Bassett. Respondents’ Exhibit 2. The trial commissioner found that the Fund actually paid $37,483.60 of that sum, as evidenced by a check dated September 20, 1996. Respondents’ Exhibit 4.

According to the Fund, the reason for the unpaid balance was that the remaining $3,963.51 was remitted to the claimant by the insurance administrator in the form of COLAs, which the Fund contended it did not have to reimburse under the Workers’ Compensation Act. The Fund cited § 31-307a(a) (Rev. to 1988), which states, “The weekly compensation rate of each employee entitled to receive benefits under section 31-307 as a result of an injury . . . which totally disables such employee . . . shall be adjusted annually . . . to provide such injured employee with a cost-of-living adjustment in his weekly compensation rate . . . . Such cost-of-living increases shall be paid by the employer without any order or award from the commissioner.” In the Fund’s view, the failure of § 31-307a to specifically mention the Second Injury Fund absolved it of any responsibility to accept financial liability for COLAs.

The trial commissioner did not share that view. He held that, though § 31-307a(a) does not expressly name the Fund, “it would be inherently inequitable, and inappropriate, to allow the Second Injury Fund to escape responsibility for paying a pro rata share of the cost-of-living increases due to the Claimant in the same percentage as it was obligated to pay the benefits to the Claimant.” Findings, ¶ D. Thus, he ordered the Fund to pay or reimburse the respondents for a portion of the COLAs paid by Gallagher Bassett since the claimant’s injury. Both parties have filed appeals from the trier’s decision.

There is no dispute that, during the intervals of time in which he was totally disabled, the claimant in the instant case was entitled to COLAs for the portion of his weekly compensation that was derived from his wages at the respondent Holiday Inn. At the May 13, 1997 formal hearing, however, the Fund hesitated to acknowledge that the claimant was entitled to adjustments to the amount of his total disability compensation attributable to his concurrent employment earnings at the Inn at Mill River. Transcript, 17. It simply maintained that, whether or not such COLAs were payable, there was no statutory authority that made the Fund liable for them.

Our review discloses no basis upon which to confine the payment of COLAs to the Holiday Inn portion of the claimant’s benefit rate. The concurrent employment provisions of § 31-310 are designed to augment a claimant’s average weekly wage, which is the basis of a claimant’s compensation rate. This statute can operate synchronously with § 31-307a, which adds COLAs to the weekly compensation rates of claimants who are receiving total disability benefits under § 31-307. The COLA provisions do not attempt to exclude from their effect the portion of a compensation rate attributable to concurrent employment earnings, and it would be inconsistent with the remedial tenor of the Workers’ Compensation Act for this board to spontaneously declare that such an exception exists. See Doe v. Stamford, 241 Conn. 692, 697-98 (1997).

The question, then, is who should be held liable for such COLAs. The Fund stresses that § 31-307a requires cost-of-living increases to be paid “by the employer,” and implicitly relies on past cases that have endorsed a narrow construction of provisions implicating Second Injury Fund liability. See, e.g., Civardi v. Norwich, 231 Conn. 287, 294 (1994); Sanders v. GAE Services, 3481 CRB-5-96-11 (April 29, 1998). Indeed, this board has held that this rule of conservative construction supports the Form 44 procedure devised by this commission as a mechanism for insurers to recover reimbursement from the Fund for concurrent employment benefits. Grillo v. Prestige Enterprises, Inc., 13 Conn. Workers’ Comp. Rev. Op. 311, 1704 CRB-1-93-4 (April 25, 1995). “This form clearly contemplates the possibility that the employer’s insurer shall be ordered to pay the claimant the full compensation due him under the Voluntary Agreement, with reimbursement for the prorated share being provided by the Second Injury Fund upon presentation of proof that full benefits have indeed been paid by the insurer.” Id., 314. “[T]he general language in § 31-310 has [no] bearing upon the authority of this commission to protect the interests of the Second Injury Fund by requiring that a Form 44 order be entered by the commissioner before liability ensues.” Id.

The initial liability of the employer for concurrent employment benefits (and, logically, for cost-of-living adjustments to those benefits) pending submission of proper documentation to the Second Injury Fund is not the sole relevant point in this matter, however. We must also remain aware of the purpose behind § 31-310, which protects the income of employees having more than one job, but is not designed to do so at the expense of part-time employers by forcing them to pay benefits calculated on the basis of an employee’s total wages. Going v. Cromwell Fire District, 159 Conn. 53, 56 (1960); Grillo, supra, 314. There is little theoretical justification behind saddling an employer with weekly compensation payments that are disproportionately greater than the amount of money it was paying its employee. Thus, the Second Injury Fund—a financial reserve composed of contributions from all employers in the state—was made responsible for concurrent employment benefits. Presuming that an employer adheres to Form 44 procedure in pursuing reimbursement, the burden of these benefits is shouldered by the business community as a whole. In this way, the legislature sought to protect injured employees without permanently assigning the additional cost to any one employer.

Essentially, a cost-of-living increase is an adjustment made in an employee’s wages that is intended to correspond with a rise in the cost of the basic necessities of life, such as food, shelter and clothing. It is not intended to reflect entitlement to a new form of compensation; instead, its purpose is to allow an employee’s wages to remain stable relative to the society in which he or she lives. Under our Workers’ Compensation Act, COLAs are generally the responsibility of the same party that is liable for the claimant’s disability benefits. On occasion, the Second Injury Fund has been expressly made responsible for the payment of COLAs despite the employer’s retention of liability for the base compensation rate. However, in each of those cases, a law was passed retroactively entitling certain claimants to COLAs, and the legislature determined that it would be improper to apply substantive statutory changes to the liability of private employers for preexisting injuries. See, e.g., P.A. 77-554 (amending § 31-306); P.A. 97-205 (amending § 31-307a). In this instance, the applicable laws regarding concurrent employment benefits and COLAs were already in place on the date of the claimant’s injury. Thus, the party responsible for the payment of the basic disability benefits would inferentially be liable for COLAs as well.

When the Second Injury Fund assumes liability for the payment of compensation benefits, it essentially stands in the shoes of the employer. Casey v. Northeast Utilities, 249 Conn. 365, 377 (1999). Our Supreme Court has stated, “where the employers and the fund are functionally similar, they are treated similarly under our workers’ compensation system. This proposition is in harmony with our prior conclusion that the fund’s obligation to provide timely compensation pursuant to an award is no different that an employer’s obligation to do the same.” Id., 383. In the present matter, the Fund stands in the shoes of the employer for the purpose of paying the portion of his benefit rate attributable to concurrent employment benefits. This includes the derivative responsibility to provide supplementary cost-of-living adjustments to those concurrent employment benefits as required by § 31-307a. The absence of specific language in either § 31-307a or § 31-310 assigning responsibility for such COLAs to the Fund is not suggestive of a contrary legislative intent. The Fund is already liable for the underlying benefit. A natural consequence of that duty is liability for the accompanying COLAs.

Irrespective of our ruling on this point of law, the Second Injury Fund observes that the voluntary agreement signed by both parties and approved on January 18, 1991 includes the following provisions on the back page:

RE: Concurrent Employment Cases
If the injured employee was working for more than one employer on the date of injury, the employer in whose employ he was working at the time of injury is responsible for:
(a) all medical and hospital costs.
(b) the entire weekly compensation rate if his wages for this employer entitle him to the maximum rate.
(c) a pro rata portion of the weekly compensation rate based upon ration amount of wages paid by him to the total wages paid the employee but not less than the minimum rate.
(d) the entire dependency allowance, subject to the statutory limitation and the entire cost-of-living adjustment.

According to the Fund, the language of ¶ (d) obligates the respondents to accept liability for the COLAs at issue in this case, no matter what the general rule may be.

We disagree. Neither of the parties drafted the language of this voluntary agreement form, which is a common document that has been designed and promulgated by this commission. Parties are strongly encouraged to utilize this particular form in reaching preliminary agreements in workers’ compensation cases, as the form explicitly states that it is not a final settlement. See § 31-296. No indication is made in the form that the parties may vary its express terms. We also note that the “official” voluntary agreement form was revised in 1992 to omit the language quoted in ¶ (d) above. Under these circumstances, we do not believe that the respondents should be bound by the content of the “fine print” on a standardized document that they did not author. The Fund has in no way demonstrated that it either relied on this language, or that the respondents expressly accepted that term as part of their agreement with the Fund in this case.

The Fund also argues in its brief that the January 16, 1996 Form 44 was defective as submitted, and that the trier erred by relying upon it in his decision. This assertion is premised on the fact that the commissioner’s signature on the form was undated, an attachment referred to in the form was absent from the record, and that (as recited above) the form provided that the insurance administrator was entitled to “$210.02 for * weeks, a total of $41,447.11.” The number of weeks of benefits was not elsewhere indicated. The Fund contends that these omissions render the Form 44 “incomplete, misleading and, ambiguous at best;” Brief, 7; particularly insofar as there is no reliable method of determining the sum of COLAs that were paid to the claimant.

Though a commissioner must issue a Form 44 order in order for an employer or insurer to obtain reimbursement from the Fund for concurrent employment benefits; Grillo, supra; we have never held that errors or omissions in said form will automatically invalidate it. As with many defective notices, the trial commissioner must determine whether or not the form conveys enough information to accomplish its goal. Here, the Form 44 was approved by Commissioner John Arcudi sometime on or about January 16, 1996, when it was stamped “Received” by the Seventh District. The trial commissioner did not err by treating this document as a valid order for the Fund to repay Gallagher Bassett $41,447.11, and relying on it as proof that such an amount was paid by the insurance administrator. That information was clearly available, despite the absence of a date on the order or an “attached print-out.” The placement of limited reliance on the Form 44 was within the trier’s discretion.

Indeed, the trier wisely compromised with respect to this form. He announced at the formal hearing that he would “not make the dollar amounts the crux of the issue or decision,” in light of the incompleteness of the Form 44 and the uncertainty surrounding the accounting that the respondents had submitted as Exhibit 5.1 Transcript, supra, 14. Importantly, both parties agreed on the record to “resolve the dollars and cents if need be one way or the other in a future date.” Id.; see also Findings, ¶ C. This means that the respondents’ appeal, which concerns the nature of the amounts repaid by the Fund to date, is not yet ripe for determination. The trier intentionally withheld making a firm decision as to the amount of the reimbursement owed by the Fund, pending further negotiation by the parties. We therefore decline to address the issue of the proper amount of the Fund’s reimbursement on appeal.

The trial commissioner’s decision is hereby affirmed.

Commissioners Angelo L. dos Santos and Stephen B. Delaney concur.

1 As stated previously, the claimant was entitled to COLAs for those weeks in which he received total disability benefits, but not for the weeks in which he received payments for his permanent partial impairment award. This delineation cannot be made from the Form 44 itself, and the reliability of the respondents’ accounting was called into question by the Fund’s counsel. Transcript, 13. BACK TO TEXT

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