Commonwealth Court Issues Ruling in Social Security Offset Case

Date: April 16, 2008
Posted In: DLP Law

In Maxim Crane Works v. W.C.A.B. (Solano),931 A.2d 816 (Pa.Cmwlth.2007), the Court addressed the applicability of a retroactive offset of the Claimant’s workers’ compensation wage loss benefits based upon his concurrent receipt of Social Security “old age” benefits. Section 204(a) of the Pennsylvania Workers’ Compensation Act (“the Act”), 77 P.S. § 71(a), provides that fifty percent of the benefits commonly characterized as “old age” benefits under the Social Security Act (49 Stat. 620, 42 U.S.C. § 301 et seq.) shall be credited against the amount of the workers’ compensation payments provided that the Social Security benefits were received after the compensable injury. The offset shall not apply if old age Social Security benefits were received prior to the compensable injury per the provisions of Section 204(a) of the Act.
The Claimant, Solano, was injured on October 10, 2000. On June 6, 2005, Claimant received Form LIBC-756 “Employee’s Report of Benefits for Offsets” from the employer. Claimant completed the form and confirmed his receipt of old age Social Security benefits. On August 3, 2005, Claimant received Form LIBC-761 “Notice of Workers’ Compensation Benefit Offset”, notifying him that the employer was taking a credit that would offset his weekly workers’ compensation benefits, and that a credit from 14 months of prior old age Social Security benefits would also be recouped, reducing his weekly workers’ compensation benefits to zero for a period of 25.75 weeks. On August 16, 2005, Claimant filed the Petition to Review alleging that the offset was calculated in error.
In deciding the case, the Commonwealth Court has held that while the Claimant owed a duty to report receipt of old age Social Security benefits, the regulations placed the initial duty upon the employer or insurer to notify claimant of the reporting requirements and to provide the Claimant with the proper forms. Therefore, the employer was only entitled to an offset for old age Social Security benefits as of the date that claimant received the form notifying him of his duty to report his Social Security benefits. The Court further noted that the equitable doctrine of laches applied so as to disallow a retrospective offset for workers’ compensation claimant’s receipt of old age Social Security benefits. The employer had an obligation to notify claimant of claimant’s reporting requirements under the Workers’ Compensation Act in order for employer to secure an offset. However, the employer did not notify claimant of the reporting requirements until nearly five years after Claimant’s work injury and over two years after Claimant had begun receiving workers’ compensation benefits. In essence, the Court held that the employer could not sit on their rights and expect to recoup a retroactive overpayment.

Thomas P. Cummings, Esq.
Dougherty, Leventhal & Price
75 Glenmaura National Blvd.
Moosic, PA 18507
(570) 347-1011

Joe Price
Attorney Joe Price is a seasoned Trial Lawyer serving Northeast, Central and Southeast Pennsylvania for the past forty (40) years. He has handled serious personal injury cases in courts throughout the Federal system including New Jersey and New York. Attorney Price is A.V. Rated by Martindale Hubble. He is Board Certified in Civil Practice by the National Board of Trial Advocacy since 1996.