The summary below was provided by Ronald Balter of Caruso, Spillane, Leighton, Contrastano, Ulaner & Savino, P.C.
The Court of Appeals of New York State issued a decision that ordered the Workers' Compensation Board to return to its prior interpretation of the Workers' Compensation Law that required an award under §15(3)(a) through §15(3)(l) to be paid out over time and not in a lump sum payment. The Court determined that the Workers' Compensation Board’s change of policy in how a scheduled loss of use award is paid not was not a policy change but was in fact a misinterpretation of the Workers' Compensation Law. The decision came in LaCroix v. Syracuse Executive Air Service, Inc.
In workers' compensation a scheduled loss of use award is an award for a permanent partial disability for an extremity, eye or hearing loss. A person who is awarded a scheduled loss is awarded a percentage loss of use equal to the percentage times the total number of weeks allocated for the body part in §15(3)(a) through §15(3)(l) of he Workers' Compensation Law. For example a arm is worth 312 weeks of benefits. A person awarded a 15% scheduled loss of use of the arm would be entitled to receive an award worth 46.8 weeks of benefits.
Prior to 2003 a person would only be paid their entire award if more time had passed from the date of the accident to the date the award is made at the Workers' Compensation Board. In the example of above if a it was more than 46.8 weeks after the date off accident then the claimant would receive the entire award at once. In the case of Ms. LaCroix she was given an award for 234 weeks of benefits approximately 100 weeks after the accident. The Law Judge at the Workers’ Compensation Board directed that the entire balance of the 234 weeks be paid to the claimant immediately.
The Workers' Compensation Board made this policy decision based upon the case of Miller v. North Syracuse Central School District, 1 A.D. 3d 691 (2003). In Miller the Appellate Division – Third Department stated that an award for a scheduled loss of use does not represent a period of time. The weeks awarded are only used as a method to calculate the value of the award. This was done so that Ms. Miller would not lose the benefits she was awarded for a scheduled loss of use award when she was receiving temporary benefits in a subsequent accident.
After the Miller decision the Workers' Compensation Board made a policy decision to start to award all scheduled loss of use awards in one lump sum payment. The Appellate Division, when it decided LaCroix, agreed with the Workers' Compensation Board that the Workers' Compensation Board had the authority to order a scheduled loss of use award to be paid at once not withstanding its prior practice that required a scheduled loss of use to be paid out over time. Neither the Workers' Compensation Board nor the Appellate Division felt constrained by the requirements of §25(1)(a) of the Workers' Compensation Law that requires workers' compensation to be paid in a “periodically, in accordance with the method of payment of the wages of the employee at the time of his injury …”
However the Court of Appeals rejected the Workers' Compensation Board’s and Appellate Division’s interpretation of the Workers' Compensation Law. The Court indicated that under the various subdivisions of §25 of the Workers' Compensation Law a scheduled loss of use award must be paid at overtime. A person can take an option to have the award paid in a lump sum. However, if they elect that option under §25(1)(a) and §27 of he Workers' Compensation Law the amount must be commuted to the present value of the award.
The Court of Appeals went on to state the Workers' Compensation Board’s position the payment of scheduled loss of use awards contradicts other portions of the Workers' Compensation Law. If the award were to be paid all at once it would make §15(3)(u) meaningless. Section 15(3)(u) of the Workers' Compensation Law states that when a person receives a scheduled loss of use for multiple body parts, the awards are to be consecutively. The Court observed that if the scheduled loss of use is paid as a lump sum it would render meaningless the provision that awards are to be paid consecutively. Additionally, it would have a similar effect with §15(3) (v) that allows payments for additional workers' compensation benefits “after termination of” an award for a permanent partial disability of more than 50% of an arm, leg, hand or foot.
The Court of Appeals did not disturb the actual holding of the Miller case. However, the Court was quite clear that it was necessarily agreeing with the result in Miller. The issue in Miller was to before the Court. If the Miller issue was before the Court it may not have survived the scrutiny of the Court. A careful reading of the Court of Appeals decision indicates that it may believe that the Appellate Division went too far in Miller by picking quotes somewhat out of context to reach its decision to allow the overlapping of an scheduled loss of use award and payments for a temporary disability in a subsequent case.