DiBenedetto v. West Shore Hosp.

• Decision Date: 09 February 2000
• Docket Number: Docket No. 112083, Calendar No. 11.
• Citation: 605 N.W.2d 300,461 Mich. 394
• Parties: Margaret DIBENEDETTO, Plaintiff-Appellee, v. WEST SHORE HOSPITAL, Defendant-Appellee, and Second Injury Fund (Two Years of Continuous Disability Provisions) Defendant-Appellant.
• Court: Michigan Supreme Court

605 N.W.2d 300

461 Mich. 394

Margaret DIBENEDETTO, Plaintiff-Appellee, v. WEST SHORE HOSPITAL, Defendant-Appellee, and Second Injury Fund (Two Years of Continuous Disability Provisions) Defendant-Appellant.

Docket No. 112083, Calendar No. 11.

Supreme Court of Michigan.

Argued October 12, 1999.

Decided February 9, 2000.

Frederick W. Bleakley, Muskegon, MI, for the plaintiff-appellee.

Jennifer M. Granholm, Attorney General, Thomas L. Casey, Solicitor General, and Rose A. Houk, Assistant Attorney General, Lansing, MI, for the defendant-appellant.

Opinion

MARKMAN, J.

In this case, we must decide whether the Worker's Compensation Appellate Commission (WCAC) properly analyzed two statutory provisions of the Worker's Disability Compensation Act (WDCA), M.C.L. § 418.101 et seq.; MSA 17.237(101) et seq. The first provision allows an injured employee the opportunity to request an increased benefit rate after two years of continuous disability if the employee's earnings would have been expected to increase because of certain enumerated factors. MCL 418.356(1); MSA 17.237(356)(1). The second provision requires termination of an injured employee's wage loss benefits when the employee's average weekly wage (AWW) from subsequent employment exceeds the AWW the employee received before the date of injury. MCL 418.301(5)(c); MSA 17.237(301)(5)(c).

The question this Court must resolve is whether subsection 301(5)(c) permits the worker's compensation magistrate to compare an injured employee's AWW from subsequent employment to the AWW imputed to the injured employee under subsection 356(1) more than two years after the date of injury. This question is clearly resolved by the plain language of subsection 301(5)(c), which requires the magistrate to compare the "average weekly wage of the employee" from subsequent employment with the "average weekly wage the employee received before the date of injury." MCL 418.301(5)(c); MSA 17.237(301)(5)(c) (emphasis added). The language "before the date of injury" precludes comparison between an injured employee's AWW from subsequent employment and the AWW imputed to the employee under subsection 356(1) more than two years after the date of the injury. We therefore reverse the decision of the Court of Appeals and reinstate the order of the WCAC.

On August 26, 1986, plaintiff Margaret DiBenedetto was injured in the course of her part-time employment as a licensed practical nurse at West Shore Hospital. Plaintiff's employer voluntarily paid her worker's compensation benefits at a rate of $108.12 a week. On May 17, 1989, more than two years after her injury, plaintiff requested an increased benefit rate under subsection 356(1) of the WDCA. M.C.L. § 418.356(1); MSA 17.237(356)(1) provides, in pertinent part:

An injured employee who, at the time of the personal injury, is entitled to a rate of compensation less than 50% of the then applicable state average weekly wage as determined for the year in which the injury occurred pursuant to section 355, may be entitled to an increase in benefits after 2 years of continuous disability. After 2 years of continuous disability, the employee may petition for a hearing at which the employee may present evidence, that by virtue of the employee's age, education, training, experience, or other documented evidence which would fairly reflect the employee's earning capacity, the employee's earnings would have been expected to increase. Upon presentation of this evidence, a worker's compensation magistrate may order an adjustment of the compensation rate up to 50% of the state average weekly wage for the year in which the employee's injury occurred. The adjustment of compensation, if ordered, shall be effective as of the date of the employee's petition for the hearing.... There shall be only 1 adjustment made for an employee under this subsection.

The worker's compensation magistrate determined that plaintiff was totally disabled as a result of her work-related injuries and was therefore entitled to benefits. The AWW plaintiff received from her employment in 1986, before the date of her injury, was $141.61. The magistrate determined that plaintiff's AWW would have been expected to increase from $141.61 to $365.38 by the time she filed her 1989 petition, but for her 1986 work-related injury. Applying subsection 356(1), the magistrate awarded plaintiff benefits at fifty percent of the 1986 state AWW, $207.35. Defendant Second Injury Fund (SIF), which was responsible for paying the increased benefit amount to plaintiff, appealed to the WCAC, which affirmed the magistrate's decision.

Plaintiff subsequently returned to work at West Shore Hospital, although not in her skilled employment as a licensed practical nurse. She worked a part-time schedule until late 1990 or early 1991, when she began full-time work. Her weekly wage from this employment fluctuated between $250 and $370. In March 1993, the SIF petitioned for termination of plaintiff's wage loss benefits under subsection 301(5)(c), arguing that plaintiff earned more from her subsequent employment than the AWW she received before the date of her injury. MCL 418.301(5)(c); MSA 17.237(301)(5)(c) provides, in pertinent part:

If disability is established pursuant to subsection (4), entitlement to weekly wage loss benefits shall be determined pursuant to this section and as follows:

* * * * * *

(c) If an employee is employed and the average weekly wage of the employee is equal to or more than the average weekly wage the employee received before the date of injury, the employee is not entitled to any wage loss benefits under this act for the duration of such employment.

The worker's compensation magistrate denied the SIF's petition to terminate benefits, concluding that plaintiff's AWW had been revised by the subsection 356(1) award and that her wage loss benefits should be determined by comparing her earnings from subsequent employment to her revised AWW. The SIF appealed to the WCAC, arguing that the decision to terminate wage loss benefits under subsection 301(5)(c) requires a comparison between the injured employee's AWW received from her subsequent employment and the AWW she "received before the date of injury." Under this construction, the amount plaintiff earned from her subsequent employment, between $250 and $370 a week, would be compared to the AWW she received before her 1986 injury, $141.61. The SIF argued that, given this comparison, the plain language of subsection 301(5)(c) provides that plaintiff would not be entitled to any additional wage loss benefits for the duration of such employment.

The WCAC agreed with the SIF's position, holding as follows:

Both of those sections are very explicit. When an employee is involved in subsequent work, the offset is to be determined using the wage the employee received before the date of the injury. In this case, that was $141.00 a week. Thus, under Section 301(5)(c), since the average weekly wage is more than plaintiff received before the date of her injury, she is not entitled to any benefits for the duration of her employment. The Magistrate's conclusion of law is corrected[,] Abbey v. Campbell, Wyant & Cannon Foundry [On Remand], 194 Mich. App. 341, 351 [486 N.W.2d 131] (1992), his decision is reversed, and the Fund's Petition to Stop [benefits] is granted. [1997 Mich. ACO 6, 10 (emphasis in original).]

Plaintiff sought leave to appeal in the Court of Appeals, arguing that the worker's compensation magistrate properly compared the AWW that plaintiff received from her subsequent employment to the AWW imputed to her more than two years after the date of her injury under subsection 356(1), $365.38. Under this construction, subsection 301(5)(c) would eliminate plaintiff's wage loss benefits only when her AWW received from subsequent employment exceeded $365.38. The Court of Appeals reversed the decision of the WCAC and agreed with plaintiff's position, holding as follows:

We agree with plaintiff that the Legislature cannot have intended § 301(5)(c) to be applied as it has been in this case in light of the legislative decision embodied in § 356(1). That section allows a disabled employee under certain circumstances to prove that, but for her injury and disability, she would be earning a greater wage than she was earning at the time of the injury. Presumably this section is meant to alleviate the inequities that may result when an employee is injured at a job paying much less than the employee would be able to command in the marketplace or would soon be able to command because of education, training, and so forth. A person might work part-time, like plaintiff, for a variety of reasons, but might have expected to work full-time and received much greater compensation in the near future. If the WCAC's interpretation of § 301(5)(c) were correct, then the purpose underlying § 356(1) would be defeated. Even if plaintiff earns only $142 a week, she would lose all benefits because her present weekly wage would exceed the weekly wage she earned at the time of her injury by thirty-nine cents. Moreover, if plaintiff were to refuse the offer of a job paying $142 a week, she would forfeit her right to benefits pursuant to § 301(5)(a).

In order to avoid this illogical result and to give effect to both sections, we hold that, when an employee successfully obtains an adjustment in compensation pursuant to § 356(1), by demonstrating that the employee would have earned a greater wage but for the injury, the imputed higher wage should be substituted for the preinjury wage when applying § 301(5). An injured employee will thereby receive the benefit of § 356(1) while unemployed, will receive no benefits if wages from favored work exceed the augmented wage rate, and will receive eighty percent of the difference up to the statutory maximum if the favored work pays less than the augmented wage rate. [229 Mich.App. 223, 228-29, 581 N.W.2d 766 (1998) (emphasis in original).]

W...