77 Pa. Stat. § 601

Current through Pa Acts 2024-53, 2024-56 through 2024-127

Section 601 - Compensation payable in periodical installments

(a) Except as hereinafter provided, all compensation payable under this article shall be payable in periodical installments, as the wages of the employe were payable before the injury.

(b) Compensation payable under this article shall be paid by direct deposit to the account of the person entitled to the compensation. upon request of the person entitled to compensation who does not have an account with a financial institution capable of accepting a direct deposit , the insurer or self-insured employer shall pay compensation by paper check in lieu of direct deposit. The following shall apply:

(1) Installments of compensation payable under this article paid by direct deposit shall be subject to the following:

(i) After the effective date of this subparagraph, an insurer or self-insured employer may permit or require payment of compensation by direct deposit. If the insurer or self-insured employer permits payment by direct deposit, the option shall be available to all persons entitled to compensation from the insurer or self-insured employer.

(ii) No later than one year after the effective date of this subparagraph, all insurers and self-insured employers shall permit payment of compensation by direct deposit.

(2) The insurer or self-insured employer shall notify the persons entitled to compensation of the option or requirement to receive compensation by direct deposit. Notification shall be made immediately upon the availability or requirement of direct deposit by the insurer or self-insured employer or concurrently with a notice of compensation payable.

(3) The insurer or self-insured employer shall provide the person entitled to compensation with a payment authorization form or may direct the person entitled to compensation to an online authorization form.

(4) A person entitled to compensation who requests to receive compensation by direct deposit shall submit an accurate and valid payment authorization form or a valid online authorization form to the insurer or self-insured employer. The following shall apply:

(i) The payment authorization form may be submitted electronically if the insurer or self-insured employer has agreed to accept the form electronically.

(ii) The insurer or self-insured employer shall not be required to pay compensation by direct deposit unless the person entitled to compensation has submitted a valid payment authorization form or a valid online authorization form.

(iii) If the insurer or self-insured employer requires payment by direct deposit and the person entitled to compensation does not submit a valid payment authorization form or valid online authorization form within thirty days of receiving notification of the requirement, the insurer or self-insured employer must temporarily pay compensation by paper check.

(5) A person entitled to compensation shall have the right to choose the deposit account to which payment of compensation is made and may request to change the deposit account designated to receive compensation or discontinue direct deposit by submitting a revised payment authorization form or a revised online authorization form to the insurer or self-insured employer. The deposit account shall be subject to the following requirements:

(i) The person entitled to compensation shall have control and signatory access to the chosen deposit account.

(ii) The deposit account shall be with a bank as defined under 12 U.S.C. § 1813(a)(1) (relating to definitions) on the effective date of this subparagraph or a credit union.

(iii) A deposit account may be changed no more than two times in any calendar year, unless otherwise ordered by a workers' compensation judge or a court of competent jurisdiction.

(6) For a person entitled to compensation, payments of compensation may not be split between multiple payment methods, and payments of compensation made by direct deposit may not be split between multiple deposit accounts.

(7) A request to initiate direct deposit, change deposit accounts or discontinue direct deposit shall be implemented within forty-five days of receipt, provided that the payment authorization form or online authorization form is valid.

(8) An insurer or a self-insured employer shall not be responsible for repaying any money deposited into an incorrect account if the sole reason for the error is incorrect information provided by the person entitled to receive compensation. An insurer or a self-insured employer shall take reasonable actions to attempt to recover the money and any money later recovered by the insurer or self-insured employer shall promptly be credited to the person entitled to receive compensation.

(9) Lump sum settlement payments made as a result of a compromise and release agreement may be made by paper check unless the insurer or self-insured employer agrees to make payment by direct deposit.

(10) A payment made on a claim with an expected duration of sixty days or less may be made by paper check unless:

(i) The insurer or self-insured employer agrees to make payment by direct deposit.

(ii) The person entitled to compensation previously received compensation by direct deposit and verifies that the direct deposit account previously used is still valid.

(c) The department shall develop and publish a standard payment authorization form for use by all insurers and self-insured employers under this section. The form shall include, but not be limited to, the following information:

(1) The name, telephone number, mailing address and email address of the person entitled to compensation.

(2) The workers' compensation claim number.

(3) Whether the person entitled to compensation is requesting to initiate direct deposit, change deposit accounts, discontinue direct deposit or elects payment by paper check in lieu of direct deposit.

(4) The name and address of the financial institution and the account and routing numbers to which compensation shall be sent.

(5) Acknowledgment that failure to notify the insurer or self-insured employer of any change in financial institution or account may delay receipt of compensation or settlement proceeds.

(6) Acknowledgment that a false statement or failure to disclose a material fact to obtain or increase compensation may result in criminal prosecution, disqualification of benefits and repayment of money deposited into the account.

(7) Acknowledgment that the person entitled to compensation shall notify the insurer or self-insured employer of changes in circumstance that affect entitlement to compensation payable under this article.

(d) As used in this section:

"Credit union" shall mean any of the following:

(1) A cooperative corporation incorporated under any of the following:

(i) The former act of May 26, 1933 (P.L.1076, No.260), referred to as the Credit Union Act.

(ii) The former act of September 20, 1961 (P.L.1548, No.658), known as the "Credit Union Act."

(iii) The act of December 19, 1990 (P.L.834, No.198), known as the "GAA Amendments Act of 1990."

(2) A credit union organized in accordance with the provisions of 12 U.S.C. Ch. 14 (relating to Federal credit unions).

"Direct deposit" shall mean a credit to a deposit account in a financial institution made by electronic fund transfer. The term does not include money loaded onto a debit card associated with a financial institution.

"Electronic fund transfer" as defined in 15 U.S.C. § 1693a (relating to definitions).

"Online authorization form" shall mean a form on a publicly accessible Internet website or electronic service, including a mobile application, which is prescribed by an insurer or self-insured employer and which contains the same information as the payment authorization form under subsection (c).

"Payment authorization form" shall mean the payment authorization form published under subsection (c).

"Person entitled to compensation" shall mean an employe, a person entitled to compensation or the person's legal representative under this article.

"Valid online authorization form" shall mean a completed online authorization form that contains all information necessary for the insurer or self-insured employer to initiate direct deposit, change deposit accounts or discontinue direct deposit.

"Valid payment authorization form" shall mean a completed payment authorization form that contains the information necessary for an insurer or self-insured employer to initiate direct deposit, change deposit accounts or discontinue direct deposit.

77 P.S. § 601

Amended by P.L. (number not assigned at time of publication) 2024 No. 126,§ 1, eff. 12/30/2024.

1915, June 2, P.L. 736, art. III, § 308. Reenacted and amended by 1937, June 4, P.L. 1552, § 1; 1939, June 21, P.L. 520, § 1. Amended 1972, March 29, P.L. 159, No. 61, § 16, eff. 5/1/1972.