CASE NO. 5030 CRB-1-05-11
COMPENSATION REVIEW BOARD
WORKERS’ COMPENSATION COMMISSION
JANUARY 9, 2007
JANICE EDWARDS, surviving spouse of RALPH EDWARDS, decedent
UTC/PRATT & WHITNEY
LIBERTY MUTUAL INSURANCE CO.
The claimant was represented by Stephen Embry, Esq. Embry & Neusner, 118 Poquonnock Road, P.O. Box 1409, Groton, CT 06340-1409.
The respondents were represented by Marian H. Yun, Esq., Law Offices of Rosenbaum & Vollono, 655 Winding Brook Drive, Glastonbury, CT 06033.
This Petition for Review1 from the November 8, 2005 Finding and Award of the Commissioner acting for the Eighth District was heard June 23, 2006 before a Compensation Review Board panel consisting of Commission Chairman John A. Mastropietro and Commissioners Donald H. Doyle, Jr., and Nancy E. Salerno.
JOHN A. MASTROPIETRO, CHAIRMAN. The respondents have petitioned for review from the November 8, 2005 Finding and Award of the Commissioner acting for the Eighth District. They contend on appeal that the trier erred by awarding the claimant cost-of-living adjustments (COLAs) retroactive to the decedent’s date of injury as opposed to the date the claimant filed her claim for survivor’s benefits. We find no error, and affirm the trial commissioner’s decision.
The decedent suffered a compensable injury to his lungs on November 24, 1999. A voluntary agreement was approved on January 29, 2001, with a compensation rate of $301.81 per week. The decedent died on or about March 4, 2004, as a result of work-related pulmonary asbestosis. The claimant, the decedent’s surviving spouse, filed a Form 30C on March 16, 2004, seeking benefits pursuant to § 31-306 C.G.S. The parties agreed that the claimant was entitled to such benefits commencing on March 5, 2004, at the base compensation rate of $301.81 per week. The respondents also applied COLAs to that compensation rate commencing on October 1, 2004. They have refused to pay COLAs retroactive to October 1, 2000. The trial commissioner determined that COLAs should be calculated as of the date of the decedent’s injury, and ordered the respondents to pay COLAs retroactively to October 1, 2000, along with statutory interest under § 31-300 C.G.S. and penalties mandated by § 31-303. The respondents have appealed that decision to this board.
The relevant statutory language is found in § 31-306(a)(2), which states that individuals wholly dependent upon the deceased employee as of the employee’s injury date shall receive weekly compensation equal to 75% of the after-tax average weekly earnings of the deceased. Annual COLAs are then introduced by explaining, “The weekly compensation rate of each dependent entitled to receive compensation under this section as a result of death arising from a compensable injury occurring on or after October 1, 1977, shall be adjusted annually as provided in this subdivision as of the following October first, and each subsequent October first, to provide the dependent with a cost-of-living adjustment in the dependent’s weekly compensation rate as determined as of the date of the injury under section 31-309.” These COLAs are calculated based upon changes in the maximum compensation rates. “If the maximum weekly compensation rate, as determined under the provisions of said section 31-309, to be effective as of any October first following the date of the injury, is greater than the maximum weekly compensation rate prevailing at the date of the injury, the weekly compensation rate which the injured employee was entitled to receive at the date of the injury or October 1, 1990, whichever is later, shall be increased by the percentage of the increase in the maximum weekly compensation rate required by the provisions of said section 31-309 from the date of the injury or October 1, 1990, whichever is later, to such October first.”2
The respondents argue on appeal that, for the purpose of a surviving spouse’s claim, the operative date of injury pursuant to § 31-306(a) is the date of the decedent’s death rather than the date of the decedent’s injury. They support this argument by observing that § 31-294c gives the surviving dependent spouse one year from the date of death to file a claim, which requires separate notice pursuant to Tardy v. Abington Constructors, Inc., 71 Conn. App. 140 (2002). As such, the respondents maintain that COLAs were not due in this case until October 1, 2004, which was the first statutory COLA adjustment date following the decedent’s March 4, 2004 demise. “To find that the widow was entitled to COLA benefits ‘retroactively to October 1, 2000,’ is to award her benefits prior to the date upon which her claim becomes vested.” Brief, p. 5. As a means of further bolstering their argument, they point out that the decedent was not entitled to COLAs on the temporary total disability benefits he received prior to his death, as he had not been totally disabled for five years as required by § 31-307a(c).
The language of the relevant statutes and the concept underlying cost-of-living adjustments are both inconsistent with the result that the respondents seek. Section 31-306(a) clearly references the weekly compensation rate “which the injured employee was entitled to receive at the date of the injury,” and immediately thereafter states that said rate “shall be increased by the percentage of the increase in the maximum weekly compensation rate required by the provisions of said section 31-309 from the date of the injury . . . to such October first.” The statute also provides the dependent with a COLA in the dependent’s weekly compensation rate “as determined as of the date of the injury under section 31-309.” Section 31-309, in turn, refers to the “year in which the injury occurred,” and sets the time of injury for occupational diseases as the “date of total or partial incapacity to work.” Dependents are thus entitled to COLAs in the weekly compensation rate, and those COLAs reflect changes in the maximum weekly wage since the date of the injured employee’s injury.
There is no ambiguity in this language that would support reading “the date of the injury” as the date of the decedent’s death. Our holding in Belanger v. American Optical, 3353 CRB-1-96-5 (January 22, 1998), in which we held that entitlement to COLAs is dependent on the injured worker’s date of injury rather than the date of the decedent’s death, is instructive. The existence of a separate limitations period for filing a notice of a survivor’s claim under § 31-294c does not disengage the calculation of the weekly wage for survivor’s benefits, including COLAs, from the date of the employee’s injury. See, e.g., Gauthier v. State/Uncas-on-Thames, 4779 CRB-2-04-2 (April 1, 2005)(dependent was entitled to COLA increases in decedent’s average weekly wage calculated from point of retirement forward). The language of the statute consistently bears out that analysis.
Also, a cost-of-living adjustment is by definition a comparison of dollar values between the past and the present, whose purpose is to translate a wage recipient’s compensation to present-day dollars, thereby preserving the relative value of that compensation rate in light of cost-of-living increases in the economy over time. See Black’s Law Dictionary, 6th Ed. (“cost of living clause” refers to contractual or statutory benefit provisions giving automatic wage or benefit increases tied to cost-of-living rises). In our Workers’ Compensation Act, the COLA is created by comparing the maximum weekly wage on the date of an employee’s injury with the maximum applicable to the year in which benefits are being received. See Meyer v. Raybestos Products Co., 3610 CRB-8-97-05 (October 20, 1998). If an injured employee’s compensation rate, which is set at the time of injury, were treated as having been set at the time of the employee’s death (as the respondents propose), changes in the value of that compensation rate between the year of injury and the year of death would be left unaddressed.
The adoption of such an approach would interfere with the purpose of keeping a claimant’s compensation rate adjusted to present-day value. Thus, where our statute delays entitlement to COLAs until a later date, such as in § 31-307a, the subsequent calculation of those COLAs dates back to the original time of injury “as if such benefits had been subject to recalculation annually,” with a lump sum payable for the COLAs that would have been accrued during the interim five-year period of total disability, had they been payable all along. Where death is caused by a compensable injury, it would be consistent with this approach to calculate the survivor’s compensation rate in the same manner, even though no lump sum COLA payment would be due under § 31-306(a)(2) for the period of total disability preceding death.
The calculation of COLAs should thus take place as follows: the base compensation rate of $301.81 should be adjusted for increases in the maximum weekly wage that occurred beginning on October 1, 2000, as per § 31-306(a)(2)(A). That compensation rate, adjusted through the October 1, 2003 increase in the maximum weekly wage, would have governed the benefits due the claimant commencing on March 5, 2004. Each succeeding October 1, the compensation rate would then be subject to recalculation based upon further changes in the maximum weekly wage under § 31-309.3
The respondents also challenge the trier’s award of statutory interest pursuant to § 31-300 and § 31-303 C.G.S. A Joint Stipulation of Facts and Proposed Order was approved on February 8, 2005, establishing the claimant’s entitlement to survivor’s benefits. The parties had agreed that the claimant would begin receiving benefits commencing on March 5, 2004, and that they would pay her benefits “at the base compensation rate of $301.81 plus cost of living adjustments until she remarries or upon death.” Findings, ¶ 5b. The trial commissioner found that the respondents had partially complied with the order by making COLA adjustments beginning on October 1, 2004, rather than October 1, 2000. He ruled that the claimant was entitled to interest on those underpaid COLAs as per § 31-300, along with penalties as prescribed by § 31-303.
The respondents now argue that no findings exist to support the contention that they were guilty of undue delay or unreasonable contest under § 31-300. They also note that there are no findings to support an award of interest as per § 31-300 or § 31-303. They contend that there was no undue delay following the February 8, 2005 order, which was nonspecific as to the date from which COLAs would be calculated, and that any underpayment of COLAs was due to a genuine disagreement between the parties regarding the correct interpretation of the law.
Section § 31-306(a)(2)(A) requires the payment of COLAs “without any order or award from the commissioner.” By statute, they are payable once the claimant becomes entitled to the payment of benefits. Section 31-300 allows the commissioner to award interest “at such rate, not to exceed the rate prescribed in section 37-3a, as may be fair and reasonable” where there has been undue delay in adjustment or payment that is not due to the fault or neglect of the employer or insurer. It also allows interest at the rate prescribed in § 37-3a where there has been undue delay in payment because of the employer or insurer’s fault or neglect. As for § 31-303, it states that payments due under an award must commence within twenty days from the date of such award, with a 20% penalty being due for each late payment “in addition to any other interest or penalty imposed pursuant to the provisions of this chapter.” A finding of fault or neglect is not a prerequisite for an award of § 31-303 penalties.
There was an award in place directing the respondents to pay COLAs. It did not specify a particular amount to be paid. The respondents subsequently adopted a calculation method that underpaid the claimant. We have held in the past that, in the absence of an award obliging a respondent to pay retroactive COLAs, § 31-303 was not triggered under the statute. Melendez v. Valley Metallurgical, 4178 CRB-2-00-1 (May 1, 2001), appeal dismissed, A.C. 23921 (May 14, 2003), cert. denied, 266 Conn. 904 (2003). In contrast, there was an award in place here. Even though it was not specific as to an amount, it created the obligation to pay the COLAs that were due under § 31-306(a). Having adopted an interpretation of that order that was to their financial advantage, the respondents are now accountable for the collateral consequences of a later determination that their payments were insufficient. This includes liability for penalties under § 31-303.
As for § 31-300, without a finding of undue delay due to fault or neglect, we would have to presume that the trier was awarding interest for delay without fault or neglect on the part of the employer or insurer. It is unclear whether the issue of undue delay was even properly raised; the hearing notices do not reflect the issue, but there is no transcript from the proceedings below. See Capozzo v. Milford Jai Alai, 4655 CRB-3-03-3 (March 26, 2004)(finding of undue delay reversed because of inadequate notice). Either way, undue delay is not mentioned in the trier’s decision.
Where interest is awarded under § 31-300 without a finding of undue delay, the commissioner is required to provide the employer or insurer with an opportunity to demonstrate that a “fair and reasonable” interest rate would be less than the rate prescribed in § 37-3a. Izzo v. American Compressed Gases, 4678 CRB-3-03-6 (August 5, 2004). The burden is on the employer or insurer to advocate for a lower-than-statutory rate. However, the respondents did not raise the issue of the interest rate in their motion to correct, nor did they move to submit evidence favoring a lower rate of interest than that prescribed by § 37-3a (as was done in Izzo, supra). The respondents instead challenged the entire § 31-300 interest award based on an absence of undue delay or unreasonable contest. As § 31-300 allows for an interest award without a finding of employer fault, and the respondents have not objected to the amount of interest awarded within the context of what is “fair and reasonable,” we uphold the award of interest under § 31-300.
The trial commissioner’s decision is accordingly affirmed. Insofar as benefits due have remained unpaid pending the outcome of this appeal, interest is awarded as required by § 31-301c(b).
Commissioners Donald H. Doyle, Jr., and Nancy E. Salerno concur.
1 We note an extension of time was granted during the pendency of this appeal. BACK TO TEXT
2 Section 31-306(a)(2) adds that “The cost-of-living increases provided under this subdivision shall be paid by the employer without any order or award from the commissioner. The adjustments shall apply to each payment made in the next succeeding twelve-month period commencing with the October first next succeeding the date of the injury.” BACK TO TEXT
3 The respondents have briefed the argument that the trier’s Finding and Award was ambiguous with respect to whether the claimant’s underlying date of injury or the date of death should be used to calculate the COLA adjustment, and assert that this issue should have been articulated further. We disagree. In the context of this claim, the trier’s holding that the claimant is entitled to COLAs retroactively to October 1, 2000 entails the use of the November 24, 1999 date of injury as a basis for calculating those COLAs, with payments due beginning on March 5, 2004, reflecting the decedent’s base compensation rate plus changes in the cost of living from the date of injury through October 1, 2003. Also, as the decedent’s estate did not seek COLAs pursuant to § 31-307a for the temporary total disability benefits that the decedent had been receiving prior to his death, the payment of retroactive COLAs from October 1, 2000 through March 4, 2004 is not an issue under the Finding and Award. BACK TO TEXT