Key Takeaways

• In Matter of Arias, the New York State Supreme Court, Appellate Division Third Department has gutted the prior Taher standard establishing that there must be a finding that the claimant is not entitled to a PPD award to receive an SLU

• The carrier-friendly Taher standard established that a claimant may not receive an SLU without a prior finding that the claimant is not entitled to a PPD award

• Under Arias, if a claimant with conditions amenable to SLU and PPD is working without a loss of earnings the claimant can elect to receive an SLU rather than a PPD

In Taher v. Yiota Taxi,the New York State Supreme Court, Appellate Division Third Department addressed a claim where the injured worker argued that they were entitled to both a classification and a schedule loss of use (SLU). Previously, the New York State Workers’ Compensation Board found that a claimant who does not receive payment for a permanent partial disability (PPD) may receive an SLU, but that there may not be simultaneous PPD and SLU. The Third Department found that “if it is ultimately determined that claimant is not entitled to a nonschedule award, he will at that time be entitled to an SLU award.”

Following Taher, carriers argued that there must be a finding that the claimant is not entitled to a PPD award to receive an SLU. The Third Department, however, effectively gutted this argument in Matter of Arias. Here, the Board classified the claimant, who was earning her full wages, with a 40 percent loss of wage earning capacity (LWEC). The claimant asked the Board to rescind the PPD finding and award an SLU per Taher. The department essentially took a humanitarian stance, finding it unfair to make an injured worker who was disabled but working to wait to be paid for their disability and that they should be able to recover an SLU in such matters. This, unfortunately, flies in the face of prior precedent requiring a finding that the claimant have no residual impairment to classifiable sites before an SLU can be awarded.

In summary, if a claimant with conditions amenable to SLU and PPD is working without a loss of earnings, or if a determination is made that there is no loss of wage earing capacity for classifiable sites, the claimant can elect to receive an SLU rather than a PPD. If, at some later date, they lose time from work, we can presume that the proper course of action would be to rescind the SLU and make a PPD finding which the carrier could then credit the SLU against. However, if a claimant is classified with a PPD and an initial award is paid, Arias provides that they cannot appeal to rescind the PPD and receive an SLU.

Goldberg Segalla’s New York State Workers’ Compensation team closely watched Matter of Arias and is continuing to monitor how the decision will affect workers’ compensation litigation across the state. For more information on Matter of Arias or for immediate guidance, contact:

• Cory A. DeCresenza
• Mark A. Hauck
• Damon M. Gruber
• Sean J. McKinley
• Esther F. Omoloyin
• Or another member of our Workers’ Compensation team