Pennsylvania Court Affirms Employer Entitled to Offset of Claimant’s Benefits
In a recent case, the Pennsylvania Commonwealth Court addressed the issue of when and how an employer may recoup benefits when an employee has a change in their benefits.
The Pennsylvania Workers’ Compensation Law provides that an employer is entitled to an offset for pension benefits, to the extent it funded those benefits. While employees must report to the insurer the amounts received in unemployment, Social Security, and pension benefits, insurers are required to notify employees of the reporting requirements. The insurer is also required to provide the required forms to the employee, so that they can complete and forward the form to the insurer within 30 days of receiving benefits.
In this case, Claimant was a former state trooper for the Pennsylvania State Police. The Workers’ Compensation Judge awarded Claimant benefits for a disability from a work-related post-traumatic stress disorder. Claimant received indemnity benefits.
Years later, Claimant applied for disability pension benefits with the Pennsylvania State Employees’ Retirement System. She began receiving those benefits. She stated that she reported the disability pension on a report sent by Employer. She then received a Notice of Workers’ Compensation Benefit Offset from Employer. She was informed that her workers’ compensation benefits would be suspended and then restored nearly one year later. Claimant contends that she suffered a hardship when her benefits were suspended, since she went nearly a year without receiving compensation once Employer suspended her benefits.
At issue was whether Employer was entitled to recoupment from Claimant’s retroactive disability pension benefits. Claimant argued that the Workers’ Compensation Judge should have conducted a hardship analysis, since the overpayment of benefits occurred for more than six months, and she suffered a hardship when the benefits were unilaterally terminated. The Workers’ Compensation Judge determined that Employer offered no evidence to justify stopping her benefits. Employer then appealed to the Workers’ Compensation Board.
The Board stated that Employer had notified Claimant of her reporting requirements and sent her the appropriate forms in a timely manner. They determined that Employer was entitled to recoup the payments from the disability pension benefits. Claimant then appealed.
Claimant also argued that the Workers’ Compensation Board erred in allowing Employer to recoup costs because Claimant was found to have suffered a financial hardship. Here, Claimant contends that the Workers’ Compensation Judge had the authority to modify the terms of recoupment in order to reduce any financial hardship she, a claimant, may suffer.
The court of appeal stated that Claimant never requested a reduction in the recoupment amount. Furthermore, Claimant was incorrect in stating that the Workers’ Compensation Judge found a financial hardship in her case. Instead, the Judge had simply summarized Claimant’s statement that she experienced a hardship, but this does not constitute a finding.
The Board correctly determined that Employer is entitled to an offset, so the judgment of the Workers’ Compensation Board was affirmed.