Case Title: Sanchez v. Potomac Abatement

Citation: 417 Md. 76

Docket Number: 65/09

State: maryland

Court: Maryland Supreme Court

Date: 2010-11-19T00:00:00Z

Document:
HEADNOTE:   Edy Sanchez v.  Potomac Abatement, Inc., et al., No. 65, September
Term, 2009
                                                                                                                                                
WORKERS’ 
COMPENSATION; 
CALCULATION 
OF 
COMPENSATION
RESULTING FROM AN AWARD OF PERMANENT PARTIAL DISABILITY
BENEFITS:    The calculation of an injured worker’s permanent partial disability benefits 
must be based upon the Maryland Statewide Average Weekly Wage index in effect on the
date of the employee’s injury rather than the index in effect on the date that the employee’s 
right to such benefits is established.  
IN THE COURT OF APPEALS
OF MARYLAND
No. 65
September Term, 2009
                                                                                 
EDY SANCHEZ
    
v.
POTOMAC ABATEMENT, INC., et al.
                                                                                 
Bell, C.J.
Harrell 
Battaglia 
Greene
Murphy
Adkins
Barbera, 
JJ.
                                                                                 
Opinion by Murphy, J.
                                                                                 
Filed:    November 19, 2010
This case presents the issue of whether an injured employee’s permanent partial
disability benefits (PPD) are “capped” by the State average weekly wage (SAWW) in
effect on the day when the injury occurred, or by the SAWW for the year in which the
employee’s PPD commence.  Edy Sanchez, Petitioner, who was injured on September 22,
1998, argues that his award should be based upon the 2000 SAWW because 2000 is the
year in which his right to PPD was established.  After this argument was rejected by the
Workers’ Compensation Commission (the Commission), the Circuit Court for Baltimore
County, and the Court of Special Appeals,  Petitioner filed a petition for writ of certiorari
1
in which he presented this Court with a single question:
Whether the Maryland Statewide Average Weekly Wage index
[] used to calculate and establish the maximum or cap of weekly
compensation resulting from a PPD [permanent partial
disability] of 185 weeks is that index on the date of the accident
or on the date of the right to such compensation commences[?]
We granted that petition.  409 Md. 47, 972 A.2d 861 (2009).  For the reasons that
follow, we hold that the applicable SAWW index is the index in effect on the date of the
employee’s injury.  We shall therefore affirm the judgment of the Court of Special
Appeals.  
 The opinion of the Court of Special Appeals was not designated “for reporting” pursuant
1
to Md. Rule 8-605.1(a).  
Background
Each year the Department of Labor, Licensing, and Regulation determines the
“State Average Weekly Wage” as required by § 9-603 of the Labor and Employment
Article of the Maryland Code (LE).   Petitioner was awarded 185 weeks of benefits under
2
LE § 9-629, which provides:
If a covered employee is awarded compensation for a period
equal to or greater than 75 weeks but less than 250 weeks, the
employer or its insurer shall pay the covered employee weekly
compensation that equals two-thirds of the average weekly wage
of the covered employee but does not exceed one-third of the
State average weekly wage.
(Emphasis added). 
According to Petitioner, because the 2000 SAWW must be used to calculate the
cap, he is entitled to weekly benefits in the amount of $211.00.  On the other hand, if the
1998 SAWW is used, Petitioner is entitled to weekly benefits in the amount of $191.00 .  
3
The unreported opinion of the Court of Special Appeals includes the following
factual background:
  “On or before December 15 of each year, the Department of Labor, Licensing, and
2
Regulation shall: (1) determine the State average weekly wage as of July 1 of that
year; and (2) report the State average weekly wage to the Commission.”  LE § 9-603.
 Petitioner’s AWW at the time of injury was $428.34.  Two-thirds of that amount is
3
$285.55.  Because the 1998 SAWW was $573, Petitioner’s PPD award was “capped” 
at one-third of that SAWW.  
2
In September 1998, Sanchez suffered an injury in the course of
his employment with the [Respondent], Potomac Abatement, Inc.  Eight
years later, on August 3, 2006, [t]he Commission granted Sanchez an
award, to be paid by [Respondent] or its insurer, the co-[respondent],
AIU Insurance Co.  The award consisted of two parts.  First, Sanchez
was awarded compensation for a TTD [temporary total disability], to
be paid retroactively for the period of March 4, 1999, to January 13,
2000.  The Commission also awarded Sanchez compensation for a
PPD, to be paid for a period beginning on January 14, 2000.  This latter
portion of the award is the subject of Sanchez’s challenge.
The Commission concluded that Sanchez’s injury is an “other
case,” under Section 9-627(k), and that he has lost the industrial use of
30% of his body.  Accordingly, the Commission calculated that
Sanchez is entitled to 150 weekly payments (30% of 500), qualifying
him as a Tier 2 PPD claimant.  As a Tier 2 PPD claimant, Sanchez
would be entitled to the lesser of two thirds of his AWW [average
weekly wage] and one third of the SAWW [state average weekly
wage].  In this case, one third of the SAWW was the lesser, and
therefore applicable, amount.  Pursuant to its annual notices of the
SAWW, the Commission applied the value of the SAWW for the year
when Sanchez was injured - $573 for 1998 – and calculated that
Sanchez was entitled to weekly payments of one third of that amount,
i.e., $191.  Commission, Maximum Rate of Benefits for Calendar Year
Beginning January 1, 1998 . . . .
On August 28, 2006, Sanchez filed a petition for judicial review
in the Circuit Court for Baltimore County, requesting a jury trial. 
Sanchez then filed a motion for partial summary judgment, initially
arguing that, for each weekly payment, the Commission should have
applied the SAWW of the year in which the payment was due – i.e., the
2000 SAWW for payments due in 2000, the 2001 SAWW for payments
due in 2001, and the 2002 SAWW for payments due in 2002. 
However, before the court ruled on that motion, Sanchez changed his
argument, asserting that the Commission should have solely used the
SAWW for the year 2000, the year that his right to the PPD award
commenced.  Eventually, the court held a hearing on the matter, and
then denied the motion on September 19, 2007.  
3
Based on the ensuing jury trial and verdict, the circuit court did
conclude that Sanchez had suffered impairment to 37% of his body,
(rather than 30% as the Commission had found), and that he was
therefore entitled to 185 rather than 150 weekly payments. 
Accordingly, the court vacated the Commission’s award and remanded
the case for the Commission to adjust the award. 
As noted above, Petitioner requests that this Court reverse the judgment of the
Court of Special Appeals, and direct that his PPD award be “adjusted.”  
Discussion
Section 9-601 of the Labor and Employment Article provides:
A provision of this subtitle may not be construed to change:  
(1) a law relating to an accidental personal injury or an
occupational disease, that occurred before the effective date of
the provision and for which a claim is made under this title; or
(2) the payment basis in effect when an accidental personal
injury or an occupational disease, for which a claim is made
under this title, occurred.
(Emphasis added).  
“The higher the AWW, the higher the benefits the claimant receives up to any
statutory caps in effect for the year in which the injury occurred.”  Richard P. Gilbert,
Maryland Workers’ Compensation Handbook § 9.06 (3rd ed. 2007).  (Emphasis
supplied).  According to Petitioner, however, because LE § 9-629 does not expressly state
which year’s SAWW should be used to determine the cap on Petitioner’s benefits that
4
ambiguity should be resolved in his favor.   While rejecting that argument, the Court of
4
Special Appeals stated:
Notwithstanding Sanchez’s Herculean efforts to persuade
us to make new law, we conclude that the issue Sanchez asks us
to decide is already settled.  This Court has previously stated
that the SAWW of the year of the accidental injury controls the
amount of a PPD award.  Marshall v. Univ. of Md. Med. Sys.
Corp., 161 Md. App. 379, 386 (2005); cf. § 9-628 (Tier 1 PPD
award capped by statutory ceiling value determined by date of
injury).  Granted, this case is distinguished by the fact that
Sanchez’s right to PPD payments commenced years after his
injury.  See Waters v. Pleasant Manor Nursing Home, 361 Md.
82, 99 (2000).  Nevertheless, “[t]he general rule in workers’
compensation benefit cases is that the date of injury controls for
determining compensation benefits.”  Id. at 96.  The date of
injury is considered to be the date of the accident, not the date
on which the resulting disability manifests itself.  Id. at 99; see
also DeBusk v. Johns Hopkins Hosp., 342 Md. 432, 440 (1996).
(interpreting statute of limitations applicable to workers’
compensation claims).
The statutory basis of the general rule is Section 9-601,
which “fixe[s] the compensation rate as of the time of the
accidental injury.”  Baltimore County v. Fleming, 113 Md. App.
 The purpose of the Workers’ Compensation Act, codified in the Annotated Code of
4
Maryland, Labor and Employment Article, Section 9-101 et. seq., is to “provide
employees with compensation for loss of earning capacity, regardless of fault, resulting
from accidental injury . . . occurring in the course of employment.”  DeBusk v. Johns
Hopkins Hospital, 342 Md. 432, 437, 677 A.2d 73, 75 (1996).  This compensation
“substitutes for an employee’s common law right to bring a fault-based tort suit against an
employer for damages resulting from the employee’s injury or disablement on the job.” 
Id. at 438, 677 A.2d at 75.  “[T]he Act strikes a[n] important balance between the need to
provide some form of financial benefits to the injured or sick employees and the need, of
both employers and employees, to avoid expensive and unpredictable litigation over
accidents in the workplace.”  Id. 
5
254, 258 (1996).  In particular, § 9-601 states: “A provision of
this subtitle may not be construed to change: . . . (2) the payment
basis in effect when an accidental personal injury . . . occurred.”
(Emphasis added.)
Apart from case law, there has been legislative
acquiescence in the Commission’s consistent practice of using
the SAWW of the year of injury ever since the General
Assembly first directed the Commission to cap awards using the
SAWW in 1975.  The Commission’s expertise in administering
the workers’ compensation statutes, as well as the legislature’s
acquiescence to the Commission’s longstanding practice,
indicate that the Commission is operating in accord with the
legislative will.  As the Court of Appeals said in a different case
affirming the Commission’s interpretation of the workers’
compensation statutes:
[a] long-standing administrative interpretation is
particularly 
persuasive 
. 
. 
. 
when 
the
administrative interpretation was established at
the same time as the legislative enactment and
continued uniformly thereafter. Balto. Gas &
Elec. v. Public Serv. Comm'n, 305 Md. 145, 161,
501 A.2d 1307 (1986); Swarthmore Co. v.
Kaestner, 258 Md. 517, 528, 266 A.2d 341
(1970). In a like vein, the consistent construction
by an administrative agency responsible for
administering a statute, particularly where the
administrative interpretation has been made
known to the legislature in various annual reports
of the agency, as in the present case, is entitled to
considerable weight. National Asphalt v. Prince
Geo's Co., 292 Md. 75, 80, 437 A.2d 651 (1981).
Falik v. Prince George’s Hosp. & Med. Ctr., 322 Md.
409, 416 (1991); accord Colburn v. Dep’t of Pub. Safety &
Corr. Servs., 403 Md. 115, 128 (2008) (citing Schwartz v. Md.
Dep’t of Natural Resources, 385 Md. 534, 554 (2005).
6
As of September 1998, the date of Sanchez’s injury, the
payment basis then in effect incorporated that year’s SAWW
value, $573.  Nothing in the law at that time entitled Sanchez to
the benefit of a later SAWW value.  Accordingly, the
Commission was correct to apply the 1998 SAWW to Sanchez’s
claim.
We agree with that analysis, which is consistent with two opinions that the Court
of Special Appeals has designated “as precedents” pursuant to Md. Rule 8-605.1(a).
In Baltimore County v. Fleming, 113 Md. App. 254, 686 A.2d 1161 (1996), the
Court of Special Appeals stated:
By enacting § 9-601, the General Assembly has fixed the
compensation rate as of the time of the accidental injury or
occupational disease, and it is the statute in effect at the time of
injury or disease that governs. 
* * *
Prior to the enactment of § 36(11), the General Assembly, on an
ad hoc basis, often would expressly provide that certain
amendments would not apply to injuries predating the enactment
of said amendments. See, e.g., Laws of Maryland 1974, ch. 450;
1973, ch. 671; 1971, ch. 404; 1920, ch. 456; State Accident
Fund v. Jacobs, 140 Md. 622, 624, 118 A. 159 (1922)
(commenting on chapter 456, Acts of 1920). While the genesis
of the principle that a claimant's rights are governed by the
statute in effect at the time of injury is the Act itself, the
principle has generally found favor in case law, independent of
the Act. In 1949, the Court of Appeals cited Jacobs for this
proposition without discussing the fact that Jacobs involved
application of a statute, chapter 456 of the Acts of 1920, which
expressly provided that "nothing in this act shall affect any
rights arising from injuries or disabilities received prior to June
1, 1920." Furley v. Warren-Ehret Co., 195 Md. 339, 347-48, 73
A.2d 497 (1949). . . . [I]t is important for practitioners and
7
courts to be cognizant of the statutory genesis of the concept that
the law in effect at the time of injury applies. Departure from the
statute has the potential to raise certain red herrings such as the
issue of vested rights.
Id. at 258-260, 686 A.2d at 1163-64.  
In Marshall v. Univ. of Md. Med. Sys. Corp., 161 Md. App. 379, 869 A.2d 391
(2005), the Court of Special Appeals stated:
Once the duration of [PPD] compensation is ascertained,
the award amount is calculated according to LE sections 9-628
to 9-630. These sections create a three tier system for PPD
benefits, which depends on the number of weeks compensation
is awarded. For first tier benefits, or compensation for less than
75 weeks, "the employer or its insurer shall pay the covered
employee compensation that equals one-third of the average
weekly wage of the covered employee but does not exceed [a
maximum rate, which depends on the year of the accident.]" LE
§ 9-628.
For second tier benefits, or 75 to 249 weeks
compensation, the covered employee is paid "weekly
compensation that equals two-thirds of the average weekly wage
of the covered employee but does not exceed one-third of the
State average weekly wage." LE § 9-629.
The third tier, or "serious disability" benefits, addresses
compensation for 250 weeks or more.  [LE §9-630.]
* * *
Likewise, the "ceiling" for first tier benefits depends
solely on the date of accidental injury. See LE § 9-628(b)-(e).
Section 9-628(b)-(e) creates four first tier benefit rate
maximums, delineated by the accidental injury date. For
instance, a covered employee cannot be compensated more
than $ 94.20 a week for a "claim arising from events
8
occurring on or after January 1, 1993," whereas an employee
injured on or after January 1, 2000, cannot be compensated
more than $ 114 a week. See id.
Compensation for second and third tier benefits cannot
exceed a set percentage of the State average weekly wage. See
LE §§ 9-629, 9-630 (one-third and three-fourths,
respectively). The State average weekly wage, in turn, is
calculated on a yearly basis by the Department of Labor,
Licensing, and Regulation. See LE § 9-603(a). 
Finally, LE section 9-604(a) requires the Commission
to "compute all compensation awarded under this title in
accordance with the applicable schedule in this subtitle."
(Emphasis added). Construing the above sections together, we
hold that the Legislature intended that PPD benefits be
awarded at rates applicable at the time of the accidental
injury.
Id. at 383-84, 386, 869 A.2d at 394-95 (footnotes omitted) (emphasis in original).
In Waters v. Pleasant Manor Nursing Home, 361 Md. 82, 760 A.2d 663 (2000),
this Court answered the question, “Is the total amount of Petitioner's permanent total
disability compensation established by the statute in effect when Petitioner became
permanently totally disabled?”  The petitioner in that case had requested that the
Commission “reopen” her case and award her additional permanent total disability
benefits.  She argued to this Court that “the date of the Commission’s finding that she was
permanently totally disabled should govern the amount of her benefits, rather than the
date of [her] injury.”  Id. at 87, 760 A.2d at 666.  Before distinguishing claims  arising out
of an “occupational disease” from claims arising out of an “accidental injury,” this Court
9
reaffirmed the proposition that “[t]he general rule in workers’ compensation benefit cases
is that the date of injury controls for determining compensation benefits.  Id. at 96, 760
A.2d at 671.  As to the distinction between those claims, this Court stated:    
It has been established that the date of injury for
determining benefits for an occupational disease is the date of
disablement and the date of determination for accidental injuries
is the date of occurrence of the injury. This difference in
analysis is based upon the fundamental differences in definition
between an occupational disease and an accidental injury.
The Court of Special Appeals has stated aptly that "the
defining difference between accidental injury and occupational
disease is that the cause of the former is unusual or unexpected
and the cause of the latter is usual and a risk inherent to the
nature of employment." Luby Chevrolet v. Gerst, 112 Md. App.
177, 191, 684 A.2d 868, 875 (1996). In addition, an
occupational disease often develops over time and will manifest
itself at some point after the encounter with its causation. See
Gerst, 112 Md. App. at 193, 684 A.2d at 876. The court further
noted that the Workers' Compensation Act treats accidental
injuries differently from occupational diseases. Gerst, 112 Md.
App. at 192, 684 A.2d at 875. The significant difference for the
present case is that for an occupational disease to be
compensable under the Act, "it must cause some disablement."
Gerst, 112 Md. App. at 192- 93, 684 A.2d at 876 (citing Miller
v. Western Electric Co., 310 Md. 173, 185-86, 528 A.2d 486
(1987); Lowery v. McCormick Asbestos Co., 300 Md. 28, 47,
475 A.2d 1168 (1984); Shifflett, 293 Md. at 201, 442 A.2d 980)
(referring to Md. Code (1991 Repl. Vol., 1996 Suppl.), Labor
and Employment Article, § 9-502(a)). For an accidental injury
to be compensable, however, no disability is required; all that is
required is the date of occurrence. See Gerst, 112 Md. App. at
193, 684 A.2d at 875.
The Court of Special Appeals acknowledged that "the
date of disablement in an occupational disease case serves the
10
same purpose as the date of occurrence in an accidental injury
case." Id. 
* * *
. . . . It is necessary to fix the date in such a manner so as
“to limit proof of causation problems and potential limitation
problems.” Gerst, 112 Md. App. At 193, 684 A.2d at 875.
Id. at 98-100, 760 A.2d at 672-73.  
Petitioner argues that his interpretation of LE § 9-629 is consistent with Cline v.
Mayor and City Council of Baltimore, 13 Md. App. 337, 283 A.2d 188 (1971), aff'd, 266
Md. 42, 291 A.2d 464 (1972), which presented the question of whether the widow of a
deceased worker was limited in recovering death benefits to the statutory amount in effect
on the date of the deceased’s injury rather than on the date of the worker’s death.  The
holding in that case, however, is in no way inconsistent with our holding in the case at
bar.  As this Court stated in Waters, supra: 
In Cline, the Court of Special Appeals was presented
with the question of whether a surviving dependent of a
deceased worker should recover the amount of death benefits
provided by the statute in effect on the date of the injury or the
amount permitted by the amended statute on the date of the
death caused by the initial injury. Cline, 13 Md. App. at 340,
283 A.2d at 190. In Cline, Appellant's husband sustained an
accidental injury at his place of employment on 3 April 1967.
Cline, 13 Md. App. at 339, 283 A.2d at 189. On 2 June 1967,
Appellant's husband died from his 3 April 1967 injury. Id. On 1
June 1967, the day before his death, the statute was amended to
raise the maximum death benefits that a dependent could receive
as a result of a death caused by an on-the-job accidental injury.
Id. The court held that the statute in effect on the date of death
11
is the applicable statute when the death is caused by the initial
accidental injury because the survivor's benefits vest on the date
of death. Cline, 13 Md. App. at 340-41, 283 A.2d at 190-91.
The court first pointed to a distinction present in the
relevant statute. According to the statute, dependents may
receive benefits under the following two scenarios: (1) when the
employee dies from a cause unrelated to the compensable injury
and there is a remaining award based on permanent total or
permanent partial disability compensation; or (2) when the
employee dies as a result of the compensable injury and death
occurs within five years of the injury. See Cline, 13 Md. App. at
340, 283 A.2d at 190. According to the court, in the first
scenario, the benefit belongs to the employee, and "those who
take, in the event of his death, take under him, and not
independently." Id. The court elaborated that the dependent's
right to the benefits is governed by the statute in effect at the
time of the injury. Id. (citing Furley, 195 Md. 339, 73 A.2d
497). In the second scenario, the court stated that "although the
survivor's right to death benefits arises out of the compensable
injury, it is the employee's death itself which is the compensable
event, and the right of the surviving dependents to death benefits
is separate and independent of the injured employee's rights and
does not depend upon whether compensation was paid to the
injured workman during his lifetime." Cline, 13 Md. App. at
340-41, 283 A.2d at 190 (citing Sea Gull Specialty Co. v.
Snyder, 151 Md. 78, 134 A. 133 (1926)). Thus, the survivor's
claim for benefits vests when the employee dies, as was the
situation in Cline, and the employee's claim for benefits vests at
the time of the injury.
Contrary to Petitioner's argument, her situation is more
analogous to the first scenario, rather than the second scenario,
discussed in Cline. Petitioner is not a dependent nor has there
been a death; rather, the reasoning of the Cline court
demonstrates that, in determining benefits for employees who
suffer accidental injuries, it is the date of the injury that controls.
The court stated that the amounts of compensation payable to
the workman and his surviving dependents in cases where death
12
is caused by the injury are separate and distinct, undoubtedly
because their respective causes of action are based on different
compensable events, viz., injury in the case of the workman, and
death in the case of the dependents.
Id. at 100-101, 760 A.2d at 673-74.
Although some states use different calculations to “cap” a PPD award, we have not
found a single state statute that bases a PPD award on the SAWW in effect in the year
when the benefits are awarded rather than the year in which the injury occurs.   The date
5
of injury -- rather than the date of the award -- should be used to calculate PPD benefits in
light of the fact that “Workers’ [C]ompensation insurance premiums are based on actual
payroll figures, which means that underwriting is based on actual numbers rather than on
speculation, although the numbers might not be available until the policy-end audit.” 
  See, e.g., Ala. Code § 25-5-68 (LexisNexis 2007); Alaska Stat. § 23.30.175 (2008);
5
Ariz. Rev. Stat. Ann. § 23-1041 (Supp. 2009); Colo. Rev. Stat. Ann. § 8-42-107 (West
2003); Conn. Gen. Stat. § 31-309 (2005); Fla. Stat. Ann. § 440.12 (West 2009); Iowa
Code Ann. § 85.34 (West 2009); Ky. Rev. Stat. Ann. § 342.143 (LexisNexis 2005);
La. Rev. Stat. Ann. § 23:1202 (2005); Mass. Ann. Laws ch. 152, § 1(10) (LexisNexis
2000); Mich. Comp. Laws Ann. § 418.371 (West 1999); Mo. Ann. Stat. § 287.190.5
(West 2005); Mont. Code Ann. § 39-71-703(6) (2009); Nev. Rev. Stat. Ann. §
616C.425 (LexisNexis 2006); N.Y. Workers’ Comp. Law § 15 (Consol. 1982); Ohio
Rev. Code Ann. § 4123.62 (LexisNexis 2007); Okla. Stat. Ann. tit. 85, § 22 (West
2006); S.C. Code Ann. § 42-9-20 (1985); S.D. Codified Laws § 62-4-3.1 (2009); Tex.
Rev. Civ. Stat. Ann. art. Workers’ Comp. Law § 408.061(g) (Vernon 2006); Utah
Code Ann. § 34A-2-409, 2-412 (2005); Vt. Stat. Ann. tit. 21 §650(d) (2009); Va.
Code Ann. § 65.2-500 (2007); W. Va. Code Ann. § 23-4-6 (LexisNexis 2005); Wyo.
Stat. Ann. § 27-14-403 (2009). 
13
Richard P. Gilbert, Maryland Workers’ Compensation Handbook § 9.06 (3rd ed. 2007)
(citations omitted).  
Because of the Commission’s long-standing and consistent practice, which we find
to be “particularly persuasive,” which has been approved by “reported” opinions of the
Court of Special Appeals, and which has not been modified by the General Assembly, we
hold that any change  to the method of calculating PPD benefits should be made by the
General Assembly rather than by this Court.  
JUDGMENT AFFIRMED;
PETITIONER TO PAY THE COSTS.
14