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Offsets and Credits

SOCIAL SECURITY DISABILITY OFFSET – LA. REV. STAT. 23:1225(A):

  • Requirement: permanent and total disability.
  • Effective date: September 8, 1978.
  • Cost of living increases not included in calculation.
  • Judicial Demand: OWC
  • Calculation:

Convert weekly worker’s compensation benefits to monthly:

WC x 13 divided by 3 = monthly

Biweekly x 6.5 divided by 3 = monthly

Semi-monthly x 2 = monthly

TFB
+ monthly WC
Sum
– higher of TFB or 80% ACE
Monthly offset

  • The employee’s combined benefits cannot be reduced below the amount to which the employee is entitled under workers’ compensation law (i.e.. the weekly compensation rate); Coleman v. Times-Picayune Pub. Corp., 570 So2d 80 (La App 4th Cir 1990).
  • Disputed Claims
    In cases involving a DISPUTED claim (i.e., one which a form LDOL-WC-1008 has been filed by one of the parties), the employer must request the offset through burberry replica handbags responsive pleadings (in the Answer) or by making a request for the offset through the filing of form LDOL-WC-1008. After the workers compensation Judge has made a determination that the offset is appropriate (i.e., that the claimant is permanently disabled), the Judge will request the necessary information from the Social Security Administration and calculate the offset and issue an order on form LDOL-WC-1005 (B) recognizing the entitlement to the offset from date of judicial demand and setting the amount of the offset.
  • Paying Benefits Voluntarily
    In cases in which the employer is paying benefits voluntarily, a request for the offset may be made by motion of the employer on form LDOL-WC-1005(A) or by letter, filed in the appropriate district office. Upon receipt of such request, the district office shall request the necessary information from the Social Security Administration and shall calculate the amount of any offset. We do not recommend the use of this procedure unless you are certain that the claimant is permanently and totally disabled and you are certain that the offset will be worth the admission of permanent and total fendi replica handbags disability status. If you are not certain of either of these issues, it is recommended that you file a Petition for Declaratory Judgment with a form LDOL-WC-1008. In the Petition for Declaratory Judgment, state that the employer disputes the permanent disability status of the claimant and asks the court to determine whether the worker is permanently and totally disabled and, if such a determination is made, to grant the offset.
  • Garrett is Gone
    On May 18, 1999, the Louisiana Supreme Court in Al Johnson Construction Company and LIGA v. Pitre, 98-C- 2564 (La 5/18/99), reversed its previous decision in Garrett v. Seventh Ward General Hospital, 95-0017 (La. 9/22/95), 660 So2d 841. Under the Garrett decision an employer was able to assert an offset against the employee’s receipt of Social Security disability benefits under the disability plan offset established in La. R.S. 23:1225 C. This decision enabled the employer to take replica omega watches advantage of the employee’s receipt of Social Security disability benefits without making an admission that the employee was permanently disabled (as is required under the REVERSE OFFSET of La. Rev. Stat. 23:1225 A).

In the Pitre case, the Court (Marcus and Traylor dissenting with Victory not on the panel) concluded that their decision in Garrett was in error. According to the Court, their earlier opinion was motivated by a desire to avoid double recovery by the rolex replica employee (Social Security and workers’ compensation). However, the Court now believes that this is not a viable concern due to the offset that can be taken by Social Security when the employee is receiving workers’ compensation benefits.

  • Impact of the Pitre Decision:
  1. The Court has declared that Garrett is no longer valid and no offsets can now be taken for SSDI under 1225 C (the REVERSE OFFSET under 1225 A is still available);
  2. This decision affects all cases in which the employer has taken the Garrett offset. Unless you have a judgment recognizing your right to take the Garrett offset, you must immediately remove the offset and reimburse the employee for any reduction in benefits taken by you due to the Garrett offset.
  3. If you are asserting a Garrett offset under a court authorization, you would have a reasonable basis to believe that you can continue to take the offset until the claimant obtains a modification of the judgment. It is also possible that a court may find that even employers who are asserting the offset based on a judgment will be required to remove the offset (without the need of a modification proceeding) and to repay the amount offsetted.
  • Request for Social Security Information
    In order to obtain information concerning the employee’s receipt of Social Security Disability Benefits, we recommend that you send the following letter to the nearest OWC judge.

(DATE)
Judge ______________________

(Address)

Re: _________________________________________
[Claimant’s Name]

Social Security No. _________________________

Dear Judge _______________________:

__________________________________has made a claim for workers’ compensation benefits against the employer, ___________________________. As the workers’ compensation insurer (or the third party administrator) for the employer, we hereby request that your office secure from the Social Security Administration information concerning the employee’s receipt of Social Security Disability Benefits.

Sincerely,

UNEMPLOYMENT COMPENSATION – LA. REV. STAT. 23:1225(B):

  1. If receiving unemployment benefits, no indemnity benefits payable when employee qualified to receive TTD, permanent and total, or SEB.
  2. However, if employee is receiving permanent partial disability benefits, then can also receive unemployment benefits.
  3. Credit is week to week.

OTHER CREDITS: LA. REV. STAT. 23:1225(C):

Benefits may also be reduced:

  1. To the extent that employee has not funded old-age retirement benefits and is receiving these benefits. The employer can reduce based on benefits funded by a different employer (see, Town of Berwick v. Justilian, 634 So2d 1365 (La App 3d Cir 1994)).
  2. To the extent that disability benefits are funded by employer. This now includes Social Security disability benefits according to the Louisiana Supreme Court in Garrett v. Seventh Ward General Hospital, 95-0017 (La 9/25/95) 660 So2d 841. Using the same method of calculation as a private disability program, the employer in Social Security cases has a credit.
  3. To the extent of any other workers compensation benefits received.

Calculation:

  1. Total from state worker’s compensation benefits and 1-3 do not exceed 66 2/3 AWW.

DEDUCTIONS FROM BENEFITS – LA. REV. STAT. 23:1223:

  1. When compensation has been paid 1221(l)(2) or (3), amount of payment shall be deducted from 1221(4) or (C).
  2. When compensation has been paid 1221(l)(2) or (3), amount of payment shall be deducted from any compensation owed under 1221(3) (SEB) effective I/I/90.
  3. The credit against an award for SEB under 1223(B) is not applied retroactively. Thibodeaux v. Diamond M. Drilling Co., 632 So2d 736 (La 1994). In Cline v. St. Jude Medical Center, Inc., 619 So2d 712 (La 4th Cir 1993) the Fourth Circuit held that the credit could be applied to TTD paid after January 1, 1990.

MEDICAL EXPENSE OFFSET – LA. REV. STAT. 23:1212:

  1. Medical debt extinguished if paid by another party (e.g., health insurance).
  2. Exception is if direct payment is made by employee, spouse, relative or friend.
  3. If employee or spouse pays percentage of health insurance premium, then offset only applies to percentage paid by employer of employee or employer of spouse.

VOLUNTARY PAYMENTS – LA. REV. STAT. 23:1206:

Any voluntary payment or unearned wages paid by the employer/insurer which were not due and payable when made, may be deducted from the payments to be made as compensation.

FORFEITURE OF BENEFITS WHILE INCARCERATED – LA. REV. STAT. 23:1201.4:

The employee’s right to compensation benefits, including medical expenses, is forfeited during any period of incarceration; unless a workers’ compensation judge finds that an employee has dependents who rely on a compensation award for their support, in which case said compensation shall be made payable and transmitted to the legal guardian of the minor dependent or other person designated by the hearing officer and such payments shall be considered as having been made to the employee. After release from incarceration, the employee’s right to claim compensation benefits shall resume.