Weekly benefits are not reduced by an employee's own savings or other sources of income except for: earned wages, certain Social Security benefits, employer-paid disability and pension plan benefits, and unemployment compensation.
A. Earned Wages
If the employee returns to work, benefits can generally be reduced to partial, or terminated (see RETURN TO WORK).
B. Social Security
This provision, "coordination of benefits," applies only to injuries on or after 06/30/85, when the original provision was enacted. For all such dates of injury, weekly compensation is reduced by one half of the after-tax amount of Social Security retirement benefits received by the employee. Benefits are not affected by Social Security "disability" benefits--such benefits are themselves reduced by workers' compensation benefits. Once the Social Security setoff is calculated, the amount of the setoff remains fixed regardless of future Social Security cost of living adjustments (39-A M.R.S.A. §221). We recommend that when you are paying the maximum benefit level for a high AWW claimant, you take the SS offset from the maximum compensation rate, not the true compensation rate. The Social Security offset does not apply if the employee was already receiving Social Security retirement benefits at the time of injury, nor does it apply to spouse's benefits.
C. Employee Benefit Plans
Benefits are also reduced for certain payments under employee benefit plans. Eligible plans include disability, wage continuation and pension plans provided by the employer, but only if the plan does not provide that those benefits are themselves reduced based on receipt of workers' compensation.
The amount of the setoff is equal to the after-tax amount received by the employee if the employee did not contribute directly to the plan or to the payment of premiums. If the employee did, the amount of setoff is limited to the percentage of the employer's contributions to the plan compared to all contributions (39-A M.R.S.A. § 221).
D. Exception For Scheduled Benefits
Coordination of benefits for Social Security and employee benefit plans does not apply to benefits received under 39-A M.R.S.A. §212(2) (presumption of total incapacity for 800 weeks) and (3) (specific loss benefits for scheduled amputation losses).
E. Unemployment Benefits
For all dates of injury, compensation is reduced dollar for dollar by the amount of unemployment benefits received.
