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WORKERS' COMPENSATION BENEFITS NOT PAYABLE TO RETIRED EMPLOYEE

In Campbell v General Motors Corporation, ___ Mich App ___ (2005), the Michigan Court of Appeals held that a retired employee was not entitled to workers’ compensation wage loss benefits under MCL 418.373 (the “retiree provision”). The employee started working for General Motors in 1964. He began to experience shoulder pain in 1995. He treated at the plant clinic, but continued working, without restrictions, until the plant closed on October 4, 1999. Rather than being laid off, the employee was placed in General Motors’ “jobs bank,” which was created pursuant to a union demand during contract negotiations to avoid layoffs. While in the jobs bank, the employee was required to report to a specific location to await placement in an available job involving manual labor. The employee received full pay and benefits during his time in the jobs bank, although he did not perform any work and the employees in the jobs bank would play cards or watch television. If a job became available, the employee was obligated to accept it. The employee took a regular, non-disability, retirement on August 1, 2000. Prior to that time, he was not placed into a job through the jobs bank. Shortly after taking his retirement, the employee filed an Application for Hearing, seeking workers’ compensation benefits due to shoulder and knee injuries. §373 of the Workers’ Disability Compensation Act (MCL 418.373) provides that an employee who terminates active employment and receives a non-disability pension or retirement benefits paid by or on behalf of an employer from whom weekly wage loss benefits are sought, is presumed not to have a loss of earnings or earning capacity as the result of a compensable injury or disease. The question in the Campbell case was whether the employee had retired from “active employment”. The Court of Appeals characterized plaintiff’s assignment to the jobs bank as “active employment” even though the nature of plaintiff’s work had changed. Therefore, the court reversed the Magistrate’s award of benefits, and remanded the case for application of the §373 retiree presumption.

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