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Permanent Total Disability and Severance Packages

As a result of some injuries in the workplace, an employee may be ruled to be totally and permanently disabled by the Illinois Workers’ Compensation Commission. A person is deemed totally and permanently disabled when the injury prevents him from work activities in a reasonably stable labor market. When the Commission finds a person to be totally and permanently disabled, he or she is entitled to weekly benefits for life.

Importantly, a recent Illinois Appellate Court case rules that a person who accepts a severance package while still treating for his or her injuries does not give up his or her right to be found totally and permanently disabled. In that case, the employee was injured at work in October of 2003. She was temporarily totally disabled from work as a result of these injuries and was be paid weekly workers’ compensation benefits. In April of 2004, she was offered and accepted a severance package by her employer, which included forty-two weeks of wages. She testified at her hearing that she accepted the package because she was worried she would lose her job due to the company laying off a large portion of its workforce.

In June of 2005, the employee was released from her treatment with permanent restrictions as a result of her work injury. The judge ruled that the employee was totally and permanently disabled and entitled to lifetime weekly benefits. The employer argued that she was not entitled to this award because she accepted the severance package. The court disagreed with the employer.

Instead, the Court ruled that because the severance agreement was signed by the employee when she was still treating for her injuries and she was not aware of her final medical condition and because she had a fear of a future lay-off where she would have no employment, she was entitled to weekly lifetime workers’ compensation benefits due to her injuries.

Before signing a severance package agreement, you should consult with an attorney if you have a work related injury. This will ensure that you are being properly advised on what rights, if any, you may have under the law.

If you have any questions on this subject or any other workers’ compensation or personal injury matter, please contact us.