ASSEMBLY, No. 458

STATE OF NEW JERSEY

Introduced Pending Technical Review by Legislative Counsel

PRE-FILED FOR INTRODUCTION IN THE 1996 SESSION

By Assemblyman ROMA

An Act concerning workers' compensation and amending R.S.34:15-28 and P.L.1979, c.468.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. R.S.34:15-28 is amended to read as follows:

    34:15-28. Interest on payments withheld. Whenever lawful compensation shall have been withheld from an injured employee or dependents for a term of [three months] 45 or more days following entry of a judgment or order, simple interest on each weekly payment for the period of delay of each payment [may, at the discretion of the division,] shall be added to the amount due at the time of settlement. In any case of benefits which are delayed for one year or more following the expiration of the 26-week period which commences upon the date that the employer is notified of the death, injury or occupational disease, upon the date of the employee's final active medical treatment or upon the date that the employee returns to work, whichever date is later, the division shall add simple interest on each weekly payment for the period of delay of each payment to the amount due at the time of settlement, unless the division finds and states that the delay was because of reasons beyond the control of the employer or the employer's carrier. If interest is ordered with respect to weekly benefits preceding the entry of the order or judgement, the interest shall be calculated from the date of expiration of the 26-week period which commences upon the date that the employer is notified of the death, injury or occupational disease, upon the date of the employee's final active medical treatment or upon the date that the employee returns to work, whichever date is later. The annual rate of interest on payments withheld shall equal the average rate of return, to the nearest whole or one-half percent, for the corresponding preceding fiscal year terminating on June 30, of the State of New Jersey Cash Management Fund (State accounts) as reported by the Division of Investment in the Department of the Treasury.

(cf: P.L.1987, c.126, s.2)

    2. This act shall take effect immediately.

STATEMENT

    This bill makes changes regarding the charging of interest in certain instances of delayed payments of workers' compensation.

    The bill requires that, if a workers' compensation payment is delayed for 45 or more days following the entry of a judgement or order to pay, simple interest for the period of delay be added to the amount due to the injured employee. Under current law, interest may not be imposed unless the payments are at least three months late, and whether to charge the interest is left to the discretion of the Division of Workers' Compensation.

    The bill also provides that interest may be charged in certain cases where there are excessive delays prior to a judgement or order. If benefits are delayed for a term of one year or more following the expiration of the 26-week period which commences when the employer is notified of the death, injury or occupational disease, when the employee's medical treatment ends or when the employee returns to work, whichever occurs last, the bill requires the division to add simple interest for the period of delay to the amount due at the time of settlement, unless the division finds and states that the delay was because of reasons beyond the control of the employer or the employer's carrier. The interest would be calculated from the date of expiration of the 26-week period.

    The bill also permits the division to impose prejudgement interest for delayed payments in certain cases.

Concerns interest payments in certain cases of delayed workers' compensation benefits.