TAKING MONEY FROM YOUR POCKET

Under Pennsylvania Law, an employer is entitled to a credit equal to 50% of any old age benefits against workers’ compensation benefits the employee receives.  If the employee was collecting old age benefits before the work injury occurred, the employer is not entitled to a credit.  This credit does not apply to social security disability benefits.

For example, if an employee receives $2,200.00 per month in workers’ compensation benefits and $1,100.00 per month in social security retirement benefits (old age benefits), the insurance company would be obligated to pay only $1,650.00 monthly. ($2,200-$1,100/2=$1,650.00)

In Caputo v. WCAB, an injured worker challenged this position, arguing that it was a violation of the Pennsylvania Constitution. The Court rejected the employee’s challenge. 

Bottom line:  Employers are entitled to reduce payments of workers’ compensation benefits by 50% of social security retirement benefits the injured worker receives.