Elgin Board of Education School District 4-26 v. Illinois Workers’ Compensation Commission, Et al., No. 1-09-3446WC
Linda Weiler worked for the Elgin Board of Education School District U-46. On November 13, 2002, she struck her right knee against a metal desk, aggravating an unrelated condition for which she had just one week before undergone surgery. This cause hemiarthrosis, blood in the knee joint, which caused inflammation. While off work, Weiler received salary. At trial, the School District attempted to introduce a “sample letter” which informed employees that unless directed otherwise by the employee, employees would be charged sick leave and receive full pay for absence due to a work-related injury. Once accumulated sick leave was exhausted, the employee would be placed on TTD benefits. The arbitrator sustained Weiler’s objection to the admission of the letter. Notwithstanding this, the arbitrator granted credit for the salary paid to the extent the School District was liable for TTD pursuant to Section 8(j)2 of the Act.
The Commission modified this decision, relying on a prior case, Tee-Pak, Inc. v. Ind. Comm’n., where it was held that an employer can receive no credit for benefits which would have been paid irrespective of the occurrence of the workers’ compensation accident. The Commission noted that Weiler had to utilize her sick pay in order to receive TTD benefits. Also, use of earned sick pay impacted her retirement benefits. The Commission affirmed the arbitrator’s ruling disallowing the “sample letter” and denied credit for payment of full salary in lieu of TTD benefits.
The Appellate Court reversed, allowing credit for wages paid in lieu of TTD benefits. Section 8(j) provides that:
“1. In the event the injured employee receives benefits…under any group plan covering non-occupational disabilities contributed to wholly or partially by the employer, which benefits should not have been payable if any rights of recovery existed under this Act, then such amounts paid to the employee…as shall be consistent with, and limited to, the provisions of paragraph 2 hereof, shall be credited to or against any compensation payment for temporary total incapacity for work…. This paragraph does not apply to any payments made under any group plan which would have been payable irrespective of any accidental injury under this Act….
“2. Nothing contained in this Act shall be construed to give the employer or the insurance carrier the right to credit for any benefits or payments received by the employee other than compensation payments provided by this Act, and where the employee receives payments other than compensation payments, whether as full or partial salary, group insurance benefits, bonuses, annuities or other payments, the employer or insurance carrier shall receive credit for each such payment only to the extent of the compensation that would have been payable….”
The employer has the burden of proving entitlement to a credit under 8(j).
The court interpreted the first clause of Section 8(j)2 to mean that an employer is entitled to a credit only for compensation payments made pursuant to the Act. But, the second clause states that when an employer pays money other than compensation payments, the employer “shall receive credit for each such payment,” thus qualifying the first clause of Section 8(j)2. This interpretation was rejected in Tee-Pak where credit was disallowed for benefits which would have been paid irrespective of the occurrence. In Tee-Pak, the employer failed to show that the salary payments the employee received were limited to occupationally-related disabilities and thus the claim for credit was denied. Therefore, the employer was not entitled to a Section 8(j) credit.
The court distinguished Tee-Pak from the present case. In Tee-Pak, there was evidence which indicated that the employer intended its employees to collect both TTD and salary for the same period of time. But unlike Tee-Pak, there was no evidence that the School District intended for its employees to collect both salary and TTD. Therefore, the limits placed on Section 8(j) in Tee-Pak did not apply, and the court held that the School District was entitled to credit for salary paid, but only to the extent of its TTD liability.
COMMENT: The right to a credit exists only if provided by the Act. Further, the assertion of a Section 8(j) credit will be narrowly construed. The employer must offer evidence which establishes the employer’s policy that it is not intended that employees receive both TTD and salary during the period off work following an occupational injury. Here, the employer had a clear policy in place giving employees the option of receiving salary or TTD. Without the “sample letter,” it is arguable that the court would have affirmed the Commission and denied the credit. Mere payment of salary without proof of the employer’s policy permits an inference that employees can collect both salary and TTD.
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