CHAD S. PIKULA, Employee/Appellant, v. WADENA COUNTY and MINNESOTA COUNTIES INS. TRUST, Employer-Insurer, and MERITCARE HEALTH SYS. and MN DEP=T OF HUMAN SERVS., Intervenors.
WORKERS= COMPENSATION COURT OF APPEALS
AUGUST 2, 2007
WAGES - BENEFIT PAY. Substantial evidence supports the compensation judge=s decision not to include employer contributions for health insurance premiums in the weekly wage.
APPORTIONMENT - PERMANENT PARTIAL DISABILITY. Where there was no evidence that the employee had sustained an impairment of function from an earlier work injury despite a rating of permanent partial disability, it was error for the compensation judge to award an offset for the permanent partial disability payable as a result of the current injury.
Affirmed in part and reversed in part.
Determined by: Stofferahn, C.J., Wilson, J., and Pederson, J.
Compensation Judge: Gary Hall
Attorneys: Michael D. Miller, McCollum, Crowley, Moschet & Miller, Bloomington, MN, for the Appellant. Thomas J. Christenson, Attorney at Law, Fargo, ND, for the Respondents.
DAVID A. STOFFERAHN, Judge
The employee appeals from the compensation judge=s determination of the weekly wage on the date of injury. The employee also appeals from the compensation judge=s finding that permanent partial disability benefits are to be offset in part by the permanent partial disability rated for a previous work injury. We affirm in part and reverse in part.
Chad Pikula, the employee, sustained a work-related injury on August 25, 2004, while working for Wadena County. Primary liability for the injury was admitted and various workers= compensation benefits were paid.
A claim petition filed by the employee in February 2006 was heard by Compensation Judge Gary Hall on December 28, 2006. A number of issues for determination were identified by the parties at the hearing. The compensation judge=s decision on two of those issues is the basis for the present appeal.
The parties disputed the employee=s weekly wage on the date of injury. The employee claimed a wage of $777.17 and the employer admitted a wage of $570.79. The compensation judge found a wage of $618.98. The compensation judge included overtime earnings as requested by the employee but refused to include the employer=s contribution of $478.62 per month for health insurance premiums. The employee appeals this issue.
The employee claimed entitlement to 13% permanent partial disability, based on a rating by his treating doctor, Dr. Timothy Studer. The employer alleged that the employee had no permanent partial disability attributable to the 2004 work injury, relying on the opinion of the IME, Dr. Robert Hartman. The compensation judge concluded the employee had permanent partial disability of 12% pursuant to Minn. R. 5223.0390, subp. 4.D(1) but gave an offset to the employer for 10% permanent partial disability rated by Dr. Manuel Pinto as the result of a 1993 work injury with a different employer. The employee appeals the award of an offset.
The compensation judge concluded that the employee=s wage was Airregular@ within the meaning of Minn. Stat. § 176.011, subd. 3, and averaged the employee=s earnings for the 26 weeks preceding the injury. He also determined that overtime worked by the employee was Aregular or frequent@ and included these earnings in the wage calculation. Minn. Stat. § 176.011, subd. 18. Those findings have not been appealed by any party. At issue here is whether payments made by the employer for health insurance premiums for the employee should have been included in the weekly wage calculation. The compensation judge determined that those payments were not includable.
The contract between Wadena County and the employee=s union, Local 49 of the International Union of Operating Engineers, provides that the Aemployer=s contribution for single family coverage is towards premiums for coverage for each employee employed by the employer who qualifies for and is enrolled in the employer=s group health and hospitalization plan. Any additional costs of the premium over and above the contribution the employer listed should be paid by the employee through payroll deduction.@ Under the contract, the county contributed $478.62 monthly for employees electing single coverage. A larger amount was contributed for employees selecting family coverage and an employee who provided Aevidence of coverage in a group sponsored plan elsewhere@ received a lesser amount.
In support of his claim, the employee introduced a printout identified as Aemployee check history@ (Petitioner=s Ex. A). $478.62 is shown as a monthly payment in a column labeled Aother pay.@ The amount is included in gross pay and it appears to have been subject to withholding for taxes and FICA. However, for each paycheck when $478.62 was included in gross pay, $364.07 was subtracted before net pay was calculated. The employee testified he did not understand the details of the employer=s contribution and was not able to explain the exhibit. The employer called an employee from the county auditor=s office who testified that the employer=s contribution was for health insurance premiums. The witness was unable to explain the subtractions noted on Petitioner=s Exhibit A.
The general rule, as set forth in a number of decisions by this court, is that benefits that the employee cannot use at his discretion and that are not taxable as wages, are not considered a part of the employee=s wage. Powell v. Northern Cass DAC, slip op. (W.C.C.A. Aug. 20, 1996); Prochnow v. Robert Gibb and Sons, 66 W.C.D. 353 (W.C.C.A. 2006).
The record is clear that the money paid by the employer was for health insurance premiums only and was not available for the employee to use at his discretion. If the employee had provided evidence of other health insurance coverage, he would not have received the payment of $478.62 for his own use and he could not designate another purpose for the payment.
The compensation judge found the evidence that the monthly payments were taxable to be unpersuasive. Although the monthly payments show up in Petitioner=s Exhibit A under the column headed Aother pay,@ there was no explanation for amounts under that heading or for the subtractions for pay reflected in this exhibit. There were no tax returns introduced and neither witness at the hearing could explain the figures.
Given this record, we are not able to conclude that the compensation judge erred in refusing to include the employer=s contribution for health insurance premiums in the calculation of weekly wage. The compensation judge=s determination on this issue is affirmed.
Permanent Partial Disability Offset
Minn. Stat. § 176.101, subd. 4a, provides for a reduction in the permanent partial disability paid an employee for an injury if the Adisability is attributable in part to a preexisting disability.@ In Beck v. Dick & John=s Price Rebel, 40 W.C.D. 254, 257 (W.C.C.A. 1987), this court considered this subdivision and held that the statute Arequires medical evidence that the employee suffered loss of use or impairment of function prior to the personal injury.@ The Beck decision was recently reviewed by this court in Frampton v. Cub Foods, 65 W.C.D. 251 (W.C.C.A. 2005) and the holding in Beck was reaffirmed. A prior rating of permanent partial disability alone is not a sufficient basis for apportionment of permanent partial disability; there must be evidence of a previous loss of function which contributes to the present disability.
We find no such evidence in the present case. The employee injured his low back in his employment at Perham Egg on August 9, 1993. He was lifting flats of eggs and twisting when he felt sharp pain with tingling in his left leg. The leg pain resolved shortly and he was left with persistent low back pain.
The employee received conservative medical care for his injury. A CT scan done in November 1993 showed bulging discs from L2 to S1 with Schmorl=s nodes and no herniation. The employee was referred to Dr. Manuel Pinto on February 4, 1994, for surgical consultation. Given the discogram study which showed degenerative discs at a number of levels, Dr. Pinto recommended against surgery. Dr. Pinto instead recommended an FCA and a return to work within the restrictions established by the assessment. The FCA results and any employment restrictions are not in the record. In January 1995, Dr. Pinto rated the employee as having 10% permanent partial disability. The employee testified that after he left Perham Egg he worked at a number of jobs, including dry wall work for about five years. His duties included hanging dry wall panels weighing between 80 and 100 pounds. Dr. Pinto=s records note the employee came in on November 9, 1995, stating that he had reinjured his back in October or November of 1994 while he was picking up sheet rock. Dr. Pinto provided pain medication. The employee testified that he was able to do all of his jobs after Perham Egg with no difficulty. The medical records in evidence show no treatment for back problems between November 1995 and his work injury in August 2004 - - a period of almost nine years.
In its response, the employer cites to no evidence that would show the 1993 injury contributed to the present disability. The compensation judge refers to no such evidence and states in his memorandum that Athe employee continued to have some problems but was able to function without serious limitation until his injuries at Wadena County.@
We must conclude there is not sufficient evidence to support the compensation judge=s award of an offset against permanent partial disability. The compensation judge=s decision on this issue is reversed.
 Dr. Pinto=s chart notes indicate that he rated the employee under Minn. R. 5223.0090 1C.(2). That is almost certainly a mistake, since that section deals with sensory loss of the upper extremities. He may have meant to refer to 5223.0390, subd. 3.C.2, which refers to multi-level degenerative changes in the low back.