Court of Appeals Affirms Denial of Penalty Benefits

In Dubinovic v. Des Moines Public Schools, No. 18-1065 (Iowa App. June 5, 2019), the court was presented with the commissioner's denial of claimant's application for penalty benefits.  Claimant argued that healing period benefits were not paid in a timely manner and that penalty benefits were due for this and for later payment of permanency.  The commissioner found that the employer paid healing period and permanency benefits in a timely manner.

The court of appeals first finds that claimant did not establish that there was a delay in payment or a denial of benefits since the employer had paid benefits on a timely basis.  Claimant alleged that the payment of  healing period benefits was several days late.  Claimant was paid wages by the employer until January 25 and healing period benefits were begun on January 29 for amounts higher than claimant's weekly earnings.  The court finds that on these facts, the failure to award penalty benefits was not irrational, illogical or wholly unjustifiable.  On the permanency benefits question, the court concluded that since the employer was paid permanency before there was a determination that claimant was at MMI, penalty benefits were not appropriate.  The court states: "we find that assessment of a penalty is inappropriate until the employer has been informed that an employee has reached maximum medical improvement and then delays in seeking an impairment rating or commencing payment."  Since the employer had paid benefits even before there was a finding of MMI, the denial of penalty benefits was not irrational, illogical or wholly unjustifiable.