Can An Employer Modify or Suspend An Employee's Disability Benefits ?
In general, when an employer seeks to modify or suspend a claimant's benefits, it must produce evidence of a referral to an available job that is within the limitations of claimant's disability. Kachinski v. Workmen's Compensation Appeal Board (Vepco Constr. Co.), 516 Pa. 240, 532 A.2d 374 (1987).
If the employer produces this evidence, then the claimant must show that she acted in good faith to follow through on the job referral. Id. at 252, 532 A.2d at 380.
If the claimant fails to make such a showing, then her benefits can be modified. Id.
In Banic v. Workmen's Compensation Appeal Board (Trans-Bridge Lines, Inc.), 550 Pa. 276, 705 A.2d 432 (1997), the Supreme Court reiterated the premise that the four prong analysis of Kachinski is not to be rigidly applied in situations where an employer seeks to suspend a claimant's benefits because her loss of earning power is no longer caused by her work-related injury but rather by something unrelated to the work injury.
It held that the Kachinski test did not apply when an employer seeks to suspend benefits because of incarceration since the employer is not required to demonstrate that claimant has recovered some ability or that available jobs were referred to the claimant. Id. at 286, 705 A.2d at 437.