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Outrageous WorkComp Request
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Outrageous WorkComp Request
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For the first 90 days of a workcomp issue our organization pays 1/3 of the employee's pay. WC covers the other 2/3. After 90 days the employee's long term disability has to cover the 1/3 and we stop p
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Outrageous WorkComp Request
posted at 6/25/2011 5:12 PM EDT
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Posts: 6
First: 6/25/2011 Last: 8/30/2011 |
For the first 90 days of a workcomp issue our organization pays 1/3 of the employee's pay. WC covers the other 2/3. After 90 days the employee's long term disability has to cover the 1/3 and we stop paying. But...our finance person made an error and failed to stop paying him. Once we realized the error we had no choice but to remove 100 of his accrued sick leave hours and 70 of his accrued vacation hours to cover our losses. He claims it was our mistake and we should simply reinstate his lost leave hours and eat the loss. He claims that we should have notified him of his 90 day mark. We disagree. Can you believe what these guys try to pull? |
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Outrageous WorkComp Request
posted at 6/27/2011 5:52 AM EDT
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
I agree that your approach may not be legal. What I would suggest is that this may be considered inadvertant payments and if the employee is paid through direct deposit you could put through a debit for the amount overpaid.
If that does not work, advise the employee that you will be witholding the overpayment over a series of pay periods so as to minimize the cash flow effect. Check with legal counsel and always make sure that you have paid at least the minimum wage for any period he worked for you. |
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Outrageous WorkComp Request
posted at 7/5/2011 7:41 AM EDT
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Posts: 1
First: 7/5/2011 Last: 7/5/2011 |
In this case, they employee is in the right. You can not penalize an employee by taking vacation and sick time. The employee is out on Workers Compensation which is totally different than if the employee just went out on leave. You can tell the employee there was an error and he was overpaid and needs to payback the amount but you can't just go in and take his/her vacation & sick tome. |
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Outrageous WorkComp Request
posted at 7/6/2011 4:44 AM EDT
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Posts: 1103
First: 3/16/2007 Last: 8/19/2011 |
Leslie what is your documented support for that? Do you have some reference that declares this is definitely illegal and you cannot do this, or, are you simply suggesting that in some instances this may not be illegal? |
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Outrageous WorkComp Request
posted at 7/6/2011 1:57 PM EDT
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Posts: 17
First: 9/27/2005 Last: 7/10/2011 |
Legal is one aspect, fair is another. I'm not sure I understand fully. Did he get his LTD pay plus the company continuing to pay or did he never file for LTD and so wasn't overpaid, just paid by the company instead of LTD? Whichever it is makes a difference in my mind. If he wasn't overpaid, I can understand an employee not being too aware how the process was supposed to work without some notification by the company it was stopping 1/3 of his pay and he had to file. If he got both and was overpaid he should have noticed and asked, but either way, the company probably can't take the vacation as easily as the accrued sick time as there are employment standards in most places that could penalize that. If he wasn't overpaid I'd say the company should eat the mistake or at very least half of it and try to get the money from the LTD plan. If he was overpaid I'd be happy to hold back 10% of regular pay till the amount was paid back and only hold back accrued sick if he left before that... to the extent there isn't something here I'm missing. |
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Outrageous WorkComp Request
posted at 7/6/2011 3:13 PM EDT
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Posts: 6
First: 6/2/2010 Last: 7/6/2011 |
What should happen, but won't, is for the vacation and sick leave hours to be credited back to the employee on w/c. Then, the dollar amount of the overpayment should be deducted from the gross wages of the finance/payroll person (at a rate of at least $100/week) until the dollar amount has been recouped. Then the employee on w/c is satisfied and the payroll person is held accountable for his/her error.
But, I am sure that the company will NOT take that action. Thus, the employee may file a claim with the state agency that adjudicates wage claims and claim that the deductions were not lawful; and the company's defense will be that he was overpaid and the deductions were a reasonable and lawful way to recover the overpayment. And, the agency will resolve what should be resolved internally. Great employee relations strategy. |
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Outrageous WorkComp Request
posted at 7/7/2011 10:26 AM EDT
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
I think that both sides should own part of the error. But just because there is an error should not mean that the employee gets to profit from it! The employee should have been able to calculate that 2/3rds WC plus 1/3rd LTD plus 1/3rd ER didn't add up to 1!
That said, the current setup (obviously) has issues with how it is setup. It is very convoluted and I am a bit surprised that LTD will pick up wages from a WC case. I know there are differing LTD plans, but in a way the employer is just asking to make a mistake in a case like this where pay is coming from multiple buckets and needs to be integrated. PTO is generally not covered by federal law. It might be covered under the specific state law. Past that, it depends on the employer's policy. Hopefully for the employer's sake that policy is such that it allows for payroll mistakes to be redeemed using PTO. If it is not written, hopefully the employer could show a precedent. In the end, I think an employer would win a state wage claim, because the employee DID get those wages...just earlier or in a different way than expected/wanted. And it is generally up to the employer as to when/how PTO is paid out. It's not that the employer stole them away and gave nothing in return. The employee got the full value of the PTO time. I wish the OP had posted the state this occurred in though. |
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Outrageous WorkComp Request
posted at 7/9/2011 3:43 PM EDT
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Posts: 6
First: 6/25/2011 Last: 8/30/2011 |
Since this is my thread I should clarify:
The employee went out on WC. For 90 days, we pay 1/3 and WC pays 2/3 of his pay. After 90 days, WC still pays 2/3 but we stop. This is when the employee should file for LTD. The policy at that time would have covered the 1/3, this has been verified. We failed to stop our payment of 1/3 at the 90 day mark and once we realized it we recovered it from his accrued leave. He says that we are responsible for telling him when to file. He is associating our stopping of the pay (1/3) with the filing of his claim as one in the same. Isn't this like saying: "I only put my trash cans out when my neighbor does so when he forgets to put his out it is therefore his fault that my trash does not get picked up." If we hadn't made the error we could have held his hand and walked him through a process that was his to perform, but we did make an error. He did not recieve his LTD at all because he failed to file for it. If he had, all would be well. He could simply have reembursed us and we would have restored his leave. Everyone would have been even. I admit there was cause and effect here but is it really anyone's responsibility but the employee's to count to 90 one day at a time and then file for a LTD policy supplied by his benefits package? How is the employer legally at fault here? A thirty year old man does bear more responsibility than that of a child when it comes to understanding his own sources of income both primary and back up. Anything more we could have done for this man would have been beyond our responsibility and possibly set precedent for future employee's that don't take the time to understand their own benefits. |
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Outrageous WorkComp Request
posted at 7/9/2011 4:27 PM EDT
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
If he had a legitimate LTD claim, late filing does void the claim in my experience.
The coverage was paid for, the injury occurred the claim can be filed and paid. Please note that some LTD plans may exclude Worker's Comp claims, so this claim may not have been paid. If WC claims are not excluded he should protest this denial to the Plan Administrator and the state insurance board. Claims like this are not normally time barred except after a long period. |
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