Receipt of Pension Isn’t Evidence of Retirement, Justices Say

By Zack Needles
The Legal Intelligencer
April 2, 2013

The state Supreme Court has ruled that an employee's receipt of a pension is not sufficient evidence that the employee has retired and does not satisfy an employer's burden of proof for modifying or suspending workers' compensation benefits.

The court further held that the burden of proof does not shift to the claimant until the employer produces sufficient evidence to support a conclusion that the claimant voluntarily withdrew from the workforce.

In City of Pittsburgh v. Workers' Compensation Appeal Board (Robinson), the six-justice court unanimously ruled to uphold a Commonwealth Court plurality that established a "totality of circumstances" test for employers seeking to prove that claimants have voluntarily removed themselves from the workforce.

The Commonwealth Court had found, and the Supreme Court agreed, that the employer in this case, the city of Pittsburgh, did not prove that claimant Dorothy Robinson had voluntarily left the workforce.

Chief Justice Ronald D. Castille, writing for the court, said that while an employee's election to receive a pension is one element an employer can point to in an attempt to show the employee has retired, it is not enough on its own to give rise to a presumption of retirement.

"Given that the inference to be drawn from a person's receipt of a pension, viewed alone, is equivocal and inconclusive, the receipt of a pension is not sufficient evidence, in and of itself, to discharge the employer's burden of proof," Castille said.

Castille was joined by Justices Max Baer, Thomas G. Saylor, J. Michael Eakin, Debra Todd and Seamus P. McCaffery.

In City of Pittsburgh, according to Castille, claimant Dorothy Robinson became a police officer with the city of Pittsburgh — referred to in the opinion as "employer" — in April 1989 and sustained a work-related injury in 1997.

Robinson's employer moved her to a light-duty office position, but in October 2001, Robinson was traveling to an appointment to treat her work-related injury when she sustained new injuries in an automobile accident, according to Castille.

In December 2001, Castille said, the employer accepted those injuries through a notice of temporary compensation and Robinson did not return to, nor was she offered, a light-duty position.

In late 2004, Robinson was awarded a disability pension after being examined by three doctors who certified she was unable to perform her previous job as a police officer, Castille said.

In October 2007, according to Castille, another doctor performed an independent medical examination of Robinson on behalf of her employer and found that while she could not perform her previous police officer work, she could perform modified-duty work.

In November 2007, the employer sent Robinson a notice of ability to return to work and filed a petition to suspend Robinson's compensation benefits, arguing that while she was able to work, she had "'voluntarily removed herself from the work force as she has not looked for or sought employment in the general labor market,'" according to Castille.

Robinson responded that she was still attached to the workforce and that, while she had registered for work with the Pennsylvania Job Center, she remained unemployed simply because there were no jobs available and the city of Pittsburgh had not offered her light-duty work following her 2001 accident.

Following three hearings that took place between January and October 2008, a workers' compensation judge denied the employer's suspension petition, finding that Robinson had not voluntarily removed herself from the workforce.

The WCJ reasoned that when an employer terminates the position of an employee injured on the job, the employer must provide temporary total disability benefits, according to Castille.

If the employer then wants to suspend or modify those benefits, it must show that there is suitable work available to the claimant, the WCJ explained, according to Castille.

The WCJ pointed to the 1995 state Supreme Court ruling in Southeastern Pennsylvania Transportation Authority v. WCAB (Henderson), which held that a claimant seeking to continue receiving disability benefits post-retirement must show that he or she is either continuing to look for work or has been forced into retirement by an injury, according to Castille. 

The WCJ ultimately found that Robinson had been forced into disability retirement when the employer failed to offer her a light-duty position following her 2001 injury.

The employer appealed the decision first to the Workers' Compensation Appeal Board, which affirmed the WCJ, and then to the Commonwealth Court, which affirmed in an en banc plurality decision, Castille said.

The Commonwealth Court found that, under Henderson, an employer seeking to suspend or modify benefits does not need to show the availability of suitable work if the claimant has voluntarily removed him or herself from the workforce, according to Castille.

The Commonwealth Court said it would adopt a "'totality of the circumstances'" standard for employers to show that a claimant has retired, Castille said.

The Commonwealth Court said circumstances that an employer could point to include the claimant's acceptance of a retirement pension and the claimant's acceptance of a pension and refusal of suitable employment, according to Castille.

Based on this test, the Commonwealth Court found, the employer in Robinson failed to show that Robinson had intended to retire, Castille said.

Castille agreed with this analysis and rejected the employer's argument that Henderson established a presumption of retirement when a claimant seeks a pension.

"In the case sub judice, the Commonwealth Court plurality properly evaluated Henderson insofar as it recognized that the WCJ must consider other evidence in addition to the claimant's simple receipt of a pension to determine whether a claimant in fact has retired from the workforce totally," Castille said. "In this regard, the plurality's 'totality of the circumstances' test is simply another way of saying that the fact-finder must evaluate all of the relevant evidence in determining whether a worker has retired from the workforce. This conclusion is consistent with our reasoning in Henderson and therefore, in our view, the plurality did not impermissibly establish a new test."

The employer cited the Commonwealth Court's 2008 ruling in Pennsylvania State University v. WCAB (Hensal), which had relied on Henderson to reach the conclusion that a claimant who accepts a pension is presumed to have left the workforce, according to Castille.

But Castille said both the employer and Hensal court"misread" the Henderson decision.

"It is true that Henderson did not distinguish among types of pensions, which may partially explain why the Hensal court held that a presumption of retirement arises from acceptance of any pension," Castille said. "But, Henderson did not purport to address issues that might arise with different pensions. More importantly, Henderson never discussed rebuttable presumptions (much less did it purport to establish any) — indeed, the court never invoked the word presumption — nor was the Henderson decision premised upon the mere or sole fact of that claimant's acceptance of a pension." 

Castille said it is not "self-evident, or even logical to presume, from the simple fact that a claimant accepts a pension, a conclusion that the claimant has completely and voluntarily withdrawn from the workforce, or is prohibited from working in any capacity."

Furthermore, Castille said there is no presumption of retirement that arises when a claimant seeks or accepts a pension — only a permissive inference of retirement.

"Such an inference, if drawn, is not on its own sufficient evidence to establish that the worker has retired — the inference must be considered in the context of the totality of the circumstances," Castille said. "The fact-finder must also evaluate all of the other relevant and credible evidence before concluding that the employer has carried its burden of proof."

Castille also agreed with the Commonwealth Court's analysis of the specific circumstances in Robinson.

"In this case, the disability pension only shows withdrawal from the claimant's time-of-injury job," Castille said.

"Moreover, the Commonwealth Court plurality accepted the WCJ's factual finding that petitioner was seeking employment, and that she would have been working had the employer not terminated her modified-duty job."

A spokesperson for the Workers' Compensation Appeal Board also could not be reached.