Should I take an early buyout?

Q. GM has offered me a deal they are calling an “inverse retirement” where I would go into the JOBS Bank for a year, get paid wages for not showing up,  and then go immediately into a Regular 30 and Out Retirement.  They want me to sign a (false) statement that I have no work injuries keeping me from working as part of this deal. I am exhausted from working in pain  and want to retire  Should I go ahead and sign?  If I do this, will it effect my rights to recover for my work injuries?

A. A Michigan employee’s right to workers’ compensation benefits are drastically effected when he or she takes a regular pension, including this new-fangled thing GM dreamed up that they are calling an “inverse retirement.”

For anyone claiming that they suffered a work injury after March 31, 1982, that worker’s compensation benefits which he or she could potentially recover will be reduced by the after-tax value of his or her regular pension benefit.  If a person retires on a regular pension, there is also usually a legal presumption that such a worker has not had a loss of wage earning capacity, and therefore would not be entitled to any workers’ compensation wage loss benefits. Defendants will also sometimes argue that these attrition agreements may be used as a complete bar from seeking any workers' compensation benefits.

The Michigan legislature let employers and employees negotiate the effect disability pensions have on workers’ compensation benefits. A disabled worker may be better off pursuing workers' compensation along with a disability pension instead of a early buyout.

If you are physically unable to work because of your work injuries, you are probably significantly better off trying to secure workers’ compensation benefits with a disability pension rather than walking out the door through the JOBS Bank and into a regular retirement (and losing most if not all of your potential workers’ compensation coverage.).  We would recommend that you, and anyone else you know faced with this situation, give our office a call for individualized advice regarding these various options. (2005)

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