IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Frank Martz Coach Company, :

Petitioner :

:

v. : No. 1555 C.D. 2015 : Submitted: March 24, 2016 Workers’ Compensation Appeal : Board (Avila), :

Respondent :

BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge

HONORABLE ANNE E. COVEY, Judge HONORABLE DAN PELLEGRINI, Senior Judge

OPINION NOT REPORTED

MEMORANDUM OPINION BY PRESIDENT JUDGE LEAVITT FILED: April 13 , 2017

Frank Martz Coach Company (Employer) petitions for review of an adjudication of the Workers’ Com pensation Appeal Board (Board) that granted
penalties to Julio Avila (Claimant). In doing so, the Board affirmed th e decision of the Workers’ Compensation Judge (WCJ) that a Supplemental Agreement by

which Employer agreed to pay Cla i mant total disability benefits, unless or until
modified by order of a WCJ, precluded Employer from thereafter issuing a Notice
of Compens ation D enial . Holding that Employer’s unilateral termination of compensation benefits violated the Workers’ Compensation Act, 1 the Board

affirmed the WCJ ’s decision to award penalties. Concluding that the record is
inadequate to conduct appellate review, we vacate and remand.

On January 19, 2013, Claimant sustained a work injury. On February
5, 2013, Employer issued a Notice of Temporary Compensation Payable (NTCP)

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

- 1041.4, 2501

- 2708.2

that described Claimant’s work injury of January 19, 2013, as a lumbar strain that

occurred when “[Claimant] went to pull the latch for the engine compartment panel

and strained his lower back.” Reproduced Record at 3a (R.R. __). 2 Employer
began paying Claimant compensation benefits at the rate of $824.84 per week. Employer’s NTCP stated that the 90

- day temporary compensation period began on
January 24, 2013

, and would end on April 23, 2013.

On March 12, 2013, Cla imant and Employer entered into a

“ Supplemental Agreement for Compensation for Disability as Permanent Injury

, ”

which contained se veral terms relevant to this appeal

. R.R. 5a

- 6a. First, Claimant
agreed to a reduction of disability benefits from February 11 , 2013, through
February 25, 2013, during which period he worked in a light duty posit ion.
Second, Employer agreed to resume th e payment of total disability on February 28,

2013

, when his work injury recurred. Finally, Employer agreed to pay total
disability benefits into the future for an “uncertain” number of weeks

. R.R. 6a.

On April 22, 2013 , Employer issued a Notice Stopping Temporary

C ompensation (NSTC) and a Notice of Compensation Denial (NCD) . Employer

did so for the stated reason that the medical information provided by Claimant was inadequate to establish a work injury . In response, on April 26, 2013, Claimant
filed a penalty petition, contending that Employer violated the Act by unilaterally
terminating his disability compensation

. The penalty petition asserted that the 90

- day

- period of temporary compensation expired on April 19, 2013 , because

Claimant was inj ured on January 19, 2013 . Thus, Employer’s NTCP conver t ed

2 Because this case turned entirely on the legal significance of Employer’s agreement to pay Claimant disability compensation in a Supplemental Agreement , there is no evidentiary record

on Claimant’s job title

, or when the injury was reported

.3

automatically to an NCP on April 19, 2013 , making Employer’s NCD o f April 22,
2013, untimely. Claimant sought an immediate reinstatement of disability
compensation and an award of penalties.

The WCJ convened a hearing on May 28, 2013. The WCJ began the
hearing by marking as exhibits filings that had been made with the Bureau of Workers’ Compensation (Bureau )

. Exhibit No. 2 was the Supplemental Agreement, signed by Claimant and Employer’s claims representative. 3 R.R. 5a

6a. Both Claimant’s counsel and Employer’s counsel stated they did not know

about the Supplement al Agreement. Claimant then amended his penalty petition to

ad d the contention that the Supplemental Agreement precluded Employer from
unilaterally terminating compensation

.

Employer ’s counsel responded with two points

. First, Employer
argued that although Claimant was injured on January 19, 2013, he continued to

work . On January 24, 2013, Claimant took a vacation day

. 4 Employer argued that

the 90

- day duration of the NTCP did not begin until January 24, 2013. S econd,
Employer stated that because it had just learned of the Supplemental Agreement,
its significance was unclear. Employer asked for time to research the issue.

The WCJ gave the parties two weeks to brief the significance of the
Supplemental Agreement . The WCJ stated that should the Supplemental
Agreement be found to be controlling, then he would grant the penalty petition. If

3 Other exhibits included the NTCP, Bureau Exhibit No. 1; the NSTC, Bureau Exhibit No. 3; and the NCD, Bureau Exhibit No. 4.

4 These recitals cannot be confirmed or refuted because there is no evidentiary record. This is

tr ue for both Employer and Claimant.4

not, he would schedule a hearing to take evidence on the question of when the 90

- day period of temporary compensation began

.

On June 17, 2013, the WCJ issued a decision granting Claimant’s
penalty petition ; striki ng Employer’s NS TC and the NCD ; and reinstating total
disability compensation to Claimant . The WCJ acknowledged that Employer’s

NTCP accepted liability for Claimant’s back injury only on a temporary basis

. However, by executing the Supplemental Agreement

, Employer fully accepted
liability as of March 12, 2013. At that point, Claimant’s benefits could not be
terminated unilaterally by Employer but only by agreement of the parties or order

of a WCJ

. Accordingly, the WCJ awarded a penalty equal to 30% perc ent of the
outstanding compensation benefits as of the date of the order.

Employer appealed to the Board . It argued that the Supplemental
Agreement was not controlling , as held by the WCJ . In support
, Employer offered

a notice from the Bure au stating tha t the Supplement al Agreement was an “Improperly Filed Form.” R.R. 7a. The notice stated as follows:

Claim is in a temporary status. A Supplemental Agreement (LIBC

- 337) cannot be used to correct/amend a Notice of Temporary Compensation Payable (LIBC

- 501). A corrected/amended LIBC

- 501 must be submitted.

Id

. The Board refused to consider the Bureau’s notice for the stated

reason that it had not been presented to the WCJ and, thus, was not part of the

certified record

. 5 In any case, the Board f ound the notice irrelevant

. The Board

5 The d issent argues that in “fairness,” the Board should have considered the Bureau’s notice. However, Employer did not appeal this ruling of the Board to this Court.5

held that Employer could not disavow the terms of the Supplemental Agreement
simply because it filed the “ wrong form .” The Board held that the Supplemental
Agreement was binding unless and until it was modified by a greement of the
parties or by an order of the WCJ. Because the Supplemental Agreement provided
compensation “for uncertain weeks” into the future, Employer had admitted
ongoing liability for Claimant’s back injury

. The Board noted that the
Supplemental A greement sh ould have been captioned as an Agreement for

C ompensation, but this had no bearing on the meaning and enforceability of the parties’ agreement

. 6

Employer petition ed for this Court’s review

. On appeal, 7 it raises one

issue. It contends the Board erred as a matter of law in concluding that the Supplemental Agreement altered the provisional nature of Employer’s acceptance of liability for Claimant’s injury

.

Employer argues that the Sup plemental Agreement did not have the
legal effect of an Agr eement for C ompensation . Under Section 406.1 (d) of the
Act, 8 77 P.S. §717.1(d), an employer may pay compensation payments for 90 days

6 Notably, the form for a “ Supplemental Agreement ” is identical to that for an “ Agreement for Compensation ,” except for the caption.

7 This Court’ s review determines whether the findings of fact are supported by substantial evidence, whether Board procedures were violated, whether constitutional rights were violated or whether an error of law was committed. City of P hiladelphia v. Workers’ Compensation Appeal Board (Brown) , 830 A.2d 649, 653 n. 2 (Pa. Cmwlth. 2003)

. Our scope of review of questions of law is plenary, and our standard of review is de novo

. 8 It provides, in relevant part: (d)(1) In any instance where an employer is uncertain whether a claim is compensable under this act or is uncertain of the extent of its liability under this act, the employer may initiate compensation payments without prejudice and without admitting liability pursuant to a notice of temporary compensation payable as prescribed by the department. (Footnote continued on the next page . . . )6

without admitting liability

. Employer contends that it did not intend the
Supplemental Agreement to extend the benefit p eriod in the NTCP . Rather, its

purpose was to return Claimant’s rate of compensation to “ the rate set forth in the NTCP initially issued by [Employer].” Employer B rief at 15. Employer argues

that it entered into the Supplemental Agreement solely to obta in Claimant’s
agreement to a reduction in the disability payment set forth in the NTCP for three

weeks in February

. I t entered the S upplemental A greement to avoid penalties,

which this Court awarded in Gereyes v. Workers’ Compensation Appeal Board
(New Knight, Inc.) , 793 A.2d 1017 (Pa. Cmwlth. 2002)

, because the employer had
unilaterally reduced the rate of disability compensation stated in its NTCP

.

At issue here is a penalty petition filed pursuant to Section 435(d) (i)

of the Act

, 9 77 P.S. §991(d)(i). In a penalty petition , the claimant bears the burden

(continued . . . ) (2) The notice of temporary compensation payable shall be sent to the claimant and a copy filed with the department and shall notify the claimant that the payment of temporary compensation is not an admission of liability of the employer with respect to the injury which is the subject of the notice of temporary compensation payable. The department shall, upon receipt of a notice of temporary compensation payable, send a notice to the claimant i nforming the claimant that: (i) the payment of temporar y compensation and the claimant’ s acceptance of that compensa tion does not mean the claimant’ s employer is accepting responsibility for the injury or that a compensation claim has been filed or commenc ed; (ii) the payment of temporary compensation entitles the claimant to a maximum of ninety (90) days of compensation[.] Added by Section 3 of the Act of February 8, 1972, P.L. 2 5

, as amended, 77 P.S. § 717.1(d)

. 9 It states , in relevant part , as follows : ( d) The department, the board, or any court which may hear any proceedings brought under this act shall have the power to impose penalties as provided herein (Footnote continued on the next page . . . )7

of proving that a violation of the Act has occurred. Shuster v. Workers’
Compensation Appeal Board (Pennsylvania Human Relatio ns Commission) , 745
A.2d 1282, 1288 (Pa. Cmwlth. 2000)

. The WCJ concluded that Claimant met its

burden

. T he WCJ reasoned that in the Supplemental Agreement, Employer accepted liability for Claimant’s injury and, thus, it could not unilaterally terminate
compensation. The WCJ explained as follows:

Although [Employer] initially only provisionally accepted Claimant’s injury via a [NTCP], [Employer] subsequently accepted the claim fully by entering into the Supplementa l Agreement. Pursuant to the terms of the Supplemental Agreement, [Employer has] accepted l iability for a January 19, 2013 work

- related injury in the form of a lumbar strain, for which Claimant should be receiving temporary total disability benefits at th e rate of $824.84 per week.

WCJ Decision at 2, Conclusion of Law No. 2. In affirming the WCJ, t he Board

relied upon Sharon Tube Company v. Workers’ Compensation Appeal Board
(Buzard) , 908 A.2d 929 (Pa. Cmwlth. 2006).

In Buzard

, the claimant, after havi ng been awarded compensation,

returned to work . Thereafter, the claimant suffered a recurrence of his injury. The

(continued . . . ) for violations of the provisions of this act or such rules and regulations or rules of procedure: ( i) Employers and insurers may be penalized a sum not exceeding ten per centum of the amount awarded and interest accrued and payable: Provided, however, That such penalty may be increased to fifty per centum in cases of unreasonable or excessive delays. Su ch penalty shall be payable to the same persons to whom the compensation is payable. Added by Section 3 of the Act of February 8, 1972, P.L. 25, as amended

, 77 P.S. §991(d) (i)

.8

parties executed a supplemental agreement, acknowledging the claimant’s return to

total disabilit y benefits on July 28, 2003, when he left w ork

. Sever al months later,
the employer f

iled a modif

ication petition, seeking to reduce the claimant’s

benefits as of July 21, 2003, onward, based on the claimant’s alleged ability to

work. In fact, the claimant did work the week of July 21, 2003. The cla imant
argued that because the supplemental agreement was dated July 28 , 2003, the
employer could not claim that he was able to work as of July 21, 2003. Employer
argued that the agreement was dated to reflect the claimant ’s last day of work, not
because it believed that the claimant had grounds to leave work that day.

The Board rejected the employer’s argument, and t his Court upheld

the Board. Section 413(a) of the Act

, 10 permits a modification only where there

has been a change in a claimant’s condition “ since the date of the agreement.”

Buzard , 908 A.2d at 933 (emphasis in original). In so holding

, we relied upon our Supreme Court’s construction of Section 413(a) of the Act, where it explained :

[I]n the case of an agreement or a notice of compensation payable, a petitioner has the bur den of showing that the employe’ s disability has changed after the date of the agreement or the notice of compensation payable.

10 It provides , in relevant part : A workers ’ compensation judge designated by the department may, at any time, modify, reinstate, suspend, or terminate a notice of compensation payable, an original or supplemental agreement or an award of the department or its workers ’ compensation judge, upon petit ion filed by either party with the department, upon proof that the disability of an injured employe has increased, decreased, recurred, or has temporarily or finally ceased, or that the status of any dependent has changed. Such modification, reinstatement , suspension, or termination shall be made as of the date upon which it is shown that the disability of the injured employe has increased, decreased, recurred, or has temporarily or finally ceased, or upon which it is shown that the status of any dependent has changed[.] 77 P.S. §772.9

Beissel v. Workmen’s Compensation Appeal Board (John Wanamaker, Inc.) , 465
A.2d 969, 971 (Pa. 1983) (internal citation omitted, emphasis in original). W e also
relied upon Section 407 of the Act which states, inter alia , that a supplemental
agreement for the reinstatement or termination of compensation “shall be valid and
binding unless modified or set aside as hereina fter provided.” 77 P.S. §731. In

short

, Buzard established that an employer is bound by the facts stated in the
supplemental agreement, including the stated da te of a claimant’s disability

. Buzard , 908 A.2d at 933

.

Here, t he Supplemental Agreement states , as fact, that “it is now
hereby agreed between parties hereto that the status of the disability of the said employee changed” on February 28, 2013. R.R. 5a. An “x” is pla ced before

“Recurred.” Id

. The Supplemental Agreement states that Claimant will be paid $824.84 per week beginning on February 28, 2013 , and then recites :

C ompensation payable for

___ UNK

___ weeks ____days ; or if the future period of di sability is uncertain, then to continue at said rate until further changed by supplemental agreement, final receipt, or order of a Workers’ Compensation Judge, or the Workers’ Compensation Appeal Board

.

Id

. (emphasis added). The Supplemental Agreement recites that Claimant was paid
disability compensation at a rate lower than that stated in the NTCP when he
worked at a light duty job for three weeks in February. Id. at 6a. Finally, t he
Supplemental A greement concludes as fol lows :

AS OF 02

- 18

- 13 CLAIMANT’S DI S ABILITY RECURRED TOTAL IN CHARACTER & COMPENSATION SHALL BE PAYABLE TO THE SAID EMPLOYEE AT THE RATE OF $824.84 PER WEEK FOR UNCERTAIN WEEKS.10 We, the undersigned, agree upon the facts represented by the above

- named employ ee and the[] above

- named employer.

Id. Based on these provisions of the Supplemental Agreement, the Board held that
Employer could neither stop the payment of compensation nor change the rate of
compensation by the issuance of a NSTC or NCD.

An NTCP is n ot an admission of liabi lity , and Employer was entitled

to file a NSTC and a NCD any time before the expirat ion of the 90

- day period of
temporary compensation

. It is also the case that Employer agreed “to continue [to
pay compensation] at said rate until further changed by supplemental agreement, final receipt, or order of a [WCJ] or the [Board].” R.R. 5a. These four documents

constitute the entire record in this case

.

As a consequence, w e know nothing about the circumstances that led Employer’s claim adjuster to present the Supplemental Agreement to Claimant.

Under Gereyes

, an employer’s unilateral reduction in an NTCP’s stated disability
rate violates the Act and subject s that employer to penalties. 11 Employer contends

that it intended the Supplemental Agreement, which gave Claimant’s after

- the

- fact
imprimatur to the reduction for the period February 11, 2013, to February 25,

2013 , to avoid the Gereyes result. Claimant responds that Employer should have
filled out the Supplemental Agre ement to show that the reinstatement was only for
a maximum of 90 days , if that had been its intent

.

11 In Gereyes , 793 A.2d 1017, the employer issued a NT CP and paid the claimant full disability. Shortly thereafter, the claimant returned to work, and the employer unilaterally reduced the benefit amount set forth in the NT CP. We held that the employer violated the Act by unilaterally reducing the amount of compensation paid set forth in the NT CP without the claimant’s agreement and awarded penalties to the claimant.11 The absence of an y evidentiary record impedes effective appellate
review. The Supplemental Agreement was executed, apparently, without the
knowledge or ad vice of either party’s counsel. 12 It is not known why Employer did
not file an amended NTCP (LIPC

- 501)

, as suggested by the Bureau. 13 Likewise,
the record does not support the B oard’s supposition that Employer should have
used the form for an Agreement for Compensation instead of a Supplemental
Agreement

. The intentions of either Claimant or Employer cannot be discerned
solely from the Supplemental Agreement. Accordingly, we vacate the Board ’s

order and remand for the development of a record that can res olve whether the
Supplemental Agreement was a mutual mistake of the parties and , if so, whether Employer’s NCD was issued within the 90

- day deadline

.

______________________________________ MARY HANNAH LEAVITT, President Judge

12 Employer claims that the Supplemental Agreement was a mistake, without any evidence to support that claim. Upon remand, a full record needs to be made, not one that favors only Employer. Claimant may have a different version of the facts that led to the execution of the Supplement Agreement.

13 Given this C ourt’s ruling in Gereyes , it is not clear that the Bureau’s suggestion relieves an employer of liability for a unilateral reduction in the rate of benefits set forth in a NTCP.IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Frank Martz Coach Company, :

Petitioner :

:

v. : No. 1555 C.D. 2015

: Workers’ Compensation Appeal : Board (Avila), :

Respondent :

O R D E R

AND NOW, this 13 th day of April , 201 7

, the order of the Workers’
Compensation Appeal Board, dated July 28, 2015, is hereby VACATED and the
matter REMANDED for further proceedings consistent with the attached opi nion

.

Jurisdiction relinquished.

______________________________________ MARY HANNAH LEAVITT, President JudgeIN THE COMMONWEALTH COURT OF PENNSYLVANIA

Frank Martz Coach Company

, : Petitioner :

:

v. :

: Workers’ Compensation Appeal : Board (Avila)

, : No. 1555 C .D. 201 5 Respondent : Submitted : March 24 , 2016

BEFORE: HONORABLE MARY HANNAH LEAVITT

, President Judge

HONORABLE ANNE E. COVEY , Judge HONORABLE DAN PELLEGRINI , Senior Judge

OPINION NOT REPORTED

CONCURRING/ DISSENTING OPINION BY JUDGE COVEY FILED: April 13, 2017

Although I agree that the W orkers’ C ompensation (WC) A ppeal Board’s
( Board ) order should be vacated and the matter remanded for the parties to present
evidence with respect to the timeliness of the Notice Stopping Temporary
Compensation (NSTC) and the Notice of Workers’ Compensation Denial (NCD)

, I respectful ly dissent from the Majority ’s directive that the matter be remanded to determine the intent of the parties with respect to the Supplemental Agreement for
Compensation for Disability or Permanent Injury ( Supplement al Agreement )

. The
Majority concludes tha t a remand is warranted on that issue because Julio Avila
( Claimant ) “ may have another version of the facts

, i.e. , that the ‘mistake’ was using
the form for a supplemental agreement when the form for an agreement for compensation should have been used.” M ajority Op. at 11 (emphasis added). I
disagree because : (1) Claimant did not raise that argument either before the Board orAEC

- 2

-

this Court ; and (2) the WC Act (Act)

, 1 and the WC Bureau ’s ( Bureau ) rejection of the
Supplemental Agreement support Frank Martz Co ach Company ’s (Employer)

contention. Thus, I believe this Court should vacate the Board’s order and remand
the matter for the sole purpose of litigating the timeliness issue.

O n February 5, 2013 , Employer issued a Notice of Temporary
Compensation Pay able ( NTCP ) accepting Claimant’s January 19, 2013 work

- related
injury described as a lumbar strain

. Claimant began receiving temporary total disability benefits as of January 24, 2013 at the rate of $824.84 per week, based upon an average weekly wage of $ 1,237.20. Thereafter, Employer and Claimant entered

into the March 12, 2013 Supplemental Agreement which reduc ed Claimant ’s WC

benefits to temporary partial disability at varying rates from February 11 , 2013
through February 27, 2013 due to Claimant’s ret urn to work , with total disability
recurring as of February 28, 2013

, and Claimant returning to temporary total
disability at the rate of $824

. 84 per week for uncertain weeks

. Employer filed t he
Supplement al Agreement with the Bureau. On April 22, 2013, Employer issued a n
NSTC and a n NCD

. Claimant’ s benefits were terminated as of April 22, 2013.

On April 26, 2013, Claimant filed a penalty petition ( Petition ) alleging

that

, as of April 22, 2013, Employer violated the Act by u nilaterally suspending

Claima nt’ s benefits based on a late and incorrect denial of Claimant’ s accepted
work injury

. The Workers’ Compensation Judge ( WCJ ) held a hearing on May 28,

2013. Importantly, at the beginning of the hearing

, the WCJ introduced the
Supplemental Agreement. N ei ther Counsel was aware of the Supplemental Agreement’s existence as evidenced by the following exchange:

ATTORNEY VENTRE [Employer’ s C ounsel] :

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

- 1041.4, 2501

- 2708.AEC

- 3

- Judge, to be perfectly frankly [sic]

, I didn’t even know there was a Supplemental Agreement until you just ment ioned it as one of the Bureau Exhibits

. The only

- - - JUDGE HEMAK [WCJ] : Here, I’ ll let you take a look at it

. ATTORNEY VENTRE :
Please. May I approach?

JUDGE HEMAK:
You may

. Claimant ’ s Counsel was unaware of it as well

. ATTORNEY VENTRE : Thank y ou, Your H onor. Reproduced Record (R.R.) at 27a

- 28a (emphasis added)

. Clearly, since Claimant’s

Counsel was unaware of the Supplemental Agreement’s existence , he was not arguing that Employer violat ed the Act based thereon

. 2 Because neither cou n sel

w as a ware of the Supplemental Agreement, they were prepared to argue only what

was in the Petition which made no reference to the Supplemental Agreement

. In the

Petition

, Claimant stated as the “reason [] ” for his claim :

[Employer] has unilaterally suspended be nefits based on a late and incorrect denial of Claimant’s accepted work injury. Claimant’s injury was accepted by way of [ an NTCP ]. The 90 days following which elapsed on April 19, 2013. The denial was improperly issued and late

, thus having no effect

. Claimant is seeking an immediate reinstatement of benefits along with penalties and counsel fees.

Original Record (O.R.) at 2, Claimant’s Petition (emphasis added). In addition, the
Petition gave Claimant the opportunity to state the basis for which WC b enefits were

2 The Majority states that Claimant “amended his [P] etition to add the contention that the Supplemental Agreement precluded Employer from unilaterally terminating compensation. ” Majority Op. at 3. However, Claimant’ s C ounsel made no such amendment . Claimant’ s C ounsel merely argued that the Supplemental Agreement was controlling after acknowledging the Supplement al Agreement which he did not know existed before that time

. See R.R. at 24a

- 25a.AEC

- 4

-

currently being paid

, and provided the following options: “ Notice of Compensation

P ayable [ ( NCP ) ] dated[;] Agreement dated[;] Supplemental Agreement d ated [;] Judge’s Award dated[;] [and] Court order dated[.]” Id. (emphasis added). Claimant

selected n one of these options

.

The law is well

- established that “[a] claimant who files a penalty petition

must first meet his initial burden of proving a violation of the Act or the attendant
regulations occurred; the burden then shifts to the employe r to prove the violation did

not occur.” Dep ’ t of Transp. v. Workers ’ Comp. Appeal Bd. (Clippinger), 38 A.3d
1037, 1047 (Pa. Cmwlth. 2011) . Here, Claimant asserts Employer violated the Act
by unilaterally stopping his WC benefit payments.

Section 406.1 of the Act 3 provides , in relevant part :
(a) The employer and insurer shall promptly investigate each injury reported or known to the employer and shall proceed promptly to commence the payment of compensation due either pursuant to an agreement upon the

c ompensation payable or a [NCP] as provided in [S] ection 407 [of the Act] or pursuant to a [NTCP] as set forth in subsection (d), on forms prescribed by the [D] epartment [of Labor and Industry (Department)] and furnished by the insurer. The first installme nt of compensation shall be paid not later than the twenty

- first day after the employer has notice or knowledge of the employe ’ s disability. Interest shall accrue on all due and unpaid compensation at the rate of ten per centum per annum. Any payment of compensation prior or subsequent to an agreement or [NCP]

or a [NTCP] or greater in amount than provided therein shall, to the extent of the amount of such payment or payments, discharge the liability of the employer with respect to such case.

. . . . (d)( 1) In any instance where an employer is uncertain whether a claim is compensable under [ the Act ] or is

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

- 5

- uncertain of the extent of its liability under [ the Act ] , the employer may initiate compensation payments without prejudice and without admitting liabili ty pursuant to a [ NTCP ] as prescribed by the [ D ] epartment

. (2) The [NTCP] shall be sent to the claimant and a copy filed with the [D] epartment and shall notify the claimant that the payment of temporary compensation is not an admission of liability of the employer with respect to the injury which is the subject of the [ NTCP]

. The [D] epartment shall, upon receipt of a [NTCP] , send a notice to the claimant informing the claimant that:
(i) the payment of temporar y compensation and the claimant’ s acceptance of that compensa tion does not mean the claimant’ s employer is accepting responsibility for the injury or that a compensation claim has been filed or commenced;
(ii) the payment of temporary compensation entitles the claimant to a maximum of ninety (90) days of compensation ; and
(iii) the claimant may need to file a claim petition in a timely fashion under [S] ection 315 [of the Act] , enter into an agreement with his employer or receive a [NCP] from his employer to ensure continuation of compensation payments.
(3) Payments of temporary compensation shall commence and the [NTCP] shall be sent within the time set forth in clause (a).
(4) Payments of temporary compensation may continue until such time as the employer decides to controvert the claim

.

. . . . (6) If the employer does not file a notice 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 notice of temporary compensation payable shall be c onverted to a notice of compensation payable.AEC

- 6

-

77 P.S. § 717.1 (emphasis added). Pursuant to Section 121.7a(c) of the Bureau’s
Regulations :
To modify a [NTCP] , Form LIBC

- 501, an employer shall

file an amended [ NTCP ], Form LIBC

- 501, with the Bureau during t he 90

- day temporary compensation payable period. The amended [NTCP] , Form LIBC

- 501, shall be clearly identified a s ‘ Amended ’ and may have only the insurer’ s signature.

34 Pa. Code § 121.7a(c). Under Section 121.17(b) of the Bureau’s Regulations:

Terminati on, suspension, modification or other change in compensation may be accomplished by filing with the Bureau a Supplemental Agreement for Compensation for Disability or Permanent Injury, Form LIBC

- 337. A Supplemental Agreement for Compensation for Disabilit y or Permanent Injury , Form LIBC

- 337, may be used to change an Agreement for Compensation for Disability or Permanent Injury , Form LIBC

- 336, a Supplemental Agreement for Compensation for Disability or Permanent Injury , Form LIBC

- 337, an Agreement for Compe nsation for Death , Form LIBC

338, a Notice of Compensation Payable , Form LIBC

- 495, or an award.

. . . 34 Pa. Code § 121.17(b) (emphasis added). Finally, Section 407 of the Act states:

On or after the seventh day after any injury shall have occurred, the employer or insurer and employe or his dependents may agree upon the compensation payable to the employe or his dependents under [the Act] . . . .
Where payment of compensation is commenced without an agreement, the employer or insurer shall simultaneously give [a NCP] to the employe or his dependent, on a form prescribed by the [D] epartment, identifying such payments as compensation under [the Act] and shall forthwith furnish a copy or copies to the [D] epartment as required by rules and regulations.

. . .
All [NCP s] and agreements for compensation and all supplemental agreements for the modification, suspension, reinstatement, or termination thereof, and all receiptsAEC

- 7

- executed by any injured employe of whatever age, or by any dependent to whom compensation i s payable under [S ection 307 of the Act, 77 P.S. § 561]

, and who has attained the age of sixteen years, shall be valid and binding unless modified or set aside as hereinafter provided. 77 P.S. § 731.

In the instant case, the WCJ concluded that Employer vi olated the Act by stopping Claimant’s benefits pursuant to the NSTC and NCD it filed. The WCJ

reasoned that the Supplemental Agreement’s filing reflected Employer’s acceptance
of liability and

, thus

, precluded Employer from thereafter filing the N S TC and NCD.
However, based upon the above

- quoted law , because Employer issued an NTCP, the
filing of the Supplemental Agreement as described in Section 121.17(b) of the Bureau’s Regulations was improper

. Rather, Employer should have filed an

Amended NT CP pursua nt to Section 121.7a(c) of the Bureau’s Regulations in order to modify Claimant’s benefits for the period beginning February 11 , 2013

.

Notwithstanding, t he WCJ and the Board , recognizing that the
Supplemental Agreement was not the proper form, accepted it and deemed it an Agreement for Compensation

. Indeed, the Board stated:

Although it i s acknowledged that the parties executed and filed a [S] upplemental [A] greement rather than an [A] greement for [C] ompensation, we believe that giving effect to the par ties ’ [Supplemental] Agreement avoids what the courts have condemned as exalting form over substance,

. . . and is consistent with the remedial purposes of the Act.

Board Dec. at 5. Rather than reject the form as improper, as the Bureau did which

will be discussed below, or ascertain the parties’ intent, the WCJ and the Board
reclassified the Supplement al Agreement as an Agreement of Compensation with no
evidence to support this determination and also without any record evidence

, and

determined that the Employer accepted liability

. However, the Supplemental
Agreement’s terms do not evidence Employer’s acceptance of liability . Rather,AEC

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-

the Supplemental Agreement changed Claimant’s benefits because of his return to

work. Thus, there is no substantiated ev idence to support the determination that the Employer accepted liability for Claimant’s injury.

In fact, t he Bur e au, recognizing that Employer filed the wrong form

, rejected the Supplemental Agreement. T he Board opined:

While [Employer] further all eges that the Bureau rejected the filing [] of the Supplemental Agreement form as i mproper based on the procedural posture of this case, we cannot agree that the Bureau’s alleged rejection of the form could be dispositive , as [Employer] does not argue that the Supplemental Agreement lacked any necessary information

, and as we understand from [ Beissel v. Work men ’ s Compensation Appeal Board (John Wanamaker , Inc.), 465 A.2d 969 (P a. 1983)] and Bradley [ 4 ] that an employer’s execution and filing of the document w ith the Bureau are the actions upon which liability is based, and thus we reject [Employer’s] argument.

Board Dec. at 6 (footnote omitted).

The Board’s reliance on B ei ssel is misplaced. The B ei ssel Court held
that an NCP filed by an employer, who had an opportunity to and, in fact, did investigate the cause of an employee’s disability, constituted an admission of the employer’s liability and operated to preclude the employer, under the guise of a
termination petition, from later contradicting in court precisely that which the
employer admitted in its NCP.

In addition, the Majority cites Sharon Tube Company v. Workers’
Compensation Appeal Board (Buzard) , 908 A.2d 929 (Pa. Cmwlth. 2006), for its

conclusion : “ an employer is bound by the facts stated in the supplemental agreement, including the stated date of a claimant’s dis ability

. ” Majority Op. at 9

. However, the
first paragraph of Section 413(a) of the Act authorize s an agreement to be modified or

4 Because t his is the only reference to Bradley in the Board’s decision, we have no further citation.AEC

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-

set aside based upon a material mistake of fact or law. See 77 P.S. § 771. H ere, Employer assert ed a mistake.

Employer expressly acknowledg ed in its brief

that a Supplemental Agreement was not the appropriate Bureau document to utilize at that juncture

. As the Bureau advised in its Notice of Rejected Document, in order to modify the terms of an NTCP [ , ] an Amended NTCP should have been issued

. And in point of fact, [Employer] could have done so unilaterally. See [Section 121.7a(c).3 of the Bureau’s Regulations,] 34 Pa. Code § [] 121.7a(c).3

. Emp loyer B r . at 15

- 16 (emphasis and italics added)

.

With regard to the Bureau’s rejection of the Supplemental Agreement,

t he B oard added :

In this respect [,] we note that while [Employer] has attached a document to its [b] rief filed with the Board on [a] ppeal, which document it alleges was i ssued by the Bureau, we are unable to consider such a document as i t is not i ncluded i n the evidentiary record certified to the Board on [a] ppeal herein.

Board Dec. at 6 n.5.

Notably, as Employer’s Counsel was not aware t hat a Supplemental
Agreement existed prior to the WCJ hearing, he would have no reason to present the

Bureau’s “ NOTICE OF REJECTED DOCUMENT ” (Notice) , wherein the Bureau expressly rejected the Supplemental Agreement because it was an “Improperly Filed

Form ” as the “Claim is i n a temporary status. ” O.R. at 20

. Under the circumstances

, since the WCJ offered and admitted the Supplemental Agreement into the record on
his own accord, as a matter of reviewing all pertinent evidence and fairness to the
parties

, the Board should also have considered the Bureau’s Notice. In fact

, t he

Board did include the Notice in its original record filed with this C ourt , which itAEC

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certified to be “full, entire and complete as the same remains on file in the [Bureau].”

O.R. at 40. The Notice expressly provided:

IMPORTANT: Claim is in a temporary status. A Supplemental Agreement . . . cannot be used to correct/amend a [NTCP]. A corrected/amended [NTCP] must be submitted.

T o accept or deny liability

, . . . you must timely file one of the following to stop temporary payments :
(1) A [ NSTC ], and a [ NCD ] . . . .
(2) A [NCP].
(3) An Agreement for Compensation . . . .

O.R. at 20 (emphasis added)

. As the Bureau expressly directed in its Notice,
Employer filed an NSTC and an NCD for which the WCJ penalized Employer

.

M ore importantly, and as the Bureau specifically recognized, the filing
of an improper form cannot convert the NTCP to an NCP when that document
contains no acceptance of liability

. Notwithstanding, the Supplemental Agre ement cannot be the controlling document because the Bureau’s Regulations clearly provide
that the Supplemental Agreement was procedurally improper

. See 34 Pa. Code §
121.7a(c), 34 Pa. Code § 121.17(b); see also 77 P.S. § 731.

‘ [ W ]hen construing a statute , we must follow the letter of the statute if its words are unambiguous[.] ’ Velocity Express v. Pa. Human Relations Comm ’ n, 853 A.2d 1182, 1185 (Pa. Cmwlth. 2004) (quoting McClellan v. Health Maint. Org. of Pa.,

. . . 686 A.2d 801, 805 ( [Pa.] 1996) ).

We a re mindful that, when as certaining the General Assembly’ s intent with regard to ambiguous statutory language, courts are to give strong deference to an administrative agency ’ s interpretation of a statute that the agency is charged to enforce. However,AEC

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- [c ourts] need not give deference to an agency where its construction of a statute frustrates legislative intent. Therefore, although courts often defer to an agency’ s interpretation of the
statutes it administers, where

. . . the meaning of the statute is a question of law for the court, when convinced that the agency’ s interpretation is unwise or erroneous, that deference is unwarranted.
Rosen v. Bureau of [ Prof ’ l ] [ & ] Occupational Affairs, State Architects Licensure Bd., 763 A.2d 962, 968 (Pa. Cmwlth. 2000) (citation omitted),

. . . 781 A.2d 150 ( [Pa.] 2001)

. Such is the case here.
Velocity Express, 853 A.2d at 1185 (citations omitted). Further, ‘ [i]t is well settled law that an agency ’ s substantive regulations

. . . have the force and effect of law. ’ Eas twood Nu rsing [ & ] Rehab. Ctr. v. Dep’ t of Pub. Welfare, 910 A.2d 134, 142 (Pa. Cmwlth. 2006)

. Dixon v. Workers’ Comp. Appeal Bd. (Medrad, Inc.) , 134 A.3d 518, 526

- 27 ( Pa.
Cmwlth. 2016).

Because the law and the evidence support Employer’s contention that

t he Supplemental Agreement was filed inadvertently and that Employer should have filed an amended NCP, and Claimant did not argue “ that the ‘mistake’ was using the
form for a supplemental agreement when the form for an agreement for compensation

should have been used [,] ” Majority Op. at 11 , the Majority erred in concluding that a remand is warranted to determine the intent of the parties’ in filing the Supplemental
Agreement. Accordingly

, I would vacate the Board’s order and remand the matter to

the Board f

or remand to the WCJ to determine whether the NSTC and NCD were
timely filed and

, thus

, valid

.

___________________________ ANNE E. COVEY, Judge