Public Employer Update: Appellate Court Rules That Employees Who Irrevocably Resign are Disqualified From Receiving Disability Retirement Benefits

Posted on Monday, March 11th, 2019.

An employee cannot irrevocably resign from employment and get a disability pension.  The Appellate Division has agreed with PFRS’s conclusion that an irrevocable resignation as part of a settlement agreement precluded PFRS from being able to order an employee back to work if his/her disability dissipates and therefore the employee is ineligible to receive a disability pension.

In Cardinale vs. Board of Trustees of PFRS, App. Div. Docket A-1997-17T1 (App. Div. Mar. 1, 2019), a police officer who was facing disciplinary charges for testing positive for illegal drugs applied for an ordinary disability retirement with PFRS was denied the pension because as part of the disciplinary settlement, he irrevocably resigned.  PFRS denied the ordinary disability benefits because the Officer’s irrevocable resignation legally prevented him from returning to his public employment if he became rehabilitated from his disability at a later date.

The Appellate Division affirmed PFRS’s decision. The Court reasoned that the statute requires an employee receiving disability retirement benefits to be returned to active service if the disability ends, and that the employee’s irrevocable resignation prevents the return to service thereby rendering the employee ineligible for the disability retirement benefits.  Stated another way, the employee’s separation from public employment was the result of the irrevocable resignation, not the disability and therefore the employee is ineligible for the disability pension.

The lessons from this decision can be summarized as follows:

  1. An employee is eligible for disability retirement if his separation is caused by his disability, not by an agreement to irrevocably resign.
  2. A settlement of disciplinary charges which include an irrevocable resignation will likely preclude a successful disability pension application.
  3. If the facts show that the driving force behind a disability retirement application is the resolution of misconduct charges unrelated to the claimed disability, there is a substantial risk that the disability retirement application will be denied.

If you have questions related to employee discipline or disability pensions, please contact Trimboli & Prusinowski for assistance.

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