Workers Comp – No offset for certain employer funded disability pension payments per KRS 342.730(6): ALCAN ALUMINUM CORP. V. STONE (COA 2/8/2008)

ALCAN ALUMINUM CORP. V. STONE
WORKERS COMP:  No offset for certain employer funded disability pension payments per KRS 342.730(6)
2007-CA-001677
PUBLISHED: AFFIRMING
PANEL: VANMETER PRESIDING JUDGE; NICKELL AND THOMPSON CONCUR
COUNTY: WCB
DATE RENDERED: 2/08/2008

Stone was totally occupationally disabled due to a cervical injury sustained while working for Alcan. At that time, Alcan had three retirement plan options: normal, early and full disability. Under the normal retirement plan, at age 65, an employee could retire and receive a defined benefit calculated by a dollar amount times years of service. Under the early retirement plan, an employee who had reached the age of 60 could retire and receive a discounted amount. The full disability retirement plan available to an employee who met certain medical criteria, was calculated similarly to the normal retirement benefit, without the discount for early retirement. In this case, Stone opted to receive $990.54 per month in disability retirement benefits, which is 15% more than he would have received under early retirement.

Under KRS 342.730(6)(Determination of income benefits for disability — Survivors’ rights — Termination — Offsets — Notification of return to work), an offset is allowed against workers’ compensation benefits for income benefits paid from certain employer-funded disability or accident and sickness plans. When Jackie Stone ceased working for Alcan Aluminum due to a total, permanent disability, he elected to receive benefits under Alcan’s disability retirement benefits plan. The issue is whether the benefits paid to Stone under the plan met the requirements of KRS 342.730(6). COA affirmed the Workers’ Compensation Board’s opinion which held Alcan should receive an offset only for the amount that Stone’s disability pension exceeds the pension to which he would have been entitled under Alcan’s early retirement.

Michael Stevens

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