Double Dipping—Still a Faux Pas
The Maryland Court of Appeals recently affirmed the lower court’s decision in Spevak v. Montgomery County, finding that a Maryland firefighter was not entitled to the full amount of permanent partial disability benefits awarded in 2017 after developing occupational hearing loss related to his employment. A dispute arose regarding an offset since the retirement benefits he received were for a different condition altogether.
Service-connected total disability retirement benefits and permanent partial disability benefits are considered “similar benefits” and thus subject to the offset provision of Md. Code Labor and Employment Article § 9-610.The Court of Appeals noted that the firefighter had already received “similar benefits” when he was compensated for injuries to his back as part of a service-connected disability retirement package in 2010. The amount awarded to the firefighter by the Workers’ Compensation Commission for occupational hearing loss in 2017 was able to be offset by the number of benefits received in 2010 through the service disability retirement package. This is true despite the fact that the injuries were completely different in nature. The Court of Appeals noted that the Maryland General Assembly intentionally sought to preclude employees from receiving duplicative recovery at the taxpayers’ and State’s expense. Further, the Court of Appeals noted that the service-connected total disability retirement benefits in this case compensated the recipient for all injuries related to the recipient’s service.
The Court of Appeal’s decision should be greatly appreciated by insurers of government employers, or self-insured employers, across the State of Maryland because it reduces their exposure to permanent partial disability awards issued by the Workers’ Compensation Commission. Insurers should now be able to offset any amount of benefits government employees have already received as part of their disability retirement packages from any permanent partial disability benefits awarded by the Workers’ Compensation Commission. The decision also allows insurers to more accurately and predictably assess what amount of future exposure they may have to permanent partial disability awards.
George Sfikas
** amendments effective October 1, 2023, have reversed the legal outcome in this case