The Interaction Between Workers’ Compensation and a State Disability Pension

As you may be aware, if you are injured while working, as a result of an occupational exposure, or a specific traumatic event, you are statutorily permitted to file for workers’ compensation benefits. In addition, if you are in a position that you are involved in the State pension system, you may be entitled to an accidental or ordinary disability pension.

Generally, if you are involved in a traumatic event at work that ultimately deems you unable to perform your duties any longer you may be entitled to an accidental disability pension. There is no minimal time of employment to be eligible for this pension. The jurisdiction as to whether you are disabled from your job duties as a result of the traumatic event rests with the Division of Pensions. However, the accidental disability pension may entitle you to in excess of 70% of your wages and family health benefits.

However, if you are approved for an accidental disability pension, there is a direct dollar for dollar offset for any workers’ compensation benefits you receive. This is to say, you may still file for workers’ compensation benefits, and may be entitled to benefits pursuant to same, but your pension benefits will be reduced by any recovery made. This, in fact, does not decrease your financial benefits, but merely may change from whom the money is received.

The law is different when a person involved in the State pension system is approved for an ordinary disability pension and that person also has an injury with permanent residuals in the course of his or her employment. In most cases, in order to be considered for an ordinary disability pension, you will have had to be in the State pension system for 10 years. This also may only provide a pension benefit of approximately 43% of your salary. As in the accidental disability pension, the decision as to whether you are disabled from your job duties rests with the Division of Pensions.

In New Jersey, there is a long standing public policy against double recoveries for the same injuries. In New Jersey, an injured employee may receive an ordinary disability pension and workers’ compensation benefits. However, the workers’ compensation benefits may be subject to a dollar for dollar offset for pension benefits.

However, an ordinary disability pension is generally not the result of one traumatic event that deems the worker unable to perform his or her duties, but generally is the result of numerous and varied disabilities that may or may not be work related, or related to the workers’ compensation injury. As such, there only exists an offset for those injuries incorporated in the approval of the disability pension and are specifically involved in the claim for workers’ compensation. In converse, the disabilities unrelated to workers’ compensation then are not included in the calculation of the offset.

As you can see, your choice as to whether to pursue workers’ compensation benefits when eligible for either disability pension is a difficult and law sensitive decision that should be reviewed with an attorney in depth.