Tara Reck, Managing L&I Attorney at Reck Law PLLC - Workers' Compensation Attorneys

Category: LNI Benefits (Page 1 of 16)

L&I Claim Overpayment: They Overpaid Me and Want Money Back, Now What?

The Department of Labor and Industries (L&I) sometimes sends overpayment notices to work injury claimants. Receiving one of these letters can be very stressful. The purpose of the notice is to tell you that you’ve been overpaid. And yes, they want their money back.


The reality for injured workers

When work injury claimants are unable to work, their income is automatically slashed by 40%. Clearly, this creates significant financial strain and stress. After all, the cost of living is always on the rise. Consequently, many workers have no choice. They live from check to check. In reality, many workers use wage replacement benefits in their entirety to pay for housing, food, and family care. Very often, injured workers must dip into their savings to make ends meet.


L&I claim overpayment

It feels like L&I is so stingy with paying benefits that overpayments can’t possibly happen. However, overpayments are very common. Most times, when overpayments occur, it’s not the fault of work injury claimants.


Overpayments can occur for many reasons. For example, because of clerical errors or identity mix-ups. They can also happen due to wrong data or adjudicator errors. One case is when L&I computes the wage rate incorrectly. Another is when L&I pays benefits even after the injured worker is released to work. Furthermore, there are instances where L&I reverses claim closure and must recoup a previous PPD award. That said, I’ve seen many cases where L&I tries to collect an incorrect overpayment. Therefore, it’s always important to double check everything. You must take steps and check if the L&I repayment demand is correct.


Repaying L&I overpayments and the law

Under RCW 51.32.240, L&I has the right to make a claim for repayment or recoupment of an overpayment. However, they only have one year form making of the overpayment to ask for money back. If L&I doesn’t make the claim within one year, then they waive their right to  recoup funds.


The one-year limitation doesn’t apply if there are issues of willful misrepresentation. More explicitly, willful misrepresentation is when a person obtains payments or other benefits under the Industrial Insurance Act after knowingly giving a false statement or misrepresentation. It also includes cases where people omit or conceal facts intentionally to receive benefits they shouldn’t get. Willful misrepresentation does happen. Yet, in my experience, L&I sometimes incorrectly accuses workers of willful misrepresentation. This is very common in cases of innocent mistakes.


L&I overpayment after willful misrepresentation

If an overpayment occurs due to willful misrepresentation, then L&I has three years. Here, the timer starts ticking when L&I discovers the willful misrepresentation. Then, they can also demand repayment plus 50% penalty. However, there are examples when L&I doesn’t claim the repayment within 3 years. In such cases, L&I automatically waives the right for repayments.


L&I claim repayment – summary

To conclude, overpayments in L&I claims are more common than you think. L&I has one year to make a claim to recoup overpayments. Although, if there’s been willful misrepresentation, then L&I has three years to make the overpayment claim.


Regardless, L&I sometimes makes mistakes when it comes to assessing overpayments. These mistakes happen because of miscalculations or timing issues. They can also occur when L&I incorrectly blames workers of willful misrepresentation. If you feel that L&I is incorrect, it’s always a good idea to consult with an experienced attorney right away.

Work Injury and Negligence in Workers’ Compensation and L&I Claims

The definition of negligence in Washington State is when someone doesn’t exercise ordinary care. What does that mean? In short, it means doing something that a reasonably careful person wouldn’t do. But, it can also mean the failure to do some act that a careful person would do under similar circumstances.


Negligence in personal injury

Workers’ compensation covers cases involving a work injury. The term personal injury is much broader. It also covers injury cases outside the workplace. Outside the workers’ comp ecosystem, a negligent person can be responsible for damages. For example, when a negligent driver injures another person and their property.


Here, the injured party can take the at-fault driver to court. There, they can hold the driver responsible for damages. More specifically, damages can be the actual costs of vehicle damages. On top, damages include all medical bills. However, damages can also be for things like the pain and suffering.


Negligence in a work injury

In Washington State, the Industrial Insurance Act governs workman’s comp claims. Under the law, negligence in workplace injuries is not an issue. In fact, when injuries happen at work, the law applies no matter who’s at fault. Moreover, the same goes for negligence. It doesn’t matter if the work injury happened because of the worker’s negligence. Similarly, the same rule applies if the employer or other workers were negligent. The only exception is when there’s a negligent 3rd party.


Therefore, when the Department of Labor and Industries (L&I) calculates the benefits under an L&I claim, then negligence isn’t a factor. The work injury claimant is covered by workers’ compensation and that’s it.


Injury and negligence – fact versus fiction

There are plenty of TV shows and movies about lawsuit and negligence. Hence, people are familiar with suing someone for damages. That’s one reason why many people who call my office after a work injury. Many focus the conversation on negligence. Between us – I’ve heard some truly terrible stories about employers and coworkers. If it wasn’t for workers’ compensation, I’m sure many would fall under negligence.


Here are some common examples:

  1. Employers not providing workers with proper safety equipment.
  2. Seriously hurt workers told to go back to work.
  3. After a serious injury, telling the worker to drive themselves to the hospital.
  4. Providing employees with old, faulty or broken tools.
  5. Coworkers engaging in horseplay at work causing injury to others, and
  6. Employers not taking safety hazard complaints seriously.


Frustration mounts

Understandably, this can be frustrating to work injury claimants. Workers are upset that there are no damages for negligence. Often, L&I will investigate safety violations and claim suppression. In some cases, L&I issues a fine. However, work injury claimants don’t receive additional compensation or damages for negligence. In fact, when I tell this to people that call me, many hang up in anger.


What’s the takeaway?

Negligence isn’t an issue in workers’ compensation. Therefore, it’s best to not waste your time and energy. Don’t argue about who’s at fault. There are still valuable claim benefits available for you. Most importantly, focus on getting better. Furthermore, make sure you get your benefits. They include:

  1. Medical treatment;
  2. Time loss compensation benefits;
  3. Loss of earning power benefits;
  4. Vocational services and retraining
  5. PPD awards;
  6. L&I pension; and
  7. Structured settlement or CRSA.

Focus on what matters. Get well. Go back to work if you can. And as always, please be safe out there!


Can I retire when I have an open L&I claim in Washington State?

Figuring out when to retire is always a big decision. Even if you don’t have an open workers’ compensation claim. However, retiring with an open L&I claim is even more complex. In fact, if you voluntarily retire while you have an open L&I claim, it can have serious impact on your L&I benefits.


Voluntary retirement during an L&I claim

The term Voluntary Retirement has a special meaning in workers’ compensation claims. Under WAC 296-14-100, you are “voluntarily retired” if:

  • You are not getting salary or wages from gainful employment; and
  • After your retirement, you don’t show any real attempts to go back to work.

Voluntary retirement can have negative effects on your L&I claim benefits. Specifically, under RCW 51.32.090(10), if L&I “determines that the worker is voluntarily retired and is no longer attached to the workforce”, then they won’t pay temporary total disability benefits. Moreover, under RCW 51.32.060(6), the same rule applies to permanent total disability benefits. That means, if a person voluntarily retires, they won’t receive L&I pension benefits.


Can I retire because of a work injury?

There are important nuances to the rules above. For one, a work injury claimant isn’t “voluntarily retired” when a proximate cause for their retirement is a workplace injury or occupational disease. What does it mean? If at least one reason for your retirement is directly because of your work injury, then your retirement isn’t “voluntary”.

Some people have severe disabilities because of their industrial injury or workplace illness. They can never return to work. These people may be eligible for an L&I pension. A pension is essentially a lifetime annuity. People that receive pension benefits under their L&I claim can also collect retirement money. Therefore, it’s usually better to make retirement decisions after L&I decides if you have permanent total disability.


Documenting your retirement reasons

However, delaying retirement isn’t always possible. Also, sometimes, it’s not practical. There are many reasons why people retire before L&I decides on permanent total disability. Unfortunately, in my experience, L&I usually assumes the retirement was “voluntary”. That is, if it happens while the claim is open and active. Yet, this assumption is often wrong. Many times, it’s not easy to decide if the retirement fits the legal definition of “voluntary retirement”. This is especially true when the retirement facts and circumstances are not well-documented.

Some people choose to retire while their claim is open. If the retirement has nothing to do with your work injury or disease, be ready to lose your time-loss benefits. Furthermore, you will not receive an L&I pension. But, if your decision to retire is based (at least in part) on the work injury or workplace illness, then you must document all claim-related reasons.


In summary…

If you retire with an open L&I claim, you’ll probably be giving up some benefits. You should seriously think about whether to retire while your workers’ comp claim is open. Make sure you understand the rules and consequences. I tried to explain some of the considerations in this article. However, retiring during an L&I claim is not a simple matter. Hence, I always recommend speaking with an experienced workers’ compensation attorney before making any retirement decisions.


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