EXPANSION OF THE “SAFE HARBOR” PROVISIONS ACT 337
In the 2012 legislative session a “safe harbor” for employers was established in the penalties and attorney fees statute (§1201). The statute established a telephone conference with the employer, employee and OWC judge on a “preliminary determination hearing” to consider the employee’s first payment, termination or modification of benefits. An employer who accepted the findings of the WCJ in the PD would be free of any award of penalties and attorney fees. The 2012 legislation also amended the prematurity statute (§1314) to give full access of the employer to the WC Court. This was to overturn case law that did not permit the employer to initiate a claim against the employee for the purpose of having the court render an opinion as to whether benefits were owed (generally referred to as a declaratory judgment).
In response to these changes, the attorneys representing claimant drafted HB 660, which was a total rejection of the 2012 law changes.
A compromise was reached by the claimant attorneys and representatives of employers. A substitute bill was drafted – Act 337. This bill was designed to meet the concerns of the claimant attorneys regarding the ability of the employer to file a 1008 to controvert benefits and the concern of employers that the prior safe harbor provisions may have been limited to issues regarding the calculation of the average weekly wage and that the statute needed to include other issues which involve the termination, modification or reduction of benefits.
Effective Date 8/1/13 – The bill has a section in which the legislature declared that the Act is to be applied retroactively as well as prospectively. We anticipate a challenge to the retroactive application but expect the OWC will initiate procedures to implement the new preliminary determination hearing and expedited hearing procedures.
Click on highlighted text for a summary of the new “Safe Harbor” legislation. An overview of the “Safe Harbor” legislation is also included below. If you have any questions regarding these new provision please do not hesitate to contact our firm. A complete copy of Act 337 can be found below.