Leaving a job while receiving workers’ compensation benefits in New York is legally allowed—but doing so can affect your benefits and claim outcome in several ways. Workers facing this decision need to weigh medical, financial, and legal implications before making a move.

What Happens to Workers’ Comp Benefits If You Resign?

In New York, quitting your job does not automatically end your workers’ compensation benefits. Medical benefits for your injury will generally continue as long as your condition is still work-related and properly documented. However, wage replacement benefits—also called lost wages—may be reduced, paused, or terminated depending on why you left and your ability to work.

Key distinctions to consider:

  • Medical Treatment: If a doctor confirms that you still need care due to your original workplace injury, you can continue receiving treatment through workers' comp regardless of your employment status.
  • Lost Wages: These benefits are more sensitive to your job status. If you quit without a valid reason related to your injury, insurers may argue that you voluntarily limited your income—potentially cutting off wage replacement payments.

Injury Severity and Work Capacity Play a Role in Your Worker's Comp Claim

New York workers' comp cases are closely tied to your medical classification and work capacity.

  • Totally Disabled Workers: If your doctor determines you cannot work at all due to your injury, quitting your job will typically not affect your wage replacement benefits.
  • Partially Disabled Workers: If you’re cleared for light duty or part-time work and you resign, your employer or the insurance carrier may claim you are no longer seeking employment within your limitations. This can jeopardize your payments.

Pro tip: Keep detailed records of medical evaluations and any job offers or light-duty accommodations from your employer. If you refuse a valid offer of light-duty work, that may be used against you.

Quitting Due to Hostile Work Environment or Retaliation While on Workers' Comp

In some cases, injured workers consider quitting because of hostile conditions or retaliation after filing a claim. If that’s the case, you may have additional legal protections under New York labor laws and federal anti-retaliation statutes.

However, quitting due to these circumstances doesn’t automatically protect your benefits. You’ll need to document evidence of harassment, unsafe conditions, or retaliation. It’s wise to consult an employment attorney or workers’ comp lawyer before taking action. In some cases, you may be entitled to a separate legal claim in addition to your workers’ comp case.

Can You Start a New Job While Receiving Workers' Compensation Benefits in New York?

Yes, you can accept a new job while on workers’ compensation in New York, but any income must be reported to the Workers’ Compensation Board. This may affect the amount of wage loss benefits you receive.

  • If your new job pays less than your pre-injury wage, you may still be eligible for reduced earnings compensation, which helps bridge the gap.
  • If your new job meets or exceeds your prior income, you likely won’t qualify for wage replacement anymore, but you can still receive medical benefits related to your injury.

Failing to report new employment can lead to a fraud investigation, repayment demands, and even criminal charges.

Impact on a Workers’ Comp Settlement

If you’re considering a Section 32 settlement—a lump sum agreement to close your case—quitting your job may factor into the negotiation. Insurers might offer a lower amount if you’re no longer working for the employer where the injury occurred. On the other hand, if you're leaving to pursue different work or relocate, settling the claim might be a strategic decision.

Keep in mind:

Always review settlement offers with a qualified attorney to ensure they reflect the full scope of your medical and wage loss damages.

Should You Quit or Wait? Key Considerations

Before making a final decision, consider the following:

  • Have you reached maximum medical improvement (MMI)? Quitting before reaching MMI could complicate your benefits and ongoing treatment.
  • Is your employer offering accommodations or light-duty roles? Turning them down can be used to reduce or stop your benefits.
  • Do you have another job lined up? Ensure the work is within your medical restrictions.
  • Have you discussed the move with your doctor and attorney? Professional advice helps you avoid unintended legal consequences.

Get Legal Guidance Before Making a Move

Quitting your job while receiving workers' comp in New York is allowed, but the legal and financial stakes are high. Even a well-intentioned decision can be interpreted negatively by insurers. Working with an attorney experienced in New York workers’ compensation law ensures your rights are protected, your benefits continue where appropriate, and that you’re not leaving money on the table.

Whether you’re facing a toxic work environment, moving out of state, or considering a career shift, professional guidance can help you chart the right course.

Conclusion

While it is legal to quit your job while receiving workers' compensation in New York, doing so without a clear plan can put your medical coverage and wage benefits at risk. The outcome depends on your work capacity, injury status, and how you manage the transition. Before resigning, speak with your doctor, understand your legal options, and consider consulting a workers’ compensation attorney. Making an informed decision now can protect your long-term health and financial recovery.

Injured? The Office of Brandon J. Broderick, New York Workers Compensation Lawyers, Can Help

If the unfortunate happens and you’ve been injured in an accident, don’t go it alone. An experienced lawyer can advocate for your best interest and pursue fair compensation for your damages. At Brandon J. Broderick, Attorney at Law, you can count on us to work tirelessly for your quality of life. Our long track record of success has helped people like you move forward after sustaining an injury caused by another’s negligence. 

Contact us now for a free legal review.

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