There are some situations in which your Workers’ Compensation benefits could be reduced if you receive additional benefits at the same time. It is important to understand these situations so that you can make informed decisions and are not caught off guard.
If you expect to receive more money from benefits than you receive in reality, that could negatively impact your financial plans. It is always a good idea to contact a Workers’ Compensation attorney if you have questions about your case.
Social Security (old age) benefits, unemployment benefits, pension benefits, and severance benefits all offset Workers’ Compensation benefits under specific circumstances. Social Security (disability) benefits do not offset Workers’ Compensation benefits; however, they are offset by Workers’ Compensation benefits.
Unemployment benefits offset Workers’ Compensation benefits regardless of the date on which the unemployment benefits began. Meanwhile, pension and severance benefits only offset Workers’ Compensation benefits to the extent your employer has funded them by the time the injury occurred.
Social Security (old age) offsets only apply if you begin receiving these benefits after you have begun receiving Workers’ Compensation benefits. If you are already receiving Social Security (old age) benefits before you become entitled to Workers’ Compensation benefits, there will be no offset.
However, if you began receiving Workers’ Compensation benefits first, there may be an offset. The relative dates on which the benefits begin are what matters, not simply that the benefits are being received simultaneously.
It is important to note that any benefits you are eligible for but are not receiving do not get offset from your Workers’ Compensation benefits. For example, if you are eligible for Social Security (old age) benefits but are not yet taking them, there will be no resulting offset.
Offsets from any of the previously mentioned benefits apply to Workers’ Compensation wage loss benefits.
For unemployment, pension, and severance benefits, the eligible offset of Workers’ Compensation benefits is one-to-one. For every dollar received from those benefits, a dollar will be subtracted from the Workers’ Compensation benefits. However, Social Security (old age) benefit offsets work a bit differently.
The offset caused by Social Security (old age) benefits is only 50% of the received sum. Half of what you receive from these benefits can be offset from your Workers’ Compensation benefits.
There are two steps you need to take to calculate the approximate amount by which your Workers’ Compensation benefits will be reduced due to Social Security (old age) benefits. First, divide your monthly Social Security (old age) benefits by 4.34 to determine your weekly benefits. Second, divide the resulting amount by 2 to get the 50% that will be offset.
If you received $2,993 in Social Security (old age) benefits for the month, dividing that by 4.34 will give you $689.63 per week. Further dividing that by 2 gives you $344.82. This is a reasonable approximation of the amount of the offset.
Before you apply for any additional benefits, you should explore whether or not they will affect your Workers’ Compensation benefits. This is important for determining exactly how much money you will be receiving in various benefits on a weekly basis.
Even if you are temporarily (or permanently) unable to work, you still have bills that need to be paid. Knowing how much money you’ll receive in benefits can help you more effectively plan for bills and other necessary expenses that arise. You may find that you want to hold off on receiving additional benefits beyond Workers’ Compensation.
For example, if you do not need the additional funds from Social Security (old age) benefits, it may be advantageous to hold off on taking them until after your Worker’s Compensation benefits conclude to enable them to continue to accrue in value for a later date.
Receiving Workers’ Compensation and other benefits at the same time may provide more income than Workers’ Compensation or those other benefits alone. However, you may also receive more compensation overall by receiving those benefits separately because there will be no offset.
An experienced Workers’ Compensation attorney can help you determine what your options are and the implications of each.
If you are receiving Workers’ Compensation wage loss benefits and then begin receiving Social Security (old age), unemployment, pension, or severance benefits, your Workers’ Compensation benefits may be affected. At worst, these additional benefits could completely offset those you were receiving through Workers’ Compensation.
Do you plan to take additional benefits? Are you unsure about how they will affect your Workers’ Compensation wage loss? My name is Geoffrey Hillsberg and I have been solely practicing Workers’ Compensation law in Pennsylvania since 1995. Contact my law office today for a free consultation of your case.
The advice offered above is general in nature and may not be applicable to every case. Consultation with an attorney is highly recommended. Reliance on this advice does not represent the formation of an attorney-client relationship in the absence of a fee agreement with Mr. Hillsberg.
Fill out the form with a brief description of your situation or call me at (610) 566-0600 and I’ll be in touch to schedule a free consultation.