Tort Recovery Less Than
Workers’ Compensation Benefits

The employee must reimburse the employer for the Workers’ Compensation benefits and this reimbursement is made from the amount in common law damages recovered from the third party. Now, imagine if the amount in common law tort damages is less than the amount in statutory benefits. Does the employee have to reimburse the employer out of his/her own money such that the employee now recovers less than he/she should? The increasing trend is to force the employer, as opposed to the employee, to “eat” the difference, with the employer’s reimbursement limited to the amount in damages recovered from the third party.