Summary
In Guido the court concluded Salazar "simply held that the COLA statute was meant to apply to all awards of PTD, even those based upon the maximum rate," and therefore, held that Salazar was not inconsistent with the result in Guido.
Summary of this case from In re Nance, W.C. NoOpinion
W.C. No. 4-185-583
July 11, 2003
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Friend (ALJ) which interpreted § 8-42-111(4), C.R.S. 2002 (cost of living allowance or COLA statute), as limiting the COLA to 2 percent of the maximum rate payable for permanent total disability (PTD) benefits. The claimant contends that because her average weekly wage (AWW) exceeded ninety-one percent of the state AWW, the COLA statute entitles here to an increase in compensation which exceeds 2 percent of the maximum rate payable for PTD. We affirm.
The pertinent facts are undisputed. The claimant sustained a compensable injury on April 16, 1993. At the time of the injury the claimant's AWW was $708.46. On August 19, 2002, the respondents admitted liability for PTD benefits commencing June 1, 2002.
On the date of injury the state AWW was $454.97, which established the maximum compensation rate for temporary total disability (TTD), and hence PTD, at $414.05. Section 8-42-105(1), C.R.S. 2002 (maximum TTD rate is ninety-one percent of state AWW); § 8-42-111(1), C.R.S. 2002 (PTD rate shall not exceed maximum rate set for TTD). Because the claimant's AWW on the date of injury exceeded $621.08, the AWW necessary to qualify for maximum TTD benefits, the claimant was entitled to maximum PTD benefits.
The issue in this case concerns the application of the cost of living allowance contained in § 8-42-111(4). The claimant argued to the ALJ that the 2 percent COLA should be based on the claimant's full AWW at the time of injury. Hence, the claimant would calculate the PTD COLA as follows: $708.46 x .02 = $14.17; $708.46 + $14.17 = $722.63; $722.63 x 66 2/3 = $481.75 (PTD compensation rate effective July 1, 2002). The respondents argued the COLA should be calculated by determining 2 percent of the AWW necessary to award maximum PTD benefits, adding the 2 percent to the previous maximum, and multiplying by sixty-six and two-thirds percent. Hence, the respondents would calculate the COLA as follows: $621.08 x .02 = $12.42; $621.08 + $12.42 = $633.50; $633.50 x 66 2/3 = $422.33 (PTD compensation rate effective July 1, 2002). The same result may be obtained by multiplying the maximum compensation rate for PTD by two-tenths and adding the two amounts ($414.05 x .02 = $8.28; $414.05 + $8.25 = $422.33).
The ALJ concluded the COLA statute is ambiguous concerning whether the annual 2 percent increase is to be based on the claimant's "actual" AWW, or is to be based on the AWW "that would entitle the claimant to the maximum" TTD rate. Relying on an interpretive bulletin issued by the Director of the Division of Workers' Compensation (Director), the ALJ concluded the claimant's proposed interpretation of the COLA statute would cause inequality in administration of the Act by giving a greater percentage increase in PTD benefits to claimants whose AWW exceeded ninety-one percent of the state AWW. Consequently, the ALJ held the claimant's PTD COLA should be calculated by annually increasing the "base average weekly wage sufficient to entitle the Claimant to maximum compensation rate on the date of injury."
On review, the claimant reiterates the argument that the COLA statute should be interpreted to require the 2 percent increase to be determined by reference to the claimant's AWW without regard to the benefits cap established by § 8-42-111(1). The claimant argues the COLA statute expressly provides for an increase in the "average weekly wage of injured employees," and the statute contains no reference to the "base" AWW. The claimant further argues the result reached by the ALJ is contrary to the holding in Salazar v. Industrial Claim Appeals Office, 10 P.3d 666 (Colo.App. 2000). We find no error.
Section 8-42-111(1) provides as follows:
In cases of permanent total disability, the award shall be sixty-six and two-thirds percent of the average weekly wages of the injured employee and shall continue until death of such person so totally disabled but not in excess of the weekly maximum benefits specified in this article for injuries causing temporary total disability. (Emphasis added).
Section 8-42-111(4), the COLA statute, provides as follows:
For injuries occurring on and after July 1, 1991, and before July 1, 1994, the average weekly wage of injured employees used for computing compensation paid for awards pursuant to subsection (1) of this section shall be increased by two percent per year effective July 1 of each year, and such increased compensation shall be payable for the subsequent twelve months. (Emphasis added).
When interpreting a statute, the primary objective is to effect the legislative intent. The best indicator of legislative intent is the language of the statute itself. Hence, the words in the statute should be given their plain and ordinary meanings provided no absurdity results. Further, it is presumed that the General Assembly intended just and reasonable results, and statutes must be interpreted accordingly. Weld County School District RE-12 v. Bymer, 955 P.2d 550 (Colo. 1998).
To the extent a statute is ambiguous, it is appropriate to resort to rules of statutory construction to arrive at a correct interpretation. An ambiguity exists if a statute is fairly susceptible to more than one interpretation. Miller v. Industrial Claim Appeals Office, 985 P.2d 94 (Colo.App. 1999). When resolving an ambiguity we should consider the entire statutory scheme and strive to give consistent, harmonious, and sensible effect to all its parts. Further, we should consider the state of the law prior to the enactment and the problem sought to be solved. Henderson v. RSI, Inc., 824 P.2d 91 (Colo.App. 1991). Finally, we should give deference to the Director's interpretation of the Act provided it is consistent with the language of the statute and the legislative intent. See Lobato v. Industrial Claim Appeals Office, __ P.3d __ (Colo.App. No. 02CA1145, June 5, 2003); Magnetic Engineering, Inc. v. Industrial Claim Appeals Office, 5 P.3d 385 (Colo.App. 2000).
We agree with the ALJ that the COLA statute contains an ambiguity with regard to the method of calculating the annual COLA increase. On the one hand, the statute refers to increasing the employee's AWW. Ordinarily, the "employee's" AWW refers to computation of the claimant's AWW in accordance with the provisions of § 8-42-102, C.R.S. 2002. However, as the respondent argues, the COLA statute also refers to the AWW "used for computing compensation" under subsection (1). Subsection (1) limits the PTD benefit to the weekly maximum payable for TTD benefits. As noted, the maximum compensation for TTD is limited to ninety-one percent of the state AWW for the year in which the injury occurs. Section 8-42-105(1); Bellendir v. Kezer, 648 P.2d 645 (Colo. 1982). Thus, the COLA statute's reference to a 2 percent increase in the AWW "of injured employees used for computing compensation" under subsection (1), could refer solely to the claimant's AWW, but it could also contemplate the benefit cap measured as ninety-one percent of the state AWW.
In our view, the ALJ properly resolved the ambiguity. First, there can be little doubt that § 8-42-111(4) created a "cost of living" increase in PTD benefits for the window of time set forth in the statute. See Montezuma Well Service, Inc., 928 P.2d 796 (Colo.App. 1996). Generally, the purpose of cost of living increases is to maintain the value of benefits in the face of inflationary pressures, not to award some element of compensation beyond that which was previously awarded. See Englebrecht v. Hartford Accident and Indemnity Co., 680 P.2d 231 (Colo.App. 1984); Bellendir v. Kezer, supra. Viewed in this light, it seems illogical to assume that the General Assembly intended to cap PTD benefits for one year, then authorize large increases in the percentage of benefits for those claimants with a high AWW. A more reasonable interpretation is that the 2 percent increase is intended to apply in the same way to all claimants regardless of the individual claimant's AWW so as to maintain the same relative value of PTD benefits paid to claimants.
This view is consistent with the interpretation of the statute contained in the Director's interpretive bulletin dated September 10, 2001. We find the Director's bulletin to be consistent with the statutory language. Further, the bulletin advances logical policy reasons for its proposed interpretation of the statute. Thus, we give the bulletin weight in our assessment of the issue before us. Magnetic Engineering, Inc. v. Industrial Claim Appeals Office, supra.
Finally, we do not view Salazar v. Industrial Claim Appeals Office, supra, as inconsistent with the result reached here. In Salazar, the issue was whether the COLA could be applied in any case where the claimant was entitled to receive PTD benefits at the maximum rate. The court concluded that the benefits cap of § 8-42-111(1) and the COLA provision 8-42-111(4) were inconsistent, and it was impossible to give effect to both. Therefore, because § 8-42-111(4) was enacted later in time, the court concluded the COLA would apply even if the claimant was entitled to PTD at the statutory maximum. Here, however, the issue involves calculation of the COLA in a case where the claimant is entitled to receive the statutory maximum. Thus, this case does not involve the "irreconcilable conflict" present in Salazar. Rather, as shown above, it is possible to give effect to the COLA, while calculating the COLA in a manner which is consistent with regard to both high and low wage earners.
Insofar as the claimant makes other arguments, we find them to be without merit.
IT IS THEREFORE ORDERED that the ALJ's order dated January 27, 2003, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL ________________________________ David Cain ________________________________ Kathy E. Dean
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2002. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe Street, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed July 11, 2003 to the following parties:
Linda Guido, 4150 Strasberg Rd., Strasberg, CO 80136
United Airlines, DIA, 8400 Pena Blvd., Denver, CO 80249-6357
Alice (Kasey) Troutman, Gallagher Bassett Services, Inc., P. O. Box 4068, Englewood, CO 80155-4068
Susan D. Phillips, Esq., 155 S. Madison, #330, Denver, CO 80209 (For Claimant)
Anthony D. Hall, Esq., 999 18th St., #3100, Denver, CO 80202 (For Respondent)
By: A. Hurtado