If you’ve suffered a workplace injury and you are nearing retirement age, you’re probably wondering how workers’ comp benefits are affected by retirement. Like anything in life, the answer to this question is complex and depends on a multitude of factors.
Factors like the nature of your retirement and the kind of benefits you are receiving all determine whether you lose or keep benefits. This post will demystify some of the more complicated interactions between retirement and workers’ comp benefits. But, before we dig in, we’ll have to define some terms and cover some basics.
Am I Retiring Voluntarily, or Is My Retirement Forced?
The nature of your retirement affects whether or not you get to keep some worker’s compensation benefits. Whether or not your retirement was forced or voluntary, a worker’s compensation lawyer can help you retain certain disability benefits.
Voluntary Retirement
Voluntary retirement is ‘retirement as usual’ and is initiated by the employee. When an employee voluntarily retires, they waive their eligibility to receive some worker’s compensation benefits they may have been entitled to while employed.
Forced Retirement
Forced retirement is when an employer forces an older employee to retire early. There are several reasons why an employee may be forced to retire, ranging from disability and poor health to a business’s financial need to downsize. Being forced to retire has its own causes for litigation, but, as it pertains to disability benefits, an employee may be able to retain more workers' compensation benefits if forced into retirement.
The Gray Area Between ‘Forced’ and ‘Voluntary’
Readers will surely know by now that there is a gray area between forced and voluntary retirement. In a 1986 amendment to the Age Discrimination in Employment Act, mandatory retirement at a set age was abolished for most jobs in the US.
As a result, age discrimination in the workplace has grown covert. For example, companies might offer tempting early retirement packages that expire if they are not acted on quickly as a way of ‘forcing’ employees to ‘voluntarily’ retire.
What Kind of Worker’s Comp Benefits Last Through Retirement?
Certain workers’ compensation benefits can last past retirement, but whether or not it’s possible depends on what kind of disability you have. Workers’ compensation benefits can vary depending on whether or not an employee’s disability is considered temporary or permanent.
To sum it up briefly, a temporary disability is one that an employee can recover from. If they have suffered a temporary disability, they can expect to return to work after a doctor’s approval. Examples of injuries classified under temporary disability are back injuries, overuse injuries, or any other injury that a person can recover from. Temporary disability benefits will not last past retirement.
A permanent disability permanently impacts an employee’s ability to work. These injuries are more severe, such as the loss of a limb or injury-induced blindness. Permanent disability benefits are designed to cover the loss of function of a limb, an eye, or other vital parts of the body. Permanent disability benefits can last past retirement on a case-to-case basis.
You Lose the ‘Wage Loss’ Benefit When You Retire
As the name implies, the wage loss benefit is designed to cover lost wages an employee misses while unable to work. If you are on disability and receiving the wage loss benefit, you’ll need to remain employed to keep receiving it. It is recommended that employees on disability wait for their workers’ compensation case to resolve before seeking retirement.
Your Injury-Related Medical Bills Are Still Covered Past Retirement
If you retire while on disability, your employer is still responsible for paying your medical bills past your official retirement date if those medical bills are related to the treatment of your workplace injury.
Can You Retire While Still Receiving Worker’s Compensation Benefits?
We have explored many instances where certain workers’ compensation benefits can follow you past retirement. Depending on the type of retirement you experienced and the nature of your workers’ compensation benefits, it is possible to retire and retain certain benefits.
For more tips and information regarding retirement plans, contact us.
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