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Voluntary Withdrawal and Workers' Compensation Benefits

Carriers over the last several years have developed a new weapon to avoid paying money to those claimants who are out of work. Recent legal cases on the issue of voluntary withdrawal give employers and workers' compensation carriers more leeway to deny benefits to injured employees.

Voluntary Withdrawal

Not so long ago, a worker whose doctor reported that the worker had a medical condition rendering the worker unfit to return to the prior employment meant the worker was entitled to compensation. That's not necessarily so now, thanks to the carrier defense of voluntary withdrawal. This is how voluntary withdrawal works. The insurance company can contend that the worker must look for other work and if they don't think the efforts are enough, they can ask the Judge to stop the payments. The Judge then decides whether the job search has been sufficient. And, each judge may have a different idea about what is a fair search.

Two categories, partial and total disability, classify a worker's disability and the corresponding benefits he or she receives. Workers with total disabilities are not able to earn any wages because of the limitations imposed by their disabilities or injuries. These totally disabled workers do not have to seek work. However, it is extremely difficult to have a disability in New York workers' compensation that would qualify as total. Workers with partial disabilities experience some limitations but are able to work, perhaps part-time or by doing lighter work than they previously did. Workers with partial disabilities are required to make good-faith efforts to return to work after their injuries in order to receive workers' compensation benefits.

So, for example, a cook who has worked his whole life as a cook and who cannot stand for too long, must suddenly start to look for work for which he has no training nor experience or risk having the insurance company apply to the a Judge to completely stop the benefits. And, even if the worker, in this case a cook, is able to convince a Judge that he looked for work and couldn't find any, the dollar amount of money awarded may still be reduced even though he was unable to find a new job.


"Voluntary" Definition

In recent years, the definition of voluntary withdrawal has been in flux. Now, however, two recent cases from the New York Appellate Division offer some hope that in some circumstances, workers with permanent partial disabilities may not have to prove they are seeking employment to avoid suspension of their benefits.

The Zamora Case

The first case, Zamora, was decided by the Third Department of the New York Appellate Division in December 2010. In that case, Ms. Zamora was injured at work when she was hit by a falling computer screen in 2003. As a result, she suffered permanent partial disability and received workers' compensation benefits. Ms. Zamora left her job in 2007, causing her employer and its workers'-compensation carrier to challenge her ongoing payments by contending she had voluntarily withdrawn from the workforce.

When the Workers' Compensation Board reviewed Ms. Zamora's case, it determined that, even though she had not voluntarily withdrawn from the workforce when she left her job, her efforts to find new employment after that were insufficient, and it suspended her benefits.

Ms. Zamora then appealed the Workers' Compensation Boards' decision. The appellate court ruled that, because the Board found that Ms. Zamora was permanently disabled and had not voluntarily withdrawn from the labor market, the employer and its workers'-compensation carrier had the burden to then prove that her subsequent lack of employment was the result of factors unrelated to her disability. Only then could they discontinue her workers' compensation benefits. This decision seems to be laying out a rule that once a worker is found to have a permanent partial disability and has continued to make appropriate efforts to find work, the insurance company at that point will have the almost impossible task of proving that the sole reason the injured worker is out of work is due to the workers' failure to seek employment.

The Funke Case

The second case, Funke, expanded on the Zamora decision in a January, 2011 opinion. In Funke, a teacher's assistant suffered work-related injuries in 2005. In 2009, Ms. Funke retired but continued to work as a substitute teacher's assistant on days she was physically able to do so. The Workers' Compensation Board determined that her retirement was caused by her disability and therefore involuntary; but, it also denied her application for post-retirement benefits because it found that her loss of earnings was caused by factors other than her disability. Ms. Funke appealed.

On appeal, the court reiterated the long-standing rule that at the time the Board rules the injured worker has a permanent partial disability, a retirement is an involuntary withdrawal if the worker's disability caused or contributed to the decision to retire. Supporting the Board's finding that Mr. Funke's retirement was involuntary, the court also stated that it is the duty of the employer and workers'-compensation carrier to prove that the retirement was not caused by the disability before terminating payments.

Moreover, the court said, once a withdrawal is deemed involuntary, it is inherently inconsistent to require an injured worker to search for work within his or her medical limitations. Therefore, proof that an injured worker has not sought work after retirement does not satisfy the employer's and workers'-compensation carrier's duty to show the benefits were denied for reasons other than the worker's disability.

Keep Searching Until You Receive Legal Advice

These cases mean that injured workers who have declared to have permanent injuries by a judge are not always obligated to seek new employment after occupational injuries. However, because no cases are exactly the same, people with work-related disabilities should consult an experienced workers' compensation attorney before discontinuing their job searches. If you have questions about workers' compensation or social security disability benefits or your rights and obligations after an on-the-job injury, contact a knowledgeable workers' compensation lawyer in your area.

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