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Suspension of Workers’ Compensation Benefits for Incarceration Cannot Occur Until “After” A Conviction

Pennsylvania
March 11, 2021
March 11, 2021
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In Carl Sadler v. WCAB (Philadelphia Coca-Cola Company), the Pennsylvania Supreme Court granted allocator to address the issue of whether the Commonwealth Court erred in concluding that employer was not entitled to reimbursement of benefits paid to claimant during his pre-conviction incarceration awaiting trial. Section 306(a.1) of the Pennsylvania Workers’ Compensation Act, 77 P.S. § 511.1 provides that “[n]othing in this act shall require payment of compensation … for any period during which the employee is incarcerated after a conviction….”  The Supreme Court affirmed the commonwealth court’s ruling that employer was not entitled to a credit for wage loss benefits paid during the period claimant was incarcerated pre-conviction because he could not post bail.

Claimant’s workers’ compensation injury was acknowledged via a Notice of Compensation Payable, and he began receiving indemnity benefits. On August 13, 2013, claimant was charged with a crime, and because he could not post bail, claimant remained incarcerated for 525 days until he ultimately pled guilty. Immediately after accepting claimant's guilty plea, claimant was sentenced to 525 days with credit for time served. Therefore, he was immediately released. Employer filed a Suspension Petition, arguing that claimant’s benefits should be adjusted due to his unjust enrichment for the wage loss benefits he received during his 525 days he was incarcerated pre-conviction because he could not post bail.

The essence of claimant’s argument was that his wage loss benefits could not be suspended because he spent no time incarcerated after his conviction, which the plain language of Section 306(a.1) requires. The commonwealth court agreed with claimant and emphasized that claimant’s pre-conviction incarceration was due to his inability to post bail and, based on the plain language of Section 306(a.1), claimant’s benefits could not be suspended.

Employer argued that the statutory language is unambiguous in its prohibition of benefits during a period of incarceration served for a conviction, which it argued was the 525 days claimant was sentenced to serve after he pled guilty. According to employer, the court placed too much emphasis on the word “after” in reaching its conclusion.

The Supreme Court agreed with claimant, finding that the language of Section 306(1.a) unambiguously applies to incarceration after a conviction. In applying the rules of statutory interpretation, it pointed out that the legislature’s wording of the statute could not be interpreted to capture all periods of incarceration traceable to an eventual conviction.

Based on the Supreme  Court’s holding in Sadler, an employer is not entitled to a suspension of benefits during a pre-conviction incarceration – in this case for not being able to post bail -- and is not entitled to a credit when the sentence for a conviction is the time that was served before the conviction.

In Sadler, claimant was incarcerated because he could not make bail for nearly two years, which begs the question as to the egregiousness of the crime and whether he had prior convictions or failures to appear for trial. Moreover, consider if a claimant were convicted of a crime in the past and while on parole for that conviction is charged with but not convicted of another crime. He then becomes incarcerated for violation of parole based on the previous conviction. The court’s ruling in Sadler may not prevent an employer from arguing that the claimant’s benefits should be suspended on the basis that but for the claimant’s prior conviction and sentence of parole, he would not have been incarcerated, even though the incarceration is before a conviction on the new charge. Certainly, employers should thoroughly research a claimant’s past criminal history and not simply discredit the possibility of a suspension of benefits just because the claimant is incarcerated before a conviction.