Pace Membership Warehouse, Div. of K-Mart Corp. v. Axelson
Decision Date | 19 May 1997 |
Docket Number | K-MART,No. 96SC229,96SC229 |
Citation | 938 P.2d 504 |
Parties | 21 Colorado Journal 700 PACE MEMBERSHIP WAREHOUSE, DIVISION OFCORPORATION; and Industrial Claim Appeals Office, Petitioners, v. Barbara AXELSON, Respondent, and Department of Labor and Employment, Division of Workers' Compensation; and Director, Division of Workers' Compensation, Intervenors. |
Court | Colorado Supreme Court |
Anderson, Campbell and Laugesen, P.C., John V. Fitzsimons, Frank M. Cavanaugh, Denver, for Petitioner Pace Membership Warehouse, Division of K-Mart Corporation.
Gale A. Norton, Attorney General, Martha Phillips Allbright, Chief Deputy Attorney General, Richard A. Westfall, Solicitor General, Paul Farley, Deputy Attorney General, David M. Kaye, First Assistant Attorney General, John D. Baird, Assistant Attorney General, State Services Section, Denver, for Petitioner Industrial Claim Appeals Office; and for Intervenor Department of Labor and Employment, Division of Workers' Compensation; and for Intervenor Director, Division of Workers' Compensation.
Alexander & Ricci, William A. Alexander, Jr., Joseph M. Ricci, Colorado Springs, for Respondent Colorado Compensation Insurance Authority.
Michael J. Steiner, Curt Kriksciun, Denver, for Amicus Curiae Colorado Compensation Insurance Authority.
We granted certiorari to review the court of appeals decision in Axelson v. Pace Membership Warehouse, 923 P.2d 322 (Colo.App.1996), in which the court of appeals determined that section 8-42-103(1)(f), 3B C.R.S. (1995 Supp.), violates the equal protection requirements of the United States and Colorado Constitutions. Because we hold that section 8-42-103(1)(f) is rationally related to a legitimate state interest, we conclude that this statutory provision does not violate the constitutional requirements of equal protection. We therefore reverse the court of appeals and remand to reinstate the final order of the Industrial Claim Appeals Office (ICAO).
The parties have stipulated to the facts in this case. On June 26, 1990, Barbara Axelson (Axelson) sustained an industrial injury while working for Pace Membership Warehouse (Pace). Axelson continued to work for Pace through July 12, 1990, at which time she was separated from her employment. Axelson contended that she was separated from her employment because Pace did not offer her re-employment within her work restrictions, while Pace argued that Axelson voluntarily left her employment. Pace thus refused to pay Axelson's claim for temporary total disability (TTD) benefits.
Axelson filed an administrative appeal, and on March 24, 1992, the administrative law judge (ALJ) ordered Pace to pay Axelson TTD benefits backdated from July 13, 1990. However, during the period in which Axelson's eligibility for TTD benefits was litigated, she applied for and received unemployment insurance (UI) benefits for forty weeks in the total amount of $8,109.71. Therefore, pursuant to section 8-42-103(1)(f), the ALJ ordered that Axelson's TTD benefits be offset by the amount of UI benefits she had received. Pace complied with the ALJ's order, reducing the TTD benefits it paid to Axelson by the amount of her UI benefits.
On February 22, 1994, the ALJ determined that Axelson had reached maximum medical improvement (MMI) on December 15, 1992 and that she was no longer entitled to TTD benefits after the MMI date. Axelson subsequently applied for additional UI benefits, but was awarded only twelve weeks of benefits because she had previously exhausted forty weeks of UI benefits. Axelson then requested an administrative hearing, asserting that Pace inappropriately reduced her TTD benefits by the amount of UI benefits she had received. On June 29, 1994, the ALJ determined that Axelson was not entitled to restoration of the amount Pace had claimed as an offset. On March 17, 1995, the ICAO affirmed, concluding that, pursuant to section 8-42-103(1)(f), TTD benefits must be offset by UI benefits.
The court of appeals set aside the ICAO's order, holding that as applied, section 8-42-103(1)(f) violates the equal protection requirements of the United States and Colorado Constitutions. We granted certiorari to review the court of appeals decision and now reverse.
The Fourteenth Amendment to the United States Constitution provides that "[n]o state ... shall deny to any person within its jurisdiction the equal protection of the laws." The right to equal protection also finds support in the Due Process Clause of the Colorado Constitution. Colo. Const. art. II, § 25. When a statute is subject to an equal protection challenge, the level of judicial scrutiny varies with the type of classification utilized and the nature of the right affected. See Industrial Claim Appeals Office v. Romero, 912 P.2d 62, 66 (Colo.1996). Where a legislative classification does not involve a suspect class or an abridgement of a fundamental right triggering strict scrutiny, or where the classification is not a special one triggering an intermediate standard of review, an equal protection challenge must be analyzed under the rational basis standard of review. See id. In the current case, section 8-42-103(1)(f) does not affect a suspect or a special class, and the receipt of workers' compensation benefits is not a fundamental right. See Romero, 912 P.2d at 66. We therefore review this statutory provision under the rational basis standard. 1
Under the rational basis standard of review, a statutory classification is presumed constitutional and does not violate equal protection unless it is proven beyond a reasonable doubt that the classification does not bear a rational relationship to a legitimate legislative purpose. See Duran v. Industrial Claim Appeals Office, 883 P.2d 477, 482 (Colo.1994). In order to establish that a classification violates the equal protection provisions of the federal and state constitutions, the classification must arbitrarily single out a group of persons for disparate treatment and not single out for such treatment other persons who are similarly situated. See Romero, 912 P.2d at 66.
Moreover, pursuant to the rational basis standard, a statute creating a classification is not deemed unconstitutional simply because distinctions created by the statute are not made with mathematical nicety. See Dawson ex rel. McKelvey v. Public Employees' Retirement Ass'n, 664 P.2d 702, 708 (Colo.1983). Rather, the problems of government being practical ones, equal protection will tolerate "a rough accommodation of variant interests." Id. A statute can only be stricken under the rational basis standard if there exists no reasonably conceivable set of facts to establish a rational relationship between the statute and a legitimate governmental purpose. See Colorado Soc'y of Community and Institutional Psychologists, Inc. v. Lamm, 741 P.2d 707, 711 (Colo.1987). Simply because a statutory classification creates a harsh result in one instance does not mean that the statute fails to meet constitutionality requirements under the rational basis standard. See Movitz v. Division of Employment and Training, 820 P.2d 1153, 1155 (Colo.App.1991).
In Bellendir v. Kezer, 648 P.2d 645 (Colo.1982), the claimant argued that the failure of the Workers' Compensation Act to provide for increases in past compensation awards to keep pace with inflation violated equal protection. In rejecting this argument, we stated:
Obviously, the statutory formula is arbitrary in the sense that the General Assembly might have chosen some other method of computing disability benefits. Our inquiry is limited, however, to whether the scheme as presently constituted furthers a legitimate state purpose in a rational manner.
....
... [W]e do not mean to indicate that the present statute necessarily best fulfills the social and economic objectives it was designed to achieve or that a more just system could not be formulated.... However, it is not the function of this Court to rewrite legislation; the power to change the present scheme rests with the General Assembly.
Id. at 647; see also Boehm v. Industrial Comm'n, 738 P.2d 804, 806 (Colo.App.1987) ( ). 2
Section 8-42-103(1)(f), 3B C.R.S. (1995 Supp.) ("the offset provision"), provides for the offset of TTD benefits as follows:
In cases where it is determined that unemployment insurance benefits are payable to an employee, compensation for temporary disability shall be reduced, but not below zero, by the amount of unemployment insurance benefits received, unless the unemployment insurance amount has already been reduced by the temporary disability benefit amount and except that temporary total disability shall not be reduced by unemployment insurance benefits received pursuant to section 8-73-112.
(Emphasis added.) The offset provision requires TTD benefits to be offset, or reduced, by the amount of UI benefits a claimant receives when the two benefits are awarded for the same period of time. The offset provision expressly prohibits offset in cases where UI benefits are paid pursuant to section 8-73-112, 3B C.R.S. (1995 Supp.).
Section 8-73-112 provides for the receipt of UI benefits after the receipt of TTD benefits as follows:
[A] person who is separated from employment due to an accident or injury resulting in a temporary total disability for which he has been compensated under section 8-42-105, if otherwise eligible, shall be entitled to receive, after the termination of the continuous period of disability, benefits under this article which were available and in effect at the time of separation from employment.
(Emphasis added.) Section 8-73-112 provides that a claimant may be entitled to UI benefits pursuant to its provisions only after the claimant's TTD benefits...
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