Avoiding Double Recovery From Workers’ Compensation and Third Party Claims

When a worker is injured during and in the course of employment, but as a result of the negligent or reckless conduct of a third party, the issue of a double recovery becomes an issue. New Jersey law statutorily prohibits double recovery. Although you may collect both workers’ compensation benefits as well as damages based on a third party action, your New Jersey worker’s comp lawyer is obligated to reimburse your employer for the workers’ compensation benefits you received.

Right of Reimbursement

Pursuant to N.J.S.A. 34:15-40, your employer’s workers’ compensation carrier has a right of reimbursement of up to two-thirds of the workers’ compensation liability minus $200 if you recover in a related third-party action. This lien is applicable to medical treatment, temporary disability benefits, and permanent disability benefits. Your New Jersey worker’s comp lawyer is responsible for protecting this lien. Any failure to do so can result in personal liability.

This statute prevents double recovery by ensuring that you do not recover the greater of either the total workers’ compensation benefits provided or the total of the third-party recovery, but not both.

When Recovery is Less Than Or Greater Than Employer’s Liability

There are two sub-sections to this statute: N.J.S.A 34:15-40(b) applies if your third-party recovery is greater than the liability of your employer; and N.J.S.A 34:15-40(c) applies if your third-party recovery is less than the liability of your employer. Under both sections, your employer will pay up to one-third of your New Jersey worker’s comp lawyer’s fees plus $200 in costs.

Contact Us

If you have been injured during the course of employment but due to the negligence of another individual, you need to consult with a New Jersey workman’s comp lawyer in order to avoid double recovery from both workers’ compensation and a third party action under New Jersey’s Workers’ Compensation statutes.

For more information or to consult with a New Jersey worker’s comp lawyer, call the Law Offices of Dan T. Matrafajlo at (908) 248-4404.

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