House Bill 2738 (now Act 147) was signed by the Governor on November 9, 2006 resulting in several substantive procedural changes to Pennsylvania Workers' Compensation law.

The purpose of the new legislation was to reduce litigation costs, streamline the adjudication process and improve the timeliness of workers’ compensation Decisions. The new law also imposes ethical standards on the conduct of members of the Workers’ Compensation Appeal Board and established an Uninsured Employers’ Guarantee Fund to provide compensation to injured workers employed by uninsured employers.

The most sweeping changes involve the adjudication process. Section 401.1 of the Act was amended to include legislative intent of: “fulfilling the Department’s responsibilities to enforce time standards and other performance standards provided and processing of injury cases and payment of compensation…" In practice, workers’ compensation Judges have been directed to “set forth a mandatory trial schedule at the first hearing.” The Judges have been directed to “strictly enforce their schedules…"

The trial schedule shall include specific dates and times for a mediation conference. The mediation shall take place no later than 30 days prior to the date set for filing Proposed Findings of Fact and Conclusions of Law or legal briefs. Mediation is mandatory unless “upon good cause shown, the workers’ compensation Judge determines that mediation would be futile.” A “resolution hearing procedure” was also created by Act 147. The sole purpose of the resolution hearing is to promptly present Compromise and Release Agreements to Judges.

One of the most frightening provisions of the new Act provides that “delays in hearings will be granted according to rules established by the Department, and any party who unreasonably delays a hearing would be subject to a penalty as provided in Section 435.” There is an expectation that the Bureau will pass procedural regulations governing the trial schedule and further defining what constitutes “unreasonable delay.” 

What It Means to You

The immediate impact of Act 147 is significant. Currently, Judges have been putting the mandatory trial schedule into effect at the first hearing. Judges are assigning deadlines for presentation of all medical and fact testimony and a date to close the record is established at the first hearing. Judges have also stated on the record a requirement that the parties attempt mediation prior to the close of the record. Mediation is mandatory unless the parties show good cause that the mediation would be futile. One troubling provision of Act 147 is a potential penalty exposure for a party “who unreasonably delays a hearing.” Presently, rules and regulations are not in place to define what constitutes an unreasonable delay. The attorneys at Cipriani & Werner are ready to answer any questions you may have about the effect of Act 147 on your pending cases.