by Karl Voigt
Many of our clients ask us if they can collect unemployment compensation after their workers compensation cases settles or closes.
From the workers’ compensation perspective, our clients may not want to collect unemployment compensation while collecting workers’ compensation. This is because the workers’ compensation insurer is allowed a credit for any unemployment compensation a Claimant receives while collecting workers’ compensation. Workers’ compensation benefits are not taxable, but unemployment compensation income is taxable.
However, if and when their workers’ compensation case settles, some clients are still able to file an unemployment compensation claim.
So, can you collect? The answer is … maybe.
Unfortunately, the answer depends on the language of your workers’ compensation settlement agreement. There is recent appellate case law that holds that, when an injured worker’s settlement includes a resignation from employment, he is not entitled to collect unemployment compensation. Many Employers will require a resignation letter, even if claimant was laid off or fired while the case was in litigation. If you have resigned, the courts have more than suggested that you cannot collect unemployment compensation.