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Traditionally, posthumous permanency awards in New York workers' compensation claims were limited to certain circumstances where an injury to a statutorily enumerated body member (generally, an extremity) entitled a decedent-claimant's qualifying survivors or estate to benefits based on the scheduled loss of use (SLU) of the extremity. In Matter of Green v. Dutchess County BOCES, 183 A.D.3d 23 (3d Dept. 2020), however, the New York State Supreme Court, Appellate Division, Third Department expanded workers' compensation carriers' liability to payments not just for posthumous SLUs, but also for permanent partial disability (PPD) benefits to a claimant's estate, even where the claimant passes during the PPD period as a result of unrelated causes. The Court of Appeals passed on providing a substantive ruling on the matter pending a final determination on awards following remand in Green, leaving the case currently valid law.
In SLU cases, it has long been held that if a claimant passes after it is proven that their injury has resulted in permanent loss that qualifies for an SLU award, qualifying survivors or their estate are entitled to some or all of that payment. Even in cases involving no lost time, the justification for this rested on the fact that the claimant's medical situation achieved a stable point and the impact of the injury on the claimant's earning potential could be calculated based on the medical evidence preceding death. In contrast, when a claimant's injury qualifies them for a PPD award, a claimant's entitlement to ongoing benefits has previously rested upon claimant demonstrating that they are out of work or making less than full wages due in part or in whole to their disability. In cases where the reason for a PPD claimant's departure from the workforce is wholly unrelated to their disability, such as a voluntary retirement (and previously, death), awards were suspended based on the fact that a deceased claimant can no longer demonstrate that their injury impacts their earning power following the date of death.
Seizing on language in Workers' Compensation Law §15 referring to both PPD and SLU-type claims, the Third Department has concluded that the statutory framework did not support treating the two types of permanency awards differently and that the post-death balance of PPD awards, now typically granted in capped periods between 225-525 weeks to living claimants, can be provided to qualifying survivors. The court conceded that although a worker's right to receive PPD benefits was generally supported by wage loss "caused by the established injuries" which death would ordinarily terminate, but that "such a position unfairly deprives an injured worker's surviving spouse and/or children of the remaining cap weeks that were established, set and fixed at the time of classification" and that "if an injured worker dies without any reduced earnings, or while at preinjury wages, his or her surviving spouse and/or children would forever be deprived of any benefits because the deceased worker never sustained, and could no longer establish, a causally-related reduction in wages."
For qualifying survivors, the Green ruling opens the door to potential recovery of benefits that ordinarily would have terminated upon the death of the injured worker. Humanitarian principles have always been a touchstone of workers' compensation law and the Third Department's rationale rests in part upon the perceived inequity of provision of posthumous SLU awards, but not PPD awards. In practice, claimant's representatives would be well served in monitoring PPD files that would have ordinarily been closed on a return to work and/or periodically reviewing claims to where an injured worker is earning less than their full average weekly wage set an evidentiary basis for a claim for benefits if a working PPD claimant passes. The Green decision provides additional settlement leverage for claimants. Carriers which would have once safely closed their files based on a living claimant's return to work are now faced with the specter of reopening long-closed claims which may provide some economic incentive to settle, even in cases of no ongoing lost time.
For workers' compensation carriers, a Pandora's box of uncertainty was opened in the Green decision. In addition to potentially reopening files that were closed on a return to work years ago, the entirety of a five- or six-figure PPD award may now be payable to an estate even where there was no lost time during the injured workers' lifetime. Additionally, in PPD claims where the claimant was receiving fluctuating reduced earnings awards based on a return to work in a part-time or partial-duty capacity resulting in less than pre-injury wages, projecting what the balance of a PPD award might be may be an exercise in speculation.
Given that the Court of Appeals has not yet had occasion to address the merits of the Green decision, it is unclear whether any part of the decision will be modified in the future pending subsequent appeals. For now though, Green remains valid law. In the interim, practitioners would do well to carefully monitor claims involving the death of claimants who were previously classified with a PPD. Numerous open questions remain that will ultimately necessitate litigation and judicial determination including:
- Does the decision apply to older PPD claims that are not subject to the temporal "caps" of 225-525 weeks?
- How do you calculate the balance of a PPD award owed in situations where there was no lost time sustained by the injured worker?
- May a claimant be able to retroactively argue a change in condition and seek reclassification based on medical evidence that arose prior to a claimant's passing?
- How do you calculate the balance of a PPD award when the claimant's earnings fluctuated due to a part-time or partial-duty return to work?
- Does Green apply to cases where it was judicially determined that the claimant was not entitled to benefits for reasons unrelated to the disability (such as fraud)?
- Does Green impact the survivor's entitlement to benefits in claims where a PPD award is cut short by a causally related death and if so, how?
Cory A. DeCresenza is a partner at Vaughan Baio & Partners, where he concentrates his practice on workers' compensation and appellate litigation. He advises clients on all aspects of workers' compensation claims handling and litigation, from inception of a claim to recommending resolution through settlement or alternative resolutions.