Richter: The Carrier Could Not Count Unreimbursed EDD Payments Against Its Disability Obligation

State Disability Insurance can provide income while a workers’ compensation claim is disputed. If the compensation carrier later accepts responsibility, the payment history needs to be reconciled. Otherwise, a worker can be told that benefits have run out even though the carrier is counting money paid by a different program.

In Richter v. Frontier Communications, No. ADJ12335903 (WCAB Jan. 5, 2024), the carrier counted a year of EDD payments toward an agreed 104-week temporary-disability period. The Board rejected that credit because the record did not establish reimbursement to EDD. It allowed credit for the carrier’s own temporary-disability payments and made an award covering the supported period.

The carrier’s termination letter combined two different sources of payment

Mark Richter worked as a field technician and sustained an industrial injury on August 18, 2018 involving his back, psychiatric condition and urological condition. His claim was initially denied. EDD paid disability benefits during the first year of the later-agreed temporary-disability period.

The notices quoted in Richter both dated from November 2020: One started temporary-disability benefits; the other ended them. The carrier’s termination notice said Richter had received the maximum 104 weeks, including EDD payments for the first year. The benefit printout showed the carrier’s payment for the following year, but no reimbursement to EDD.

The parties agreed that Richter was entitled to temporary disability for August 25, 2018 through August 23, 2020—a total of 104 weeks. The dispute was whether the carrier could satisfy part of its obligation by counting the unreimbursed EDD benefits.

Reimbursement was the missing link

EDD disability payments can cover an income gap while liability for an industrial injury is disputed. When the carrier becomes responsible for the same period, EDD may seek reimbursement through a lien. That reimbursement coordinates the programs and can support credit against the carrier’s temporary-disability obligation.

The Richter decision applied the distinction between agreeing to reimburse EDD and actually doing so. The trial record contained no evidence of reimbursement. A later argument that an agreement had been reached on the trial date did not establish payment in satisfaction of the agreement.

The report adopted in Richter also addressed documents offered with the reconsideration petition. EDD’s lien had been known for years, and the carrier had an opportunity to address it before trial. The report rejected the suggestion that the reimbursement issue was newly discovered or could not reasonably have been presented earlier.

For the worker, the useful question was therefore concrete: What evidence showed that the carrier had paid EDD? The existence of an EDD lien, a settlement discussion or a benefits ledger listing EDD payments did not establish that fact.

The accounting affected access to income after temporary disability ended

The judge explained why the issue mattered beyond the carrier’s ledger. Properly coordinating the EDD payments with workers’ compensation could affect the disability benefits available to Richter after his workers’ compensation temporary-disability period ended.

By the time of the dispute, almost three years had passed since the carrier’s notice accepted temporary-disability liability without establishing reimbursement to EDD. The judge reasoned that counting the state benefits anyway would deprive the worker of the intended coordination between the programs.

That reasoning supports examining your EDD claim balance and reimbursement history together. To assess later Disability Insurance, ask EDD to review the individual claim balance and reimbursement record. Its eligibility determination and the carrier’s payment accounting work together to establish the benefits available.

The Board specified the award and left the disputed rate for proof

The Board granted reconsideration in Richter to correct and complete the award. It found the agreed 104-week disability period, allowed credit for temporary-disability payments the carrier had actually made, and affirmed the denial of credit for EDD benefits on this record.

It also clarified that the award ran against Zurich North America, the insurance carrier, and deferred the weekly rate because the parties had presented no stipulation or evidence establishing it. The parties were to adjust payment subject to proof, with the trial judge retaining authority to resolve a dispute.

That last step matters when reading benefit notices. A weekly amount printed in a carrier’s letter is evidence to examine; the operative decision tells you what the Board actually found and what still requires proof.

Compare the two payment histories before accepting a credit calculation

Obtain the carrier’s payment ledger and the EDD payment and lien records. Match the dates and amounts, identify when the carrier accepted liability, and request proof of any reimbursement it claims. Separate money paid directly to you from money paid to EDD.

Current Unemployment Insurance Code section 2629.1 addresses reimbursement and sets a 60-day period following voluntary acceptance of liability or a final Board award, order or decision. The applicable trigger and reimbursement evidence should be identified in the actual claim.

EDD’s workers’ compensation guidance also explains that Disability Insurance may be available when compensation is delayed or denied, or in other specified circumstances. Tell EDD about the compensation payments and ask it to determine eligibility; keep both agencies’ records accurate.

Our disability-credit guide addresses a different dispute: Offsetting an alleged overpayment against another benefit. Our Karaiskos analysis examines EDD reimbursement after insurer insolvency. For a disputed carrier credit, see our workers’ compensation practice.