STATUTES CONSTRUED – MINN. STAT. § 176.135, SUBD. 5. The compensation judge did not err by determining that the employer did not have a right to reimbursement under Minn. Stat. § 176.135, subd. 5, because there had been no disablement of the employee as required by the statute.
Compensation Judge: Sandra J. Grove
Attorneys: Mark J. Freeman, Thill & Freeman, PLLC, Minneapolis, Minnesota, for the Respondent. David O. Nirenstein and Kelly B. Nyquist, Fitch, Johnson, Larson & Held, P.A., Roseville, Minnesota, for the Appellant.
Affirmed.
SEAN M. QUINN, Judge
The self-insured employer, Metropolitan Council, appeals from the compensation judge’s determination that the employer did not have a right to reimbursement under Minn. Stat. § 176.135, subd. 5. We affirm.
This appeal arises from a complicated set of facts overlaying a unique area of the Workers’ Compensation Act.
From 1986 through 2017, the employee, Dennis Sershen, worked successively in a variety of different capacities for five employers, Streater, Truth Hardware, SPX, ATEK, and Metropolitan Council. During his career, he was regularly exposed to occupational noise, which at times was extremely loud. Eventually, the employee developed hearing loss and was prescribed hearing aids. There is no evidence that the employee changed jobs or lost wages because of his hearing loss.
After he retired from working for reasons unrelated to his hearing loss, the employee brought a claim against his former employers and their respective workers’ compensation insurers, seeking medical benefits including payment for hearing aids, and permanent partial disability (PPD) benefits. All of the employers and insurers denied liability. The intervenor, Hear Now, Inc., provided medical care to the employee.
Prior to the hearing on the employee’s claims, the employee and the intervenor entered into a Pierringer[1] settlement with SPX and ATEK and their respective insurers. Consistent with Pierringer settlements, the employee maintained his right to seek workers’ compensation benefits from the remaining non-settling employers and insurers, but agreed to hold harmless the settling employers and insurers from claims for contribution and/or reimbursements brought by the non-settling employers and insurers.[2]
The employee’s claim for medical and PPD benefits against the remaining employers and insurers was heard by a compensation judge, who issued her Findings and Order on November 20, 2020. The compensation judge found that the employee’s exposure to workplace noise was a substantial contributing factor to his hearing loss, and that the last workplace noise exposure that significantly contributed to the employee’s hearing loss occurred during his employment with SPX. She found the employee had further occupational exposures to noise in his subsequent employment with ATEK and Metropolitan Council, but that those exposures were not significant contributing factors to the hearing loss. Despite this finding, the judge held that Metropolitan Council, as the last employer where the employee was exposed to noise, was required to pay medical benefits, including payment to the intervenor, pursuant to the provisions of Minn. Stat. § 176.135, subd. 5. Because the employee had settled his case with SPX, the compensation judge concluded that the issue of PPD was moot and made no findings as to any PPD rating.
Metropolitan Council appealed to this court, and we affirmed. Sershen v. Metro. Council, No. WC21-6395 (W.C.C.A. June 24, 2021). Metropolitan Council appealed our decision to the supreme court, which affirmed the compensation judge’s conclusion that Metropolitan Council was liable for the employee’s medical benefits under Minn. Stat. § 176.135, subd. 5. However, the supreme court further held that because there was a Pierringer settlement, the compensation judge should have made a determination as to whether Metropolitan Council had a right of reimbursement, rather than leave that question open for subsequent resolution through a petition for reimbursement. [3] The supreme court accordingly remanded the case to the compensation judge to determine whether the employee had a “disablement,” thereby triggering a right of reimbursement under Minn. Stat. § 176.135, subd. 5. If so, the compensation judge was to determine the effect of the Pierringer settlement on the mechanics of that reimbursement. The court also noted that if the employee was ultimately determined to be liable for that reimbursement due to the Pierringer settlement, then the employee, not Metropolitan Council, would have to pay the medical expenses. Sershen v. Metro. Council, 974 N.W.2d 1 (Minn. 2022).
At the hearing on remand, the parties stipulated that the employee had at least a two percent PPD rating. Based on that stipulation, Metropolitan Council argued that the employee had suffered disablement sufficient to create a right to reimbursement for the medical benefits it was ordered to pay under Minn. Stat. § 176.135, subd. 5. The employee asserted that there was no disablement because he was never unable, as a result of his hearing loss, to earn full wages at the work in which he was last employed. The compensation judge found that no disablement had occurred within the meaning of the reimbursement provision. She further concluded that, in the absence of a right to reimbursement, potential questions over the effect of the Pierringer agreement on such a reimbursement were moot. Metropolitan Council appeals.
The facts of this case are not in dispute for the purposes of this appeal. The only issue presented is one of statutory interpretation. 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), summarily aff’d (Minn. June 3, 1993).
Whether Metropolitan Council is entitled to reimbursement for the medical expenses it was required to pay under Minn. Stat. § 176.135, subd. 5, depends on whether the stipulated fact of a PPD rating constitutes disablement. That subdivision provides:
Minn. Stat. § 176.135, subd. 5 (emphasis added). The compensation judge reasoned that where the first paragraph of the provision defines “disabled” as being unable to earn full wages at the employee’s last job, then “disablement” in the second paragraph logically carries the same definition. Since there is no dispute that the employee remained able to work at full wages in his last job, the compensation judge concluded that there had been no disablement under this subdivision and therefore Metropolitan Council did not have a right to reimbursement.Notwithstanding section 176.66, an employee who has contracted an occupational disease is eligible to receive compensation under this section even if the employee is not disabled from earning full wages at the work at which the employee was last employed.
Payment of compensation under this section shall be made by the employer and insurer on the date of the employee’s last exposure to the hazard of the occupational disease. Reimbursement for medical benefits paid under this subdivision or subdivision 1a is allowed from the employer and insurer liable under section 176.66, subdivision 10, only in the case of disablement.
On appeal, Metropolitan Council asserts that the compensation judge incorrectly interpreted the statutory language and renews its argument that a ratable PPD, standing alone, constitutes disablement under Minn. Stat. § 176.135, subd. 5. In considering this question, we must review the lengthy history of the law interpreting disablement in our occupational disease statutes.
From 1921, when an occupational disease section was first added to Minnesota’s workers’ compensation laws, until 1973, a specific statutory definition of the term “disablement” was provided in the occupational disease statutes. That definition did not materially change throughout that period. Most recently, that definition was included in Minn. Stat. § 176.66, subd. 1 (1972), which provided:
(Emphasis added.) At the time that this definition of “disablement” existed, employees, whether due to an injury or to an occupational disease, were precluded from receiving PPD benefits without wage loss. Both benefits were considered aspects of the loss of earning capacity. Boquist v. Dayton-Hudson Corp., 297 Minn. 14, 209 N.W.2d 783, 27 W.C.D. 167 (1973).The disablement of an employee resulting from an occupational disease, except where specifically otherwise provided, is to be treated as the happening of an accident within the meaning of the workmen's compensation law and the procedure and practice provided applies to all proceedings under this section, except where specifically otherwise provided herein. When used in this section, “disability” means the state of being disabled from earning full wages at the work at which the employee was last employed and “disablement” means the act of becoming so disabled.
Amendments to the Workers’ Compensation Act in 1973 removed the specific language defining “disability” and “disablement” from Minn. Stat. § 176.66, subd. 1. Similarly, in 1974, PPD benefits were made separate stand-alone benefits regardless of whether there was any wage loss. Minn. Stat. § 176.021, subd. 3. This later amendment evinced an intent by the legislature to allow wage loss benefits for injuries that cause loss of earnings and to allow PPD benefits for injuries that cause loss of function, independent of the other. The supreme court noted the new 1974 law by stating, “Accordingly, we hold that the legislature has made impairment of function compensable for its own sake in the form of damages separate and distinct from wage loss.” Tracy v. Streater/Litton Indus., 283 N.W.2d 909, 914, 32 W.C.D. 142, 148 (Minn. 1979); see also Smith v. Armour and Co., 316 N.W.2d 925, 34 W.C.D. 574 (Minn. 1982).
As to the 1973 amendments, however, the supreme court reasoned in 1982 that because “the meaning of the term ‘disablement’ was well established at the time the statute was amended . . . if the legislature had intended to use the term in a different sense in the amended statute, it would have said so.” Abram v. Art Goebel Ford, 327 N.W.2d 88, 91, 35 W.C.D. 495, 500 (Minn. 1982). In that case, the employee’s occupational disease claim for PPD and wage loss was denied because he had no wage loss. The court held that in an occupational disease case, an employee was required to establish an inability to earn full wages at the last job to show disablement and thus entitlement to PPD. See also Guggenberger v. Cold Spring Granite Co., 332 N.W.2d 655, 35 W.C.D. 846 (Minn. 1983) (the employee’s claim for PPD for occupational exposure denied without a showing of wage loss).[4]
Subsequently, in Moes v. City of St. Paul, 402 N.W.2d 520, 39 W.C.D. 675 (Minn. 1987), the supreme court clarified that this statutory definition has two intrinsic parts, 1) an inability to earn full wages, and 2) at the work in which last employed. Thus, the court held that an employee was able to receive PPD benefits in an occupational disease case where the employee was able to continue earning full wages but the occupational disease necessitated a job transfer due to “functional loss of use.” Moes, 402 N.W.2d at 527, 39 W.C.D. at 687. The court stated, “A contrary holding making permanent partial disability benefits for occupational disease dependent solely on wage loss would contravene the language of [section 176.021, subdivision 3]. We fail to see why permanent partial disability benefits for occupational disease should be dependent on wage loss, while permanent partial disability benefits for scheduled disabilities is available regardless of whether employee has lost earnings.” Id. at 527-28, 39 W.C.D. at 687 (this decision overruled the Guggenberger decision to the extent they were inconsistent). Yet, some aspect of “disablement” not required in other workers’ compensation cases was still required for PPD to be payable in occupational disease cases.
With the development of the law in mind, we conclude that the compensation judge’s interpretation of disablement as used in Minn. Stat. § 176.135, subd. 5, is not only internally consistent with the other language of that section, but with the long-established definition of the term in the occupational disease statutes. We note that, despite repealing the definition of “disablement” in Minn. Stat. § 176.66, subd. 1, the legislature retained similar language in the statute at issue, Minn. Stat. § 176.135, subd. 5, and cross-referenced Minn. Stat. § 176.66. Applying the supreme court’s reasoning in Abram, we conclude that the legislature intended that the term “disablement” in this provision similarly retains the established definitional meaning that is consistent with the prior language of Minn. Stat. § 176.66. Absent action by the legislature changing that definition, or more recent precedent from the supreme court addressing the issue, we must adhere to that definition.
Metropolitan Council contends that a modifying precedent is found in the text of the decision by which the supreme court remanded this case, arguing that the court stated “disablement” is established when the employee has any ratable PPD. We are not persuaded. This argument relies on language in the supreme court’s decision that is directly quoted from an earlier supreme court decision, Conwed Corp. v. Union Carbide Chemicals and Plastics Co., Inc., 634 N.W.2d 401 (Minn. 2001). In that case, where the definition of “disablement” was not at issue, the supreme court addressed a certified question[5] from a federal district court by prefacing the answer with the following statement:
Conwed, 634 N.W.2d at 409 (emphasis added). In support of this statement, the supreme court cited Flint v. Am. Can Co., 426 N.W.2d 190, 41 W.C.D. 68 (Minn. 1988). In that case, the court held that an employee who had changed his job due to an occupational exposure was entitled to receive PPD benefits. There was no holding in Flint that without a wage loss or a job change, PPD alone was sufficient to satisfy the definition of “disablement.”As a general rule, an employee’s cause of action for workers’ compensation benefits stemming from an occupational disease does not accrue at the time of exposure, but rather when the employee suffers disablement, meaning that the employee’s illness has led to a wage loss, job transfer, or permanent impairment.
In the decision remanding this case to the compensation judge, the supreme court directly quoted Conwed, stating:
Sershen, 974 N.W.2d at 8 (emphasis added). Metropolitan Council argues that by stating that an occupational disease claim based on “disablement” may accrue when the illness results in “permanent impairment,” the court clearly meant that a PPD rating satisfies any requirement of “disablement” in occupational disease cases.The Workers’ Compensation Act does not define “disablement,” but we have said that a claim based on “disablement” from an occupational disease accrues when “the employee’s illness has led to a wage loss, job transfer, or permanent impairment.”
We note that the quoted language was part of a short, generalized introduction to the legal concepts underlying compensability for an occupational disease, just as it was in Conwed. The quote directly preceded the court’s discussion of Metropolitan Council’s claim that awarding medical expenses against the last employer was inconsistent with the statutory scheme for other kinds of benefits in occupational disease cases, where liability is placed only on the employer with the last significant exposure. The court rejected that argument, noting that the statute assigning liability for medical benefits on the last employer was in a separate section related to medical benefits, and not alongside other occupational disease provisions, and expressly applied “notwithstanding” anything in those provisions. In addition, the court did not refer to this quoted language or any part of it in setting out the issues which the compensation judge was directed to consider on remand. Accordingly, the language quoted by the appellant appears to be general background material, not a definitional mandate. Further, “permanent impairment” could reasonably be interpreted as permanent functional impairment that limits the employee’s ability to continue working at the last job, which would fit within the court’s longstanding interpretation of “disablement,” unlike the suggested interpretation of the term as any ratable PPD.[6]
The supreme court has consistently held that the term “disablement” in the occupational disease statute requires that an employee became unable to work at full wages in the work at which last employed. This has been further explained to mean actual wage loss due to the occupational exposure or a job change due to that exposure. We conclude that had the supreme court intended in Sershen to further expand the definition of “disablement” as asserted by Metropolitan Council, and to specially mandate this expanded definition to be applied on remand in this case, such would have been clearly and unambiguously stated.
Consequently, we affirm the compensation judge’s conclusion that the term “disablement” for the purposes of Minn. Stat. § 176.135, subd. 5, requires an inability to earn full wages at the specific job the employee was performing at the time of his last employment during exposure to the hazard. Because the employee here experienced no wage loss or change in job duties because of his noise exposure, there has been no disablement. Without disablement, Minn. Stat. § 176.135, subd. 5, does not provide a right of reimbursement to Metropolitan Council for the medical expenses payable pursuant to that section.
Having affirmed the compensation judge’s denial of reimbursement, we accordingly affirm the compensation judge’s conclusion that any potential issues related to the effect of the Pierringer settlement on the mechanics of reimbursement are moot.
[1] Pierringer v. Hoger, 21 Wis.2d 182, 124 N.W.2d 106 (1963); see also Frey v. Snelgrove, 269 N.W.2d 918 (Minn. 1978).
[2] The intervenor retained its right to seek the remaining balance of its intervention claim from the non-settling employers and insurers.
[3] The supreme court called into question whether Pierringer settlements, a creature of civil common law, were appropriate to use in the context of a statutory workers’ compensation claim. Because the parties did not argue this issue, the viability of Pierringer settlements in workers’ compensation cases was not addressed.
[4] The dissent in Guggenberger reasoned that because the case only involved a claim for PPD benefits, there was little reason to require proof of wage loss in order for the PPD benefits to be compensable, particularly since no requirement existed for non-occupational disease injuries. Later, in Green v Boise Cascade Corp., 377 N.W.2d 924, 38 W.C.D. 301 (Minn. 1985), the supreme court noted the unfairness to an employee who has a PPD claim due to an occupational disease, but who did not suffer wage loss, being required to choose between taking another job at reduced wages or earning no wages in order to receive PPD benefits on the one hand, or on the other hand, continuing to face the exposure of the known occupational hazard but receive no PPD benefits despite having quantifiable impaired function. The court declared this to be a question for the legislature. Because the employee was not disabled, in that he had not suffered any wage loss, he was not entitled to any PPD benefits from his occupational disease.
[5] The question was whether an employer had a viable third-party claim in cases where employees exposed to an occupational disease hazard had not yet manifested symptoms and thus had not yet received workers’ compensation benefits.
[6] Interpreting “permanent impairment” as suggested by Metropolitan Council in this context would nullify the requirement to prove disablement in cases where there is a PPD rating in that Metropolitan Council argues “disablement” and PPD are synonymous. In addition, in such cases where there are no other payable benefits other than medical benefits, requiring an employer that has no other liability to reimburse the medical benefits paid by the last employer would appear to contravene Minn. Stat. § 176.135, subd. 5.