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In 1979, the New Jersey Legislature made sweeping changes to the Workers’ Compensation Act. Among those was the creation of a sliding scale on the Schedule of Disabilities found in N.J.S.A. 34:15-12c. The legislative intent was to award greater compensation to the more seriously injured worker. To accomplish this intent, the pertinent language in Section 12c says: “When a claim petition alleges more than one disability, the number of weeks in the award shall be determined and entered separately for each such disability and the number of weeks for each disability shall be cumulative when entering the award.”
Initially judges of compensation as well as appellant panels had mixed interpretations of the above section. The issue was resolved in 1984 with the New Jersey Supreme Court decision in Poswiatowski v. Standard Chlorine Chemical Co., 96 N.J. 321 (1984). Poswiatowski was actually a consolidation of three cases and the other two are: Fagan v. City of Atlantic City and Smith v. United States Pipe and Foundry Company.
In Poswiatowski, the petitioner fell in 1981 fracturing his back and left foot and received an award of 20% permanent partial disability for the back, 40% of the foot and 10% permanent partial disability for the neuropsychiatric component. The trial court, believing that the award should be entered separately, gave $6,924 (120 weeks @ $59) for the back, $4,328 (92 weeks @ $47.04) for the foot and $2,820 (60 weeks @ $47) neuropsychiatric for a total of $13,172. Petitioner argued that the total of the weeks should dictate the rate, and he should have been awarded 272 weeks at 50% SAWW (State Average Weekly Wage) or $33,456. The Appellate Division affirmed and the Supreme Court granted certification.
In the Fagan case, the petitioner, a public health nurse, was assaulted and robbed during the course of her employment. She suffered a concussion, fractured nose, facial scarring, sinus disorders, headaches, facial numbness and recurring nightmares. The compensation court awarded her 7 ½% permanent partial disability (45 weeks) for the fractured nose, 7 ½% permanent partial disability (45 weeks) for severe contusions of the scalp, lips and mouth with numbness, and 15% permanent partial disability (90 weeks) for the post traumatic nightmares. That totaled 180 weeks (30% permanent partial disability) at an average rate of $57.30 or $10,314. The Appellate Division reversed and modified the award to $8,460. ($2,115 nose + $2,115 contusions and numbness of face plus $4,230 nightmares). Again, the Supreme Court granted certification.
In Smith, petitioner received a significant crush injury to his right forearm resulting in numerous surgeries for vascular, orthopedic and cosmetic injuries together with skin grafts from petitioner’s abdomen and right thigh. The compensation court awarded 23% permanent partial disability (138 weeks @ $66) for the combination of the right hand and right leg (apportioned 50% of the hand and 5% of the leg), 10% permanent partial disability (60 weeks @ $47) for the cosmetic scarring of the abdomen and 12 ½% permanent partial disability (75 weeks @ 47) for neuropsychiatric residuals for a total of $15,468. Petitioner argued that he was entitled to 273 weeks at 50% SAWW or $33,759. The Appellate Division agreed with petitioner, finding that the compensation court’s interpretation was “inconsistent with the purposes of the 1980 amendments.”
The Supreme Court stated “(W)e believe that the Smith case best illustrates the method most consistent with statutory purpose.” The court added, “We hold that the weeks of compensation awarded for one accident’s multiple injuries that establish a single compensable disability should be cumulated, not separated, in computing the award.”
The Supreme Court went on to explain, “(O)f course, if the compensation judge uses the schedule as an aid in determining the extent of the award, such may be regarded as a reasonable finding if expressed in terms of permanent partial disability. Orlando v. F. Ferguson & Son, supra, 90 N.J.L. at 553, 102 A. 155. But the point of the Smith panel is to focus on the nature of the injury. The method of calculating permanent partial disability to two or more major body members under N.J.S.A. 34:15-12(c)(20), -12(c)(22), has not been affected by the 1980 amendments. The compensation court is not to determine the scheduled number of weeks for each injury separately; rather, it is to look at the effect of the injuries and to make a reasonable assessment of the extent of the combined disability in terms of a percentage of permanent and total disability. This requires the court to make a judgment about the extent of impairment resulting from the combined injuries without being limited by the statutory schedules. See Cooper v. Cities Serv. Oil Co., supra, 137 N.J.L. at 182, 59 A.2d 268; Orlando v. F. Ferguson & Son, supra, 90 N.J.L. at 557, 102 A. 155; Vishney v. Empire Steel & Iron Co., supra, 87 N.J.L. at 483-84, 95 A. 143.”
In further support the Court said: “(B)ut under the new schedule of benefits set forth in N.J.S.A. 34:15-12(c), the difference is of great significance. If the weeks due the injuries are added together when entering an award, more money is awarded. By the 1979 amendments, L. 1979, c. 283, § 5, the Legislature not only increased the weekly rate for permanent disability from a maximum of $40 to a maximum of 75% of statewide average weekly wage (SAWW), but also created a sliding scale of weekly dollar payments ranging from $47 where the adjudicated disability requires payment for 90 weeks or less, up to $82 for the last six weeks of disability for which 180 weeks of payments are required. Over 180 weeks of entitlement, there is a dramatic increase in weekly dollars payable. From 181 up to 600 weeks, disability is compensated from a low of 35% of SAWW (for disabilities drawing entitlement of from 181 to 210 weeks), to a maximum of 75% of SAWW (for disabilities falling within the 421- to 600-weeks bracket.)1 See **1259 Gothelf v. Oak Point Dairies of N.J., 184 N.J.Super. 274, 445 A.2d 1170 (App.Div.1982).”
Based on this logic, the Supreme Court reversed the appellate division decisions in Poswiatowski and Fagan and affirmed the decision of the appellate division in Smith.
Now let’s consider how stacking affects reopener claims and new accidents. Where an injury results in an award encompassing more than one body part, and the petitioner seeks to reopen that award under N.J.S.A. 34:15-27 for review and/or modification of the prior award, the petitioner need not allege an increase in disability to all affected body parts. Since the original award set the overall disability for the accident, an increase of disability to one part is added to the overall award. In effect, the prior award becomes the base.
For example, let us assume that petitioner receives an award for injury occurring in 2017 to his or her lumbar spine and left shoulder. The award is for 35% permanent partial disability apportioned 20% to the low back and 15% to the left shoulder (210 weeks x $418 = $85,260 assuming wages sufficient for maximum rates in 2017). In 2019 petitioner files an application for review and/or modification alleging an increase in disability to the left shoulder. The judge of compensation finds an increase in disability of 7 ½% of the left shoulder, taking into consideration the overall disability to the petitioner in 2019. The overall award must be increased to 42½% permanent partial disability apportioned 20% (unchanged) to the low back and 22 1/2% of the left shoulder. Because it is an extension of the original award, the award must be paid at the rates in effect for the year of the accident, which is 2017. (255 weeks x $522 = $133,110 less credit for the prior award of $85,260) The award calculation is made by going back to the beginning of the original award and changing the rate to $522 and paying the accrued weeks at the increased rate of $104 per week and the balance of the non-accrued weeks at the full $522.
In contrast to the example above, stacking does not occur with a new accident to one of several previously awarded body parts. Suppose our petitioner above received the original award of 35% permanent partial disability and then had a new accident in 2019 causing increased disability to the left shoulder only. The Judge of Compensation finds an overall disability to the left shoulder to be 22 1/2% permanent partial disability. That is 7.5% higher than the prior shoulder apportionment of 15%, but the new award is only based on the shoulder, not the low back. In effect, the shoulder can be separated from the previously stacked award. So the new award would be 22 ½ % permanent partial disability for the left shoulder minus a credit of 15 % preexisting with no mention of the back at all. The new award would equal 135 weeks x $271.33 or $36,630 credit $22,140 (15% @ the 2019 rate) or $14,490. Obviously, if the new award had been stacked on the prior back/shoulder award, it would have resulted in a great deal more money.
Notice in this example of the new 2019 accident impacting only the shoulder, that the rates must be those for 2019 for both the new award AND the credit. Obviously the new award should command 2019 rates since the new injury occurred in 2019, but the credit also jumps to 2019 rates, unlike the situation noted above for reopeners.
About the Author:
Prior to joining Capehart Scatchard as Of Counsel, Judge Hickey III (Ret.) served as the Compensation Administrative Supervisory Judge for the State of New Jersey from 1991 to 2009. Previous to his judgeship, he served as a Prosecutor in Gloucester County, New Jersey from 1986 to 1991
About the Editor:
John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at email@example.com.