How does the Workers’ Compensation System Decide What is Fair to Pay to an Injured Worker? By Barry Lovell
When the workers’ compensation system was implemented early in the 20th century, New York adopted two overlapping methods for determining awards to workers. In 2007, the legislature made major modifications to the system, but left intact the different methods. In the past two years, New York State’s Appellate Division, Third Department, issued several decisions that look to fundamentally change the way in which the reformed methods interact with one another. For injuries to specific body parts like the hand or foot, Section 15 of the workers’ compensation law provides for what is commonly referred to as schedule loss of use awards. The law designates each body part as worth a certain number of weeks. For example, an arm is worth 312 weeks while a leg is worth 288 weeks. A 10 percent loss of the leg would pay 28.8 weeks of benefits. Doctors use the Workers’ Compensation Board guidelines to testify as to the percentage loss of use. Workers’ Compensation Law judges use this medical testimony to make awards to workers. The law, however, recognizes that some injuries do not lend themselves to this type of classification. Injuries to the back, or to multiple body parts that are particularly severe, receive awards of unscheduled benefits. Prior to the reform, claimants who had not returned to work and who were found to be permanently totally or partially disabled, received lifetime awards up ON THE LEVEL:
to two-thirds of the worker’s average weekly wage, subject to a maximum of two-thirds of the statewide average weekly wage—currently $966.78. In 2007, New York reformed its system and imposed caps on the duration of unscheduled awards to permanently partially disabled claimants. Permanently totally disabled claimants still receive lifetime awards. Awards now range from 225 weeks for 15 percent or less, to 525 weeks for 95 percent or more. Prior to 2007 these percentages were based upon the medical degree of disability, affecting the amount of a weekly award but not how long the award was paid. Post-reform, the law judge uses the medical testimony in combination with other testimony to determine the Loss of Wage-Earning Capacity (LWEC) percentage, which now determines both the size and duration of the award. LWEC considers non-medical factors like the age, language skills, or education level of a claimant. One of the key differences between the types of awards is that scheduled benefits are paid regardless of whether an employee returns to work. An employee with a leg injury could receive workers compensation benefits for the time that they were out of work, return to work, and then still get a check for thousands of dollars. Unscheduled benefits are paid only when an employee is not working or has not returned to work at their full salary. What happens when
Barry Lovell is the President of Lovell Safety Management Co., LLC. He can be reached at 212-709-8600 or blovell@lovellsafety.com.
workers have both schedulable and unschedulable injuries? Up until last year, case law precluded an award for schedule benefits when an employee was eligible for unscheduled benefits. Two recent decisions determined that an employee eligible for unscheduled benefits who returns to work at full pay can now receive benefits for their schedulable injuries. The latest decision, Matter of Arias v City of New York, published at the end of February of 2020, has produced a rising tide of litigation, as claimants who are currently working now seek additional awards. We now find ourselves at a perplexing moment, where many claimants who are working at their pre-injury salary are classified as having lost wage earning capacity, even though they haven’t lost any actual wages. These same claimants, the court has ruled, now qualify for additional compensation awards. Some argue that this outcome is fair, even if the process itself is now self-contradictory. All, however, agree that this circumstance guarantees more litigation.
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