The Legislature and Governor recently enacted and signed into law legislation which eliminates the sick leave injury program upon the conclusion of the state collective bargaining agreement for state employees.
For many years State employees benefited from the program that guarantees them full salary for up to one year from the date of a work related injury. This coverage traditionally has started from the first day of the injury, and has included days or parts of days which may be taken for medical treatment related to that work related injury. All of that has now come to an end.
Instead of receiving sick leave injury benefits, State employees will be eligible for traditional workers’ compensation benefits administered through the Bureau of Risk Management of the Department of Treasury. Workers’ compensation benefits are payable at 70% of one’s gross weekly wage up to a maximum for the year 2010 of $794.00 per week. No taxes are deducted from workers’ compensation benefits and all non contributory benefit costs are still paid by the employer to Pensions and Benefits. Any premiums payable by the injured worker for benefits such as dental insurance coverage, or pension loans, are either deducted from the workers’ compensation check or billed separately. Any dispute over workers’ compensation benefits would go to the New Jersey Division of Workers’ Compensation.
This creates several problems for State employees. First, workers’ compensation benefits are paid at a maximum of $794.00 per week. This means that anyone earning over $59,000 per year will not receive full compensation for their lost time. Second, in order to qualify for workers’ compensation, an injured worker must be out of work at least seven days. Any lost time injury of less than eight days would simply be chargeable to the workers’ sick time. Because of the way workers’ compensation benefits are calculated, it appears those days will be lost and not recoverable. Worse still, workers’ compensation does not pay for days or part of days taken for medical treatment due to a work related injury. Those will be charged to the individual’s sick time.
The Administration of payments of workers’ compensation benefits is done by the Bureau of Risk Management of the Department of Treasury. All decisions regarding the payment of workers’ compensation temporary disability will be made by the Bureau of Risk Management and not by the respective departments. Because of the waiting period, workers’ compensation benefits will not be payable for at least three weeks from the date of the injury. It is clear that this change will result in accumulative loss of sick time by State employees. It will result in delays in receiving benefits as well as other financial losses because of the limitations on benefits.
Elimination of Disability Pensions
This same legislation will eliminate both the accidental disability pension as well as the ordinary disability pension for members of the Teachers Pension and Annuity Fund as well as new employees enrolled in the Public Employees Retirement System after the effective date of the bill.
Traditionally, members of all of the State Pension Systems were eligible for an accidental disability pension in the amount of 72.3%, if as a result of their employment, they suffered an accident which is the sole cause of their inability to work. The ordinary disability retirement allowed for the payment of 43.6% of salary as well as retiree medical in the event that a member of either pension system became disabled from performing their job and had 10 years of service. Both these pensions will end for new enrollees and will be replaced by a disability insurance plan. This new law limits enrollment in the disability insurance plan to new employees under the age of 60. It will pay benefits until the age of 70 if the disability commenced prior to age 60.
Under this new plan, a public employee will be considered totally disabled if he is unable to perform the duties of his occupation. There is an additional requirement that after 12 months following the commencement of disability, a public employee will only be eligible for benefits if he is unable to engage in any gainful employment. There are other limitations as to eligibility as well.
This new limitation in benefits will result in many injured workers who are unable to return to work, being forced out of their jobs with no benefits. This applies particularly to people whose jobs required heavy physical exertion and who have suffered a physical injury.