Commonwealth Court Sets Path for Employers to Follow When Seeking to Establish an At-Fault Termination in Response to a Reinstatement Petition

06.30.22

Category: Pennsylvania

The Commonwealth Court has now addressed the often-confusing issue of whether an employee who has been terminated from employment while on modified duty because of a work-related injury is entitled to a reinstatement of benefits.  The Court did this by clarifying the burden on the employer to establish whether the termination from employment was the “fault” of the injured worker, or was related to the claimant’s partial work-related disability.  In the case of Franklin Montano v. Advance Stores Company, Inc. t/a Advance Auto Parts (WCAB), No. 732 C.D. 2021, filed June 27, 2022), the Commonwealth Court affirmed the denial of a Petition for Reinstatement, holding that the employer met its burden of establishing that claimant was not entitled to a reinstatement of total disability benefits due to his termination for cause.

In Montano, the claimant sustained a work injury to his back and right shoulder on May 30, 2017.  On June 13, 2017, claimant returned to work in a modified duty position with employer as a trainer.  On August 13, 2018, claimant was terminated from employment based on his job performance as a trainer.  Claimant sought a reinstatement of benefits on the basis that he was “terminated while on modified duty because of work injury related medical restrictions.”  While the Reinstatement Petition was pending, claimant underwent lower back surgery and right shoulder surgery.  The primary issue for the WCJ was whether claimant’s termination while on modified duty entitled claimant to a reinstatement of benefits.  Claimant testified that he was terminated without prior discipline, and denied that he had done anything wrong to lead to his termination.  Claimant further suspected his termination was because he was speaking with a union representative about signing up for a union organization.  The employer presented testimony from claimant’s supervisor who testified that, in August 2018, she notified her supervisor that claimant was not completing his paperwork as a trainer correctly.  She testified about informal counseling of claimant on numerous occasions, and official counseling on two occasions.  The employer fact witness was not involved in the termination process.  However, employer also submitted a report supporting the basis for claimant’s termination, which was admitted into evidence with no objection from claimant’s counsel under the business record exception.

In essence, the Court determined that claimant’s termination from the modified duty job was for legitimate performance reasons, and not related to the work injury that occurred 15 months prior.  The Court noted that a post-injury involuntary discharge should be considered in connection with the separate determination of job availability, rather than dispositive of loss of earning capacity.  A partially disabled employee who, by act of bad faith, would not be eligible for total disability benefits, since suitable employment was in fact available but for claimant’s own wrongful conduct.   The Court also addressed claimant’s argument on appeal as to whether the employer needs to establish that claimant was terminated for “bad faith” willful misconduct.  The Court cited to prior decisions, indicating that the issue is whether, through no fault of the claimant, the injury has once again affected claimant’s earning ability.  The issue is not one of misconduct akin to that found in the unemployment compensation setting; it is a question as to whether the claimant’s injury is affecting his ability to earn.

Comment:  This case was clearly decided on its specific facts, as well as the credibility determinations of the WCJ.  The employer’s evidence supported that claimant was terminated post-injury for submitting false training records.  The case’s successful outcome hinged on the employer keeping detailed records to support its termination of this employee while on modified duty for a work injury.  The employer further supported the testimony of its fact witness with business records detailing the reason for termination from employment.  It remains important for employers to keep detailed records, follow their own procedures regarding discipline, and present the appropriate person with knowledge as to the reasons for termination to overcome any argument by claimants that their termination was related to the work injury or their modified duty status.

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