City of Pittsburgh v. Workers' Compensation Appeal Board
2014 Pa. Commw. LEXIS 244
| Pa. Commw. Ct. | 2014Background
- John Wright, a longtime Pittsburgh firefighter, was injured at work (Feb 4, 2004). Employer paid Heart and Lung benefits, then after Claimant elected a disability pension (May 30, 2005) began paying workers’ compensation benefits ($690/wk) plus a $3,568/month pension.
- Employer failed to offset pension for ~2 months (May 30–Aug 8, 2005), overpaying workers’ compensation by $1,783.48, then issued Form LIBC-761 and recouped the overpayment by deducting $100/week until repaid and reduced ongoing WC benefits to $555.76/week (then paid $555.76 after recoupment completed).
- Claimant later filed a petition (Dec 29, 2008) challenging the offset amount and arguing the $100/week recoupment caused financial hardship; Employer defended its calculations and recoupment method.
- The WCJ found Employer’s offset calculations correct, held Claimant waived the Form LIBC-756 issue, but disallowed recoupment based on a presumption of prejudice and ordered reimbursement of $1,783.48. The Board affirmed, but held issuance of Form LIBC-756 was a condition precedent to any retrospective recoupment.
- On appeal, the Commonwealth Court reversed the Board in part: it held the Form LIBC-756 issue was waived, rejected a per se presumption of prejudice for all recoupments (distinguishing Maxim Crane and applying Muir), and permitted the $100/week recoupment for this short (weeks-long) overpayment.
Issues
| Issue | Claimant's Argument | Employer's Argument | Held |
|---|---|---|---|
| Whether failure to issue Form LIBC‑756 bars retrospective recoupment | Employer didn’t provide LIBC‑756; recoupment unlawful without it | Not required here; Employer already knew pension amount; issue waived | Issue was waived by Claimant; Board erred to base decision on lack of LIBC‑756 |
| Whether an employer faces a presumption of prejudice when recouping overpayments | Recoupment presumed prejudicial; WCJ ordered reimbursement | No automatic presumption; employer may recoup under regs; can rebut hardship claim | No blanket presumption of prejudice for all recoupments; WCJ erred to apply one |
| Whether Maxim Crane controls to bar recoupment here | Maxim Crane and Muir prohibit recoupment prior to employer notice/forms | Maxim Crane limited to its facts (failure to notify for years); Muir requires six‑month form cycle but not absolute bar | Maxim Crane’s hardship holding was fact‑specific/obiter; Muir requires periodic LIBC‑756 but does not create automatic bar here |
| Appropriateness of Employer’s $100/week repayment schedule given alleged hardship | $100/week caused real financial hardship (e.g., changed child’s schooling) | Repayment schedule lawful for a small, short overpayment and claimant delayed challenge | Repayment schedule permissible here for a weeks‑long overpayment; any hardship claim is moot (recoupment already completed) |
Key Cases Cited
- Maxim Crane Works v. Workers’ Compensation Appeal Board, 931 A.2d 816 (Pa. Cmwlth. 2007) (denied retroactive recoupment where employer failed to notify claimant of reporting duty and delay produced severe hardship)
- Muir v. Workers’ Compensation Appeal Board, 5 A.3d 847 (Pa. Cmwlth. 2010) (interprets LIBC‑756 six‑month issuance/filing requirement and requires employer notice cycle)
- Department of Public Welfare v. Workers’ Compensation Appeal Board (Harvey), 993 A.2d 270 (Pa. 2010) (explains Section 204(a) pension offset purpose: prevent double recovery and foster cost containment)
- Department of Transportation v. Workers’ Compensation Appeal Board (Noll), 80 A.3d 525 (Pa. Cmwlth. 2013) (employer may structure recoupment and recoup overpayments to prevent unjust enrichment)