ASSEMBLY LABOR COMMITTEE

STATEMENT TO

ASSEMBLY, No. 458

STATE OF NEW JERSEY

DATED: FEBRUARY 22, 1996

      The Assembly Labor Committee reports favorably Assembly Bill No. 458.

      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.

      This bill was pre-filed for introduction in the 1996 session pending technical review. As reported, the bill includes the changes required by technical review which has been performed.