May 02, 2023

A self-insured city fire department not entitled to reimbursement for certain workers' compensation benefits it had paid to the claimant firefighter

The Workers' Compensation Board [Board] found a city fire department [Employer] was not entitled to an offset or reduction of workers' compensation benefits in a manner that would reduce the workers' compensation benefits due a firefighter [Claimant]. 

Although the Employer had contended that as a result of then receiving both workers' compensation benefits and accidental disability retirement benefits the claimant was being unjustly enriched, the Board held that the accidental disability retirement benefit payments that the Employer was making under General Municipal Law §207-a (2) to Claimant did not constitute wages within the meaning of Workers' Compensation Law §25(4)(a) and, therefore, there was no double recovery or unjust enrichment by Claimant. Employer appealed the Board's determination.

The Appellate Division rejected Employer's argument that either Workers' Compensation Law §25(4)(a) or §30(2) gave Employer the right to a credit, reimbursement and, or, reduction of workers' compensation benefits it had paid to Claimant.

Citing Matter of Harzinski v Village of Endicott, 126 AD2d at 58, the Appellate Division opined that the benefit payments the Employer made to Claimant pursuant to General Municipal Law §207-a(2) do not constitute wages within the meaning of Workers' Compensation Law §25(4)(a) or §30(2) because Claimant was not rendering any services to the Employer while accidental disability retirement benefits were being paid to Claimant.

In this instance Claimant had been awarded, and was then receiving, accidental disability retirement benefits. In addition, the firefighter received benefits pursuant to General Municipal Law §207-a (2), which, in pertinent part, provides as follows:

"... such firefighter shall continue to receive from the municipality or fire district by which he or she is employed, until such time as he or she shall have attained the mandatory service retirement age applicable to him or her or shall have attained the age or performed the period of service specified by applicable law for the termination of his or her service, the difference between the amounts received under such allowance or pension and the amount of his or her regular salary or wages."

Click HERE to access the decision of the Appellate Division posted on the Internet.