September 30, 2010

Filing for accidental disability retirement

Filing for accidental disability retirement
Sukup v McCall, App. Div., Third Dept., 264 AD2d 921

The Sukup case illustrates the importance of filing a timely application for accidental disability retirement benefits. Simply put, if the individual, or his or her representative, fails to file the application in time, the application for such benefits will be rejected. However, critical to such a determination is that the applicant knew that he or she was actually terminated from employment.

Broome County landfill employee Richard Sukup sustained a work-related accident in June 1994. Placed on Workers’ Compensation Leave pursuant to Section 71 of the Civil Service Law, the County terminated his employment after a three-month extension of his one-year leave of absence expired on September 24, 1995.*

In February 1997, Sukup filed for accidental disability retirement benefits. His application was rejected as untimely.

Sukup, however, denied receiving any notice that his employment had been terminated or that his leave had expired. As the Appellate Division pointed out, there was no direct evidence that the County notified him of the termination of his employment.

Clearly, Retirement and Social Security Law Section 605(b)(2) provides that an application for disability retirement benefits must be submitted within 12 months after an employee is advised that his or her employment status had been terminated.

The Comptroller concluded that the two identical letters concerning COBRA benefits that the County sent to Sukup in 1995 indicating that his employment was placed on “non-payroll status” effective June 24, 1994 constituted notice “of the termination of his employment no later than October 1, 1995.”**

However, a notice of “non-payroll status” could simply mean that the individual has been placed on “leave without pay” rather than he or she is “terminated.”

In this instance the Appellate Division concluded there was significant confusion as to whether Sukup received any notice that his employment had been terminated. For example, although the COBRA application form relied upon by the Comptroller lists a number of possible reasons for a change of enrollment, including termination, none of the boxes is checked and no “reason” was indicated on the form.

Also, although the “Employee Final Clearance Form,” which is to be completed upon an employee’s separation from employment, signed by Sukup was date-stamped “September 25, 1995,” it was apparently actually signed by Sukup and five other County employees, including Sukup’s supervisor, on either August 16 or August 19, 1996.

Because of “the ambiguity, confusion and uncertainty created by the notices to Sukup advising him that he had been placed on “non-payroll status” and, more importantly, the “Employee Final Clearance Form” dated in August 1996, the court deemed Sukup’s February 1997 application for disability retirement was timely.

This ruling demonstrates the importance of the employer making certain that an individual on leave without pay is given complete and accurate information concerning his or her status as an employee.

* For the purposes of Section 71, an employee may be terminated after being absent on workers’ compensation leave for a cumulative period of one year. In Duncan v NYS Developmental Center, 63 NY2d 128, the Court of Appeals specifically considered “termination” under Section 71 and ruled that it was permitted.

** COBRA requires that employees who are covered by an employment-related health care plan are to be given the opportunity to elect continuation of such coverage after some qualifying event, including termination of employment [29 USC Section 1161].
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