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NO. 150.  AN ACT RELATING TO DISABILITY RETIREMENT BENEFITS FOR STATE EMPLOYEES.

(S.51)

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  FINDINGS; INTENT

(a)  The general assembly finds that:

(1)  The disability retirement system for state employees found in chapter 16 of Title 3 requires an injured employee to choose between disability retirement benefits and workers’ compensation benefits for temporary disability (pursuant to chapter 9 of Title 21).  Eligible employees, who wish to collect disability retirement benefits to provide a stream of income while they are unable to work and who want to continue their health care coverage are required to forfeit their right to appeal the denial of their workers’ compensation benefits.

(2)  The disability retirement system for state employees found in chapter 16 of Title 3 requires a catastrophically injured employee to choose between disability retirement benefits and permanent total workers’ compensation benefits beyond 330 weeks, up to lifetime (pursuant to chapter 9 of Title 21).  If a workers’ compensation claim is denied and the employee has to accept disability retirement to have an income while he or she appeals the workers’ compensation claim, the employee would be waiving significant future workers’ compensation benefits with no ability to choose the higher workers’ compensation benefit if the claim is ultimately determined to be compensable.

(b)  By this act, the general assembly intends to allow an eligible employee to accept disability retirement benefits during the pendency of the employee’s compensation appeal.  Upon resolution of the workers’ compensation claim, the employee would either continue in the disability retirement or resume his or her employee status and receive workers’ compensation benefits which the employee would have received if the claim had been accepted at the outset.  While an employee will still waive access to workers’ compensation benefits under Title 21 in excess of 330 weeks if the employee chooses to accept disability retirement benefits, this waiver applies only to the period after 330 weeks of permanent partial or permanent total disability benefits have been paid.  An employee may receive both disability retirement and permanent partial or permanent total benefits under the workers’ compensation system for up to 330 weeks. 

(c)  By this act the general assembly does not intend to enable the concurrent receipt of retirement disability benefits and temporary workers’ compensation disability benefits or permanent total benefits beyond 330 weeks.


Sec. 2.  3 V.S.A. § 466 is amended to read:

§ 466.  OFFSETS Coordination of disability retirement

             benefits with workers' compensation BENEFITS

Acceptance of disability retirement benefits under this chapter shall act as a waiver of any additional claim under sections 642 or 646 of Title 21 or any additional claim for benefits in excess of 330 weeks under sections 644 and 645 of Title 21.

(a)  Disability pension and annuity retirement benefits payable under this chapter shall not commence until workers' compensation benefits have been exhausted under section 642 or 646 of Title 21.

(b)  Notwithstanding subsection (a) of this section, disability retirement benefits payable under this chapter shall be paid to a member who applies for and meets all of the eligibility criteria for disability retirement under section 460 or 461 of this title, has filed a claim for temporary disability workers' compensation benefits under section 642 or 646 of Title 21, and for whom no such benefits have been or are being paid pursuant to any of these sections.  If the disability retiree receives temporary workers’ compensation benefits pursuant to section 642 or 646 of Title 21, disability retirement pension and annuity benefit payments shall cease immediately and the retiree shall be immediately restored to his or her employment position and status as existed immediately preceding separation from service as an employee, including restoration of all benefits that existed at that time.  Acceptance of disability retirement benefits prior to being restored to state service shall not act as a waiver under subsection (d) of this section.

(c)  No employee shall concurrently receive both disability retirement benefits payable under this chapter and workers' compensation benefits payable under section 642 or 646 of Title 21.  If an employee receives disability retirement pension and annuity benefits and later receives an award for temporary disability workers’ compensation benefits for the same period, the Vermont state retirement system shall have a lien against any retroactive workers' compensation award under section 642 or 646 of Title 21 for the same period that the employee received disability retirement benefits in the amount of the disability retirement pension and annuity benefits paid.  Any recovery under section 642 or 646 of Title 21 against the employer or the employer’s workers' compensation insurance carrier shall, after deducting expenses of recovery, reimburse the Vermont state retirement system for disability retirement pension and annuity benefits for all retroactive periods of time included in the recovery.  The state treasurer shall notify the department of buildings and general services when a disability retirement application is approved for an employee who has filed a workers’ compensation claim.  The department of buildings and general services or its workers’ compensation insurance carrier shall notify the state treasurer of commencement or termination of any workers’ compensation payments or awards to an employee who has been reported by the state treasurer as eligible to receive disability retirement benefits. 

(d)  An employee who chooses to accept disability retirement benefits payable under this chapter, except as otherwise described under this section and subsection (b) of this section, shall waive any claim for benefits in excess of 330 weeks under sections 644 and 645 of Title 21.  Under this subsection, an employee may receive permanent disability benefits under chapter 9 of Title 21 and disability retirement benefits under this chapter simultaneously for up to 330 weeks.  Prior to actual payment of disability retirement benefits, the disability retiree shall make an election of what benefit he or she wants to receive after 330 weeks by indicating on a form provided by the state treasurer at the time of application.  The form shall advise the disability retiree in conspicuous print that he or she may wish to consult with legal counsel prior to making the election.

Approved:  May 16, 2006



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us