§ 123.4. Application of the offset generally.
(a) After receipt of Form LIBC-756, the insurer may offset workers’ compensation benefits by amounts received by the employee from any of the sources in § 123.3 (relating to employee report of benefits subject to offset). The offset of workers’ compensation benefits only applies with respect to amounts of unemployment compensation, Social Security (old age), severance and pension benefits received subsequent to the work-related injury.
(1) The offset applies only to wage-loss benefits (as opposed to medical benefits, specific loss or survivor benefits).
(2) The offset for amounts received in Social Security (old age), severance and pension benefits only applies to individuals with claims for injuries suffered on or after June 24, 1996.
(3) The offset for amounts received in unemployment compensation benefits applies to all claims regardless of the date of injury.
(b) At least 20 days prior to taking the offset, the insurer shall notify the employee, on Form LIBC-761, ‘‘Notice of Workers’ Compensation Benefit Offset,’’ that the workers’ compensation benefits will be offset. The notice shall indicate:
(1) The amount of the offset.
(2) The type of offset (that is—unemployment compensation, Social Security (old age), severance or pension).
(3) How the offset was calculated, with supporting documentation, which may include information provided by the employee.
(4) When the offset commences.
(5) The amount of any recoupment, if applicable.
(c) Whenever the insurer’s entitlement to the offset changes, the insurer shall notify the employee of the change at least 20 days prior to the adjustment on Form LIBC-761.
(d) The insurer shall provide a copy of Form LIBC-761, to the employee, the employee’s counsel, if known, and the Department. The form shall be provided to the employee consistent with section 406 of the act (77 P. S. § 717).
(e) The employee may challenge the offset by filing a petition to review offset with the Department.
(f) When Federal, State or local taxes are paid with respect to amounts an employee receives in unemployment compensation, Social Security (old age), severance or pension benefits, the insurer shall repay the employee for amounts previously offset, and paid in taxes, from workers’ compensation benefits, when the offset was calculated on the pretax amount of the benefit received. To request repayment for amounts previously offset and paid in taxes, the employee shall notify the insurer in writing of the amounts paid in taxes previously included in the offset.
Cross References This section cited in 34 Pa. Code § 123.1 (relating to purpose); and 34 Pa. Code § 123.5 (relating to offset for benefits already received).
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