Issue: Whether an employee’s election to receive pension benefits amounts to a voluntary withdrawal from the workforce and automatic suspension of workers’ compensation benefits.

 

Background: The employee sustained a work-related injury in 1997 and subsequently returned to work in a modified capacity. After being involved in a motor vehicle accident en route to a workers’ compensation doctors appointment, sustained additional injuries, and did not return to her modified-duty position. The employee went on to receive a disability pension, which required she first demonstrate an inability to return to her pre-injury job. The employer filed a Suspension Petition three years later after an IME showed Employee could work in a modified capacity on the theory that she had voluntarily withdrawn from the workforce by virtue of her receipt of the disability pension.

 

Ruling: The workers’ compensation judge denied the employer’s Petition and the Commonwealth, applying the a totality of the circumstances standard, affirmed.

The Supreme Court reinforced the totality of the circumstances standard applied by the Commonwealth Court and expressly ruled that an employee’s receipt of pension benefits, standing alone, is not tantamount to a voluntary removal from the workforce. The Court further held that receipt of pension benefits allows a permissive inference for a voluntary withdrawal; however, the employer must introduce additional evidence demonstrating the employee had retired in order for a suspension of benefits to be appropriate.

 

Practical Significance: While a claimant’s election to receive a pension benefits logically implies a voluntarily withdrawal from the workforce, employers must also proffer additional evidence demonstrating that the employee had effectively retired in order to suspend their workers’ compensation benefits. As such, when it becomes known that claimant has elected to receive any sort of pension, employers should proactively gather evidence reinforcing the permissive inference raised the receipt of those benefits before filing a Suspension Petition.