DECISION AND ORDER
_____ (Petitioner) contests the Notice of Administrative Violation and Order to Respond of the Texas Workers’ Compensation Commission (Commission), charging her with committing an administrative violation, pursuant to § 415.032 of the Texas Workers’ Compensation Act (Act). The Commission charges that _____ knowingly or intentionally concealed a material fact for the purpose of obtaining workers’ compensation benefits in violation of § 415.008(a) of the Act. Specifically, the Commission charges that _____ failed to report income received from employment and collected supplemental income benefits (SIBs) to which she was not entitled. The ALJ finds that _____ committed the administrative violation and orders her to repay $699.15, plus interest, to the insurance carrier. The ALJ also agrees that an administrative penalty of $250.00 should be assessed against _____.
I. PROCEDURAL HISTORY, NOTICE AND JURISDICTION
On February 26, 2004, a hearing in this matter was convened before Administrative Law Judge (ALJ) Suzanne Formby Marshall at the William C. Clements Building, 300 West 15th St., Austin, Texas. _____ appeared by telephone and was assisted by Commission Ombudsman Anthony Walker, who appeared at the hearing. The Commission was represented by Yvonne M. Williams, Staff Attorney. The hearing concluded and the record closed on that day.
The Commission has jurisdiction to consider this matter pursuant to Tex. Labor Code Ann. ch. 415. The State Office of Administrative Hearings (SOAH) has jurisdiction over matters related to the hearing, including the authority to issue a decision and order, pursuant to § 415.034 of the Act and Tex. Gov’t. Code Ann. ch. 2003.
During the hearing, the Commission contended that _____’s appeal was untimely filed and should be dismissed. According to the Commission, _____ did not comply with the provisions of 28 Tex. Admin. Code (TAC) § 148.3(a), requiring that a person file a written request for hearing with the Chief Clerk of Proceedings not later than 20 days after receipt of the official notice of adverse action from the Commission. The Commission’s notice was mailed to _____ on March 25, 2003, by certified mail. _____ filed her request for hearing with the Commission’s Compliance and Practices division on March 31, 2003. It took over a month for the Compliance and Practices division to forward the hearing request to the Chief Clerk. When the Chief Clerk received the appeal, on May 2, 2003, it was 18 days past the deadline. Consequently, the Commission contends it should be dismissed.
_____ argues that the intent of the language is to ensure that the hearing request is filed within twenty days and she met this requirement. The ALJ agrees and believes the facts of this case are distinguishable from those in the appeals decisions provided by the Commission. The purpose of the rule seems to require prompt notice to the Commission. Although the Chief Clerk is designated as the recipient for the Commission, the rules do not provide a consequence for failing to file the notice with the Chief Clerk. _____ promptly responded to the Commission’s notice and the internal delay in forwarding her request to the Chief Clerk seems excessive. While _____ did not comply with the specific terms of the rule, the ALJ believes that she fulfilled the intent of the rule and that her failure to direct the request to the Chief Clerk is not jurisdictional. See, e.g., Albertson’s, Inc. v. Sinclair,984 S.W.2d 958, 961 (Tex. 1999). Accordingly, the Commission’s motion to dismiss is denied.
On _____, _____ suffered a work related injury while working as a mental health/mental retardation aide for the _____. The hospital, a state employer, carries worker’s compensation insurance through the State Office of Risk Management. _____ was unable to return to her previous job. She reached maximum medical improvement on June 3, 2000, with a 16% impairment rating, and has been receiving supplement insurance benefits (SIBS) since May of 2001.
As a condition for receiving SIBs, _____ was required to make a good faith effort to find work and to report any income from employment while receiving SIBs. _____ worked for the _____ from June 25, 2001, through August 12, 2001. She did not report all the income she received as a result of the employment and continued to collect SIBs.
B.Summary of Parties’ Positions
The Commission’s position is that _____ violated § 415.008(a) of the Actby knowingly or intentionally concealing a material fact to obtain a workers’ compensation benefit. The Commission argues that the evidence shows that _____ knew about her obligation to report all income she received from any job while receiving supplemental insurance benefits, but she failed to completely report all income from her work at the _____. Instead, she continued to receive monthly SIBs payments, resulting in an overpayment of $699.15, to which she was not entitled. The Commission asserts that _____’s income from the _____ was a “material fact’ because it affected _____’s entitlement to SIBs payments.
The Commission argues that pursuant to § 415.008, a person who has obtained an excess payment in violation of this section is liable for full repayment; and that a violation of § 415.008 is punishable by an administrative penalty not to exceed $5,000.00 pursuant to § 415.022 of the Act. The Commission contends that a penalty of $250.00 is appropriate for these circumstances.
_____ does not dispute the Commission’s position that she received an overpayment of SIBs from SORM in the total amount of $699.15. She states a willingness to reimburse SORM in the amount of $699.15.
On the other hand, _____ denies that she knowingly or intentionally concealed a material fact with regard to her income from the _____ in her application for continued SIBs payments from SORM. _____ claims that she did not understand how to complete this information on the SIBs application. She said that she relied upon the advice of her SORM adjuster and her Texas Rehabilitation Commission (TRC) counselor in reporting income on the two relevant SIBs applications.
C. Analysis and Conclusion
Section 415.008 of the Act provides that:
(a)A person commits a violation if the person, to obtain or deny a payment of a workers’ compensation benefit or the provision of a benefit for the person or another, knowingly or intentionally:
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(2) misrepresents or conceals a material fact . . . .
Pursuant to § 415.008(c), a person who has obtained an excess payment in violation of the section is liable for full repayment, plus interest computed at the rate prescribed by § 401.023 of the Act. The overpayment to _____ is not disputed and she has agreed that she owes and will repay $699.15. The only contested issue is whether an administrative fine should be assessed for any misrepresentation or concealment of a material fact by _____.
The burden is on the Commission to prove by a preponderance of the evidence that _____ committed the administrative violation with which she is charged. _____ did disclose, as required, that she had found employment during the relevant two quarters. She also reported some income from the _____ (Store) on her second quarter application, but failed to report any income from the Store on the following third quarter application.
The ALJ finds that sufficient evidence was presented to show that _____ knowingly or intentionally misrepresented or concealed a material fact. The record indicates that _____ was
aware of her continuing obligation to report income when she previously received temporary income benefits (TIBs). She was also notified of her obligation to report income when she was notified of her eligibility for SIBs. The quarterly applications clearly state that the applicant must identify whether he or she worked during the qualifying period, i.e., three month period before the quarter, and all wages that were earned.
_____ testified that the second quarter SIBs application was the first one that she prepared because the first one had been completed for her by the Commission. She said that she was confused about how to report her Store income and contacted the SORM claims adjuster for assistance. She further testified that she also relied upon assistance from her TRC counselor. She claims she was told to report the $714.00 on the second quarter application and to report the remainder on the third quarter application. Copies of data entry from _____’s SORM adjuster confirm that _____ had contacted SORM and her TRC counselor about the duty to report income. However, the entries also reflect that _____ was told to report all income.
Even assuming that _____’s testimony is truthful about the amount she reported on the second quarter application, she should have reported the remaining income on the third quarter application. Instead, she did not report any income from the Store on that application. Consequently, the ALJ finds that _____ knew, at a minimum, that she was required to report additional Store income on the third application, but did not do so. This failure constitutes an intentional choice by _____ to conceal a material fact, i.e., her income level. The ALJ concludes, therefore, that the Commission has met its burden and that an administrative penalty should be assessed against _____. Further, because _____ admits that she was not entitled to receive $699.15 of SIBs from SORM, she is ordered to repay that amount, with interest, as provided by § 401.023 of the Act.
III. FINDINGS OF FACT
- On _____, _____ suffered a work related injury during the course of employment with the _____, with a resulting disability entitling her to supplemental income benefits (SIBs).
- At the time of _____’s injury, the _____ carried workers’ compensation insurance through the State Office of Risk Management (SORM).
- In May 2001, SORM commenced monthly SIBs payments to _____.
- In its notification to _____ that she might be eligible for supplemental insurance benefits, _____ was informed of her responsibility to seek work and to report any income earned during the relevant time period.
- _____ worked for the _____ from June 25, 2001, through August 12, 2001.
- _____ did not report all income earned from her job referenced in Finding of Fact No. 5 to SORM in her second and third quarter applications for SIBs in 2001 and 2002.
- As a result of her failure to report all her income from the _____ in 2001, _____ received an overpayment of monthly SIBs payments from SORM.
- The amount of the overpayment described in Finding of Fact No. 7 is $699.15.
- Based on Finding of Fact Nos. 4, 5, 6, and 7, _____’s failure to report all income from the _____ in 2001, was intentional.
- The amount of _____’s income from the _____ was a material fact.
- _____ timely requested a hearing, and notice of the hearing was issued by the Commission on October 8, 2003.
IV. CONCLUSIONS OF LAW
- The Texas Workers’ Compensation Commission (Commission) has jurisdiction of this case pursuant to § 415.021 of the Texas Workers’ Compensation Act (Act), Tex Labor Code Ann. ch. 401, et seq.
- The State Office of Administrative Hearings (SOAH) has jurisdiction over matters related to the hearing in this proceeding, including the authority to issue a decision and order, pursuant to § 415.034 of the Act and Tex. Gov’t. Code Ann., ch. 2003.
- A person who, to obtain a payment of a workers’ compensation benefit, knowingly or intentionally conceals a material fact commits a Class B administrative violation, punishable by an administrative penalty not to exceed $5,000.00, pursuant to §§ 415.008(a) and 415.022 of the Act.
- A person who has obtained an excess payment in violation of § 415.008 of the Act is liable for full repayment plus interest computed at the rate prescribed by § 401.023 of the Act.
- Based on Findings of Fact Nos. 5-8 and Conclusion of Law No. 4, _____ is liable for full repayment to SORM of the overpaid supplemental income benefits to her in the amount of $699.15, plus interest at a rate computed pursuant to § 401.023 of the Act.
- Based on Findings of Fact Nos. 4-6, 9 and 10 and Conclusion of Law No. 3, _____ committed an administrative violation of § 415.008(a) of the Act by knowingly or intentionally concealing material facts related to her income while receiving supplemental income benefits.
- Based on Conclusion of Law No. 6, an administrative penalty of $250 should be assessed against _____.
IT IS, THEREFORE, ORDERED that _____ repay to the State Office of Risk Management $699.15, plus interest at a rate computed pursuant to § 401.123 of the Texas Workers’ Compensation Act. IT IS FURTHERORDERED that _____ be assessed an administrative penalty of $250.00, pursuant to §§ 415.008(b) and 415.0022 of the Act.
Signed April 26, 2004.
SUZANNE FORMBY MARSHALL
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS
- In the event that _____ reported income from a job, the amount of her SIB would be adjusted, depending upon the amount of income she received.↑
- The relevant quarters for purpose of this case are the 2nd and 3rd quarters. The time frame covered by Quarter 2 was August 5, 2001 through November 3, 2001. The time frame covered by Quarter 3 was November 4, 2001 through February 2, 2002. On each quarterly application, a claimant is required to report all income from the preceding three-month period so that the quarterly SIBs payment can be determined by the carrier.↑
- The ombudsman contended that the amount of repayment should take into account the fact that health care premiums had been part of _____’s state salary, so that her weekly wage was properly determined. See 28 Tex. Admin. Code (TAC) § 128.1(b)(3). The ALJ was provided with insufficient evidence to determine that the overpayment of $699.15 should be modified.↑