PA Uninsured Fund Held to Same Standard by Commonwealth Court

To give some background information, the Pennsylvania Uninsured Guaranty Fund was enacted into law to protect employees injured at work and the employer is uninsured.  It is a separate fund set up under the Pennsylvania Treasury.  Essentially, when an Employer is uninsured, the UEGF steps in and acts as the Employer’s insurance carrier, although,. the Fund and the Employer often have quite different interests.  Often times, I see these type of cases where there is a dispute whether an injured workers is an actually employee or a sub-contractor.

To some extent, the Pennsylvania Uninsured Guaranty Fund is held to different standards under the Pennsylvania Workers Compensation Act.   Some of thise differences are provided for in the Act.  For one, the Fund is not subject to penalties for violating the Act, unlike insurance carriers.  The Fund is not at risk for unreasonable contest fees, unlike a private insurance carrier.   These type of differences have led the Fund to believe at times that it is superior in litigation.

The Commonwealth Court recently reigned in the Fund and it’s superior attitude in Pennsylvania Uninsured Employers Guaranty Fund v. Workers’ Compensation Appeal Board (Dudkiewicz), No. 1540 C.D. 2013.  The legal issue in the case revolved around a Petition for Joinder filed by the Fund.  The rules require a Petition for Joinder be filed within 20 days from the first hearing in which evidence is provided that another party may be liable.  Petition for Joinder happens in most cases with the Fund, a tool used to bring other party(s) into the case for liability purposes.  Obviously, the Fund will want to assign liability to another party, mainly the uninsured employer(s).   Specifically, in this case, the hearing for claimant testimony, in which the claimant testified as to his employers, was held on February 9, 2010.  However, the Fund did not filed a Petition for Joinder until May 27, 2010.  That is obviously well beyond the statutory 20 day limitation.  Subsequently, the Workers Compensation Judge dismissed the Petition for Joinder for failing to adhere tot he 20 day time limit.

The Fund argued as follows:

UEGF emphasizes that it is not an insurer . . . And while UEGF urges this Court to be mindful that “it is not the entity in control of the [relevant] evidence” in this case, (UEGF brief at 27), at issue is UEGF’s obligation to seek such evidence, not produce it.

The Court responded:

Although the Act states that UEGF is not an insurer and exempts the fund from being subject to penalties, unreasonable contest fees, and certain reporting requirements, it expressly provides that the “fund shall have all of the same rights, duties, responsibilities and obligations as an insurer.” 77 P.S. §2702(e) (emphasis added). Moreover, although not an insurer, UEGF was a party to these proceedings, 34 Pa. Code § 131.5, not a bystander.  UEGF also refers to its . . . “unique role and obligations”; however, we must conclude that it is the obligation of UEGF, not this Court, to conserve UEGF’s resources. We reject the suggestion that where UEGF fails to pursue its rights in a 13timely manner, the property remedy is for this Court to disregard the policies underlying joinder practice and the twenty-day limit set forth in §131.36(d).

The opinion by the Court is a step in the right direction to hold the Fund accountable, just like all private insurance carriers.  The Workers Compensation Act is a ‘remedial’ act in nature.  The fact an employer is uninsured when a person gets hurt while working is not the fault of the injured party.   The Fund should not be permitted to use special status to get around the remedial purposes of the Workers Compensation Act.

If you have been hurt on the job, and your employer failed to carry Workers Compensation insurance coverage, do not think you are out of luck.  You can still get workers compensation benefits you are entitled to.  Call Mooney & Associates today at 1-877-632-4656, for a FREE consultation to protect your Pennsylvania workers compensation rights.