RENDERED:  JULY 7, 2017; 10:00 A.M.



Commonwealth of Kentucky

Court of Appeals

NO. 2017-ca-000469-WC



active care chiropractic, inc.                                    APPELLANT




                           PETITION FOR REVIEW OF A DECISION


                                        ACTION NO. wc-14-81319




BOARD                                                                                        APPELLEES







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BEFORE:  CLayton, j. lambert, and thompson, JUDGES.

CLAYTON, JUDGE:  Active Care Chiropractic, Inc. (Active Care) petitions for review from an opinion of the Workers’ Compensation Board (Board) that affirmed an award by the Administrative Law Judge (ALJ) to Katherine Rudd.  The question is whether the ALJ properly applied the two multiplier to Rudd’s permanent partial disability (PPD) benefits since she had voluntarily retired from the workforce. 

                   After careful consideration, we affirm.


                   Beginning in 2004, Rudd worked for Active Care part-time, about 16 to 17 hours per week, as a secretary and receptionist.  In June 2014, Rudd received an hourly wage of $12.  On June 2, 2014, while taking trash to a dumpster at the end of the work day, Rudd fell and landed on her left shoulder.  Active Care advised her to seek medical treatment. 

                   Treatment required three surgeries on her left shoulder.  In September 2015, Rudd returned to her regular work duties for Active Care at the same hourly rate of payment.  On May 2, 2016, Rudd chose to retire.  And on October 25, 2016, the ALJ entered an opinion, order, and award, which included PPD benefits, which were increased by the two multiplier as authorized under Kentucky Revised Statutes (KRS) 342.730(1)(c)2.    

                   Active Care petitioned for reconsideration of the ALJ’s application of the multiplier in the calculation of Rudd’s PPD award, but the ALJ denied the petition because she was “bound by the plain wording” of KRS 342.730(1)(c)2.  Active Care appealed the decision to the Board, which held that the ALJ did not err in applying the two multiplier.  Active Care now petitions for review of the Board’s decision. 

                   Active Care maintains, on appeal, that the ALJ erred in awarding Rudd double income benefits after she retired because the statute’s purpose is not effectuated by applying the two multiplier to persons voluntarily retiring from both the job for which the benefits are paid and also the work force.  It believes that because Rudd successfully returned to work after her injury, and then, voluntarily retired, the purpose of the multiplier was not fulfilled, and therefore, it should not have been applied. 

                   Here, the question is legal, and our review of the application of the law by the ALJ and the Board is de novo.  Finley v. DBM Techs., 217 S.W.3d 261, 264 (Ky. App. 2007).  The legal question is whether voluntary retirement is an exception to the application of the double income benefit in KRS 342.730(1)(c)2 because the purpose of the multiplier, return to work by an employee, is not fulfilled. 

                   We begin by observing that the Workers’ Compensation Act in KRS 342.730(1)(c)2 permits a double income benefit, for any reason, after an employee returns to work and then stops working at that job.  The statutory language provides:

If an employee returns to work at a weekly wage equal to or greater than the average weekly wage at the time of injury, the weekly benefit for permanent partial disability shall be determined under paragraph (b) of this subsection for each week during which that employment is sustained.  During any period of cessation of that employment, temporary or permanent, for any reason, with or without cause, payment of weekly benefits for permanent partial disability during the period of cessation shall be two (2) times the amount otherwise payable under paragraph (b) of this subsection.  This provision shall not be construed so as to extend the duration of payments.


KRS 342.730(1)(c)2.  In sum, the statutory subsection provides for a double benefit when there is a cessation of employment “for any reason, with or without cause[.]”  Id.

                   Prior to 2015, the Kentucky Supreme Court interpreted the clause “for any reason, with or without cause,” as permitting a double income benefit provided the reason for cessation of employment was related to the disabling injury.  Chrysalis House, Inc. v. Tackett, 283 S.W.3d 671, 674 (Ky. 2009) overruled by Livingood v. Transfreight, LLC, 467 S.W.3d 249 (Ky. 2015).  But the Court revisited this holding in Livingood, and in its review, the Supreme Court concluded that its prior interpretation of the statute in Chrysalis House misinterpreted the legislature's intent.  Livingood, 467 S.W.3d at 257. 

                   In Livingood, the employee returned to work at the same wages, but was subsequently terminated when a forklift that he was operating accidentally bumped into a pole.  Based on Chrysalis House, the ALJ denied the double income benefit, noting that the employee was terminated for reasons unrelated to his injury.  Nonetheless, in reviewing the matter in Livingood, the Supreme Court concluded that its prior interpretation of the statute in Chrysalis House had not correctly interpreted the legislature’s intent.

                   The Court first noted that the purpose of KRS 342.730(1)(c)2 is to keep partially disabled workers in the habit of working and earning as much as they are able.  The double benefit provides workers an incentive to return to work at the same or greater average weekly wage because not only will they receive a basic benefit, in addition to their wage, but they are also assured of a double benefit if the attempt proves to be unsuccessful.  Id. at 256. 

                   Next, the Court highlighted that the statute also discourages an employer from continuing to employ an injured worker at the same or a greater wage for the sole purpose of finding a partial rather than a total disability under KRS 342.730(1)(c)2 rather than a triple benefit under KRS 342.730(1)(c)1.  Id. (citing Chrysalis House, 283 S.W.2d at 675).  Nonetheless, the Court specifically recognizes that the purpose of the statute is to encourage continued employment.  Id. at 257. 

                   Based on this legislative intent, the Court modified the holding in Chrysalis House that interpreted the statute to require that the cessation of employment must relate to the disabling injury.  Nevertheless, the Court observed that a literal construction of KRS 342.730(1)(c)2 would allow an employee, such as the one in Chrysalis House, to benefit from his or her own wrongdoing, which would be inconsistent with other provisions of KRS Chapter 342 that encompass the legislative intent that an employee should not benefit from his own wrongdoing.  Id. at 258.

                   Therefore, the Court concluded that KRS 342.730(1)(c)2 permits a double income benefit during any period that employment at the same or a greater wage ceases “for any reason, with or without cause,” except where the reason for the reduction in income is shown to be the employee’s intentional, deliberate action with a reckless disregard of the consequences either to himself or to another. Id.  In Livingood, the Court determined that the employee’s conduct, while possibly negligent, did not rise to the level of an intentional act with reckless disregard.  But the Court informed that the employee’s conduct in Chrysalis House, which involved theft, would meet this standard.  Id.


                   Based on the plain meaning of the statute, we affirm the Board’s decision because “[w]e have a duty to accord to words of a statute their literal meaning unless to do so would lead to an absurd or wholly unreasonable conclusion.”  Id. at 257-58 (citing Bailey v. Reeves, 662 S.W.2d 832, 834 (Ky. 1984).

                   However, whether “voluntary retirement” is a reason to apply the double benefit, given the purpose of the statute is to encourage workers to remain in the work force, is a consideration for examination by a higher court.   

                   We affirm the decision of the Workers’ Compensation Board.


                   ALL CONCUR.




R. Christion Hutson

Paducah, Kentucky





Mark L. Ashburn

Paducah, Kentucky