Supreme Court Decides PPD Rating Used to Determine Eligibility For PTD Must Affect Employability

In Allan v. R.D. Offutt Co., the Minnesota Supreme Court, relying on the plan language of Minn. Stat. § 176.101, subd. 5(2), reversed the Workers’ Compensation Court of Appeals’ holding that, when determining eligibility for permanent total disability benefits, any disability may contribute to the employee’s permanent partial disability rating, regardless of whether that disability affects the employee’s ability to secure employment.

In Allan, a forty-eight year old employee sustained a work-related injury to his low back on September 28, 2010, which was assigned a permanent partial disability rating of 10%. Given the employee’s age at the time of injury, in order to qualify for permanent total disability benefits, he was required to demonstrate at least a 17% permanent partial disability rating of the whole body. In addition to the 10% permanent partial disability rating for the low back, the employee also relied on a non-work-related 10% rating for complete loss of teeth. The employee claimed the combined permanent partial disability rating of 20% satisfied the 17% permanent total disability threshold. The compensation Judge rejected the employee’s argument and the Workers’ Compensation Court of Appeals reversed.

The Supreme Court reversed the Workers’ Compensation Court of Appeals, holding that Minn. Stat. § 176.101, subd. 5(2), “unambiguously requires that disabilities that contribute to an employee’s permanent-partial-disability rating must affect employability.” Relying on the plain meaning of the statute, the Court found subd. 5(2) contained a causal nexus between employability and the work-related injury, and the disabilities that combine to meet the permanent total disability threshold.

Interestingly, a footnote in the decision may give rise to a future challenge to the holding in Frankhauser v. FabCon, Inc., 57 Minn. Workers’ Comp. December 250-51 (WCCA), affirmed without opinion, 569 N.W. 2d 533 (Minn. 1997). The Allan majority noted the WCCA has held that non-work-related disabilities may contribute to permanent partial disability ratings, but specifically noted that the self-insured employer did not challenge that part of the WCCA’s holding, and therefore, the Supreme Court declined to address it.

The Allan decision can be found here.