Advance in benefits paid for hardship don't count toward 78-week limit

In Georgia, a lump-sum payment of future income benefits to prevent extreme hardship is not subject to conversion into weekly income benefits paid to compensate for lost income in calculating the statute of limitation on reimbursement.

Case name: Subsequent Injury Trust Fund v. City of Atlanta, No. A11A0688 (Ga. Ct. App. 07/06/11).

Ruling: The Georgia Court of Appeals held that a city's claim against the subsequent injury trust fund for reimbursement of benefits paid was timely.

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What it means: In Georgia, a lump-sum payment of future income benefits to prevent extreme hardship is not subject to conversion into weekly income benefits paid to compensate for lost income in calculating the statute of limitation on reimbursement.

Summary: A worker for a city sustained a compensable work injury. He initially received his salary instead of workers' compensation benefits. Later, he began receiving temporary total disability benefits. Pursuant to an order by the board of workers' compensation, the city also paid him an advance of $12,000 to prevent extreme hardship, which was to be credited against the city's liability to pay permanent partial disability benefits in the future. After having paid 59 weeks of benefits, the city notified the subsequent injury trust fund of a potential claim for reimbursement. The fund denied reimbursement on the ground that the city's notice of its claim was untimely under the 78-week time limitation. In a case of first impression, the Georgia Court of Appeals held that the notice was timely.

The court found that the advance was not ordered to further compensate the worker for present lost wages. Therefore, the prohibition of a worker receiving PPD income benefits at the same time as temporary disability benefits was not violated. The court concluded that an advance of future income benefits paid due to extreme hardship, rather than to compensate for present lost wages, is not subject to conversion to the equivalent of weekly income benefits paid within the meaning of the 78-week limitation on the receipt of income benefits.

The court noted that if it found differently, advance payments made late in the 78-week period would deny most employers reimbursement of lump sums advanced in good faith. The court also said that a different result would contravene the "humane purpose" of workers' compensation.

Read more at the WorkersComp Forum homepage.

August 4, 2011

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