An injured employee with dependents is incarcerated for an unrelated offense. Temporary disability otherwise payable is:

• A. paid
• B. paid to employee
• C. paid to employee's dependents
• D. paid to the state treasury to the credit of the Uninsured Employer's fund

Answer: (D)

Temporary disability benefits are usually wage replacement paid to the injured employee, but a special rule applies when the worker is incarcerated for an unrelated offense and has dependents. In this situation the law directs that the temporary disability funds be remitted to the state treasury for credit to the Uninsured Employers’ Fund. The Uninsured Employers’ Fund is a public pool used to cover certain claims when an employer lacks proper coverage, so sending the payments there ensures those funds remain available and prevents diverting benefits to the incarcerated worker or his dependents. Therefore, the payment goes to the Uninsured Employers’ Fund instead of to the employee or to the dependents.