Tinsley v. J. M. Ney Company

CASE NO. 1554 CRB-1-92-11

COMPENSATION REVIEW BOARD

WORKERS’ COMPENSATION COMMISSION

SEPTEMBER 16, 1994

JEROME TINSLEY

CLAIMANT-APPELLEE

v.

J. M. NEY COMPANY

EMPLOYER

and

AETNA CASUALTY & SURETY

INSURER

RESPONDENTS-APPELLANTS

APPEARANCES:

The claimant was represented by Kenneth L. Shluger, Esq., 221 Main Street, Hartford, CT 06106.

The respondent-employer was represented by Gary R. Atkinson, Esq., Law Offices of Anthony J. Palermino, 945 Wethersfield Avenue, Hartford, CT 06114. The respondent-insurer did not participate in the proceedings below but did appear at oral argument although no brief was filed.

This Petition for Review from the November 5, 1992 Finding and Award of the Commissioner for the First District was heard August 13, 1993 before a Compensation Review Board panel consisting of Commissioners John A. Arcudi, Donald H. Doyle, Jr. and Nancy A. Brouillet.

OPINION

JOHN A. ARCUDI, COMMISSIONER. This appeal seeks to have the commissioner interpret an Extended Illness Income Protection Plan provided by the respondent employer for its employees. The commissioner ordered the claimant to reimburse the employer for four weeks of compensation, but denied the employer’s claim for reimbursement from the specific award.

A Voluntary Agreement was executed March 26, 1991 providing for a twenty percent permanent partial disability of the second finger, left hand (8.8 weeks) and a twelve and a half percent permanent partial disability of the cervical spine (21.875 weeks). At claimant’s compensation rate of $361.56, the total amount (30.675 weeks) of specific benefits owed claimant under the agreement was $11,090.85.

The employer’s policy provided employees full pay during the first four weeks absent due to workers’ compensation leave. In exchange the employee was to return to the employer any worker’s compensation benefits payable during that four week period.

In this case, the employer paid four weeks full pay and also $13,148.92 between April 24, 1990 and February 10, 1991 under an Extended Illness Income Protection Plan. The employer sought reimbursement for those first four weeks and also claimed the total amount of the specific award as reimbursement credit against the $13,148.92 paid. The claimant agreed the employer was due the first four weeks of temporary total Sec. 31-307 benefits payable, but disagreed that the employer had any rights against the Sec. 31-308 specific benefits.

The commissioner held the employer was only entitled to reimbursement for four weeks of compensation “and any advanced payments that were made to the claimant as a charge against his specific award.” Finding and Award Paragraph B. He also concluded claimant’s award for permanent partial disability was “not an award for loss wages” but was “an award for the permanent loss of function or impairment that the claimant will have for the rest of his life.”1

The appellant employer argues Sec. 31-314 authorizes a credit against the specific for the second group of payments. Sec. 31-314 provides “In fixing the amount of any compensation under this chapter, due allowance shall be made for any sum which the employer has paid to any injured employee or to his dependents on account of the injury, except such sums as the employer has expended or directed to be expended for medical, surgical or hospital service”.

The trier did not specifically find that the respondent asserted a Sec. 38a-470 lien, but this fact is alleged by the respondent and unchallenged by the claimant. We assume arguendo that respondent asserted such a lien. That statute states:

(a) For purposes of this section, “controverted claim” means any claim in which compensation is denied either in whole or in part by the workers’ compensation carrier or the employer, if self-insured.

(b) Any insurer . . . or employee welfare benefit plan which furnished benefits or services under a health insurance policy or a self-insured employee welfare benefit plan to any person suffering an injury or illness covered by the workers’ compensation act has a lien on the proceeds of any award . . . to the extent of benefits paid or services provided for the effects of the injury or illness arising out of and in the course of employment as a result of a controverted claim, provided such plan, policy or contract provides for reduction, exclusion, or coordination of benefits of the policy or plan on account of workers’ compensation benefits. (emphasis ours)

The company’s personnel manual states the following:

WORKERS’ COMPENSATION. In compliance with the Workers’ Compensation laws, your Company carries insurance for all employees who incur on-the-job injuries or work-related illnesses . . . . In order to protect your earnings beyond what is required by law, we will make up the difference between the amount you receive under Compensation and your normal base rate for a maximum of 4 weeks. For your convenience and to insure current income, the Company will advance full pay on the regularly scheduled paydays for this four-week period. Money later paid to you by the Insurance Company for lost wages during this period belongs to the Ney Company and must be returned to us by way of a payroll deduction.

This language in the manual is separate from the provisions of the Extended Illness Income Protection Plan. That plan did not concern time lost from work due to worker compensation disability, but rather time lost due to non work-related extended illness.

Our courts have ruled permanent partial disability benefits are not wage loss benefits. See e.g. Levanti v. Dow Chemica1 Co., 218 Conn. 9, 13 (1991) citing, inter alia; Morgan v. East Haven, 208 Conn. 576, 584 (1988); Everett v. Ingraham, 150 Conn. 153, 155 (1962); Panico v. Sperry Engineering Co., 113 Conn. 707, 710 (1931).

Both the appellant and the appellee cite Levanti. Claimant relies on:

An award of workers’ compensation benefits for permanent partial impairment . . . is a specific indemnity award. (citation omitted) “Specific benefits are benefits for the loss or loss of the use of specific body parts. See Everett v. Ingraham.,150 Conn. 153, 155 (1962).” Morgan v. East Haven, 208 Conn. 576, 584 (1988) (citation omitted) “‘These [specific] benefits . . . are not paid as compensation for loss of earning power but to compensate the injured employee for the incapacity through life because of the loss or loss of use of the body member in question. J. Asselin, supra, p. 151.” Morgan v. East Haven, supra.

Levanti, supra, p. 13.

But Levanti also stated:

In enacting the schedule of benefits set forth in General Statutes Sec. 31-308(b), our legislature must have presumed that the losses therein affected earning capacity, because any other construction would suggest that the section was intended to provide compensation solely for the body part itself, comparable to a tort recovery. This construction would be inconsistent with our Workers’ Compensation Act. “[W]orkers’ compensation ‘established almost a complete substitute for the common law of torts . . .’” since “the ‘purpose of our Act . . . is to give to the employee . . . compensation for the loss of wages accruing from the employee’s injury.’ Bassett v. Stratford Lumber Co., 105 Conn. 297, 303 (1926).” Perille v. Raybestos-Manhattan-Europe, Inc., 196 Conn. 529, 540 (1985). Furthermore, in remarking on the defendants’ apparent confusion between general incapacity benefits and specific benefits, the review division implicitly concluded that an award of specific benefits does not require a showing of impairment of earning capacity because the probability of wage loss of presumed. (emphasis ours) Levanti, supra, p. 1415.

Permanent partial disability benefits represent a guess of the future earnings loss an employee will suffer due to his impairment. They do not represent actual lost wages. We note that respondent’s personnel policy on Workers’ Compensation payments requires repayment of money paid for “lost wages.” The term “lost wages” in that policy refers to actual lost wages and not potential loss of wages.

Finally, it is arguable respondent should not have paid claimant any money under its Extended Illness Income Protection Plan. The personnel policy states, “Extended Illness Income Protection is a supplement to your basic sick pay plan and is designed to cover your long-term illness or injury (non job connected)” Respondent’s Brief Exhibit D. Respondent’s counsel in an April 7, 1991 letter to claimant’s counsel wrote: “The sick leave payments made to Mr. Tinsley were made under an extended illness protection plan. This plan is described in the Personnel Policy attached. It is clear from the relevant provision that this payment is not available to an employee on workers’ compensation leave . . . . Mr. Tinsley was provided with these benefits with the condition that he reimburse the Company for all workers’ compensation benefits paid (see letter dated November 21, 1990 from Lois Dowd to Jerome Tinsley attached). Respondents’ Brief Exhibit C.

It may well be the employer may have a claim that those monies were improperly paid under the Plan and should be returned. But we are a tribunal of limited jurisdiction. Sec. 38a-470(f) provides:

The validity or amount of the lien may be contested by the workers’ compensation carrier, the employer, if self-insured or the employee by bringing an action in the superior court for the judicial district of Hartford-New Britain or in the judicial district in which the plaintiff resides.

Sec. 31-314 permits the commissioner to give “allowance . . . for any sum which the employer has paid to any injured employee . . . on account of the injury”. Where that sum is a controverted claim under Sec. 38a-470, recourse should be had to that statute for a Superior Court remedy and not one for this forum.

It is important here to note that if the employee had returned to work during the 30.675 weeks of specific benefits payable under the Voluntary Agreement, he would have been able to collect both his specific benefits and his weekly wages for the period. In that sense, the specific benefits are not payments for loss of wages.

If claimant was paid any Sec. 31-307 temporary total disability benefits, then those sums should be reimbursed to the employer due to his advance payments under Sec. 31-314, but not as to any benefits payable under Sec. 31-308.

We affirm the commissioner and deny the employer’s appeal.

Commissioners Donald H. Doyle, Jr. and Nancy A. Brouillet concur.

1 While the trier’s Finding and Award refers to a formal hearing held November 1, 1991 no transcript was forwarded. We also note that the record forwarded by the district office does not contain any documents formally noted as exhibits. However, the respondent-appellant’s brief does not refer to various exhibit’s appended to its brief. As the claimant-appellee’s counsel has not objected to the appellant’s reliance on these “exhibits” and additionally, refers to language contained in the “exhibits” we think any procedural defect has been waived. BACK TO TEXT