Reversed: Imposition of An Additional Penalty of a Workers’ Compensation Settlement Due to Delay in Payment
Docket No.: A-2972-20
Decided June 3, 2022
Submitted by New Jersey Workers’ Compensation Lawyer, Jeffrey Hark.
In a recent published decision, the Appellate Division of New Jersey reversed the imposition of an additional penalty of a Workers’ Compensation settlement due to delay in payment.
In Ripp, Louis Ripp worked for the County of Hudson (the County) as an assistant chief engineer/boiler operator and injured his back in a workplace accident on February 11, 2013. Ripp filed a petition with the Division of Workers’ Compensation (the Division) in June 2013, seeking benefits under the Workers’ Compensation Act (the WCA), N.J.S.A. 34:15-1 to -142; the County filed an answer. Ripp received temporary disability benefits and medical benefits before both his medical expert and the County’s medical expert declared Ripp was permanently disabled in 2016.
On January 26, 2021, the judge of workers’ compensation (JWC) entered an Order for Total Disability (Order) approving a settlement in the amount of $365,100. The Order stated Ripp was totally disabled as the result of a disc herniation and disc bulges, post-operatively, accompanied by radiculopathy at several vertebral levels of his spine. It is undisputed that the County was to pay Ripp $173,480 within sixty days of the entry of the Order.
Ripp filed a motion to enforce the Order because the County had not made the required payments. He sought simple interest on the settlement amount pursuant to N.J.S.A. 34:15-28, and, pursuant to N.J.S.A. 34:15-28.2(a), Ripp sought enforcement of the Order through “an additional assessment not to exceed 25% of the money due . . . for unreasonable payment delay” and counsel fees. Ripp also moved for additional penalties for payment delay “not exceeding $5,000 . . . with proceeds . . . paid into the Second Injury Fund,” pursuant to N.J.S.A. 34:15-28.2(b).
If the County filed a formal answer to the motion, it is not in the record. Nevertheless, it is undisputed Ripp received full payment of the amount due him on April 12, 2021, sixteen days after the due date, although the County had not paid reimbursement of other expenses at that time. At oral argument on the motion before the JWC on May 11, 2021, the County offered the following excuses for the late payment: its third-party administrator failed to submit the payment request in time for the February “bill listing,” delaying its approval until the March meeting, presumably, of the county commissioners; delay by the third-party administrator was the result of a “transfer [of the file] from one adjustor to another”; and because of the COVID-19 pandemic, payment to Ripp was briefly delayed.
The JWC found some of the delay to be reasonable, but because of the delays in the litigation as well as the undisputed delay in payment, the JWC imposed the miximum 25% penalty on the benefits due to Ripp, and required the additional $43,370 to be paid within sixty days pursuant to N.J.A.C. 12:235-3.16. The County appealed.
The Appellate Division reversed, finding that it was inappropriate for the JWC to consider the delays in litigation when imposing the penalty for delay of payment. Coupled with the JWC’s finding that some of the reasons for delay were reasonable, the JWC abused her discretion in administering the maximum penalty. The case was remanded before a different judge as to the appropriate penalty, if any.
This case is important to understand that an award issued in Workers’ Compensation Court does not have a required period of payment, but undue delay can require the employer to pay additional fees and penalties if the delay is inexcusable.
If you or someone you know has been, injured at work or anything related to work including commuting, or were involved in a car accident, truck crash, or slip and fall, call the experienced personal injury attorneys at Hark & Hark today. For personal injury matters including workers compensation, no money is paid up front, and fees are only collected if a recovery is made. At Hark & Hark, we represent clients for any case in any county in New Jersey Atlantic County, Bergen County, Burlington County, Camden County, Cape May County, Cumberland County, Essex County, Gloucester County, Hudson County, Hunterdon County, Mercer County, Middlesex County, Monmouth County, Morris County, Ocean County, Passaic County, Salem County, Somerset County, Sussex County, Union County, and Warren County and any town including Bass River, Beverly, Bordentown City, Bordentown Township, Burlington City, Burlington Township, Chesterfield, Cinnaminson, Delanco, Delran, Eastampton, Edgewater Park, Evesham, Fieldsboro, Florence, Hainesport, Lumberton, Mansfield, Maple Shade, Medford Lakes, Medford Township, Moorestown, Mount Holly, Mount Laurel, New Hanover, North Hanover, Palmyra, Pemberton Borough, Pemberton Township, Riverside, Riverton, Shamong, Southampton, Springfield, Tabernacle, Washington Township, Westampton, Willingboro, Woodland Township, and Wrightstown.