Given the considerable number of employees under the age of 18 in the workforce, employers and insurers need to be aware of how to manage those claims. While minor employees are entitled to the same benefits as adult employees, the way those benefits are paid, and the way the claims are settled, is different.
Generally, the only person capable of representing a minor entitled to workers' compensation benefits is a conservator duly appointed and qualified by a probate court or some other court of competent jurisdiction. This means that indemnity benefits should not be paid directly to a minor employee; rather, they must be paid to a conservator who will hold and use the funds for the benefit of the minor employee. Fortunately, the Board has been granted the authority to appoint a conservator for limited purposes related to administering workers' compensation rights and benefits.
The first use of the Board's authority to a appoint a conservator comes into play early in a claim. The Board has authority to appoint a conservator of a minor employee to receive and administer weekly income benefits on behalf of and for the benefit of the minor employee. The conservator is legally accountable to the minor employee for the proper handling of the funds.
The Board has a form, specifically Board Form WC-226a, that must be submitted by the person seeking to be appointed as the conservator. The person submitting the application must consent to a criminal history check at the time the petition is submitted to the Board. The Board's Enforcement Division has the ability to run multi-state criminal history background checks for the purposes of determining the suitability of an applicant. Further, beginning on July 1, 2024, the Board may require the petitioner to submit additional documentation necessary to process the petition such as a marriage certificate, birth certificate, death certificate, custody orders, or child support orders.
Pursuant to Board Rule 226(a), if weekly benefits are owed to a minor employee, the petition for appointment of a conservator should be filed and a conservator appointed prior to the payment of any monetary benefits. If the minor employee has an attorney, the petition should be filed at the same time as the WC-14 notice of claim.
If the minor employee does not have an attorney, the employer/insurer may need to offer assistance to the minor employee and/or help identify if the employee has a natural parent who could apply to become conservator so that benefits can be commenced. The motivation for this is that indemnity benefits owed to a minor employee should not be paid until a conservator is appointed. The employer/insurer may consider providing the form to the minor employee and the potential conservator and assisting with its competition and submission to the Board for consideration and approval.
In addition to an attorney or the employer/insurer providing assistance to the minor employee, the Board has the ability to offer assistance. Specifically, if a minor employee does not have a duly appointed representative or conservator, the Board may, in its discretion, appoint a guardian ad litem to bring or defend a workers' compensation claim in the name of and for the benefit of the minor employee. The guardian ad litem, however, is not permitted to receive any proceeds from the claim unless said guardian ad litem is also appointed as a conservator pursuant to the Board's authority.
A concern arises as to what to do about weekly income benefits when the minor employee does not have a conservator appointed by a court of competent jurisdiction and the Board has not yet exercised its authority to appoint a conservator to receive and administer weekly income benefits. If income benefits payable without an award are not paid when due, a 15% penalty will be added to the accrued benefit. The employer and insurer could find themselves in a situation where weekly income benefits are due but there is no one authorized to receive them. One possible solution would be to file a WC-2 with the Board confirming commencement of benefits and seek an order from the Administrative Law Judge authorizing the employer and insurer to hold the funds in trust until a conservator is appointed by the Board. Following the appointment of the conservator, the funds held in trust can be released and weekly payments to the conservator can be commenced. It is important to remember that checks issued to the conservator should be made payable to the conservator on behalf of the minor employee.
As the appointment of a conservator early in the claim benefits the employer and insurer by providing a person to receive and administer weekly income benefits, it will also be important if the claim approaches settlement. In addition to the authority to appoint a conservator to receive and administer weekly income benefits, the Board also has the authority to appoint a conservator to compromise and terminate a claim and receive any sum paid in settlement for the benefit and use of the minor employee if the net settlement amount is less than $100,000. If the net settlement amount is less than $15,000 and the natural parent is the guardian of the minor employee, no Board-appointed conservator is needed. Otherwise, a conservator must be appointed. The same WC-226a form that is used to appoint a conservator to receive and administer weekly income benefits allows for the same person to be appointed to compromise or terminate a claim and receive any sum in settlement for the benefit and use of the minor employee where the net settlement amount is less than $100,000. If steps have been taken on the front end to have a conservator appointed, the case is one step closer to settlement.
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