Upon application of the disabled employee, the employee’s dependents or the employer, the director of labor and industrial relations may order that the periodic benefit payments be commuted to one or more lump sum payments equal to the present value at the time when the lump sum payments are due of the future benefit payments, computed at four per cent true discount compounded annually, if the director finds that such commutation is in the best interest of the employee or the employee’s dependents and does not impose undue hardship upon the employer.

The probability of the death of the disabled employee or of a dependent entitled to benefits before the expiration of the period during which the employee or dependent is entitled to receive such payments and the probability of the remarriage of the spouse shall be determined in accordance with the latest United States Life Tables and the American Remarriage Tables, respectively, as adjusted and corrected on the basis of the most recent available experience, or in accordance with any other appropriate actuarial tables selected by the director, upon advice of the chief actuary of the Social Security Administration. The probability of the happening of any other contingency affecting the amount or duration of the benefit payments shall not be considered.

Payment of the lump sums shall discharge the employer of the employer’s liability for the corresponding income and indemnity benefits.