Explainer: Why so Many “Re-Opener” Claims in New Jersey?

New Jersey’s workers’ compensation is unique in that nearly 1 in 6 cases filed with the Division of Workers’ Compensation is not new at all – they are simply re-openings of cases which were already litigated to conclusion and settled. In 2015 the most recent year for which statistics are available, 34,500 “new” claim petitions were filed in New Jersey Division of Workers’ Compensation. An additional 6,250 re-opening claim petitions were filed in the same period.

In order to file a reopened of a closed case, the petitioner must show “material worsening” of her condition such that disability is increased. Why so many re-opener cases? Are the petitioners really worsening as they allege? Read on to learn about the statutory and legal framework that encourages “re-opener” claims in this jurisdiction.

Modification of Formal Award

N.J.S.A. 34:15-27 of the Workers’ Compensation Act Provides:

An agreement for compensation may be modified at any time by a subsequent agreement. A formal award, determination and rule for judgment or order approving settlement may be reviewed within 2 years from the date when the injured person last received a payment upon the application of either party on the ground that the incapacity of the injured employee has subsequently increased. If any party entitled to a review under this section shall become insane within the aforesaid 2-year period, his insanity shall constitute grounds for tolling the unexpired balance of the 2-year period, which shall only begin to run again after his coming to or being of same mind. An award, determination and rule for judgment or order approving settlement may be reviewed at any time on the ground that the disability has diminished. In such case the provisions of section 34:15-19 of this Title with reference to medical examination shall apply.

The doctrine of res judicata does not apply to workers’ compensation cases.

As the New Jersey Supreme Court stated:

the prior award is not res judicata as to the extent of the petitioner’s presently existing disability arising out of the previous injury. The prior award is conclusive as to all questions of law and fact comprehended by that determination, including the nature and extent of the then existing disability. (citing Hopler v. Hill City Coal and Lumbar Company, 5 N.J. 466 (1950). However, by the terms of N.J.S.A. 34:15-27, a prior award of compensation is expressly made subject to the continuing jurisdiction of the Division of Workmen’s Compensation to modify its determination with the subsequently occurring increase or diminution of the incapacity flowing from the established compensable injury.

See Yeomans v. Jersey City, 27 N.J. 496, 507 (1958).

Therefore, the prior award is “conclusive as to all questions of law and fact comprehended by that determination, including the nature and extent of the then-existing disability.”

Accordingly, in order to succeed in modifying the previous award, a petitioner must come forward with adequate proof that her disability has indeed increased since her previous award.
The New Jersey Division of Workers’ Compensation has prescribed a form for an Application for Review or Modification of Formal Award.

The Reopening Period.

An Application for Review or Modification of Formal Award must be filed within two years of the last payment of compensation to the petitioner. This statute of limitations is calculated from the last payment of temporary disability mailed to the claimant or the last date of medical treatment paid for by the respondent. The petitioner has an affirmative duty to show that her disability has increased.

A recently decided case (2008) has changed the way we look at the re-opener period.

As set forth above, the law (N.J.S.A. 34:15-27) states that the worker can re-open their claim for “two years from the date compensation was last paid” which includes payments for medical benefits.

In Pollock v. Tri-State Motor Transit, Inc., 2008-WL-3539972 (App. Div. decided Aug. 15, 2008)(Judges Winkelstein & LeWinn), cert. den. 196 N.J. 595 (2008), the claimant received “accelerated” compensation payments, representing accrued benefits and interest (for late payment) on March 28, 2002. The carrier paid out all the benefits in one lump sum as accrued based on a practice known as “filling in the gaps.” In the “filling in the gaps” practice, the payments due under an award (in this case, 203 weeks) are retroactively applied to periods of “accrued partial permanency benefits.” In practice, this means that the carrier looks back to periods where the claimant was not receiving temporary disability wage compensation and “fills in” those periods with permanency payments. This serves to decrease the number of payments due the claimant.

The claimant then filed a re-opener claim on September 7, 2004. The carrier argued that the accelerated “filling in the gaps” payments had reduced or shortened the statutory time period for re-opener. The carrier argued that the claimant had two years from the date the last payment was made (March 28, 2002) to re-open his case.

The claimant argued that the filling in the gaps practice could not reduce/foreshorten his time for a re-opener and that the time period for a re-opener runs consecutively from the date of the award.

The Trial Judge and the Appellate Panel found that the period for a re-opener should run consecutively from the date of award or settlement. This effectively ends the practice of “filling in the gaps.”

Greg Lois is the managing partner of LOIS LLC, a 19-attorney law firm dedicated to defending employers and carriers in New York and New Jersey workers' compensation claims. Greg is the author of a popular series of "Handbooks" on workers' compensation, and is the co-author of the 2016 Lexis-Nexis New Jersey Workers' Compensation Practice Guide. Greg can be reached at 201-880-7213 or glois@lois-llc.com