Reimbursement to Employer in a Work-Related Injury Case

Many employers continue to pay wages to an injured employee even though he has stopped working and applied for compensation. Most statutes provide that if a continuation of wages was intended to be in lieu of compensation, the employer is entitled to be reimbursed out of an award to the employee when it is made. The employer must file his request for reimbursement. If an employer does submit such request and his company fails to protect him by neglecting to have the award for reimbursement, the employer can look to the company for reimbursement even though the full benefits have been paid to the employee.

Determination of Wage Earnings Capacity

The degree of disability in most states is estimated by comparing actual earnings before the injury with earning capacity after the injury. In many cases the actual wages earned by the injured worker after his return to work is held to be determinative of his wage earning capacity. This is calculated by taking the payroll of the injured employee for the year prior to the accident and averaging them on a weekly basis.

Some statutes provide for average monthly wages before the accident. Basically, the setting of post-injury earning capacity is a more difficult problem. No question exists if there is total disability. However, the difficulty arises when partial disability is present. If there are no earnings after the injury, the medical evidence must be evaluated and interpreted by the referee in order for him to establish a theoretical earnings capacity which produces an average weekly wage loss.

Where the actual post injury earnings are used to fix a wage-earning capacity, it is the obligation of the company to prove any reservation it might have as to the amount due the employee. In other words, the company might have reason to believe that the actual wages earned are not the full wages which the claimant could reasonably earn. The theory here is that the claimant might be taking employment on a part time basis, or otherwise limiting his work capacity, in order to obtain higher Worker’s Compensation benefits than he merits. These higher benefits, plus the salary from his job, plus the easier working schedule because of the combined income, induce some claimants to misrepresent their working capacity.

In order to halt the benefits or to bring them in line with the actual income producing ability of the claimant, the company must prove that the injury claimant had been offered work at a better salary and had rejected it. Or, the company must prove that the claimant could secure and is capable of carrying on other work with greater salary.