Workers’ Compensation Proceeds: Are They Exempt From Creditors?

Florida Statute 222.11 protect from garnishment wages and other compensation earned by a head of household, and it further exempts wages deposited in the debtor’s bank accounts. . A client asked me this week if workers’ compensation payments were exempt under the wage exemption statute. The client thought that if the law protects wages paid to an employee the law should also exempt money paid on account of injuries incurred during employment. I found that the wage exemption statute, 222.11, does not exempt workers’ compensation, but that other Florida Statutes provide an exemption from creditor garnishment.

Florida Statute 222.11, the wage exemption statute, does not mention or even refer to workers’ compensation payments. Workers’ compensation is dealt with in Chapter 440 of the Florida Statutes. Section 440.22 provides that payments due the beneficiary of workers’ compensation cannot be assigned and threat the benefits due or payable are exempt from claims of creditors. The statute does not specifically exempt workers’ compensation after it is paid and deposited into a bank account. However, the Florida Supreme Court has interpreted the statute and the legislature’s intent to protect workers’ compensation proceeds after they are paid and deposited so long as the debtor is able to identify the money deposited in the bank to workers’ compensation. The case is Broward v. Jacksonville Medical Center.

About the Author

Jon Alper is an expert in asset protection planning for individuals and small businesses.

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