Allen v. Comm Social Security ( 2005 )

Opinions of the United
2005 Decisions States Court of Appeals
for the Third Circuit
8-8-2005
Allen v. Comm Social Security
Precedential or Non-Precedential: Precedential
Docket No. 04-2163
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PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
NO. 04-2163
WILLIAM D. ALLEN,
Appellant
v.
JOANNE B. BARNHART,
COMMISSIONER OF SOCIAL SECURITY
On Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil No. 02-cv-02597)
District Judge: Hon. Dennis M. Cavanaugh
Argued March 8, 2005
Before: NYGAARD, McKEE, and RENDELL,
Circuit Judges
(Filed August 8, 2005)
Abraham S. Alter [ARGUED]
Langton & Alter
2096 St. Georges Avenue
P. O. Box 1798
Rahway, NJ 07065
Counsel for Appellant
William D. Allen
Anthony J. LaBruna, Jr.
Office of United States Attorney
970 Broad Street, Room 700
Newark, NJ 07102
Karen T. Callahan [ARGUED]
Social Security Administration
Office of General Counsel - Region II
26 Federal Plaza
New York, NY 10278
Counsel for Appellee
Commissioner of Social Security
OPINION OF THE COURT
2
RENDELL, Circuit Judge
William Allen complains of the determination of the
Social Security Administration (“Agency”) that Allen is
capable of substantial gainful employment. Allen was
awarded social security benefits in 1994 based on his manic-
depressive disorder, and schizoid condition. These benefits
were discontinued in 1998 based on the Agency’s
determination that Allen’s condition had improved. Allen
appealed this decision and the Appeals Council remanded the
decision, specifically requiring, among other things, that “if
warranted by the expanded record” the Administrative Law
Judge (“ALJ”) “obtain evidence from a vocational expert to
clarify the effect of the assessed limitations on the claimant’s
occupational base...” Allen urges that the ruling of the ALJ
on remand denying his continued benefits was not supported
by substantial evidence because the ALJ relied on the
medical-vocational grids notwithstanding the fact that the
impairment from which he suffers was not exertional. Allen
urges that the Commissioner was required to come forward
with testimony from a vocational expert regarding the
occupational base in light of the nature of Allen’s limitations.
The District Court affirmed the determination of the
Agency that Allen’s condition had improved, reasoning that
“...because the findings and opinions of Plaintiff’s treating,
examining and non-examining sources confirm that Plaintiff’s
condition improved to where he could perform substantial
3
gainful activity, Plaintiff failed to show that his medical
impairment resulted in functional limitations that precluded
all successful gainful activity.” The District Court also held
that reliance on the grids, as well as on Social Security
Rulings, was sufficient in order for the Commissioner to
satisfy its burden of proof and the ALJ had discretion whether
or not to call a vocational expert. While we agree generally
with the District Court’s ruling that the Commissioner can
satisfy his burden in this manner, we disagree with the way in
which the ALJ applied the Social Security Ruling at issue
here, and we will reverse the District Court’s Order and
remand for it to refer the matter to the Agency for further
findings.1
We review the Agency’s factual findings only to
determine whether the administrative record contains
substantial evidence supporting the findings. See 42 U.S.C.
§ 405(g); Sykes v. Apfel, 228 F.3d 259, 262 (3d Cir. 2000).
We exercise plenary review over all legal issues. See Id.1
This is an appeal from a final order of the United States
District Court for the District of New Jersey denying Allen’s
claim for continuation of Social Security disability benefits.
The District Court had jurisdiction pursuant to 42 U.S.C.
§ 405(g). We have jurisdiction pursuant to 28 U.S.C. § 1291.
4
BACKGROUND
Allen’s grant of benefits came up for periodic
continuing disability review in October 1997, pursuant to
Sections 216(i) and 223 of the Social Security Act, 42 U.S.C.
§§ 416(i) and 423, at which time the issues were whether his
medical condition had improved, and whether he had the
ability to obtain gainful employment. See 20 C.F.R.
§ 416.994 (2005).
When benefits were originally awarded to him in 1994,
Allen had completed a Functional Assessment Questionnaire,
in which he indicated that he lived with his mother, needed
help taking care of his personal needs, and did not prepare his
own meals. He indicated that on some days he did not get out
of bed. His mother did the shopping, and he barely left the
house. He stated, “I think I’m God, so I waste money.”
Further, with respect to his interests and recreational
activities, he noted that all he did was to “sleep and
fantasize,” and that he didn’t visit others because “I don’t
trust humans.” Asked to elaborate on his medical condition,
he wrote: “Sometimes I think the world is coming to an end,
that I’m God, that I’m the devil and that I’m the richest man
in the world. I also think the TV is talking to me.”
At that time, Dr. Edward Tabbanor opined that Allen
had a 15-year history of emotional difficulties, and that
although he was on medication and “is pleased with his
5
present adjustment . . . he is functioning marginally and is
involved in no organized activities. He should be encouraged
to seek the services of vocational rehabilitation.” Dr.
Tabbanor concluded that Allen was “not a good candidate”
for gainful employment.
The Agency terminated Allen’s benefits in January
1998, based on its own determination that, as of November
1997, he had the ability to engage in substantial gainful
employment. Reconsideration of the denial was denied, but
Allen then requested a hearing before an ALJ, which was held
in May 1999, at which he appeared and testified.
The ALJ considered the applicable standard, namely,
that he needed to determine whether there had been a decrease
in the medical severity based on changes in symptoms, signs,
and/or laboratory findings manifested by the impairment,
noting that the medical improvement must be related to ability
to work. If there was a medical improvement and an increase
in the individual’s functional capacity to do basic work
activities, the ALJ noted, he would determine that medical
improvement related to the ability to do work has occurred.
20 C.F.R. § 1594(b)(3).
The ALJ cited extensive improvement in Allen’s
condition, giving appropriate details as to specific areas of
improvement, and describing the 1997 findings of two
physicians, Edward Tabbanor and Luis Zeiguer. The ALJ
6
concluded, in summary fashion, that based on the evidence,
“the claimant has the residual functional capacity to perform
substantial gainful activity, including his past relevant work
as a salesperson.” The ALJ then concluded that the benefits
had been correctly terminated.
On appeal, the Appeals Council took the ALJ to task
for failing to include (1) an evaluation of the severity of
Allen’s mental impairment or effects pursuant to 20 C.F.R.
§ 404.1520(a); (2) an evaluation of the credibility of Allen’s
subjective complaints as required by Social Security Ruling
96-7(p) and 20 C.F.R. § 404.1529; and (3) an indication of
Allen’s exertional or nonexertional limitations. The Appeals
Council stated that it was unable to determine “how the
decision has been reached that the claimant retains the
residual functional capacity to perform his past relevant
work.”
The Appeals Council then remanded Allen’s case to
the ALJ, instructing the ALJ to further evaluate the claimant’s
subjective complaints, evaluate his mental impairment in
accordance with the technique described in 20 C.F.R.
§ 404.1520a(c), consider the maximum residual functional
capacity, and “if warranted by the expanded record, obtain
evidence from a vocational expert to clarify the effect of the
assessed limitations on the claimant’s occupational base
(Social Security Ruling 85-15).” The Appeals Council
included the following in concluding its directive: “The
7
hypothetical questions should reflect the specific
category/limitations established by the record as a whole.
The Administrative Law Judge will ask the vocational expert
to identify examples of appropriate jobs and to state the
incidence of such jobs in the national economy. (20 C.F.R.
§ 404.1566).”
A hearing was held on August 13, 2001, at which
Allen appeared and testified. Allen testified that he had
completed college and had taken some graduate courses. He
had held a few jobs, as a draftsman, a salesperson, and a
telemarketer, but was fired from every job within three
months. He was on medication, and took public
transportation to get to the doctor’s office and to the hearing.
He testified that he had a “short fuse” and sometimes
co-workers would make him angry. Working in a workplace
setting was difficult when he experienced manic episodes and
he missed work because of lack of sleep.
The record before the ALJ included assessments from
three doctors. Dr. Robles, who had treated Allen in 1999 at
the Newark Beth Israel Medical Center, noted that Allen’s
bipolar disorder made him “likely to decompensate if under
pressure or with large groups of people.” Dr. Tabbanor, who
had rendered an opinion when Allen first qualified for
benefits, opined that Allen was “compliant with medical
supervision and lithium medication with fair results. He
presents as a fair candidate for resumption of gainful
8
employment.” Dr. Zeiguer noted that Allen explained that he
has not sustained full-time employment because “under stress
of employment production demands he tends to develop
paranoid ideation and gets into conflicts.” The opinion then
went on to note the potential for stress-related
decompensation, although experiencing very limited
psychiatric hospitalization and concluded that Allen “showed
good enough concentration for simple repetitive chores.”
The ALJ issued his opinion on November 29, 2001,
referencing the opinions of Drs. Tabbanor and Zeiguer, and
noted that the Beth Israel psychiatric records indicated that
“the claimant was doing well and his condition had stabilized.
The ALJ did not refer to the “decompensation” note contained
in Dr. Robles’ report. The ALJ found Allen’s symptoms to
be not fully supported by objective medical evidence alone,
and his allegations that he was unable to work after
November 1, 1997 because of his mental impairments to be
not fully credible.
The ALJ then noted that Allen’s impairment was
“severe,” but not of listing severity. He then followed the
dictates of 20 C.F.R. §§ 404.1520(a) and 416.920(a),
examining Allen’s Residual Functional Capacity, noting that
Allen had “mild” limitations in his activities of daily living
and concentration, “moderate” limitations of social
functioning (which decrease when he takes his medication),
and that he had not experienced episodes of decompensation.
9
The ALJ concluded that Allen had made medical
improvement in the symptoms of bipolar disorder. This was
based primarily upon Dr. Tabbanor’s opinion in 1997 (as
compared to his first opinion, in 1994). Drawing on
Dr. Tabbanor’s opinion that “claimant was capable of gainful
employment,” and Dr. Zeiguer’s opinion that claimant was
“capable of performing simple chores,” the ALJ concluded
that Allen had the Residual Functional Capacity for simple
routine repetitive work at all exertional levels. However, he
was not capable of his past relevant work, as a salesman,
because it was classified as “semi-skilled,” and claimant was
no longer capable of performing semi-skilled work.
Stating that the Commissioner had the burden of
showing that significant jobs existed in the local or national
economy that claimant was capable of performing, given his
medically determinable impairments, and functional
limitations, the ALJ then concluded:
The claimant has a college education and a semi-
skilled work background. The claimant is capable of
performing a full range of unskilled work at all exertional
levels. A finding of not disabled was reached by application
of medical-vocational rule 204, Appendix 2, subpart P,
Regulations Part 404, used as a framework for decision
making. The mental limitations for simple, routine, repetitive
work do not significantly erode the base of jobs that claimant
is capable of performing. (SSR 85-15 )
10
Accordingly, in reaching the ultimate conclusion regarding
the availability of jobs in the economy that Allen is capable of
performing, the ALJ relied on SSR 85-15 without requiring
testimony from a vocational expert.
On appeal, the District Court affirmed the ALJ’s
decision, finding substantial evidence in the record to support
the ALJ’s findings that Allen’s condition had medically
improved since November 1, 1997, that this medical
improvement was related to Allen’s ability to work and that
Allen had the Residual Functional Capacity to perform
simple, repetitive work at all exertion levels. Thus, the
District Court held that the ALJ was correct to conclude that
although Allen could not likely return to his past relevant
work, there existed other jobs in the national economy at the
sedentary level that Allen could perform. The District Court
further held that the ALJ did not have to consult a vocational
expert in order to make his determinations as to whether Allen
was able to perform basic mental work-related functions, as
the decision whether the consult such an expert was within the
discretion of the ALJ. The District Court noted that the ALJ
“distinctively noted that based on Social Security Ruling
85-15, he found that Plaintiff’s mental limitations did not
significantly erode the base of unskilled work available. This
Court may defer to the SSR since there exists no evidence in
the record, nor allegations by Plaintiff, to establish that SSR
85-15 is plainly erroneous or inconsistent with the Act and
‘once published, [SSRs] are binding on all components of the
11
[Social Security Act].’ Walton v. Halter, 243 F.3d 703, 708
(3d Cir. 2001).”
DISCUSSION
On appeal, Allen challenges the ALJ’s reliance on the
medical-vocational grids when presented with nonexertional
impairments. Allen contends that the ALJ’s ruling runs
contrary to our opinion in Sykes v. Apfel, 228 F.3d 259 (3d
Cir. 2000), in which we stated:
The Commissioner cannot determine that
nonexertional impairments do not significantly
erode occupational base under medical-vocational
guidelines (“grids”) without taking additional
vocational evidence establishing that fact.
Sykes at 261.
Allen posits that in Sykes, we specifically forbade the
ALJ from “invoking the dubious ‘framework’ exception by
considering himself or herself to be a vocational expert.”
Allen contends, in addition, that the ALJ’s decision violates
the Agency’s own rulings and regulations.
While Allen’s argument has an initial appeal, because
the grid’s “framework” clearly classifies work in terms of
strength, thus tying it to physical exertion, nonetheless, as we
12
discuss below, the Agency has used, and the courts are thus
directed to employ, the grids as a framework when
nonexertional limitations are also at issue. Here we are
presented with exclusively nonexertional limitations by virtue
of Allen’s mental diagnosis. Accordingly, we must
determine whether the grids still are an appropriate
framework and whether if nonexertional limitations are
present, a vocational expert must be called by the
Commissioner in order for it to meet its burden at the
5th step.2
2
As the Court noted in Sykes v. Apfel, 228 F.3d 259, 262-63
(3d Cir. 2000):
The Social Security Administration has
promulgated a five-step process for evaluating
disability claims. See 20 C.F.R. § 404.1520(1999). First, the Commissioner considers
whether the claimant is currently engaged in
substantial gainful activity. If he is not, then the
Commissioner considers in the second step
whether the claimant has a ‘severe impairment’
that significantly limits his physical or mental
ability to perform basic work activities. If the
claimant suffers a severe impairment, the third
inquiry is whether, based on the medical
evidence, the impairment meets the criteria of an
impairment listed in the ‘listing of impairments,’
20 C.F.R. pt. 404, subpt. P, app. 1 (1999), which
result in a presumption of disability, or whether
13
Here, the ALJ relied on the regulations as a
“framework,” and then relied on Social Security Ruling
(“SSR”) 85-15 in reaching his ultimate conclusion that Allen
could engage in substantial gainful employment.3 Allen
the claimant retains the capacity to work. If the
impairment does not meet the criteria for a listed
impairment, then the Commissioner assesses in
the fourth step whether, despite the severe
impairment, the claimant has the residual
functional capacity to perform his past work. If
the claimant cannot perform his past work, then
the final step is to determine whether there is
other work in the national economy that the
claimant can perform. The claimant bears the
burden of proof for steps one, two, and four of
this test. The Commissioner bears the burden of
proof for the last step. (Internal citations omitted).
3
“Social Security Rulings are agency rulings published under
the authority of the Commissioner of Social Security and are
binding on all components of the Administration.” Sullivan v.
Zebley, 493 U.S. 521, 531 n.9 (1990) (Internal quotations
omitted). “...Rulings do not have the force and effect of the law
or regulations but are to be relied upon as precedents in
determining other cases where the facts are basically the same.
A ruling may be superseded, modified, or revoked by later
legislation, regulations, court decisions or rulings.” Heckler v.
Edwards, 465 U.S. 870, 874 n.3 (1984) (Internal quotations
14
contends that only a vocational expert could make that last
link, and that relying on an Agency ruling does not satisfy the
Agency’s burden.
The issue before us, then, in the broadest sense,
requires an inquiry into the role that Social Security Rulings
play in Agency determinations, and, more specifically,
whether, here, reference to the specific Ruling was an
appropriate substitute for the testimony of a vocational
expert.4
We start our analysis with the Supreme Court’s
opinion in Heckler v. Campell, 461 U.S. 458 (1983), in which
the Supreme Court clearly established the general rule that the
Agency may rely on rulemaking authority to determine issues
omitted).
4
We note at the outset that although Allen contends that the
remand order directed the use of a vocational expert, we do not
read the order as mandatory in this regard. Rather, the remand
order states that the ALJ will: “If warranted by the expanded
record, obtain evidence from a vocational expert to clarify the
effect of the assessed limitations on the claimant’s occupational
base (Social Security Ruling 85-15). . . .” Thus, it was up to the
ALJ on remand to determine whether a vocational expert was
necessary. The Appeals Council, in affirming the ALJ after its
more recent ruling did not question the ALJ’s reliance on the
Social Security ruling rather than on a vocational expert.
15
that do not require case-by-case consideration. In that case, a
challenge was leveled at the medical-vocational guidelines
themselves, with Campbell arguing that the ALJ had the
obligation to examine specific types of work in order to
determine whether she could obtain substantial gainful
employment when presented with the issue as to what jobs
she could perform, given her back condition, which permitted
her to do only light work. The ALJ rejected that argument,
and relied on the medical-vocational guidelines in his finding
that a significant number of jobs existed that someone in her
condition could perform. The Court of Appeals for the
Second Circuit reversed, holding that the Secretary must
engage in individualized scrutiny of her limitations and
possible relevant jobs, and must identify “specific alternative
occupations available in the national economy that would be
suitable for the claimant.” 461 U.S. at 464.
The Supreme Court rejected the Court of Appeals’
view, noting that after the ALJ makes the assessment as to the
claimant’s individual abilities, he must then determine
whether jobs exist that a person having claimant’s
qualifications could perform. With respect to that second
inquiry, the Court noted:
The second inquiry requires the Secretary to
determine an issue that is not unique to each
claimant – the types and number of jobs that
exist in the national economy. This type of
16
general factual issue may be resolved as fairly
through rulemaking as by introducing the
testimony of vocational experts at each
disability hearing.
Id. at 467-68.
Thus, Heckler stands for the broad proposition that the
Commissioner can satisfy its burden of proof regarding
availability of jobs in the national economy via rulemaking
rather than requiring actual evidence on a case-by-case basis.5
Thus, Agency rulemaking, as long as it is not arbitrary or
capricious, is permissible as a substitute for individualized
case-by-case determinations, thus doing away with the need
5
Campbell had raised an issue regarding due process and the
requirement of notice of reliance on rulemaking, but the court
declined to address it, since Campbell had not previously raised
this claim and the Court did not view it as an exceptional case
where issues not raised should nonetheless be addressed on
appeal. In alluding to the issue, however, the Court noted the
principle of administrative law, “that when an agency takes
official or administrative notice of facts, a litigant must be given
an adequate opportunity to respond.” Such an opportunity to
respond would appear to require notice to the claimant of the
agency’s intent. Thus, the Court left open the possibility that an
ALJ’s reliance exclusively on rulemaking without notice might
be viewed as unfair to the claimant. See Heckler v. Campbell,
461 U.S. 458, 469 n.13 (1983).
17
for evidence to support the determination at Step 5.
In Walton v. Halter, 243 F.3d 703 (3d Cir. 2001), we
had occasion to examine the extent to which the Agency’s
rules and regulations are binding on the Agency. There, the
Commissioner reached a conclusion with respect to the onset
date of the claimant’s disease based upon medical evidence
which was not clearly dispositive. We concluded that the
ALJ could not, consistent with SSR 83-20 and the necessity
of establishing “an onset date based on substantial evidence,”
simply “draw an inference from the record evidence [that
lacked] medical support.” Id. at 709. In other words, because
SSR 83-20 required a medical basis for the ALJ’s conclusion,
the ALJ’s determination that ran afoul of the ruling was not
supported by substantial evidence. In this way, we required
adherence to the SSRs, finding them to be controlling.
More recently, in 2000, our Court had occasion to
consider the application of these directives in the context of a
different fact pattern, namely, one that involved nonexertional
as well as exertional limitations. In Sykes v. Apfel, Sykes
had a number of severe impairments, including left eye
blindness. The ALJ in Sykes relied on the medical-vocational
guidelines as a “framework” and, on review, we concluded:
[U]nder Heckler v. Campbell . . . , and in the
absence of the rulemaking establishing the facts
of an undiminished occupational base, the
18
Commissioner cannot determine that a
claimant’s nonexertional impairments do not
significantly erode his occupational base under
the medical-vocational guidelines without either
taking additional vocational evidence
establishing as much or providing notice to the
claimant of his intention to take official notice
of this fact (and providing the claimant with an
opportunity to counter the conclusion).
228 F.3d 259, 261 (3d Cir. 2000).
In Sykes, the ALJ had denied Sykes’ application,
summarily concluding that the exclusion of jobs requiring
binocular vision from light work positions did not
significantly compromise Sykes’ broad occupational base.
We disagreed, and concluded that either vocational evidence
or “rulemaking establishing the fact of an undiminished
occupational base” was necessary. Id. at 261.
Allen contends that the ALJ’s ruling here, and thus the
District Court’s as well, is contrary to Sykes. However,
whereas Sykes spoke to the situation in which rulemaking
regarding the degree of diminution in the occupational base
was lacking, here the ALJ specifically referred to rule
SSR 85-15. SSR 85-15 addresses the precise issue presented
here, namely, the interplay between nonexertional
impairments and the grids, which we will discuss more fully
19
below.
After the Sykes opinion, the Agency issued an
Acquiescence Ruling to specifically address how the Agency
would deal with issues of this kind in cases within the
geographic limits of the Third Circuit. There, the Agency
noted that, thereafter, at Step 5, the Agency would not use the
grid framework exclusively when there were nonexertional
limitations, but would, in addition:
(1) Take or produce vocational evidence, such
as from a vocational expert, the DOT, or other
similar evidence (such as a learned treatise); or
(2) Provide notice that we intend to take or are
taking administrative notice of the fact that the
particular nonexertional limitation(s) does not
significantly erode the occupational base, and
allow the claimant the opportunity to respond
before we deny the claim.
However, the Agency then went on to specifically
state:
This Ruling does not apply to claims where we
rely on an SSR that includes a statement
explaining how the particular nonexertional
limitation(s) under consideration in the claim
20
being adjudicated affects the claimant’s
occupational job base. When we rely on such
an SSR to support our finding that jobs exist in
the national economy that the claimant can do,
we will include a citation to the SSR in our
determination or decision.6
AR 01-1(3), 2001 WL 65745 at *4 (S.S.A.).
Accordingly, the ALJ’s use of the guidelines as a
framework in this case, and his reliance upon an SSR at
Step 5 to determine Allen’s occupational job base is not an
improper application of either the case law or rules
established by the Agency. Further, from the standpoint of
common sense, the grids’ use for exertion level are not totally
irrelevant if a claimant has only a nonexertional impairment,
for there would still be an applicable exertional level, i.e., the
claimant could do work requiring heavy exertion.
However, the ALJ’s reliance on SSR 85-15 in this
instance, and in summary fashion, gives us pause. While the
Agency excerpted a certain portion of SSR 85-15 as
6
Interestingly, the Agency then noted as well: “We are
considering revising our rules regarding our use of the grid rules
as a framework for decision making and may rescind this Ruling
once we have made the revision.” AR 01-1(3), 2001 WL 65745at *5 (S.S.A.). No revision has occurred to date.
21
conclusive on the relationship between the type and degree of
mental limitation and the size of the occupational base,
nonetheless, the ALJ’s conclusion in this regard fails to focus
on any of Allen’s work-related limitations. Instead, the ALJ’s
opinion parrots the attributes of work, not the limitations
experienced by Allen, noting that Allen was capable of
performing “a full range of unskilled work at all exertional
levels” but then stating, as the complete mental impairment
analysis, the following: “The mental limitations for simple,
routine, repetitive work do not significantly erode the base of
jobs the claimant is capable of performing. (SSR 85-15.)”
The difficulty we have with this reasoning is that the
Appeals Council in its remand order specifically admonished
the ALJ to state the claimant’s exertional and nonexertional
limitations. Instead, the ALJ refers to SSR 85-15 as though it
resolves the issue. However, SSR 85-15 is a ten-page ruling
that specifically addresses the relationship of different mental
impairments to job activity.
SSR 85-15 provides that where individuals have
nonexertional limitations of function or environmental
restrictions, the table rules (medical-vocational rules) still
provide a “framework” for consideration of how much the
individual’s work capability is further diminished in terms of
any types of jobs. Where a person has solely a nonexertional
impairment: “[T]he table rules do not direct conclusions of
disabled or not disabled. Conclusions must, instead, be based
22
on the principles in the appropriate sections of the
regulations...” The Ruling then notes that its purpose is to
clarify policies applicable in cases involving the evaluation of
solely nonexertional impairments. 1985 WL 56857 at *1
(S.S.A.).
The policy statement of SSR 85-15 notes that the first
issue to be considered is the Residual Functional Capacity
reflecting the severity of the particular nonexertional
impairment with its limiting effects on the broad world of
work. Id. at *2. The SSR makes clear that, while there may
be a need to consult a vocational resource, “the publications
listed in Sections 404.1566 and 416.966 of the Regulations
will be sufficient vocational resources for relatively simple
issues. In more complex cases, a person or persons with
specialized knowledge would be helpful.” Id.at *3.
Within the discussion of mental impairments in the
Ruling are several examples of different attributes of
individuals which would, or would not, limit the occupational
base for jobs in the national economy. The Ruling contains a
general discussion that merits repeating:
Given no medically determinable impairment
which limits exertion, the first issue is how
much the person’s occupational base – the
entire exertional span from sedentary work
through heavy (or very heavy) work – is
23
reduced by the effects of the nonexertional
impairment(s). This may range from very little
to very much, depending upon the nature and
extent of the impairment(s). In many cases a
decision maker would need to consult a
vocational resource.
Id.The SSR then proceeds to address certain examples of
nonexertional impairments, commenting on their impact on
the occupational base. In introducing the topic of “mental
impairments,” it states: “The decision maker must not assume
that failure to meet or equal a listed mental impairment
equates with capacity to do at least unskilled work. This
decision requires careful consideration of the assessment of
RFC.” Id. at *4. The SSR also includes a discussion of the
impact of the inability to handle stress, and addresses how an
individual with a difficult reaction to the demands of work
may have difficulty meeting the requirements of even a low-
stress job. Further, it notes that the reaction to stress is highly
individualized. The section ends with the notation that any
impairment-related limitations created by an individual’s
response to demands of the workplace must be reflected in the
RFC assessment. Id. at *5-6.
Notwithstanding the ALJ’s reference to, and apparent
reliance on, this Ruling, we are at a loss to find within the
24
Ruling itself the conclusion the ALJ seems to find regarding
the occupational base for one with Allen’s mental limitations.
The ALJ makes broad statements regarding Allen’s
RFC, as we referenced above, but his conclusion only
addresses in general fashion the “mental limitations for
simple, routine, repetitive work.” It does not reference any
aspect of SSR 85-15 that relates Allen’s particular
nonexertional limitations to the occupational job base. Thus,
we have difficulty in determining what the ALJ believed were
Allen’s “mental limitations for simple, routine, repetitive
work,” and how they fit into the various categories or
examples set forth in SSR 85-15. While, surely, the Agency
can use its rules as a substitute for individualized
determination, nonetheless, there must be a “fit” between the
facts of a given case, namely, the specific nonexertional
impairments, and the way in which the Rule dictates that such
nonexertional limitations impact the base. In fact, the
Acquiescence Ruling states that a ruling that is being relied
upon in lieu of testimony should set forth the “fit.” See 2001
WL 65745 at *4 (stating that the requirement that the Agency
consider vocational expert testimony or provide notice that it
is taking administrative notice of the fact that a particular
nonexertional limitation does not significantly erode the job
base when making a disability determination as to a
nonexertional impairment at Step 5 of the sequential process
would not be necessary if the “SSR includes a statement
explaining how the particular nonexertional limitation(s)
25
under consideration... affects the claimant’s occupational
base”). SSR 85-15 refers specifically to aspects of
nonexertional limitation apparent in Allen’s profile, as the
doctors’ reports indicate, namely, difficult response to
supervision, impaired ability to deal with changes in a work
setting and job stress. The Rule states, in concluding the
discussion of this type of limitation:
Because response to the demands of work is
highly individualized, the skill level of a
position is not necessarily related to the
difficulty an individual will have in meeting the
demands of the job. A claimant’s condition
may make performance of an unskilled job as
difficult as an objectively more demanding job.
For example, a busboy need only clear dishes
from tables. But an individual with a severe
mental disorder may find unmanageable the
demands of making sure that he removes all the
dishes, does not drop them, and gets the table
cleared promptly for the waiter or waitress.
Similarly, an individual who cannot tolerate
being supervised may not be able to work even
in the absence of close supervision; the
knowledge that one’s work is being judges and
evaluated, even when the supervision is remote
or indirect, can be intolerable for some mentally
impaired persons. Any impairment-related
26
limitations created by an individual’s response
to demands of work, however, must be reflected
in the RFC assessment.
1985 WL 56857 at * 6.
The RFC assessment here fails to really focus on the
limitations at issue. Moreover, the ALJ made only passing
reference to the nature of Allen’s limitations, stating that “the
record shows an opinion that pressure or being in large groups
of people could aggravate his symptoms.” However, the ALJ
then discarded this fact by noting that Allen could travel on
his own and did not relate either of these factors as
specifically problematic. In fact, Allen did express concern as
to the social interaction and stress of jobs. The ALJ did not
connect these limitations to any applicable occupational base
directives within SSR 85-15. While, admittedly, SSR 85-15
does include specific statements explaining how specific
nonexertional limitations would affect the claimant’s
occupational base, it also includes certain areas of concern
that should require the ALJ to make an individualized
determination. These would appear to be present here.
Looking at the ALJ’s conclusory reference to
SSR 85-15, we cannot determine whether he was relying upon
a specific aspect of the Rule in a permissible way, or whether,
by contrast, he found certain limitations to exist which would
require, under the dictates of the Rule itself, an individualized
27
determination. Looking at the record before us, we cannot
help but note that certain aspects of Allen’s mental disorder –
including response to supervision, stress, and the like – would
more likely be subjected to an individualized assessment.
In reviewing proceedings before ALJs, we have been
careful to ensure that a vocational expert’s hypothetical
contain a complete and accurate factual basis in order for the
conclusion to constitute substantial evidence. See Ramirez v.
Barnhart, 372 F.3d 546 (3d Cir. 2004). Just as we required in
Ramirez that a vocational expert’s testimony was only as
valid as the limitations that the ALJ had included in the
hypothetical, here we will require that the ALJ’s own
reference to the SSR ruling discuss specifically the limitations
presented by the medical record. As we said in Ramirez, “If,
however, an ALJ poses a hypothetical question to a vocational
expert that fails to reflect ‘all of the claimant’s impairments
that are supported by the record . . . it cannot be considered
substantial evidence.’” Id. at 550 (quoting Chrupcala v.
Heckler, 829 F.2d 1269, 1276 (3d Cir. 1987)).
Recently, in Burns v. Burnhart, 312 F.3d 113 (3d Cir.
2002), where the vocational expert’s testimony did not touch
on borderline intellectual functioning, and the ALJ used only
the concept of “simple repetitive one-, two-step tasks” in the
hypothetical, we could not conclude that its ruling was
supported by substantial evidence because the reference to
simple tasks did not “specifically convey” the claimant’s
28
intellectual limitations and that “greater specificity” was
required.
Accordingly, we hold that if the Secretary wishes to
rely on an SSR as a replacement for a vocational expert, it
must be crystal-clear that the SSR is probative as to the way in
which the nonexertional limitations impact the ability to work,
and thus, the occupational base. Here, notwithstanding the
fact that stress was alluded to by one of the doctors, and that
stress is singled out as an individualized factor in the SSR
relied upon, the ALJ fails to discuss this and, as a result, his
determination that Allen has the ability to perform simple
tasks prevalent in the national economy is not supported by
substantial evidence.
Accordingly, we will vacate and remand for further
elaboration by the ALJ regarding how the specific limitations
experienced by Allen would impact his ability to perform
simple repetitive tasks in a job that constitutes substantial
gainful employment. This can be accomplished by noting
how SSR 85-15 is relevant and controlling – if indeed that is
the case – or by obtaining the individualized assessment that
SSR 85-15 seems to prefer by way of a vocational expert.
We also take this opportunity to address the issue of
notice, alluded to but not decided by the Supreme Court in
Heckler, See supra note 5, and required in some situations by
the Acquiescence Ruling referred to above. If an agency will
29
rely on rules as a substitute for individualized determination,
and thus relieve the agency from the burden of producing
evidence, we think advance notice should be given. In the
Acquiescence Ruling, however, the Agency excepted out
those instances where the reliance would be placed on an SSR
that includes a statement explaining how the limitation did
affect the occupational job base. 2001 WL 65745 at *4. We
question whether this exception is called for and urge that, as
a matter of fairness, alerting a claimant to the relevant rule in
advance will always be appropriate. While the Agency can
meet its burden by reference to a Ruling, as the Supreme
Court has held, nonetheless, the claimant should have the
opportunity to consider whether it wishes to attempt to
undercut the Commissioner’s proffer by calling claimant’s
own expert. Obviously, this requires notice in advance of the
hearing.
We think it only appropriate to give close scrutiny to
the ALJ’s reliance on a Ruling as satisfying the
Commissioner’s burden at Step 5 where the Commissioner
has not previously advised or argued the clear applicability of
the Ruling in advance of the hearing. In this way, while the
Commissioner has the ability to satisfy its burden in this way,
its doing so does not constitute an ambush whereby the
claimant, who assumed he would have the opportunity to
cross-examine a vocational expert, is left as a practical matter
to merely argue against a Ruling in response to the
Commissioner’s proof.
30
CONCLUSION
In light of the foregoing, we will reverse the District
Court’s Order and remand for it to refer the matter to the
Agency for further findings consistent with this opinion.
31