Do you receive workers’ compensation benefits and pension benefits or benefits from a 401k or some other retirement plan? If your injury occurred after June 24, 1996, your employer and the workers’ compensation insurance carrier may try to reduce your compensation benefits based on your receipt of pension or retirement benefits. If this happens to you, here are a few things to keep in mind:
–The insurance company can only reduce your workers’ compensation to the extent that the employer for whom you were working at the time of the injury funded the retirement. Thus, if you are receiving money from a 401k plan, but the employer for whom you were working at the time of your injury didn’t contribute any money to the 401k plan, your workers’ compensation benefits can’t be reduced. Similarly, if you work out of a union hall and your retirement is funded by multiple different employers, your workers’ compensation can only be reduced based on the percentage of funding attributable to your time-of-injury employer.
–It is not uncommon for employers and/or insurance carriers to miscalculate the amount of the pension offset. Not surprisingly, when a miscalculation occurs, it usually benefits the employer/insurance carrier. In other words, it’s not uncommon for the insurance carrier to reduce an injured workers’ compensation to a greater degree than is allowed under the law. You do not have to accept that the insurance carrier accurately calculated the offset. You have the right to challenge those calculations.
–If you are an employee of the Commonwealth of Pennsylvania, it is, in our opinion, very likely that your employer is taking a larger offset than is permitted under the law. In multiple cases that we have identified, the Commonwealth of Pennsylvania has taken an offset based on the Maximum Single Life Annuity (MSLA), or the maximum amount of cash that a person could receive in pension benefits each month. The Commonwealth has taken such an offset even in cases in which the injured employee elects to receive a different payment option (i.e. one that pays less cash each month). We believe that it is a violation of the law for the Commonwealth to do so and Abes Baumann is currently litigating this issue in several cases.
If you are an injured worker who receives some sort of retirement benefit, contact our firm and we will help you determine whether or not the insurance company has accurately calculated your benefit rate.