Smedley v. State of Connecticut (Connecticut Supreme Court)

This case raises the issue whether the Connecticut Workers’ Compensation Act (“Act”) permits an employer to offset disability retirement payments against wage replacement benefits otherwise due an injured worker under the Act.  Eileen Smedley suffered a back injury while employed by the State of Connecticut and received workers’ compensation benefits.  In 1999, she retired with State Disability Retirement benefits.  Smedley has been employed in private industry earning less than she earned in her former state job, and she is again seeking wage supplement benefits under the Act.  The Workers’ Compensation trial commissioner included Smedley’s disability retirement benefits in calculating her eligibility for workers’ compensation benefits, and on the basis of that calculation concluded that she was ineligible for workers’ compensation benefits.  The Workers’ Compensation Commission upheld that ruling, and Smedley appealed.  The Connecticut Supreme Court took the appeal, and NELF has filed a brief in support of the employer State of Connecticut on its own behalf, and on behalf of the Connecticut Business and Industries Association.  In its brief, NELF argues that both the plain language the Act and case law prohibit double compensation.  NELF also argues that there is compelling public policy in favor of preserving the continued financial viability of the workers’ compensation system by avoiding duplicate benefits and excessive compensation.  The system is supported by the mandatory contributions of employers, and excessive payouts ultimately have one of two impacts: they force a reduction of wages and benefits available to workers generally, or they increase the cost to employers.  If the employer is the state, the result can be tax increases, program cuts, or both. The Connecticut Supreme Court decided in favor of the employee, but based its decision strictly on language in statues applicable to state employment, leaving open the question of how private employees in similar circumstances would be treated. 270 Conn.32, 855550 A.2d 1007 (2004).