Commonwealth Court Makes Clear There is No "Grace Period" for Employers to Make Timely Payment
In this Commonwealth Court decision filed on May 17, 2007, the Court finds, in conjunction with recent decisions, that there is no "grace period" for the employer to make timely payment on settlement payments for an injured worker. For a full-text of the decision, click here.
On 10/18/2004, the client in the case settled their case through compromise & release, and the decision was circulated on the same date. On 11/5/2004, the settlement checks are issued, but the client's check is not signed by the insurance carrier and is, therefore, not negotiable. The client's attorney returned the check to the carrier, and the carrier received the check on 11/10/2004. On 11/18/2004, the client files a penalty petition for failure of the carrier to re-issue the check within 30 days. The insurance carrier finally re-issued the check on 11/22/2004. In this case, since the insurance carrier did not fulfill the obligation of issuing payment within 30 days of the decision, the Workers' Compensation Judge awarded the client a 5% penalty that was confirmed by the Workers Compensation Appellate Board and the Pennsylvania Commonwealth Court.
This decision affirms that the 30-day deadline to issue payment in a compromise & release is clear, and there is no excuse for the untimely issue of checks by insurance carriers.
