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  1. #1
    Join Date
    Jan 2010
    Posts
    2

    Default Workmans Comp and Severance Pay

    I was hurt on the job and eventually let go. They paid me a severance. I went to court for my injury. Now my lawyer says my severance pay has to be deducted from my settlement amount. He says that is the law in Pa. Does anyone have any info on this law?
    Thanks!

  2. #2
    Join Date
    Feb 2007
    Location
    Calif
    Posts
    18,011

    Default Re: Workmans Comp and Severance Pay

    And who is supposed to get the severence pay once its deducted ?

  3. #3
    Join Date
    Jan 2010
    Posts
    2

    Default Re: Workmans Comp and Severance Pay

    I'm not sure. My lawyer said it is Pa. law if you got a severance it would be deducted from the settlement from Workmans comp. He implied it would go back to my employer. I still don't understand what my injury has to do with my severance. What about the taxes I had to pay on it?

  4. #4
    Join Date
    Feb 2007
    Location
    Calif
    Posts
    18,011

    Default Re: Workmans Comp and Severance Pay

    TIm Bell will be along shortly. But I'm confused too on how the employer paying a severence package would have affect on a comp settlement.

    WC indemnity is paid for your reduced earning capacity or ability to compete in the open labor market. The IC pays indemnity, not the ER. If you received a settlement and RTW, get terminated 2 weeks later... who gets the severence pay ?
    And you're right about the taxes...(?)

    Ask your atty for the statute he's relying upon..

  5. #5
    Join Date
    Dec 2007
    Location
    Tunkhannock, PA
    Posts
    1,103

    Default Re: Workman's Comp and Severance Pay

    My guess is that this is not a settlement, but rather an award of back benefits. If that is the case, your employer or the IC will normally be entitled to a credit for the pension money paid just like they would have if you were paid any other form of wages during this time period. As to how the taxes are dealt with, I have to admit that there have been several resent decisions on this issue, and I have not completed reading all of them, but I would push for the credit to be taken on net after taxes unless their lawyer could provide contrary authority.
    Timothy D. Belt, Esquire
    Helping injured workers in Northeast Pennsylvania.
    belt-law@belt-law.com
    www.belt-law.com

    DISCLAIMER: This post is intended as general information applicable only to the state of Pennsylvania. The information given is based strictly upon the facts provided. This post is not intended to create an attorney client relationship, or to provide any specific guarantee of confidentiality.

  6. #6
    Join Date
    Feb 2007
    Location
    Calif
    Posts
    18,011

    Default Re: Workmans Comp and Severance Pay

    Here is info on severence package payments http://www.portal.state.pa.us/portal...=553016&mode=2

    123.11. Application of offset for severance benefits.
    (a) Workers' compensation benefits otherwise payable shall be offset by amounts an employe receives in severance benefits subsequent to the work-related injury. The offset may not apply to severance benefits to which an employe may be entitled, but is not receiving.

    (b) The net amount of any severance benefits shall offset workers' compensation benefits on a weekly basis except as provided in subsections (c) and (d).

    (c) When the employe receives severance benefits in a lump-sum payment, the net amount received by the employe shall be divided by the weekly workers' compensation rate. The result is the number of weeks, and fraction thereof, the insurer may offset against future payments of workers' compensation benefits.

    (d) When an employe receives a severance benefit in the form of tangible property, the market value of the property, as determined for Federal tax purposes, shall be divided by the weekly workers' compensation rate. The result is the number of weeks, and fraction thereof, the insurer may offset against future payments of workers' compensation benefits.

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