*1 App 212 Mich PATTERN COMPANY v SIMPLICITY KRUEGER 1992, 3, Lansing. Decided at March 123758. Submitted Docket No. sought. 5, 1992, appeal a.m. Leave to at 9:05 October Jr., Krueger, sought benefits workers’ William F. ' Company, Simplicity and its employer, Pattern former from his Krueger, insurer, Company. had re- who Travelers Insurance claim, his filing to take year had elected tired a before magistrate in an lump awarded benefits pension The as a sum. entitlement, monthly pay- Krueger’s equal less pension chosen had he received as he would have ment Simplicity’s monthly payments. reduction was made The that, given Simplici- magistrate’s indicated order election. 418.354(l)(e); MSA under MCL ty’s coordinate election to reduction, 17.237(354)(l)(e), age sixty-five apply the it could not 17.237(357), 418.357; to the provided in MCL expired. Krueger’s pension The defendants benefits once award Appellate Compensation Commis- appealed, and the Workers’ granted. appealed by leave The defendants sion affirmed. Appeals held: The Court 354, Krueger’s Having benefits under § to coordinate chosen 357(2) applying prevented by from later § defendants are employer elects to coordinate age sixty-five reduction. Once employ- when the reverse the coordination it cannot Coordination, begun, expire. contin- benefits ee’s lapse merely automatically one of the because ues and does not equation zero. becomes in the coordination factors Affirmed.
McDonald, J., concurred. Allen, J., Legislature dissenting, never that the stated G.S. prevented employer be that an intended long sixty-five as the set forth currently having under 354 but is coordinated is not employer be security should not benefits. The for social benefits. its decision to coordinate forever bound References 414, 415, 431, 2d, Compensation 680. §§ Am Jur Workers’ Compensation. Annotations under Workers’ the Index to See Opinion of the Court — — Reduction Benefits Coordination Workers’ by Employer. Age Sixty-Five — Election After of Benefits a retired to coordinate who chooses An disability compensation benefits and workers’ *2 Disability Compensation pursuant the Workers’ to expire, the not, reduce may benefits once the Act the em- pursuant of the act after disability 357§ begun, age sixty-five; once contin- ployee reaches merely the automatically lapse one of becáuse does not ues and (MCL equation zero becomes factors in 17.237[357]). 418.357; 17.237[354][l][e], 418.354[l][e], (by McCroskey, & Brock Feldman, Cochrane plaintiff. Kragt), Timothy for the A. Rosenberg), Phillip (by for G. & Kelman
Gofrank the defendants. Marilyn P.J.,
Before: Kelly, and McDonald S. JJ. and G. Allen,* impres-
Marilyn of first Kelly, P.J. In this case granted appeal by from an leave sion, defendants Appellate of the Workers’ order that, an ruled The Commission Commission. employer pen- coordinate elects to Disability Com- the Workers’ sion benefits pensation age-65 apply may Act, not later it We affirm. reduction. Simplicity Pat- for defendant
Plaintiff worked years. forty-two in Company retired He for tern pension in September, to take his elected 1985 and lump $29,300.61. he not Had sum, calculated a elected monthly pen- lump amount, his sum have been $305.98. would sion benefits plaintiff a claim for filed November, In magistrate compensation. disability awarded The per disability week. of $213.03 him * Appeals by judge, sitting Appeals the Court of on Former Court assignment. App 212 196 Mich op Opinion the Court was entitled plaintiff what represents
The have re- he would weekly payment to less the take it not chosen to had he pension, as his ceived made at was The reduction lump in a sum. magistrate’s The employer. of plaintiffs election to coordi- the election given indicated order statutorily nate, apply could defendants plaintiffs age-65 authorized MCL expired. once his award 17.237(357). 418.357; MSA Compensa- to the Workers’ appealed Defendants alleging part Appellate Commission barring them magistrate’s order confusing, unneces- was age-65 357 reduction Commission af- and should be stricken. sary the follow- concluded with firmed the award and ing: *3 the content of from the form and
It is clear
2 that when a disabled
in
language
subsection
that
pension benefit coordinated
employee has a
exempts
employee
fact of coordination
the
from the effects
as set out
of the reductions
to elect which
employer is free
1. The
subsection
course to
nate,
either
follow,
having
for
to coordi-
chosen
but
age is not available
then the reduction
serially.
simultaneously or
legislation
derives
The matter
at
issue
time,
Legis-
Michigan
in 1981. At that
enacted
to de-
allowing employers
a statute
passed
lature
disabled
to those
compensation
crease workers’
compensa-
wage-loss
to receive
employees
General
sources.
employer-funded
from other
1105;
Romein, 503 US
—; 112 S Ct
Corp v
Motors
418.354; MSA
328,
(1992); MCL
L
335
Ed 2d
17.237(354).
coordina-
of this so-called
purpose
Workers’ Disabil-
Michigan’s
under
tion of benefits
costs to the
to reduce
Act was
ity Compensation
Opinion of the Court
duplicate
community and to eliminate
business
recovery
v General Motors
of benefits. Romein
(1990)
Corp,
515, 552; 462 NW2d
436 Mich
dissenting),
—; 112
(Riley, C.J.,
503 US
S Ct
aff'd
(1992). The resources saved
1105;
[t]he amount received or payments of the or retirement pursu being by employee received main plan program or established or ant to a by the same from whom tained under section 418.354(1)(e); 351, 361, 835 are received. or [MCL 17.237(354)(1)(e).] provides once an receiv- Section 357 age ing of 65: reaches the workers’ (1) following year [W]eekly payments for each by birthday shall be reduced sixty-fifth his or her age paid payable at weekly payment of the or 5% 65, weekly than of the benefit but not to less 50% paid so that on his or her payable or shall birthday weekly payments seventy-fifth 50%; shall after which there have been reduced for the duration of the not be a further life. . . . (2) (1) person ... a apply shall not Subsection this act are coordinated payments under whose 418.357; MSA section 354. [MCL 17.237(357).] *4 argue appeal, that. defendants In the case on they allowed to terminate should have been plaintiff’s under coordination of they plaintiff 65; then have would when turned App 196 Mich Opinion op the Court applied age-65 357. Alterna- tively, they argue plaintiff that, reached 65 after they exhausted, and his benefits became option age-65 should have had the disagree. reduction statute. We plaintiff’s When defendants chose to coordinate they gained advantage by benefits, a financial paying plaintiff they less than would otherwise obliged pay. Having have been tion, applying to made the elec they statutorily from later were disallowed 418.357(2); age-65 reduction. MCL 17.237(357)(2). they chosen, instead, MSA Had they to coordinate plaintiff’s could have reduced up fifty percent 418.357(1); age 65. after he reached MCL 17.237(357)(1). ways, However, defendants cannot have it both they They would like. made a business decision They prevail to coordinate benefits. cannot now on they anticipated a claim that could not have how long plaintiff possible would live and the financial consequences disability. Employers, of his or at carriers, least their insurance determine the likelihood that coordination of bene- have the means advantage. they may fits will be to their That lose given money they in a is a case business risk take. argue Defendants also bene expire, They point fits that duction employee’s out ceases. prohibition against using age-65 re
applies only when, statute, under the implying coordinated,”
benefits "are 418.357(2); being currently "are reduced.” MCL 17.237(357)(2). disagree MSA that We and determine having begun, continues. Noth ing suggests in the statute otherwise. Coordination automatically lapse merely of benefits does not because one of the factors the coordination equation becomes zero. *5 by Allen, J. G.S. Dissent Ap- Compensation agree the
We with Workers’ employer pellate elects Commission the coordi- it cannot reverse to coordinate ex- when the nation pire. Affirmed. J., concurred.
McDonald, (dissenting). I the believe G. S. J. Allen, legislative clearly majority has misconstrued the Workers’ §§ 354 and 357(2) intent behind Disability 418.354; MSA Act. MCL 17.237(357)(2). 17.237(354); MSA 418.357(2); Legislature majority notes, enacted the As the provision §in set forth coordination-of-benefits cost-saving for and to elimi a reform businesses as duplicate recovery of benefits. Section 357(2), nate hand, that claimants are on the other penalized ensures by upon reaching sixty-five applica by i.e., effect of double §§ 357(1). of both 354 and pari reading ma- these two sections Whether giving language by simply §of 357(2) teria or Legisla- meaning, plain it is evident that its pre- employer be ture never intended that an age-sixty-five vented long is not forth in as the set currently having § benefits coordinated security benefits. is for social but majority’s is forever conclusion that an initial election to coordinate bound its none was intended a business risk where creates Legislature. by the
I would reverse.