Many times in the settlement of worker’s compensation cases, the question of voluntary termination of employment comes up. While there may be valid reasons for seeking such a termination, the issue can unduly complicate the resolution of the worker’s compensation claim. There are at least four reasons why requesting a voluntary termination of employment under these circumstances can be problematic:
- The involvement of the voluntary termination issue is not a part of the W/C coverage and the time and expense spent with regard to that issue cannot be billed to the W/C carrier.
- The statutory value of the PPI due can be easily calculated, but the value of the employment to the employee is unknown. There is likely to be a huge difference of opinion between the employee and the employer on that issue. And, when the value for the employment termination is reached, there will be an inevitable effort to shift that value to the W/C case settlement so as to avoid income and other tax liability.
- The request that the employment be voluntarily terminated in the context of the resolution of the W/C issues creates an additional issue which can, and often does delay or prevent the resolution of the W/C case.
- If the employee does not want to resign, and if the employee is ultimately terminated or treated in such a way as he feels compelled to quit, then the request that the employment be voluntarily terminated is potential evidence of the employer’s state of mind which evidence could support the employee’s civil claim for actual or constructive retaliatory termination of employment.
With these problems in mind, if a request for voluntary termination is to be pursued as a part of the W/C negotiation, it is best that the termination of employment issue be handled by the employer’s employment law or in house attorney separate from the negotiation of a resolution of the W/C claim. That is a better way in which to deal with issues 1-3 noted above. But, if the voluntary termination negotiations fail, then the risk of issue 4 is difficult to negate. Once that “bell has rung” it is impossible to un-ring it.