Workers’ compensation benefits are often treated as a financial lifeline for employees injured on the job, but the characterization and distribution of such benefits can become complex when family law intersects with injury compensation. A recent decision by a Massachusetts court highlights how workers’ compensation proceeds may be treated as marital property and can factor into child support enforcement actions. If you were injured at work, it is important to understand your rights and how any benefits you may be owed could be treated in future litigation, and you should speak to a Massachusetts workers’ compensation attorney who can help clarify your rights.
Case Setting
It is reported that the parties married in 2013 following a lengthy personal and financial relationship, during which they shared expenses and jointly purchased property. The marriage ultimately broke down by 2020. The husband, employed by a commuter rail service, reportedly experienced several periods of disability due to job-related injuries and surgeries.
It is alleged that the husband received a net workers’ compensation settlement of $200,000 in 2020 related to his workplace injuries. By the time of the divorce trial, he claimed only limited income, specifically, $788 per week from workers’ compensation and unemployment insurance, and was no longer employed by his previous employer. The trial judge did not credit the husband’s assertions that his departure from work was medically necessary and found that he had made no effort to seek reemployment.
It is further reported that the parties had a child born in 2017. Following a 2021 stipulation, the husband agreed to pay $215 per week in child support. At the time of trial, he was in arrears in the amount of $8,412.14. The court found that during the same period, he failed to meet his support obligations and had dissipated the entire $200,000 workers’ compensation settlement. The dissipation violated an automatic restraining order issued pursuant to Supplemental Probate and Family Court Rule 411, which prohibits parties from transferring or disposing of marital assets once divorce proceedings commence.
As a result, the trial judge entered two judgments of contempt against the husband, including one for willful failure to pay child support. The judgment of divorce nisi also ordered him to pay the arrears and a $50,000 equitable share of the dissipated compensation proceeds to the wife. The husband appealed.
Workers’ Compensation Benefits in the Context of Divorce Cases
The Massachusetts Appeals Court affirmed the contempt judgment and upheld the trial court’s characterization of the workers’ compensation settlement as a marital asset subject to division. The Court cited the principle that property acquired during the marriage, including compensation for injuries, is generally presumed to be part of the marital estate unless otherwise excluded. Because the injury occurred during the marriage and the settlement was received before the divorce judgment became final, the court concluded that the workers’ compensation award was properly included in the equitable distribution analysis.
The Court also rejected the husband’s argument that the workers’ compensation settlement should have been excluded as a federally governed benefit under the Federal Employers’ Liability Act (FELA). The appellate panel found no legal authority suggesting that the nature of the underlying claim immunized the proceeds from equitable division in state domestic relations proceedings. In the absence of such authority, and in light of the husband’s failure to properly substantiate the claim, the trial court’s finding was upheld.
Additionally, the Appeals Court concluded that the finding of contempt was supported by clear and convincing evidence. The record showed that the husband had the ability to pay child support and instead chose to expend the settlement funds for purposes not approved by the court. The judge did not credit the husband’s claims of financial hardship and found that he had not made reasonable efforts to remain employed or earn income. Under Massachusetts law, an obligor’s ability to pay at the time of the contempt finding is essential, and here, the dissipation of compensation proceeds while in arrears rendered the contempt finding appropriate.
Talk to an Assertive Massachusetts Workers’ Compensation Attorney
If you received substantial workers’ compensation settlements during or following a marriage, you should consult legal counsel to understand how these funds will be treated under Massachusetts law. Attorney James K. Meehan is an assertive Massachusetts workers’ compensation attorney with deep experience navigating injury compensation cases, and he can provide guidance tailored to your circumstances. Contact the Law Office of James K. Meehan at 508-822-6600 or reach out through our online form to schedule a confidential consultation.