February 07, 2014

State employer entitled to reimbursement by the Workers’ Compensation Board for personal leave credits used by State employee injured on the job


State employer entitled to reimbursement by the Workers’ Compensation Board for personal leave credits used by State employee injured on the job
2014 NY Slip Op 00153, Appellate Division, Third Department

A guard [Guard] at a State psychiatric center [Employer] suffered a work-related injury and his claim for workers' compensation benefits was approved. Guard was awarded benefits for the period July 2 until September 7. During that period Guard received his full salary, which included payment for five days of absence charged to his personal leave credits.

The Employer then requested reimbursement at the workers' compensation benefit rate for the advance payment of compensation* it paid to Guard during his disability, including for the time Guard charged against his personal leave credits. The Workers' Compensation Board ultimately ruled that Employer was not entitled to reimbursement related to Guard's use of personal leave credits and Employer appealed.

Here, said the court, personal leave credits, in contrast to sick leave credits, may not be accrued from year to year or converted into cash or retirement credits. In the opinion of the Appellate Division, Guard’s use of his personal leave time during his absence for disability did not result in a permanent benefit to Employer or a net detriment to Guard as Guard did not surrender "valuable vested rights" in return for the payment of full wages.

Rather, said the court, the denial of reimbursement for Employer’s payments related to personal leave credits would result in Guard receiving both full wages and compensation benefits for the time in question. Such a result is disfavored and requires that Employer be reimbursed for the personnel leave credits used by Guard.

The Appellate Division reversed the Board’s decision and remitted the matter  “to the Workers' Compensation Board for further proceedings not inconsistent with this Court's decision.”

* Workers' Compensation Law §25(4)(a) provides that, "[i]f the employer has made advance payments of compensation, or has made payments to an employee in like manner as wages during any period of disability, [the employer] shall be entitled to be reimbursed out of an unpaid installment or installments of compensation due." Citing Houda v Niagara Frontier Hockey, 16 AD3d 926, the decision notes that, "[a]n employer can be reimbursed for compensation paid to a claimant even if that compensation was paid in accordance with a contract or a collective bargaining agreement" and reimbursement must be awarded to the employer "unless such reimbursement would achieve a disproportionate result, either to the employer or employee"

The decision is posted on the Internet at:
http://www.nycourts.gov/reporter/3dseries/2014/2014_00153.htm
.