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Peck v. Newark Morning Ledger Company

344 N.J. Super. 169, 781 A.2d 58 (App. Div. 2001)

WORKERS COMPENSATION; WAIVER—Before the injury or illness occurs, an employee’s waiver of the right to collect a workers compensation claim for an occupational disease must, spell out in writing, precisely and unambiguously, the rights that are being given up, the benefits to be lost, and the risks of doing so and, the writing must be dated.

After working for nearly 20 years on a production line for a newspaper printer, an employee developed carpal tunnel syndrome. He filed a workers compensation claim. After a medical evaluation, the employee underwent surgery. The Workers Compensation Judge granted him a permanent disability award for partial loss of the use of his hands. His employer appealed, arguing that the employee had signed a waiver that terminated his right to collect Workers Compensation benefits under Article II of the Workers Compensation Act (dealing with all claims including occupational exposure and disease claims), and instead would only have the right to pursue claims under Article I of the Act (dealing only with accident claims). The Appellate Division recognized that the Act allows employers and employees to elect to limit employee’s rights to file claims, but that such elections must be conducted in accordance with the statute and the employee must understand what rights he is giving up as a result of the election. The Court articulated that any such election must be memorialized in a written notice that: 1) spells out in very precise and unambiguous language that both parties know that they are entitled to be bound by either Article I or Article II, 2) describes in exact detail the benefits that each party would receive under both Article I and Article II, and the risks inherent in rejecting Article II in favor of Article I, and 3) was made prior to any injury or illness. Also, there must be independent evidence to show that the parties understood exactly what they were getting and what they were giving up. Reviewing the record, the Court concluded that: 1) the employee signed the waiver under duress or otherwise risked losing his job; 2) the waiver was in legalistic terms not generally understood by lay persons; 3) the employee did not understand the scope of the waiver nor the limitations it imposed on him; 4) the election to waive recovery rights under the Act must be made before the employee is exposed to the activity causing the illness or injury, and not merely before the illness or injury manifests itself; and 5) the election to include the waiver language in a collective bargaining agreement is against public policy. For those reasons, the Court upheld the Workers Compensation award.

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