Workers’ Compensation – Interest on Benefits – Lump Sum Award – Permanent Partial Disability – Temporary Disability Benefits – Deduction

Lewis v. N.C. Department of Correction (Lawyers Weekly No. 14-07-0569, 8 pp.) (John Martin, Ch. J.) Appealed from the Industrial Commission. N.C. App.

Holding: G.S. § 97-86.2 required the Industrial Commission to order defendant to pay interest on the permanent partial disability benefits awarded to plaintiff in the Commission’s May 23, 2012 opinion and award from the date of the initial hearing in this dispute. Since the Commission gave defendant credit for the temporary disability benefits it had been paying, plaintiff is not receiving a double recovery.

Reversed and remanded.

G.S. § 97-86.2 states in part, “In any workers’ compensation case in which an order is issued either granting or denying an award to the employee and where there is an appeal resulting in an ultimate award to the employee, the insurance carrier or employer shall pay interest on the final award or unpaid portion thereof from the date of the initial hearing on the claim, until paid at the legal rate of interest provided in G.S. 24-1.”

By its use of the word “shall” the statute compels the Commission to award interest on the unpaid portion of an award. The purpose of interest is to compensate an individual for his inability to use the awarded money while an appeal is pending.

There is no issue of double recovery here. The opinion and award gives defendant a credit for the total amount of the temporary total disability benefits paid to plaintiff under G.S. § 97-29. Thus, a double recovery does not occur because the amount paid to plaintiff under § 97-29 is deducted from the balance of the permanent partial disability benefits awarded to plaintiff under G.S. § 97-31. Plaintiff is not collecting benefits under § 97-29 and § 97-31 at the same time.

In addition, the Commission erred in reasoning that none of plaintiff’s award was past due. The Commission reasoned that because none of plaintiff’s benefits were past due at the time of the initial hearing in this matter or when the May 23, 2012 opinion and award was entered, plaintiff was not entitled to interest. G.S. § 97-86.2 states that the “employer shall pay interest on the final award or unpaid portion thereof from the date of the initial hearing on the claim.” Thus, it does not matter that defendant had made weekly payments to plaintiff during the pendency of the appeal and that none of those payments were past due because the full amount of the lump sum award “became due” as of the date of the initial hearing. Therefore, the statute entitles plaintiff to interest on the unpaid portion of the award from the date of the initial hearing in this matter.

Reversed and remanded.