Source: https://www.massachusettsworkerscompensationlawyer-blog.com/reviewing-board-holds-massachusetts-employees-must-protected-employers-cannot-meet-financial-obligations-compensate-work-related-injury/
Timestamp: 2019-04-22 12:04:03+00:00

Document:
The Board stated that self-insurers under the Workers’ Compensation Act must have a license either by complying with § 25A(2) or by obtaining a bond and reinsurance. Here, the employer was required to have reinsurance to further guarantee their ability to pay benefits to injured employees.
The employee filed a claim against the reinsurer to receive her payment of § 34A and COLA benefits from the date that her benefits stopped. At a conference, the insurer was ordered to pay the employee § 34A benefits, and both parties appealed. At the hearing, the WCTF was joined.
The reinsurer denied any obligation to pay the employee benefits directly, and the WCTF also denied liability, on the ground that the self-insurer was not an uninsured employer. Here, the Board stated that reinsurers, as set forth by statute, must pay benefits due to injured workers once bond funds are depleted. Section 25A(2) protects injured employees of defunct self-insurers.
The Board cited the case of Janocha v. Malden Mill Industries, Inc., 30 Mass. Workers’ Comp. Rep. _ (August 1, 2016). There, the court stated there are three tiers of protection for employees. The Board stated that a reinsurer is obligated under the Act to provide a further guarantee of a self-insurer’s ability to pay benefits owed to injured workers. Reinsurers are not to reimburse the bondholder, since that depletes the amount available to injured workers.
The administrative law judge ordered the WCTF to pay the employee § 34A and COLA benefits from March 4, 2013 to date, and continuing. The judge ordered the reinsurer to reimburse the WCTF.
On review, the Board cited Janocha, again stating there is no such thing as an uninsured self-insurer. Both Janocha and Massachusetts law required the reversal of the decision requiring the WCTF to pay the employee’s benefits directly. Here, the employer could not meet their financial obligations, and the injured worker must be protected.
The Board stated the insurer was liable for direct payments of § 34A and COLA benefits to the employee from March 4, 2013 forward. The insurer can seek reimbursement from the WCTF for COLA payments made from the date of injury to the employee.

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