DEDUCTIONS FOR WORKMAN'S COMPENSATION AWARDS FROM DISABILITY ALLOWANCES UNDER THE STATE EMPLOYEES' RETIREMENT ACT
Awards received under the Workman's Compensation Act because of the dependents of an injured workman must be deducted from allowances paid under the State Employees' Retirement Act, but payments made for partial disability should not be deducted.
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November 2, 1951
Mr. Samuel P. Totten
State Employees' Retirement System
215 East 5th Avenue
Olympia, Washington Cite as: AGO 51-53 No. 162
We wish to acknowledge your letter of September 18, 1951, in which you request our opinion as to what deductions for workman's compensation awards should be made from the allowances payable for disability awards under the State Employees' Retirement Act. Your questions are as follows:
1. Should a deduction be made for the amount that is added to a member's workman's compensation award because of his wife?
2. Should a deduction be made for the amount that is added to a member's workman's compensation award because of his minor children or other dependents?
3. Should a deduction be made for the workman's compensation award that is paid to a member for permanent partial disability?
It is our conclusion that the first two questions should be answered in the affirmative and the third one in the negative.
[[Orig. Op. Page 2]]
Benefits payable under the State Employees' Retirement Act for duty or non-duty [[nonduty]]disabilities are determined by the member's average final compensation subject to a certain maximum which is dependent upon whether the allowance is for a duty disability or a non-duty [[nonduty]]disability. Payments made under the Workman's Compensation Act are not based on salary, but may vary according to whether or not the injured workman is married and the number of minor children or dependents. The amount of the payment is fixed by statute.
RCW 41.40.300 of the State Employees' Retirement Law, as derived from section 21, chapter 240, Laws of 1949, provides as follows:
"Any amounts which may be paid or payable under the provisions of any workman's compensation or pension or similar law or act for any disability shall be offset against and payable in lieu of any benefits payable from funds provided by the employer under the provisions of this Act on account of the same disability."
The previous law pertaining to benefits offset by workman's compensation or similar benefits, section 31, chapter 274, Laws of 1947, provided that payments payable to dependents of an injured workman were deductible. It is to be noticed that this provision has been deleted from the present law. However, payments as such before death of the workman were not payable to the dependents of an injured workman, but to the injured workman himself. Upon the death of a member of the State Employees' Retirement System his disability benefits are terminated. Under the Workman's Compensation Act the widow and minor children of a deceased workman still have certain rights to benefits. In view of this situation, the deleted provision could be considered surplusage and its deletion has no effect on the present law.
As stated above, the amount of a duty or non-duty [[nonduty]]disability allowance is not changed by the fact that the member had a wife or other dependents and the only question involved here is who makes the payments, rather than the amounts of the payments. Payments received under the Workman's Compensation Act are generally for time loss or pensions which means temporary total disability or permanent total disability. They are in the nature of compensation to make up for the loss of earnings and salary and in that respect the benefits payable under the State Employees' Retirement Act are similar. These benefits help take the place of one's salary while the person [[Orig. Op. Page 3]] is disabled and under no circumstances can they be in excess of the allowed percentage of one's average final compensation, as set forth in RCW 41.40.220 and RCW 41.40.250.
The legislature having provided that workman's compensation benefits are deductible evidently recognized that benefits could be received under both Acts, but didn't intend to make the recovery accumulative. It is our opinion that it makes no difference whether the payments are for the injured workman, his wife or dependents because they are all payable to the injured workman and must be considered as a proper offset from the disability allowance under the State Employees' Retirement Act.
The question of whether or not a deduction should be made for the payment of a permanent partial disability award presents a different problem. This is not a payment for time loss or a pension, but for the loss of use of a limb or part of the body. It has no relation to whether a person is married or has dependents and is not determined by the amount of salary or income lost during the period of disability. It is calculated by determining the percentage of permanent disability to a workman's body and applying the percentage to the compensation schedule of the Workman's Compensation Act.
We find no particular precedent on this question, but an investigation of the procedure followed by the State Patrol, which has a similar provision in its retirement law, discloses that no deduction is made for permanent partial disability. It is our opinion that this procedure is proper and should be followed when benefits are paid under the State Employees' Retirement Act.
Very truly yours,
PHIL H. GALLAGHER
Assistant Attorney General