IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Communication Test Design, :

Petitioner :

:

v. :

:

Workers’ Compensation :

Appeal Board (Simpson), : No. 1196 C.D. 2019

Respondent : Submitted: January 17, 2020

BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge

HONORABLE ANNE E. COVEY, Judge

HONORABLE CHRISTINE FIZZANO CANNON, Judge

OPINION BY 

JUDGE COVEY FILED: April 22, 2020

Communication Test Design (Employer) petitions this Court for review 

of the Workers’ Compensation (WC) Appeal Board’s (Board) August 2, 2019 order 

affirming the Workers’ Compensation Judge’s (WCJ) decision denying Herbert L. 

Simpson’s (Claimant) Claim Petition, granting Claimant’s Reinstatement and Penalty 

Petitions, and dismissing Employer’s Suspension Petition as moot; and reversing the 

WCJ’s decision dismissing Employer’s Termination Petition as moot and modifying 

that decision to reflect a termination of Claimant’s WC benefits as of February 23, 

2017. Employer presents two issues for this Court’s review: (1) whether Claimant 

had to prove ongoing disability and entitlement to temporary total disability (TTD) 

benefits to prevail on his Reinstatement and Penalty Petitions; and (2) whether 

Employer is required to pay unreasonable contest fees when Claimant is not entitled 

to TTD benefits. 

On December 5, 2016, Claimant allegedly sustained work injuries during 

the course and scope of his employment with Employer. On December 20, 2016, 

Employer issued a Medical Only Notice of Temporary Compensation Payable 
2

(NTCP), accepting liability for medical bills for the alleged work injury, described as 

an eye laceration. On January 4, 2017, Employer issued an amended NTCP, under 

which it began paying Claimant disability benefits. On February 7, 2017, Employer 

issued a Notice Stopping Temporary Compensation Payable (NSTC), indicating that 

it ceased paying compensation as of January 19, 2017. Attached to the NSTC was a 

Notice of Compensation Denial (NCD), denying that Claimant sustained a work 

injury. 

On February 13, 2017, Claimant filed a Claim Petition, alleging he 

sustained work injuries in the nature of a concussion, post-concussion syndrome, 

right eye laceration, right shoulder sprain/strain and internal derangement of the right 

shoulder on December 5, 2016. Claimant sought TTD from the date of injury and 

ongoing, reimbursement for associated medical services, litigation costs, and

unreasonable contest attorney’s fees. On April 7, 2017, Claimant filed the

Reinstatement and Penalty Petitions, claiming that Employer violated the 

Pennsylvania Workers’ Compensation Act (Act).1 Specifically, Claimant asserted

that Employer failed to issue an NSTC within five days after the last payment of

temporary compensation. Claimant requested penalties at the rate of 50% on all past 

due compensation. Claimant also sought assessment of unreasonable contest 

attorney’s fees pursuant to Section 440 of the Act, 77 P.S. § 996.

2 Claimant further 

asked for reinstatement of total disability benefits based on Employer’s misuse of 

documents.

On April 18, 2017, Employer filed the Termination Petition averring that 

Claimant fully recovered from his alleged work injuries as of February 23, 2017. 

Employer also filed the Suspension Petition on May 3, 2017, asserting that Claimant 

responded in bad faith to a specific job offer. The WCJ held hearings on March 20, 

 

1 Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2710.

2 Added by Section 3 of the Act of February 8, 1972, P.L. 25.
3

May 8, September 13 and November 6, 2017. On May 4, 2018, the WCJ denied 

Claimant’s Claim Petition, granted Claimant’s Reinstatement and Penalty Petitions,

and dismissed Employer’s Termination and Suspension Petitions as moot. The WCJ 

determined that Claimant’s work injury was limited to a right eye laceration, which 

did not result in disability.

However, the WCJ ruled that Claimant was entitled to a reinstatement of 

benefits based on the conversion of the amended NTCP to a Notice of Compensation 

Payable (NCP) by operation of law, because Employer failed to timely file an NSTC 

and NCD. Thus, the WCJ granted the Reinstatement Petition. The WCJ also 

awarded a 10% penalty because Employer violated the Act by failing to timely file 

the NSTC and NCD and by unilaterally ceasing payment. The WCJ further 

determined that Employer’s contest as to the Reinstatement Petition was 

unreasonable and awarded $8,140.00 in unreasonable contest fees. Finally, the WCJ 

held that Claimant failed to establish any injury other than an eye laceration and 

terminated Claimant’s WC benefits as of the date of decision. The WCJ dismissed as 

moot Employer’s Suspension and Termination Petitions, concluding that Claimant 

failed to meet his burden of establishing that his eye laceration resulted in disability 

or that he had any other compensable work injuries. Claimant and Employer 

appealed to the Board.

On August 2, 2019, the Board affirmed the WCJ’s decision denying

Claimant’s Claim Petition, granting Claimant’s Reinstatement and Penalty Petitions, 

and dismissing Employer’s Suspension Petitions as moot; reversed the WCJ’s 

decision dismissing Employer’s Termination Petition as moot; and modified the 

WCJ’s decision to reflect a termination of benefits as of February 23, 2017. 

Employer appealed to this Court.3

 

3

“On review[,] this Court must determine whether constitutional rights were violated, errors 

of law were committed, or necessary findings of fact were supported by substantial competent 
4

Employer first argues that the WCJ erred by granting Claimant’s 

Reinstatement and Penalty Petitions. Claimant rejoins that, pursuant to Section 406.1 

of the Act, 77 P.S. § 717.1 (relating to prompt payment),4 his WC benefits were 

reinstated as a matter of law because Employer did not file its NSTC within five days 

of the last WC payment. 

Initially, the Pennsylvania Supreme Court has explained:

A claimant seeking reinstatement of suspended benefits 

must prove that his or her earning power is once again 

adversely affected by his or her disability,[5]and that such 

disability is a continuation of that which arose from his or 

her original claim. The claimant need not re-prove that 

the disability resulted from a work-related injury 

during his or her original employment. Once the 

claimant meets this burden, the burden then shifts to the 

party opposing the reinstatement petition. In order to 

prevail, the opposing party must show that the 

claimant’s loss in earnings is not caused by the disability 

arising from the work-related injury. This burden may 

be met by showing that the claimant’s loss of earnings is, in 

fact, caused by the claimant’s bad faith rejection of 

available work within the relevant required medical 

restrictions or by some circumstance barring receipt of 

benefits that is specifically described under provisions of 

the Act or in this Court’s decisional law.

Bufford v. Workers’ Comp. Appeal Bd. (N. Am. Telecom), 2 A.3d 548, 558 (Pa. 2010)

(emphasis added).

However, “in certain situations[,] a claimant who seeks a reinstatement 

of benefits must establish disability through the pendency of the reinstatement 

 

evidence.” Stepp v. Workers’ Comp. Appeal Bd. (FairPoint Commc’ns, Inc.), 99 A.3d 598, 601 n.6 

(Pa. Cmwlth. 2014). “Substantial evidence has been defined as such relevant evidence as a 

reasonable person might accept as adequate to support a conclusion.” Id.

4 Added by Section 3 of the Act of February 8, 1972, P.L. 25.

5

“‘[F]or purposes of receiving [WC], ‘disability’ is a term synonymous with loss of earning

power; it does not refer to physical impairment.’” Lindemuth v. Workers’ Comp. Appeal Bd. 

(Strishock Coal Co.), 134 A.3d 111, 123 (Pa. Cmwlth. 2016) (quoting Kmart v. Workers’ Comp.

Appeal Bd. (Williams), 771 A.2d 82, 85 (Pa. Cmwlth. 2001)).
5

petition.” Kranak v. Workers’ Comp. Appeal Bd. (U.S. Airways) (Pa. Cmwlth. No. 

1265 C.D. 2013, filed March 7, 2014),6slip op. at 14. “Here, Claimant never 

established disability prior to the filing of the [R]einstatement [P]etition.” Id. 

(emphasis added). Thus, “[i]t was Claimant’s burden to establish his entitlement to a 

reinstatement of benefits.” Id.

In his Penalty/Reinstatement Petition, Claimant alleged: 

[Employer] has failed to issue a[n] [NSTC] no later than 

five (5) days after the last payment of temporary 

compensation. Claimant requests penalties at the rate of

fifty percent (50%) on all past due compensation. Claimant 

requests assessment of unreasonable contest attorney’s fees 

pursuant to [Section] 440 of the Act. Claimant requests 

reinstatement of total disability benefits based on the 

misuse of documents.

Reproduced Record (R.R.) at 20a (emphasis added). 

The WCJ determined:

Because the last day that compensation was paid was 

January 19, 2017, the [NSTC] had to be filed by January 24, 

2017. The [NSTC] was not filed until February 7, 2017. 

Thus, the [NTCP] accepting Claimant’s injury as a 

laceration to his eye with disability effective December 5, 

2016 converted to a[n] [NCP] by operation of law.

WCJ Dec. at 4, Finding of Fact (FOF) 12 (emphasis added). 

First, although the NSTC stated that “payment of compensation . . .

[was] being stopped as of 01-19-2017[,]” there was no testimony as to what period 

that payment covered, see Thomas Lindstrom Co., Inc. v. Workers’ Comp. Appeal Bd.

(Braun), 992 A.2d 961 (Pa. Cmwlth. 2010), nor is the date of the last payment 

 

6 Pursuant to Section 414(a) of the Commonwealth Court Internal Operating Procedures, 

unreported opinions of a panel of the Commonwealth Court, if issued after January 15, 2008, may

be cited for persuasive value, but not as binding precedent. 210 Pa. Code § 69.414(a).
6

identified in the record, see Jones v. Workers’ Comp. Appeal Bd. (Villanova Univ.), 

164 A.3d 542 (Pa. Cmwlth. 2017); thus, there is no evidence upon which the WCJ 

could base his determination that the NSTC was not filed within five days of the last 

payment. “No penalty may be imposed . . . absent proof of a violation of the Act or 

its regulations, and a violation of the Act must appear in the record in order for a 

penalty to be appropriate.” Dow v. Workers’ Comp. Appeal Bd. (Household Fin.

Co.), 768 A.2d 1221, 1226 (Pa. Cmwlth. 2001) (emphasis added; citation omitted). 

Because substantial evidence does not support the WCJ’s conclusion that Employer 

violated the Act by failing to file the NSTC within five days of the last payment, the 

WCJ erred by granting the Penalty Petition.

Second, and more importantly, Section 406.1 of the Act does not

sanction conversion of an NTCP to an NCP for failure to file an NSTC within five 

days of stopping payment. Rather, Section 406.1(d)(5) of the Act mandates:

(i) If the employer ceases making payments pursuant to a[n]

[NTCP], a notice in the form prescribed by the 

[D]epartment [of Labor and Industry (Department)] shall be 

sent to the claimant and a copy filed with the [D]epartment, 

but in no event shall this notice be sent or filed later than 

five (5) days after the last payment.

(ii) This notice shall advise the claimant, that if the 

employer is ceasing payment of temporary compensation, 

that the payment of temporary compensation was not an 

admission of liability of the employer with respect to the 

injury subject to the [NTCP], and the employe must file a 

claim to establish the liability of the employer.

(iii) If the employer ceases making payments pursuant to 

a[n] [NTCP], after complying with this clause, the employer 

and employe retain all the rights, defenses and obligations 

with regard to the claim subject to the [NTCP], and the 

payment of temporary compensation may not be used to 

support a claim for compensation.
7

(iv) Payment of temporary compensation shall be 

considered compensation for purposes of tolling the statute 

of limitations under [S]ection 315 [of the Act7].

77 P.S. § 717.1(d)(5). There is no remedy stated therein for failure to comply with 

Section 406.1(d)(5)(i) of the Act. There is a remedy, however, for failure to file an

NSTC within 90 days of the filing of an NTCP. Section 406.1(d)(6) of the Act 

requires: “If the employer does not file a[n] [NSTC] under paragraph (5) within the 

ninety-day period during which temporary compensation is paid or payable, the 

employer shall be deemed to have admitted liability and the [NTCP] shall be 

converted to a[n] [NCP].” 77 P.S. § 717.1(d)(6) (emphasis added).

Here, the NTCP was issued on December 20, 2016, and Employer filed 

its NSTC on February 7, 2017. Because the NSTC was filed within 90 days of the 

NTCP, the NTCP could not convert to an NCP by operation of law. Thus, the WCJ 

and the Board erred by concluding otherwise.

In support of their decisions, the WCJ and the Board relied upon Jones. 

However, Jones is distinguishable from the instant case in that here, there is no record 

evidence as to the last payment date and therefore it is unknown whether the last 

payment was made within five days thereof. Further, the Jones Court expressly 

stated: “The only issue on appeal is what is the event from which the NSTC has to be 

sent or filed within no later than [five] days as set forth in Section 406.1(d)(5)(i) of 

the Act, 77 P.S. § 717.1(d)(5)(i).” Jones, 164 A.3d at 544-45. The Court held: 

“Because [the Act] provides that ‘compensation shall be paid not later than the 

twenty-first day’ after an agreement, NCP or NTCP, under Section 406.1(a), time is 

calculated from when compensation must be paid, not the last period for which 

compensation is payable ended.” Jones, 164 A.3d at 545. The issue before the Jones

Court is not the same issue herein nor did the Jones Court hold that if the NSTC was 

 

7 77 P.S. § 602.
8

not sent within five days of the last benefit payment the NTCP would convert to an 

NCP by operation of law.8 Accordingly, Jones is inapposite and the WCJ and the 

Board erred in relying thereon.

Moreover, Section 406.1(d)(5)(ii) of the Act expressly states that if the 

employer files an NSTC, “the payment of temporary compensation [is] not an 

admission of liability of the employer with respect to the injury,” and “the employe 

must file a claim to establish the liability of the employer.” 77 P.S. § 

717.1(d)(5)(ii) (emphasis added). Accordingly, Claimant herein filed a Claim 

Petition on February 13, 2017, which the WCJ denied. Because “Claimant never 

established disability prior to the filing of the [R]einstatement [P]etition[,]” “[i]t was 

Claimant’s burden to establish his entitlement to a reinstatement of benefits.” 

Kranak, slip op. at 14. The WCJ concluded: “Claimant has failed to sustain his 

burden of proving that he sustained anything other than a laceration above his eye in 

the incident of December 5, 2016. Thus, Claimant’s Claim Petition for all other 

injuries and disability is denied.” WCJ Dec. at 14, Conclusion of Law (COL) 3 

(emphasis added); see also COL 4 (“Claimant did not suffer any additional injuries or 

any disability as a result of his alleged work injury.”). Because Claimant did not 

prove his entitlement to a reinstatement of benefits, the WCJ erred by granting his 

Reinstatement Petition.

Employer next argues that it is not required to pay unreasonable contest 

fees because Claimant is not entitled to TTD benefits. Specifically, Employer 

contends its contest was not intended to harass Claimant but, rather, to determine 

 

8

In addition, the Jones Court found the NSTC was filed within five days of the last 

payment; thus, whether the NTCP converted to an NCP by operation of law was not an issue before 

the Court, and therefore, “not essential to the decision.” Program Admin. Servs. Inc. v. Dauphin 

Cty. Gen. Auth., 874 A.2d 722, 729 (Pa. Cmwlth. 2005), aff’d, 928 A.2d 1013 (Pa. 2007) (quoting 

City of Lower Burrell v. City of Lower Burrell Wage & Policy Comm., 795 A.2d 432, 437 n.7 (Pa. 

Cmwlth. 2002)). Accordingly, any mention of the conversion by operation of law is merely 

“[j]udicial dictum [which] is not binding authority.” Program Admin. Servs. Inc., 874 A.2d at 729.
9

whether Claimant was ever disabled as a result of the accepted work injury. Claimant 

rejoins that he is entitled to unreasonable contest fees pursuant to Section 440 of the 

Act because Employer continued to litigate the matter after the NTCP converted to an

NCP as a matter of law.

Section 440(a) of the Act provides:

In any contested case where the insurer has contested 

liability in whole or in part, including contested cases 

involving petitions to terminate, reinstate, increase, reduce 

or otherwise modify compensation awards, agreements or 

other payment arrangements or to set aside final receipts, 

the employe or his dependent, as the case may be, in whose 

favor the matter at issue has been finally determined in 

whole or in part shall be awarded, in addition to the 

award for compensation, a reasonable sum for costs 

incurred for attorney’s fee . . . : Provided, That cost for 

attorney fees may be excluded when a reasonable basis 

for the contest has been established by the employer or 

the insurer.

77 P.S. § 996(a) (emphasis added).

Here, the WCJ determined:

47. This [WCJ] has carefully considered Claimant’s request 

for unreasonable contest attorney’s fees. In reviewing this, 

this [WCJ] does not consider the various defenses to the 

[c]laim proposed by Employer. The statute is clear that the 

[NSTC] must be filed not later than five days after

compensation is stopped. Employer offers no defense to the 

late issuance of the [NSTC] and thus there is no defense for 

its failure to reinstate Claimant’s total disability benefits. 

This [WCJ] finds that Employer’s contest to the 

[Reinstatement Petition] was unreasonable.

48. Based on Employer’s unreasonable contest, this [WCJ] 

awards Claimant’s attorney his Quantum Meruit attorney 

fee in the amount of $8,140.00. Said fee shall be paid 

directly to Claimant’s attorney.

49. Based on Claimant’s success with regard to the 

[Reinstatement Petition] and the Penalty Petition, 
10

Employer shall pay Claimant’s attorney his litigation 

costs in the amount of $5,939.43. Said costs shall be paid 

directly to Claimant’s attorney.

50. This [WCJ] approves the fee agreement between 

Claimant and his counsel but does not award a fee because 

Counsel’s fee is covered by the unreasonable contest fees 

and no disability benefits are awarded in Claimant’s Claim 

Petition.

WCJ Dec. at 14, FOFs 47-50 (emphasis added).

At the outset, Claimant did not file separate Reinstatement and Penalty 

Petitions. Claimant filed a combined Reinstatement and Penalty Petition, therein

alleging that Claimant was entitled to reinstatement because Employer failed to 

timely file its NSTC. The law is well settled that “a claimant who files a penalty 

petition bears the burden of proving a violation of the Act occurred. If the claimant 

meets his or her initial burden of proving a violation, the burden then shifts to the 

employer to prove it did not violate the Act.” Baumann v. Workers’ Comp. Appeal 

Bd. (Kellogg Co.), 147 A.3d 1283, 1293 (Pa. Cmwlth. 2016) (quoting Gumm v. 

Workers’ Comp. Appeal Bd. (Steel), 942 A.2d 222, 232 (Pa. Cmwlth. 2008) (citation 

omitted)).

As discussed above, Claimant did not present any evidence that 

Employer violated the Act. Thus, the burden did not shift to Employer to prove it did 

not violate the Act. Further, because Claimant never established a disability prior to 

the filing of the Reinstatement Petition, he had the burden to establish his entitlement 

to a reinstatement of benefits. Kranak. Employer not only contested the

Reinstatement Petition, it prevailed in proving that Claimant did not suffer a 

disability. Accordingly, the WCJ erred by awarding unreasonable contest fees.9

 

9 Employer also requests this Court to reverse the WCJ’s decision dismissing its Suspension 

Petition as moot. Given the disposition of the above issues, this Court holds Employer’s 

Suspension Petition is now moot. 
11

For all of the above reasons, the Board’s order is affirmed in part and 

reversed in part. The portion of the Board’s order affirming the WCJ’s decision 

granting Claimant’s Reinstatement and Penalty Petitions is reversed; and the portion 

of the Board’s order reversing the WCJ’s decision dismissing Employer’s

Termination Petition as moot is reversed. The portion of the Board’s order affirming 

the WCJ’s decision denying Claimant’s Claim Petition is affirmed; and the portion of 

the Board’s order dismissing Employer’s Suspension Petition as moot is affirmed. 

___________________________

ANNE E. COVEY, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Communication Test Design, :

Petitioner :

:

v. :

:

Workers’ Compensation :

Appeal Board (Simpson), : No. 1196 C.D. 2019

Respondent :

O R D E R

AND NOW, this 22nd day of April, 2020, the Workers’ Compensation 

Appeal Board’s (Board) August 2, 2019 order is affirmed in part and reversed in part. 

The portion of the Board’s order affirming the Workers’ Compensation 

Judge’s (WCJ’s) decision granting Herbert L. Simpson’s (Claimant) Reinstatement 

and Penalty Petitions is REVERSED. The portion of the Board’s order reversing the 

WCJ’s decision dismissing Communication Test Design’s (Employer) Termination 

Petition as moot is REVERSED. 

The portion of the Board’s order affirming the WCJ’s decision denying 

Claimant’s Claim Petition is AFFIRMED. The portion of the Board’s order

dismissing Employer’s Suspension Petition as moot is AFFIRMED. 

___________________________

ANNE E. COVEY, Judge