Avoid the Sinking Sand of ERISA in Workers' Compensation Cases
Workers' compensation cases can be very hard on injured workers. Though many injuries result in the inability to perform light duty or any accommodated job, companies dispute liability. This can result in no income for an extended period. What is the worker to do while they undergo treatment and needed care? What is the worker to do to get to the point necessary to ascertain if they can return to work? What is the worker to do while waiting for his workers' comp case to be resolved?
One option is a disability claim.
Many employers offer short-term disability and long-term disability to provide compensation for a worker if they become sick or injured and are unable to perform their occupation or perhaps any occupation. Rumors often circulate in a plant or workplace which discourage workers from filing such claims if they have been injured on the job. The rumor is that if you have a work injury you cannot file for short-term disability or long-term disability. But these rumors are often the result of misunderstanding or even misinformation.
It depends on the language of the plan document, which could be employer drafted or an insurance policy. The first order of business is to obtain a copy of both the short-term disability plan and the long-term disability plan. They are different. The injured worker can make this request to the human resources department or the person in charge of benefits. If the documents are not promptly received, then the request should be made in writing signed by the injured worker, or by the attorney representing the injured worker. Request the summary plan description and the full plan document for both short-term disability and long-term disability. If those documents are not forthcoming within 30 days, that may trigger a statutory penalty claim under ERISA (the Employee Income Retirement Security Act).
Many short-term disability policies exclude claims that are covered by workers' compensation. So, the rumor may be partially true. However, that does not necessarily mean that the long-term disability plan has the same provision. It is entirely possible for the long-term disability benefit to be available, while the short-term disability claim is excluded from coverage due to Worker’s Compensation. The reverse may also be true. I have seen this myself – both ways – many times.
Further, if liability is disputed as to the workers' compensation claim, who is to say that the short-term disability claim should be excluded? What if the employer is right? No one will actually know until the court rules. If the employer is correct, failure to file the short-term disability claim in a timely manner may bar it from being considered later. There are time limits in which the claim must be filed. Thus, the safest route is to file a claim if workers' compensation liability is not acknowledged. Then if the short-term disability claim is denied, it should be appealed. It could be necessary, depending on the plan, to file a second appeal.
After the entire claim procedure has been exhausted then the deadline for filing a lawsuit should be noted. That may be in the plan, and it could be 3 years or less. Do not assume a six-year statute of limitations. While admittedly all of this gets little complicated, exhausting claim remedies before filing a lawsuit is always prudent. If indeed the workers' compensation claim is one in which liability is admitted or the court finds liability, then the short-term disability claim does not need to be pursued further. But wait until that decision is made.