LC No. 15-000038
Before: Swartzle, P.J., and Gleicher and M. J. Kelly, JJ.
an employee will be overpaid worker's disability
compensation benefits. This can create several types of
unfairness-unfairness to the employer or insurance carrier
that paid more than it should have, and unfairness to the
employee who may have come to rely on the higher payment and
now must adjust to a lower payment and, indeed, possibly
reimburse the employer or carrier.
best to minimize the resulting unfairness is a policy
question. One way would be to require an employee to
reimburse the full overpayment only if the employee engaged
in fraud. Another way would be to limit the reimbursement to
the amount overpaid within the year prior to the recoupment
action. The Michigan Compensation Appellate Commission
adopted the former policy, while our Legislature adopted the
latter policy. Under separation-of-powers principles, we
conclude that the Commission lacked any legal authority to
adopt its policy and reverse.
Kalamazoo Regional Psychiatric Hospital and the state of
Michigan, appeal by leave granted the decision of the
Michigan Compensation Appellate Commission affirming the
magistrate's opinion and order denying defendants'
petition for recoupment of benefits overpaid to plaintiff,
Iesha Fisher. See Fisher v Kalamazoo Regional
Psychiatric Hosp, unpublished per curiam order of the
Court of Appeals, entered October 1, 2018 (Docket No.
facts are few and not in dispute. Plaintiff sustained a
workplace injury, and her employer voluntarily paid her
worker's disability compensation benefits. Defendants
later filed a petition for recoupment of benefits, seeking
reimbursement of an alleged overpayment. Defendants asserted
that plaintiff received weekly compensation benefits for
approximately three months, but that defendants paid those
benefits at an incorrect rate, resulting in an overpayment to
plaintiff. The magistrate held a hearing on the petition for
recoupment, and plaintiff did not appear at the hearing,
despite the fact that she was provided with notice of that
magistrate entered an order denying defendants' petition.
The magistrate observed that the Commission had previously
held in several administrative cases that when an employer or
carrier voluntarily but mistakenly overpaid a claimant, it
could not recoup the overpayment without proving that the
overpayment resulted from the employee's fraudulent act.
The magistrate found that defendants failed to establish that
the overpayment occurred because of any fraud by plaintiff.
appealed to the Commission, arguing that an employer or
carrier has a right to recoup an overpayment of benefits
under MCL 418.354(9) and Ross v Modern Mirror & Glass
Co, 268 Mich.App. 558; 710 N.W.2d 59 (2005). Defendants
argued that they were only limited by the one-year back rule
of MCL 418.833(2), and the Worker's Disability
Compensation Act, MCL 418.101 et seq. (WDCA), did
not limit an employer's or carrier's right of
recoupment to only those instances in which the employee
fraudulently obtained the overpayment.
Commission disagreed, finding that the circumstances of this
case were distinguishable from Ross, which involved
an overpayment to an employee because of the lack of
coordination of the claimant's disability pension
benefits with the worker's disability compensation
benefits as required under MCL 418.354. The Commission also
noted that denial of defendants' petition would neither
discourage voluntary payment of claims nor result in
unnecessary disputes and delays of payments because
defendants had a clear duty to make professional and prompt
evaluation of worker's compensation claims and apply the
appeal, defendants do not argue that plaintiff engaged in
fraud or that the Commission made erroneous factual findings.
Rather, defendants ask us to consider a pure question of law-
Is the right to recoup the overpayment of disability
compensation benefits from an employee subject ...