Will I Have to Return My Workers’ Compensation Award if I File a Third-Party Claim?

Generally, workers’ compensation is the sole legal remedy when you’ve been injured on the job. However, if someone other than your employer is responsible for your damages, you may be able to pursue a third-party claim in addition to receiving workers’ compensation benefits. If you are considering filing a third-party claim, you might be wondering if you’ll have to return your workers’ compensation award. Continue reading to learn what you should know about these matters and how an experienced Morris County Workers’ Compensation Attorney can assist you in navigating your legal options and pursuing compensation for your damages. 

What is a Third-Party Claim?

A third-party claim is a personal injury lawsuit that is filed against an individual or entity that is not your employer because their negligence either caused or contributed to your injury. If your workers’ compensation benefits alone are insufficient to cover the full extent of your damages, you should consider filing a third-party claim. Although workers’ compensation benefits can cover some of your losses, they typically don’t provide compensation for pain and suffering. A third-party claim allows you to seek compensation for your non-economic damages.

You should note that workers’s compensation is a no-fault system. This means you can receive benefits even if your negligence contributed to your injuries. In a third-party claim, however, you need to prove that the third party’s negligence directly caused your injury.

How Do Workers’ Compensation Liens Affect Third-Party Claims?

Under New Jersey law, if you are injured at work due to the negligence of a third party, you cannot receive a double recovery from both your employer’s workers’ compensation insurance and the third party’s insurance carrier. While you are allowed to file a claim for workers’ compensation benefits as well as a lawsuit against the third party, it’s important to understand that your employer has the right to be reimbursed.

Your employer’s workers’ compensation insurer can place a lien on your award. Essentially, this means that part of the compensation you receive from the third-party lawsuit may be used to reimburse the insurer for the workers’ compensation benefits they have paid. Keep in mind that if your third-party claim is not settled when your workers’ compensation case is resolved, the full lien will be satisfied from the third-party settlement.

For more information about what happens when a third-party award exceeds workers’ compensation liability, please don’t hesitate to contact a knowledgeable attorney from Lutz Injury Law. Our dedicated legal team is prepared to advocate for your rights and help you fight for the compensation you deserve. Connect with our firm today to discuss your case.