On October 11, 2019, the Pennsylvania Commonwealth Court issued an important ruling on Act 111 when it dismissed the Pennsylvania AFL-CIO’s Petition for Review filed earlier this year. In rendering its decision, the court found that Act 111 conforms with the non-delegation doctrine contained in the Pennsylvania Constitution.

In Pennsylvania, partial disability benefits are limited to a period of 500 weeks. The Impairment Rating Evaluation (IRE) process provides means for employers/insurers to convert a claimant’s wage loss status from “total disability” to “permanent partial disability” without bearing the burden of demonstrating job availability.

The constitutionality of the Impairment Rating Evaluation process has been a hot topic in Pennsylvania since June 20, 2017, when the Pennsylvania Supreme Court ruled that the former Section 306(a.2) of the Workers’ Compensation Act contained an unconstitutional delegation of legislative authority to the American Medical Association (AMA) by indicating that evaluators must utilize the “most recent Edition” of the “Guides to the Evaluation of Permanent Impairment.” Protz v. WCAB (Derry Area School Dist.), 161 A.3d 827 (Pa. 2017).

On October 24, 2018, Act 111 (Protz-fix) was signed into law by Governor Tom Wolf (D). Although Act 111 bears a resemblance to its predecessor, pre-Protz Section 306(a.2), there are two important differences. First, the Sixth Edition (second printing April 2009) of the AMA “Guides” must be utilized even as new Editions are published. Second, the threshold for the presumption of total disability has been reduced from 50 to 35 percent.

On February 5, 2019, the AFL-CIO filed a Petition for Review with the Commonwealth Court, requesting declaratory relief, as well as preliminary and permanent injunctive relief, related to Act 111. The AFL-CIO argued that Act 111 violates Article II, Section 1 (non-delegation doctrine) of the Pennsylvania Constitution because it, like its predecessor, constitutes an impermissible delegation of legislative authority to the AMA.

In ruling that the AFL-CIO failed to assert a legally sufficient claim for declaratory or injunctive relief, the court specifically stated that no delegation to the AMA occurred with the enactment of Act 111, as the Sixth Edition (second printing April 2009) of the “Guides” was already published when the General Assembly made the policy decision to adopt it as the standard to applying to IREs. This standard must be utilized until the portion of the Act is revisited by the General Assembly even as the AMA publishes new Editions of the “Guides.”

This Decision is a win for Pennsylvania employers and carriers as the court refuted the AFL-CIO’s position that the use of AMA Guides was an impermissible delegation of legislative authority.