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A 5-2 en banc panel of the Commonwealth Court in Pennsylvania has ruled that when a minor secures a job by lying about his or her age, the employer does not have to pay a penalty if that minor is injured on the job. Normally, the employer of an injured minor employee working illegally must pay an extra 50 percent penalty on top of the regular compensation. But the majority in The American Belt Co. v. Workers’ Compensation Appeal Board (Figuereo), said an innocent employer should not have to suffer for a minor employee’s lie. “Accordingly, we hold that an employer is liable for the penalty mandated by Section 320 [of the Workers' Compensation Act] only if it knew or reasonably should have known that the claimant was a minor working illegally,” Commonwealth Court Judge Bonnie Brigance Leadbetter wrote for the majority. The minor employee, Karyann Figuereo, was 15 when she applied for a job with American Belt, but she said she was 18 on her job application. On an I-9 employment eligibility form, Figuereo said she had completed high school and she presented a “Pennsylvania Identification Card,” which included a photo, that said she was 18. Leadbetter said there was no evidence to suggest American Belt knew the information was false. Figuereo was hired to work in the loop department, where she was required to put her arm through a knife-like machine and pick out good and damaged loops. Her arm got caught in the machine and twisted on Aug. 9, 1994. Figuereo suffered a serious injury and filed for workers’ compensation benefits. At a hearing before a workers’ compensation judge, Figuereo’s attorney asked the judge to increase any award to his client by 50 percent, in accordance with Section 320(a). Section 320 provides that an employee less than 18 years of age, who is working illegally, “shall be paid one hundred and fifty per centum of the amount that would be payable to such minor if legally employed.” The WCJ did not make findings about the forms Figuereo submitted or the fact that American Belt relied on them in hiring her. Instead, the judge said Section 320(a) imposes strict liability. Figuereo was awarded benefits plus an additional 50 percent in compensation. When such an award of additional compensation is imposed, it is against the employer, not the insurance carrier. American Belt appealed to the Workers’ Compensation Appeal Board, arguing that Figuereo was estopped from receiving the 50 percent award because she had lied on her employment records. The board agreed that an employer should not be penalized when a minor employee has presented false picture identification to show his or her age. But the WCAB affirmed the WCJ anyway because the card Figuereo presented was not the state’s official non-driver’s identification card and the photo on the card “appeared superimposed.” Therefore, the board said American Belt’s reliance on the document was unreasonable. American Belt appealed to the Commonwealth Court, again arguing the estoppel issue. American Belt argued Figuereo should be barred from profiting from false information under Waugh v. WCAB, in which the Pennsylvania Supreme Court said that because an employer lied that an injured employee was a resident of Pennsylvania on a notice of compensation payable, the State Workmen’s Insurance Fund does not have to pay benefits. But Leadbetter did not see the same similarity between the two cases. “In the present case … [Figuereo] did not provide false information in order to receive workers’ compensation, but rather to obtain employment in the first place. Whereas in Waugh, had the true facts been stated that compensation claim would clearly have been precluded, had the claimant here been truthful, the entitlement to additional benefits would have been indisputable,” she said. “ Waugh does not involve application of estoppel, but simply stands for the proposition that employer and employee cannot, by fraudulent agreement, impose a bogus obligation upon employer’s insurance carrier.” Leadbetter said it is key to remember in a case like Figuereo’s that the purpose of Section 320 is punishment and deterring illegal conduct by employers. As the Superior Court said in the 1943 case Rudy v. McCloskey, the punitive nature of the provision is evident in the fact that it requires the employer to pay the additional compensation and provision the employer has with its insurance provider to relieve it of that liability is void. “Moreover,” Leadbetter said, “it is unreasonable to assume that the legislature was motivated by a purpose to award more workers’ compensation benefits to a minor who has obtained employment by lying about his age than to a minor who has truthfully complied with the law and obtained the required documentation.” Leadbetter said it would be counterproductive to the purpose of the act to use Section 320 in a situation where the employer in good faith hired a minor who lied about his or her age and produced documentation. But the court could not get to the issue of whether it was reasonable for American Belt to rely on the identification card because the WCJ made no findings on that issue. So Leadbetter remanded the case so the judge could make those findings. In his dissent, Judge James Flaherty said the majority failed to acknowledge that Section 320 states that an injured minor employee shall be paid 150 percent of the amount payable if that minor were legally employed. He said the state Supreme Court has said in Oberneder v. Link Computer Corp. that the term “shall” is mandatory. He cited another state Supreme Court case, Ligonier Tavern v. WCAB, in which the justices stressed that the purpose of Section 320 is to protect minors, by giving effect to child labor laws. “Giving effect to the plain language of Section 320 so as to hold employers strictly liable simply does not frustrate the purpose of protecting minors. Indeed, holding employers strictly liable promotes a degree of diligence for the protection of minors,” Flaherty said. Flaherty was harsh in his criticism of the majority’s opinion. “As a practical matter, however, the majority has now rendered ineffective a statute originally designed to protect minor children from their indiscretions generally tolerated because of their immaturity, to wit, the Child Labor Law, which was incorporated into the Workers’ Compensation Act, that was designed to protect employees in the workplace,” he said. “The statute has now been emasculated to such an extent that the minor child has a practically impossible burden of proving that the employer knew that the employee was a minor child working illegally.” Judge Doris Smith concurred in the result only.

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