Background:

The issue in this case was whether the employee’s workers’ compensation benefit should have been reduced to the maximum compensation rate before or after a pension offset was taken pursuant to the coordination of benefits section (39-A M.R.S.A. §221). The employee argued that the pension offset should be taken first and then the resulting benefit reduced to the statutory maximum, if applicable. The employer argued that the pension offset should be applied after the post-injury compensation rate has already been reduced to the statutory maximum. The hearing officer agreed with the employer and the employee appealed.

Court Ruling:

The Court agreed with the hearing officer and employer that the benefit must be reduced to the statutory maximum before applying the pension offset. The coordination of benefits section of the Act states that offsets are to be taken from the employee’s benefit and part of calculating an employee’s benefit is applying the statutory maximum pursuant to Section 211. Therefore, the employer properly took the pension offset after reducing the employee’s benefit to the statutory maximum compensation rate.

View complete text of Gregory R. Hanson v. S.D. Warren Co., et al.