U.S. Supreme Court Report: High Court Reviews Systems for Payment of Disability Benefits to Employees

1005124_29940386_02132012.jpgThe Supreme Court heard arguments last month in a dispute over how to calculate disability payments for an injured worker under the Longshore and Harbor Workers’ Compensation Act (LHWCA). The case, Roberts v. Sea-Land Services, originated in Alaska and made its way through the Ninth Circuit Court of Appeals until the Supreme Court granted certiorari in September 2011.

Maritime worker Dana Roberts was injured on the job in February 2002. He worked for Sea-Land Services as a gatehouse dispatcher in Dutch Harbor, Alaska. He slipped on some ice, injuring his shoulder and neck. Sea-Land’s insurance carrier put him on temporary total disability up until May 2005, when it stopped paying him benefits. The Benefits Review Board of the Department of Labor (DOL) determined that Roberts reached maximum medical improvement, the point at which further treatment would not improve his condition any further, in July 2005. An administrative judge then ruled in October 2006 that Roberts had become eligible for permanent total disability (PTD) compensation in 2005, and that he was eligible for permanent partial disability (PPD) after October 2005.

The LHWCA provides workers’ compensation for maritime workers injured on or near navigable waters. It limits compensation to an amount equal to twice the national average weekly wage (NAWW) for the “applicable” fiscal year. The issue presented to the Supreme Court, in essence, is which fiscal year is “applicable” in a given case.

The administrative law judge’s compensation order is dated October 12, 2006. Roberts’ eligibility for PTD benefits began on July 12, 2005. Applying benefits from the date of eligibility, Roberts would have been entitled to $1,047.16 per week, later increasing to $1,073.64 per week. This is the amount that the administrative law judge awarded to Roberts. If the NAWW in effect on the date of the order (one year later) were applied, however, the weekly amount would be $1,144.44. This is the amount Roberts wants applied. The Ninth Circuit upheld the administrative law judge’s ruling in 2010, and Roberts appealed to the Supreme Court.

The Court heard oral arguments on January 11, 2012, focusing narrowly on the question of statutory construction. Roberts argued that the statute’s phrase “newly awarded compensation” refers to the date of the award itself, not the date benefits became applicable. The government, joined by Sea-Land, argued that the phrase refers to the date of eligibility for benefits. From the analysis of the arguments at SCOTUSblog, there was apparently little to no chance of the parties finding common ground on their interpretations.

While this case deals narrowly with a statute that only affects maritime workers, it has great relevance for other businesses. Many businesses must deal with issues of worker safety, workers’ compensation insurance, and dealing with claims for injuries. This case has the potential to impact how benefits are calculated under comparable workers’ compensation systems in other industries, so its outcome is worth following.

The New York business attorneys at Samuel C. Berger, PC offer fixed-fee legal services to businesses and investors who want to do business in New York and northern New Jersey. To speak to a member of our skilled legal team, contact us today online or at (212) 380-8117.

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Photo credit: ‘Ship in the Harbor 2’ by dynamix on stock.xchng.