State News : New Jersey

It is a remarkable coincidence that the three cases that best explain entitlement to permanent partial disability benefits in New Jersey all involve claimants with the last name of Perez.  The most important of the three Perez cases is Perez v. Pantasote, 95 N.J. 105 (1984). This case addressed the key statutory definition in N.J.S.A. 34:15-36, which provides:

‘Disability permanent in quality and partial in character’ means a permanent impairment caused by a compensable accident or compensable occupational disease, based upon demonstrable objective medical evidence, which restricts the function of the body or of its members or organs;

This case stands for the proposition that subjective complaints alone are not sufficient to meet the standard for an award of partial permanent disability.  Hence the emphasis on objective tests such as MRIs, x-rays, EMGs, CT scans, pulmonary function testing and other similar studies.  The Perez principle was next applied to psychiatric disability claims in Saunderlin v. E. I. DuPont Co., 102 N.J. 402 (1986).  Even in psychiatric claims, the emphasis is on more than just recapitulating the complaints and statements made by the injured worker.  The Supreme Court said that psychiatric experts should include observations of physical manifestations of the symptoms related by the injured worker.

The next two Perez cases dealt with the remaining aspects of the test outlined in N.J.S.A. 34:15-36.  The first was Perez v. Monmouth Cable Vision, 278 N.J. Super. 275 (App. Div. 1994), certif. denied, 140 N.J. 277 (1995).  This case focused on the following language in the statute:

Included in the criteria which shall be considered shall be whether there has been a lessening to a material degree of an employee’s working ability.

The Court rejected an interpretation of the above language which would require an injured worker to prove in every case a lessening to a material degree of working ability.  The Court said that the claimant can obtain an award of permanent partial disability by proving either a substantial impairment of non-work activities or a lessening to a material degree of working ability.  It is an either/or test.  In this case the employee complained of loss of grip strength, pain in the wrist while playing with his children, diminished ability to play volleyball and not being able to do as much weightlifting as in the past.   The Court held that these complaints were sufficient to meet the test of having an impairment of the ordinary pursuits of life.  Petitioner did not need to prove work impairment to get his award.

Perez v. Monmouth Cable Vision is very important for two reasons:  one, it shows that an employee with objective evidence of permanent partial disability who gets back to work doing the same job can still receive an award of permanency if he or she can prove a substantial impairment of the ordinary pursuits in life.  Two, it shows that the threshold required by the employee for testimony about impairment of the ordinary pursuits of life is not particularly high.

The third case is Perez v. Capitol Ornamental, 288 N.J. Super. 359 (App. Div. 1996).  The petitioner in this case suffered a herniated disc.  He worked as a farm laborer in Puerto Rico before doing landscaping and construction in the U.S.  After he had his laminectomy surgery, he continued to have back problems and applied to the Division of Vocational Rehabilitation for job training.  He was out of work for years and could not find work.  Respondent’s evaluating physician estimated 12.5% permanent partial disability but stated at trial that he did not consider petitioner’s employment problems when he provided his estimate.

The Judge of Compensation awarded 32% permanent partial disability, which was much less than what the petitioner thought he was entitled to.  The Judge wrote, “ . . . the award which I presented in my opinion was determined on a basis and with the purpose of being consistent with similar injuries previously presented to me for disability determination.”  The Appellate Division took this comment to mean that the Judge of Compensation had not really considered the difference between a person with a spine surgery who gets back to work and a person with spine surgery who cannot return to work.  It reversed the decision because the percentage of the award to Mr. Perez should have taken into account the severe impact on petitioner’s working ability.

Perez v. Capitol Ornamental makes an important contribution to the workers’ compensation formula for permanent partial disability by establishing a principle that cases should be valued higher where the injury causes a career change or career loss as compared to cases where no such career loss occurs.

Together the three Perez cases delineate the basic requirements for an award of permanent partial disability:  1) objective medical evidence of restriction of function; plus either 2) a substantial impairment of non-work activities or 3) a lessening to a material degree of working ability.

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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 jgeaney@capehart.com.