Pascarelli v. Moliterno Stone Sales

The claimant was represented by Anselmo M. Delia, Esq., Delia & Dunne, L.L.C., 45 Court Street, New Haven, CT 06511.

The respondents were represented by James Sullivan, Esq., Maher & Williams, 1300 Post Road, P. O. Box 550, Fairfield, CT 06430.

The Second Injury Fund was not implicated by the issues on appeal, and did not appear at oral argument. Notice sent to Richard Hine, Esq., Assistant Attorney General, 55 Elm Street, P. O. Box 120, Hartford, CT 06141-0120.

This Petition for Review from the October 27, 1998 Decision of the Commissioner acting for the Fourth District was heard June 18, 1999 before a Compensation Review Board panel consisting of the then Commission Chairman, Jesse M. Frankl and Commissioners Angelo L. dos Santos and Stephen B. Delaney.

OPINION

JESSE M. FRANKL, COMMISSIONER. The claimant has petitioned for review from the October 27, 1998 Decision Re: Respondent’s Motion to Dismiss of the Commissioner acting for the Fourth District. He argues on appeal that the trier erred by failing to award him retroactive § 31-284b benefits for the time period between his 1989 date of injury and the 1993 decision of our Supreme Court declaring § 31-284b inapplicable to private employers. We affirm the trial commissioner’s decision.

The claimant suffered compensable injuries to his back and knee on May 2, 1989, while in the employment of Moliterno Stone Sales (Moliterno), a company which has since become insolvent. A 1994 voluntary agreement established his entitlement to a specific award. The claimant later sought to modify his wage rate by including in his base wage total the value of employer contributions for pensions, an annuity, and a health and welfare fund. A commissioner denied his request on two grounds, and this board affirmed that decision on appeal. Pascarelli v. Moliterno Stone Sales, 14 Conn. Workers’ Comp. Rev. Op. 328, 2115 CRB-4-94-8 (Sept. 15, 1995). We upheld the trier’s use of his discretion to honor an automatic bankruptcy stay, and also confirmed his conclusion that § 31-310 excludes employer health plan and pension fund contributions from the calculation of a claimant’s average weekly wage. Id., 332. The Appellate Court in turn affirmed our interpretation of § 31-310, stating that the legislature clearly intended that fringe benefits remuneration is not included in a claimant’s base compensation rate. Pascarelli v. Moliterno Stone Sales, Inc., 44 Conn. App. 397, 400 (1997).

While arguing his case to the Appellate Court, the claimant introduced another contention: that he should be allowed to open the voluntary agreement because it was premised on the existence of § 31-284b, a statute that was later declared inapplicable to private employers due to preemption by the federal Employee Retirement Income Security Act (ERISA). See District of Columbia v. Greater Washington Board of Trade, 506 U.S. 125 (1992); Luis v. Frito-Lay, Inc., Supreme Court, Docket No. SC 14536 (order, April 27, 1993). The claimant maintained that he was entitled to receive the benefits prescribed by the statutes in force at the time of his injury, even though the scope of § 31-284b was subsequently circumscribed. The court declined to formally address this argument, as the claimant had not asserted these claims before the trial commissioner or this board. Pascarelli, supra, 401. However, the panel opined in a footnote that there was no merit to these claims, because the preemption occurred well after the agreement was signed, and the “date of injury” rule only applies when there has been subsequent legislation—not when a statute has been preempted by federal law. Id., 401 n.7.

Undaunted by the court’s skeptical view of his position, the claimant did not abandon his quest for § 31-284b benefits. While proceedings continued on other aspects of his claim (such as permanent partial and temporary total disability benefits), he revised his argument slightly, and requested a formal hearing on § 31-284b fringe benefits maintenance. At its outset, the claimant explained that he was seeking payment of § 31-284b benefits through the date of the Luis v. Frito-Lay decision, supra, based on the provisions of a labor agreement that was in effect at the time of his injury. February 26, 1998 Transcript, 2. Liberty Mutual then moved to dismiss the claim on the ground that the Appellate Court had already addressed the federal preemption issue, and that this Commission lacked jurisdiction to define the terms of a private labor contract. Id., 5-7. The claimant responded that the res judicata doctrine did not apply, because he was now seeking direct payment of the § 31-284b benefits rather than a wage rate modification. Id., 9-11. He contended that § 31-2871 was applicable to this case, and that he was entitled to collect the same benefits from the insurer that he would have received from Moliterno. Liberty Mutual disagreed that it could be found liable for pension or other fringe benefits that were not part of the claimant’s base compensation rate. Id., 18.

After considering the parties’ arguments, the trial commissioner decided that the claimant’s issues were not viable, “as they have been previously ruled upon and/or are ultimately controlled by the Federal law under ERISA and Connecticut Appellate decisions.” He accepted Liberty Mutual’s assertion that pension and annuity benefits were not the responsibility of the employer’s workers’ compensation insurer, and noted that this forum lacks jurisdiction to interpret union contracts regarding such benefits. He added that the claimant had not established by a preponderance of credible evidence that delays in the workers’ compensation system affected his rights. The Motion to Dismiss was thus granted, and the claimant has appealed that ruling to this board.

The 1989 version of § 31-284b(a) states that an employer who provides accident and health insurance or life insurance coverage for any employee, or who makes payments or contributions at the regular hourly or weekly rate to an employee welfare fund2 on behalf of full-time employees, shall provide to such employee equivalent health insurance coverage or welfare fund payments or contributions while the employee is eligible to receive or is receiving workers’ compensation payments. As noted above, the United States Supreme Court determined in Greater Washington Board of Trade, supra, that ERISA supersedes and preempts any state law that attempts to impose benefit requirements by reference to a health insurance program sponsored by a private employer. The Connecticut Supreme Court then declared that this decision prohibited the application of § 31-284b to private employers. Luis v. Frito-Lay, Inc., supra; see also Civardi v. Norwich, 231 Conn. 287, 298-99 n.14 (1994).

This board has previously addressed situations in which a claimant sought to have the value of § 31-284b insurance premiums included in his weekly compensation rate. We have declared that such attempts to circumvent the effect of Greater Washington Board of Trade cannot be permitted, as they would be inconsistent with the spirit of that decision. Luce v. United Technologies Corp., 3080 CRB-1-95-6 (Dec. 16, 1996), affirmed, 47 Conn. App. 909 (1997) (per curiam), affirmed, 247 Conn. 126 (1998); Rodriguez v. Devcon Enterprises, Inc., 15 Conn. Workers’ Comp. Rev. Op. 362, 364-65, 2244 CRB-3-94-12 (June 28, 1996). The instant claimant also seeks to circumvent the effect of the preemption, but in a different manner. He argues that, as a practical matter, he would have received his health insurance premiums if it were not for the long delay in the administration of his claim that occurred prior to the issuance of the Frito-Lay decision. The claimant explained that from his perspective, he was discriminated against, because other claimants in fact received those benefits and were not told to repay them after the Frito-Lay case. Transcript, supra, 15.

This argument cannot succeed on appeal. Even if we accept the proposition that this issue was not addressed by the Appellate Court in Pascarelli, the guidance provided by the panel in footnote 7 is sound. The application of § 31-284b to private employers was declared unconstitutional and void in Frito-Lay, supra. Claimants who received health insurance coverage from such employers under the statute were the beneficiaries of an incorrect reading of the law. Once the error was discovered, the provisions of that law were essentially void ab initio with respect to employers covered by ERISA, as the state legislature did not have the power to direct § 31-284b at such employers. Legally, it is as if the statute has been “erased from the record books.” The claimant thus cannot rely upon it now to claim retroactive entitlement to health insurance benefits.

This board noted in Luce, supra, that (vis-à-vis health insurance benefits) “pension benefits were not directly the subject of the Greater Washington Board of Trade decision, thus making it less clear that § 31-284b is preempted regarding such payments with respect to private employers.” The claimant seizes upon this language in his brief, and posits that § 31-284b might still entitle him to the pension and annuity increments that he was due as part of his collective bargaining agreement. We are not so persuaded, however. Our research reveals that the claimant is no less precluded from invoking § 31-284b in this capacity than he is from using it to claim health insurance benefits.

The basis of the Greater Washington Board of Trade decision was that the District of Columbia had impermissibly passed a law that related to a covered benefit plan under ERISA. Although the suspect statute in that case happened to address only health insurance coverage, ERISA implicates much more. 28 U.S.C. §§ 1001-1003; see also Stone & Webster Engineering Corp. v. Ilsley, 518 F.Supp. 1297 (D. Conn. 1981), affirmed, 690 F.2d 323 (1982), affirmed sub nom. Arcudi v. Stone & Webster Engineering Corp., 463 U.S. 1220 (1983). ERISA’s regulation of “employee benefit plans” covers both “employee welfare benefit plans” and “employee pension benefit plans,” as defined in 28 U.S.C. § 1002(1)-(3). The only exception is for plans that are excluded by § 1003(b), such as governmental plans and “plans maintained solely for the purpose of complying with applicable workers’ compensation laws or unemployment compensation or disability insurance laws.” 28 U.S.C. § 1003(b)(3). Based on the evidence in the record, it would appear that the claimant’s employee benefit plan was quite broad in scope. He has certainly not shown or alleged that it fell outside the penumbra of ERISA; thus, he cannot claim that § 31-284b entitles him to such benefits from his insolvent employer’s workers’ compensation insurer.

Our determination that § 31-284b does not entitle the claimant to compensation leaves before this Commission nothing more than a contractual dispute based upon a collective bargaining agreement. Admittedly, a workers’ compensation commissioner may interpret a contract when an explication of its terms is necessary to resolve a case whose core is a Chapter 568 matter. See Hunnihan v. Mattatuck Mfg. Co., 243 Conn. 438 (1997); Conetta v. Stamford, 16 Conn. Workers’ Comp. Rev. Op. 228, 229, 3231 CRB-7-95-12 (June 23, 1997) (city charter could be introduced into evidence). Still, a commissioner does not generally preside over issues of contractual interpretation, and lacks the authority to adjudicate the terms of a collective bargaining agreement absent a specific statutory relationship between the case and the Workers’ Compensation Act. Stickney v. Sunlight Construction, Inc., 248 Conn. 754, 764 (1999). This is such a situation. Nothing in the Act authorizes this Commission to construe the claimant’s union contract; consequently, we cannot issue a binding judgment on that dispute.

The trier of fact properly declined to further consider the labor-union contract. This claim, if it can still be maintained anywhere, belongs in another forum. This is true regardless of any arguable effect that § 31-287 might have on this case (although we do not hold that § 31-287 covers liability under § 31-284b, given the language of § 31-284(b)(2)). As we have ruled § 31-284b inapplicable, the insurer’s alleged liability for the employer’s contractual obligations would no longer be liability imposed pursuant to the provisions of the Workers’ Compensation Act, even if it could be somehow said that it was covered by an insurance contract. Thus, § 31-287 cannot act as a basis for our exercise of jurisdiction over this claim.

The trial commissioner’s decision is affirmed.

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

1 At the time of the claimant’s injury, § 31-287 read as follows: “No policy of insurance against liability under this chapter, except as provided in section 31-284, shall be made unless the same covers the entire liability of the employer thereunder and contains an agreement by the insurer that, as between the employee and the insurer, notice or knowledge of the occurrence of injury by the insured shall be deemed notice or knowledge by the insurer, that jurisdiction of the insured for the purposes of this chapter shall be jurisdiction of the insurer and the insurer shall in all things be bound by and subject to the findings, awards and judgments rendered against such insured; and also that, if the insured becomes insolvent or is discharged in bankruptcy during the period that the policy is in operation, or the compensation, or any part of it, is due and unpaid or if an execution upon a judgment for compensation is returned unsatisfied, an injured employee or other person entitled to compensation under the provisions of this chapter may enforce his claim to compensation against the insurer to the same extent that the insured could have enforced his claim against such insurer had he paid compensation.” BACK TO TEXT

2 At the time of the claimant’s injury, the statute referred specifically to “an employee or welfare fund, as defined in section 31-53.” Section 31-53 defines employee welfare funds to include trust funds that provide benefits under an employee welfare plan, such as medical care benefits, sickness, death and disability benefits, retirement benefits, and unemployment benefits. In 1991, the reference to § 31-53 was deleted from the statute, and an explanation was added defining “employee welfare plan” (the word “fund” was also replaced) as “any plan established or maintained for employees or their families or dependents, or both, for medical, surgical or hospital care benefits.” In deciding the present matter, we will address the more inclusive version of the statute that was in effect on the date of injury; McCarty v. Consolidated Freightways, 10 Conn. Workers’ Comp. Rev. Op. 178, 179, 1243 CRD-3-91-6 (Sept. 1, 1992); even though it is unclear that the term “employee welfare fund” in § 31-53 would include the claimant’s pension plan. BACK TO TEXT