The employee appeals from the compensation judge’s determination that “[t]he preponderance of the evidence supports a Finding that effective August 1, 2012, the employer and insurer can reduce the amount of permanent total disability benefits being paid by the amount of PERA retirement benefits being paid to the employee.”  We affirm.

The facts of this case are largely undisputed.  The employee herein, Ms. Sharyn Hartwig, sustained multiple injuries arising out of and in the course and scope of her employment for Traverse Care Center, the employer herein, between September 2005 and May 2010.  The employee’s work injuries were all admitted or adjudicated and determined to be work related.  At the hearing in the present matter, which took place on March 6, 2013, the parties stipulated that all of the employee’s injuries with the employer are substantial contributing factors in the employee’s overall disability and need for medical care and treatment.  In addition, the parties stipulated that the employee is and has been permanently and totally disabled from and after May 5, 2010 and that she is entitled to permanent total disability benefits as allowed by Minn. Stat. § 176.101, subds. 4 and 5.

The employee received $25,000.00 in permanent total disability (PTD) benefits as of March 8, 2011, based upon a PTD rate of $570.70 per week.  The employee began receiving Public Employees Retirement Association (PERA) retirement benefits effective August 1, 2012.  The employee began drawing these benefits because she had reached the age of 70, and there would have been penalties imposed if she did not begin drawing said benefits before the age of 70 and 1/2.

A dispute arose with regard to whether the employer and insurer were entitled to offset the PERA retirement benefits against ongoing permanent total disability benefits.  On March 6, 2013, the parties presented the case by stipulated facts to Compensation Judge Rolf G. Hagen, and the parties asked the compensation judge to determine “whether the employee’s permanent total disability benefits can be offset by her receipt of PERA benefits.”

The compensation judge determined that pursuant to Minn. Stat. § 176.101, subd. 4 and Minn. R. 5222.0100, subp. 4, the employer and insurer were entitled to an offset and that they could reduce the amount of permanent total disability benefits being paid by the amount of PERA retirement benefits being paid to the employee.

“[A] decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which [the Workers’ Compensation Court of Appeals] may consider de novo.”  Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993).

Minn. Stat. § 176.101, subd. 4 states, in pertinent part, that:

The employee argues that Minn. R. 5222.0100, subp. 4, has no force and effect for injuries occurring after the repeal of § 176.132, including the employee’s injuries.  Rule 5222.0100, subp. 4, was promulgated by the Department of Labor and Industry pursuant to Minn. Stat. § 176.132, which allowed for supplementary benefits.  The purpose of the rule was to specify the procedure by which an employer could obtain an administrative finding of permanent total disability in order to obtain reimbursement of supplementary benefits.  Minn. Stat. § 176.132 was repealed in 1995.  Therefore, we agree that Minn. R. 5222.0100, subp. 4, has no force and effect with regard to the employee’s injuries.

The employee argues that allowing the employer and insurer to reduce permanent total disability benefits by contributions made by the employee is a violation of the employee’s right to equal protection and a violation of the employee’s constitutional rights.  She also argues that it is unfair to subject government employees to offsets that are not necessarily imposed on other types of employees.  The compensation judge stated that he “acknowledges that taking the offset for PERA retirement benefits significantly impacts the employee’s financial status.”  However, the compensation judge determined that he did not have jurisdiction to address a constitutional argument, and that “Any changes in the Statute or Rule must necessarily be made either Legislatively and/or changed through the Rule making process.”  We also lack any such jurisdiction to address the employee’s constitutional arguments.  See, e.g., Clabo v. Bor-Son Constr. Co., 481 N.W.2d 47, 46 W.C.D. 171 (Minn. 1992).  Therefore, we will not address the employee’s constitutional arguments, but we do acknowledge them in order to preserve them for further proceedings, if any.

The employee also argues that nothing in the language of Minn. Stat. § 176.101, subd. 4, allows an employer and insurer to reduce permanent total disability benefits by retirement benefits.  In other words, she argues that the compensation judge erred in determining that Minn. Stat. § 176.101, subd. 4, allows governmental employers and insurers to receive an offset when the injured worker begins drawing a retirement and not a disability pension benefit from a governmental employer.  As such, she argues that the language of Minn. Stat. § 176.101, subd. 4, allows only for an offset of government disability benefits or Social Security old age and survivorship benefits against PTD benefits.  We disagree.

The Supreme Court has not addressed this issue directly.  However, in Potucek v. City of Warren, 535 N.W.2d 333, 336, 53 W.C.D. 88, 91 (Minn. 1995), it stated:

In Telle v. Northfield Iron Co., the Minnesota Supreme Court held that the statutory offset language, at that time, limited the credit against permanent total disability benefits to old age and survivor benefits and did not include Social Security disability benefits.  278 Minn. 129, 132, 153 N.W.2d 270, 272, 24 W.C.D. 300, 303 (1967).^[1]  Later in 1967, after the decision in Telle, the legislature amended Minn. Stat. § 176.101, subd. 4, to read as follows:

This court examined the 1967 amendment in Kramer v. City of St. Paul, 33 W.C.D. 425 (W.C.C.A. 1981).  In Kramer, the employee was receiving a PERA retirement pension based only on his age and years of service.  Id. at 427.  This court noted that the employee went “to great length” in distinguishing his service pension retirement benefits from disability retirement benefits.  Id.  The employee also argued that the language “any old age and survivor insurance benefits” referred only to Social Security benefits.  Id. at 426.  This court analyzed the changes in the offset provision and held that “the [legislative] intent was to make clear that all old age and survivor insurance benefits were to be considered,” and not just federal benefits as the legislature had done in other portions of the statute.  Id. at 426-27.  This court specifically rejected the employee’s contention that the offset applied only to Social Security old age benefits and concluded that by amending the statute as it had, the legislature intended the offset to apply to any government old age benefits, including the service pension retirement benefits at issue.  Id. at 427-28; see also Wicks v. City of South St. Paul, slip op. (W.C.C.A. Nov. 18, 1998) (allowing an offset where PERA payments made to the employee were based on a service pension program and not a disability benefit program).  Ultimately, it remains true that “[t]his court has long interpreted the language of [Minn. Stat. § 176.101, subd. 4] to require the offset from permanent total disability payments not only of federal social security retirement benefits, but also a variety of state and local government retirement benefits.”  Adamski v. Kenneth Setterholm’s Farm, 58 W.C.D. 119, 121 (W.C.C.A. 1998) (citing Kramer, 33 W.C.D. 425; Wicks, slip op.).

The employee argues that the cases allowing for an offset under Minn. Stat. § 176.101, subd. 4, occurred prior to the repeal of supplementary benefits and are, therefore, distinguishable.  We disagree.  The offset provision in Minn. Stat. § 176.101, subd. 4, was originally enacted in 1953 and amended in 1967, as discussed above.^[2]  Minn. Stat. § 176.132 took effect in 1972.  As such, the reasoning in cases such as Kramer, Adamski, and Wicks is still valid.  Furthermore, supplementary benefits were intended to raise compensation levels for low-wage earners at the time of injury or to increase compensation for those whose benefits were reduced by simultaneous receipt of government old age or disability benefits, subject to the limitations in Minn. Stat. § 176.132.  Thus, receipt of supplementary benefits made it possible, in some cases, for an injured worker to receive permanent total disability benefits at the supplementary benefit level plus his or her full retirement disability pension benefits.  See Flower v. Metropolitan Council, 61 W.C.D. 358, 363-65 (W.C.C.A. 2001).  The repeal of supplementary benefits did away with this possibility, while the offset provision in Minn. Stat. § 176.101, subd. 4, remained in effect.  Had the legislature intended to allow employees to continue to receive both of these amounts, as the employee proposes, it could have amended the offset provision in Minn. Stat. § 176.101, subd. 4.  It did not.

The employee argues that her pension benefits relate solely to retirement and that she has paid in to her pension account from the time she began working at the employer in 1996.  Therefore, she argues that ordering the employee to use her pension income to offset the employer and insurer’s obligation to pay permanent total disability benefits essentially amounts to a subsidy paid by the employee to the employer and insurer for permanent total disability benefits due and owing under the Workers’ Compensation Act.

However, the terms of a public employee pension, such as the employee’s in this case, are unlike those of a pension provided through a private employer that is governed by contract.  See Cole v. Armour & Co., 257 N.W.2d 381, 30 W.C.D. 40 (Minn. 1977).  In terms of simultaneous retirement and PTD benefit payments, private sector employees may be subject to contractual offsets of retirement benefits pursuant to their pension agreements, while public sector employees are subject to the offset of their permanent total disability benefits pursuant to Minn. Stat. § 176.101, subd. 4.  In essence, then, public and private employees may be subject to different or even opposite offsets to accomplish the same goal, which is avoiding duplication of wage loss benefits.  Therefore, while we find it somewhat troubling that public employees are subject to different offsets than private sector employees, we believe this is an equal protection question that is outside of our jurisdiction.  In addition, to the extent that there is any unfairness in the system, as the employee argues, “[i]t is for the legislature, not the Court[s], to judge the social utility of this statutory system, which has no common law counterpart, to balance the interests of employees and employers, and to make whatever adjustments and corrections it deems appropriate.”  Parson v. Holman Erection Co., Inc., 428 N.W.2d 72, 76, 41 W.C.D. 129, 135 (Minn. 1988).^[3]

Here, the employee began drawing her retirement pension benefits by operation of reaching a certain age.  However, she is effectively asking to receive payment of the full amount of her governmental retirement pension benefits along with the full amount of her permanent total disability benefits.  That outcome may have been possible, subject to certain limitations, when supplementary benefits were in effect, but it is no longer possible under the current statutory structure.  Rather, Minn. Stat. § 176.101, subd. 4, allows the employee to collect the full amount of her pension benefits while receiving only a reduced amount of permanent total disability benefits after the $25,000.00 threshold has been reached.  Therefore, we conclude that the compensation judge did not err in determining that the employer and insurer were entitled to reduce the employee’s PTD payments pursuant to the offset provided by Minn. Stat. § 176.101, subd. 4, and this result is in accord with the balancing of wage loss benefits.  See Sundby, 693 N.W.2d at 211, 65 W.C.D. at 143-44 (citing 9 Larson’s Workers’ Compensation Law § 157.01).^[4]