Case Study: Workers’ Compensation Wage Benefit Dispute

This injured employee didn’t let the insurer push her around. See how our victim gets the workers’ comp pay she deserved.

Here we review a workers’ compensation lawsuit filed by an injured employee who was entitled to wage reimbursement while recovering.

The employee disagreed with the workers’ comp insurance company’s calculation of her wage benefit.

This case study is for educational purposes only. It is based on actual events, although names have been changed to protect those involved. Any resemblance to real persons or entities is purely coincidental.

We’ll review how the employee was injured, her disagreement with the insurance company, and the resolution of her lawsuit.

Our study concludes with a list of important points about workers’ compensation claims and wage benefits.

How the Employee Was Injured

Jackie Fremont worked as a food service employee for Quantity Services for more than two years. Quantity Services was a nationwide food service company with offices in all 50 states.

Quantity’s primary business was commercial catering, and the bulk of their business was catering for special events. Employees like Jackie worked as food servers during the special events.

Because Quantity’s local staff could not support some large events, Quantity Services often transferred groups of employees out of town to the site of the special event. When assigned, the out-of-town employees were paid a housing allowance in addition to their base wages and any overtime.

Out-of-town assignments often lasted 4 to 5 months. Employees on assignment rented hotel rooms, sometimes sleeping two to a room to save some of their housing allowances.

Transfers were on a voluntary basis only. Because some employees enjoyed traveling to various parts of the country, Quantity Services had little difficulty recruiting volunteer employees.

Fremont’s lived in New Jersey and worked for Quantity Services office in Hoboken. She enjoyed the travel and extra income from out-of-town assignments.

Fremont gladly accepted an assignment to Sarasota Springs in upstate New York that was expected to last for at least three months. This trip was her third extended travel assignment for the company.

Upon arrival in Saratoga Springs, Fremont and her fellow employees went to work. They usually worked from 7:00 in the morning until 7:00 or 8:00 in the evening, six days each week. Because Fremont was an hourly worker, she was paid time-and-a-half for any hours over 40 each week.

Fremont had been living and working in Saratoga Springs for almost two months. One day, while the team prepared for an event, a food-heating lamp exploded. As the lamp burst, shards of glass flew in all directions.

Although shards of glass hit some other employees, Fremont suffered the most severe injuries. When the lamp exploded, large and small bits of glass were projected directly into Fremont’s right arm. The glass cut her from her elbow to her shoulder and burned her hand and part of her arm.

Fremont was in terrible pain and shaking from the shock of the accident. Within minutes, paramedics arrived to treat the injured. Fremont was transported to the nearest emergency room.

Worker Injuries and Lost Wages

At the hospital, it took over an hour for the doctor to find and removed the jagged shards of glass from Fremont’s hand and arm. She was also treated for second-degree burns to her right hand and parts of her right arm. She remained in the hospital for two days for treatment and observation.

The treating physician told Fremont she was not to use her right hand for at least 90 days. Fremont’s hand and arm were bandaged and immobilized with a sling. She was prescribed pain revivers, antibiotics, and special ointment and bandages to treat the burns.

Quantity Services paid Fremont’s emergency room and hospital bill. They also arranged for another employee to fly with Fremont back to New Jersey.

Several days after returning home, Fremont filed a claim with Quantity Service’s workers’ compensation insurance carrier.

After filing her claim, Fremont was sent to one of the dermatologists on the employer’s approved list of treating physicians. After assessing Fremont’s burns and the healing progression, the dermatologist recommended that an approved plastic surgeon should treat Fremont.

When making the referral, the dermatologist made it clear to the insurance carrier and Fremont’s employer that she could not return to her work duties for a minimum of 90 days.

Fremont next consulted with the company-approved plastic surgeon. The plastic surgeon agreed with the dermatologist’s diagnosis and prognosis for Fremont’s recovery. The plastic surgeon confirmed in writing that Fremont would be unable to return to her work duties for at least 90 days, at which time she would be reassessed.

New Jersey worker’s compensation wage benefits are generally 70% of the injured worker’s average wage, not to exceed the maximum set by state law.

Fremont expected her wage benefit to be 70% of her weekly wages at the time of her injury. She was shocked and upset to learn the insurance company was going to pay her substantially less.

The workers’ compensation insurance carrier informed Fremont her Temporary Total Disability Benefit was based on her base hourly wages. Her benefit did not include income she had been receiving for her housing allowance and overtime in Saratoga Springs.

Fremont was adamant. She told the carrier and her employer she should not be unfairly deprived of her weekly wage benefits. Fremont said her injuries were not her fault and “but for” the employer’s hot lamps exploding, she would still be in Saratoga Springs, earning her wages, overtime, and the additional housing income she deserved.

The insurance carrier continued to base its benefit calculation solely on Fremont’s base hourly wage. Fremont refused to accept their decision and hired an experienced attorney.

The Workers’ Comp Lawsuit and Claim Resolution

Fremont’s attorney immediately filed a Formal Claim Petition with the New Jersey Division of Workers’ Compensation. The case was assigned to a Judge of Compensation.

Decisions made by a Judge of Compensation are legally binding and can only be appealed to New Jersey’s Appellate Division of the Superior Court.

Fremont’s attorney had years of experience practicing personal injury and workers’ compensation law in the state of New Jersey. He was well aware that many workers’ comp insurance companies took advantage of injured workers who depend on a weekly paycheck to make ends meet.

New Jersey Temporary Total Disability benefits are based on the employee’s average wage for the six months before the injury, including overtime and gas or housing allowances.

Fremont’s attorney used copies of her itemized pay stubs for the last six months to calculate her actual weekly earnings and the correct average wage amount for her workers’ comp benefit calculation.

Her attorney was also prepared to show that Fremont’s total earnings for the prior two years included consistent overtime pay with the frequent addition of a housing allowance.

The correct benefit amount was $350 per week more than the insurance company was currently paying to Fremont.

Fremont’s attorney copied the workers’ compensation insurance company on the calculations and documentation prepared for the trial.

Faced with Fremont’s strong case, the insurance company settled the dispute before trial by increasing her weekly benefit to the corrected amount and reimbursing the shortage in prior payments in a lump sum.

Important Points About Workers’ Comp Benefits

  • It’s up to you to file a worker’s compensation claim. If your employer says they’ve filed it for you, ask for copies of the paperwork.
  • Never rely on the insurance company to correctly calculate your workers’ comp wage benefits.
  • Workers’ compensation lawsuits are subject to strict statutes of limitations. If you miss the statutory deadline, you’ve lost your right to fight the insurance company.
  • Workers’ compensation insurance companies almost always fight extended Temporary Total Disability claims. Don’t wait to talk to an attorney if you believe you’re being treated unfairly.

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