                                 CODE OF VIRGINIA

ADJUSTMENTS IN SUPPLEMENTAL DISABILITY BENEFITS (§ 51.1-1125)

A. In addition to offsets equal to the amount of any benefits paid to a
participating employee under the Act, supplemental disability benefit payments
shall be offset by an amount equal to any sums payable to a participating
employee from the following sources:

   1. During the first 12 months the employee receives disability benefits, an
   amount equal to the employee&#8217;s wages and salary from any employment
   times the income replacement percentage payable;

   2. After the first 12 months the employee receives disability benefits, an
   amount equal to 70 percent of the employee&#8217;s wages and salary from any
   employment;

   3. Disability payments from the Social Security Administration, local
   government disability benefits, federal civil service disability benefits, or
   other similar governmental disability program benefits received by the
   employee or his family as a result of the qualifying disability;

   4. Benefits received from any other group insurance contract provided by the
   Commonwealth for the purpose of income replacement;

   5. Benefits paid under any compulsory benefits law; and

   6. If the participating employee receives a settlement in lieu of periodic
   payments for a disability compensable under the Act, an amount determined by
   dividing the workers&#8217; compensation benefit which such employee would
   have received had the lump-sum settlement not been consummated into the
   settlement actually accepted by the employee.
   				Notwithstanding the foregoing, supplemental disability benefit payments
   shall not be offset by military disability benefits payable to a participating
   employee.

B. If the plan administrator deems a participating employee to be eligible for
benefits from any of the sources listed in subdivisions A 3, A 4, and A 5, the
plan administrator may direct the participating employee to apply for those
benefits and to pursue whatever additional steps are necessary to obtain the
benefits. If a participating employee fails or refuses to pursue the available
benefits as directed by the plan administrator, supplemental disability benefit
payments may be reduced by amounts from any of the sources listed in
subdivisions A 3, A 4, and A 5 for which a participating employee is deemed
eligible by the plan administrator as if the employee received such amounts.
However, if the employee has applied for such benefits, and has reapplied and
appealed denials of the claim as requested by the administrator of the plan, and
the claim is not approved, the employee&#8217;s supplemental disability payments
shall not be reduced thereby.

C. If a participating employee&#8217;s disability benefit payments are reduced
as the result of payments from sources listed in subdivisions A 3, A 4, and A 5
or pursuant to subsection B, the employee&#8217;s disability benefits shall not
thereafter be further reduced on account of cost-of-living increases in payments
from such sources.

D. Participating employees shall be required to repay, with interest, to the
Board or the employer any overpayments of supplemental disability benefits on
account of the failure of the employee to provide the Board or its designee with
information necessary to make any of the reductions required to be made under
this article.

E. Any payment to a participating employee that is later determined by the Board
or by the employer to have been procured on the basis of any false statement or
falsification of any record knowingly made by or on behalf of the employee, or
the employee&#8217;s failure to make any required report of change in disability
status, may be recovered from the employee by the Board, with interest, either
by way of a credit against future payments due the employee or by an action at
law against the employee.

F. If a participating employee&#8217;s payments under the Act are adjusted or
terminated for refusal to work or to comply with the requirements of &#xA7;
65.2-603, his disability benefits shall be computed as if he were receiving the
compensation to which he would otherwise be entitled under the Act.

HISTORY: 1998, c. 774; 1999, c. 144; 2000, c. 889; 2003, c. 5; 2006, cc. 778,
841; 2012, c. 417.