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CFR  

Code of Federal Regulations Pertaining to U.S. Department of Labor

Title 20  

Employees' Benefits

 

Chapter VI  

Employment Standards Administration, Department of Labor

 

 

Part 702  

Administration and Procedure

 

 

 

Subpart A  

General Provisions


20 CFR 702.145 - Use of the special fund.

  • Section Number: 702.145
  • Section Name: Use of the special fund.

    (a) Under section 10 of the Act. This section provides for initial 
and subsequent annual adjustments in compensation and continuing 
payments to beneficiaries in cases of permanent total disability or 
death which commenced or occurred prior to enactment of the 1972 
Amendments to this Act (Pub. L. 92-576, approved Oct. 27, 1972). At the 
discretion of the Director, such payments may be paid directly by him to 
eligible beneficiaries as the obligation accrues, one-half from the 
special fund and one-half from appropriations, or he may require 
insurance carriers or self-insured employers already making payments to 
such beneficiaries to pay such additional compensation as the amended 
Act requires. In the latter case such carriers and self-insurers shall 
be reimbursed by the Director for such additional amounts paid, in the 
proportion of one-half the amount from the special fund and one-half the 
amount from appropriations. To obtain reimbursement, the carriers and 
self-insurers shall submit claims for payments made by them during 
previous periods at intervals of not less than 6 months. A form has been 
prescribed for such purpose and shall be used. No administrative claims 
service expense incurred by the carrier or self-insurer shall be 
included in the claim and no such expense shall be allowed. The amounts 
reimbursed to such carrier or self-insurer shall be limited to amounts 
actually due and previously paid to beneficiaries.
    (b) Under section 8(f) of the Act (Second Injuries). In any case in 
which an employee having an existing permanent partial disability 
suffers injury, the employer shall provide compensation for such 
disability as is found to be attributable to that injury based upon the 
average weekly wages of the employee at the time of injury. If, 
following an injury falling within the provisions of section 8(c)(1)-
(20), the employee with the pre-existing permanent partial disability 
becomes permanently and totally disabled after the second injury, but 
such total disability is found not to be due solely to his second 
injury, the employer (or carrier) shall be liable for compensation as 
provided by the provisions of section 8(c)(1)-(20) of the Act, 33 U.S.C. 
908(c)(1)-(20) or for 104 weeks, whichever is greater. However, if the 
injury is a loss of hearing covered by section 8(c)(13), 33 U.S.C. 
908(c)(13), the liability shall be the lesser of these periods. In all 
other cases of a second injury causing permanent total disability (or 
death), wherein it is found that such disability (or death) is not due 
solely to the second injury, and wherein the employee had a pre-existing 
permanent partial disability, the employer (or carrier) shall first pay 
compensation under section 8(b) or (e) of the Act, 33 U.S.C. 908(b) or 
(e), if any is payable thereunder, and shall then pay 104 weeks 
compensation for such total disability or death, and none otherwise. If 
the second injury results in permanent partial disability, and if such 
disability is compensable under section 8(c)(1)-(20) of the Act, 33 
U.S.C. 908(c)(1)-(20), but the disability so compensable did not result 
solely from such second injury, and the disability so compensable is 
materially and substantially greater than that which would have resulted 
from the second injury alone, then the employer (or carrier) shall only 
be liable for the amount of compensation provided for in section 
8(c)(1)-(20) that is attributable to such second injury, or for 104 
weeks, whichever is greater. However, if the injury is a loss of hearing 
covered by section 8(c)(13), 33 U.S.C. 908(c)(13), the liability shall 
be the lesser of these periods. In all other cases wherein the employee 
is permanently and partially disabled following a second injury, and 
wherein such disability is not attributable solely to that second 
injury, and wherein such disability is materially and substantially 
greater than that which would have resulted from the second injury 
alone, and wherein such disability following the second injury is not 
compensable under section 8(c)(1)-(20) of the Act, then the employer (or 
carrier) shall be liable for such compensation as may be appropriate 
under section 8(b) or (e) of the Act, 33 U.S.C. 908(b) or (e), if any, 
to be followed by a payment of compensation for 104 weeks, and none 
other. The term ``compensation'' herein means money benefits only, and 
does not include medical benefits. The procedure
for determining the extent of the employer's (or carrier's) liability 
under this paragraph shall be as provided for in the adjudication of 
claims in subpart C of this part 702. Thereafter, upon cessation of 
payments which the employer is required to make under this paragraph, if 
any additional compensation is payable in the case, the district 
director shall forward such case to the Director for consideration of an 
award to the person or persons entitled thereto out of the special fund. 
Any such award from the special fund shall be by order of the Director 
or Acting Director.
    (c) Under sections 8(g) and 39(c)(2) of the Act. These sections, 33 
U.S.C. 908(g) and 939(c)(2), respectively, provide for vocational 
rehabilitation of disabled employees, and authorize, under appropriate 
circumstances, a maintenance allowance for the employee (not to exceed 
$25 a week) in additional to other compensation benefits otherwise 
payable for his injury-related disability. Awards under these sections 
are made from the special fund upon order of the Director or his 
designee. The district directors may be required to make investigations 
with respect to any case and forward to the Director their 
recommendations as to the propriety and need for such maintenance.
    (d) Under section 39(c)(2) of the Act. In addition to the 
maintenance allowance for the employee discussed in paragraph (c) of 
this section, the Director is further authorized to use the fund in such 
amounts as may be necessary to procure the vocational training services.
    (e) Under section 7(e) of the Act. This provision, 33 U.S.C. 907(e), 
authorizes payment by the Director from the special fund for special 
medical examinations, i.e., those obtained from impartial specialists to 
resolve disputes, when such special examinations are deemed necessary 
under that statutory provision. The Director has the discretionary 
power, however, to charge the cost of such examination to the insurance 
carrier or self-insured employer.
    (f) Under section 18(b) of the Act. This section, 33 U.S.C. 918(b), 
provides a source for payment of compensation benefits in cases where 
the employer is insolvent, or other circumstances preclude the payment 
of benefits due in any case. In such situations, the district director 
shall forward the case to the Director for consideration of an award 
from the special fund, together with evidence with respect to the 
employer's insolvency or other reasons for nonpayment of benefits due. 
Benefits, as herein used, means medical care or supplies within the 
meaning of section 7 of the Act, 33 U.S.C. 907, and subpart D of this 
part 702, as well as monetary benefits. Upon receipt of the case, the 
Director shall promptly determine whether an award from the special fund 
is appropriate and advisable in the case, having due regard for all 
other current commitments from the special fund. If such an award is 
made, the employer shall be liable for the repayment into the fund of 
the amounts paid therefrom, as provided in 33 U.S.C. 918(b).

(The information collection requirements contained in paragraph (a) were 
approved by the Office of Management and Budget under control number 
1215-0065. The information collection requirements contained in 
paragraph (b) were approved by the Office of Management and Budget under 
control number 1215-0073)

(Pub. L. No. 96-511)
[38 FR 26861, Sept. 26, 1973, as amended at 49 FR 18294, Apr. 30, 1984; 
51 FR 4282, Feb. 3, 1986]
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