Articles & Updates

2017 Summary of Iowa Workers' Compensation Changes

by Bill Lamson

Foreword:  Many of the changes below represent a substantial shift from long standing, well established law and as is the case with any legislative changes, we expect some of them to be challenged in court.  As such it may be several years before the full extent of the changes and their ramifications are fully understood.  In some instances, completely new language has been added, which means that there will be different interpretations of that language which in turn may lead to more confusion and new disputes.  Without prior court cases to guide us on the proper interpretation, it’s reasonable to assume that many of these changes will lead to more disputes and litigation.  The summary below is just an overview and intended to be a guide as everyone navigates the implementation of these changes.  It is also expected that the agency will be revamping some of their procedures, possibly issuing new guidelines and forms to be in compliance with the new laws.  As we receive more information on these changes we’ll be providing further updates.  

1.    Intoxication

 The burden and standard of proof have shifted.  Once an employer shows that an employee has a positive drug or alcohol test at the time of the injury, it is presumed that the employee was intoxicated and that the intoxication was a substantial factor in causing the injury.  

a.    This shifts the burden to the employee to show that even though there was something in their system, it either wasn’t to the level of intoxication or that the intoxication wasn’t the cause of the accident and injury. 

b.    This may encourage more employers to adopt drug testing procedures since it puts the burden on the employee.  (You could say that once you have a positive test, the employee is then guilty until proven innocent, in terms of disproving causation.) 

 2.    Notice and State of Limitations:  

Clarified the notice and statute of limitation provisions and removed a prior requirement that notice was not required until an employee recognized the possible impact of the injury on their employment, which usually occurred when they missed work to seek medical treatment.  Now notice is required within 90 days of when the employee knew or should have known that the injury was work related.  This used to be a two-prong test, now it’s just a one prong test which will likely start the 90 day clock much sooner in many cases for injuries that may not be serious enough to cause an employee to miss work. 

 3.    Light duty work:  several changes: 

a.    Language was added that indicates light duty work offered by the employer does not necessarily have to be work ‘with’ that employer, meaning that you could find an employee light duty work through a vendor that provides such services and places employees in temporary positions, such as working at Goodwill.  This has been a growing practice that previously had not been specifically addressed in the statutes and as such it was often disputed by employees.  

b.    Another added provision indicates that the geographic location of the light duty work has been expanded to include locations where an employee has previously worked when their work includes travel away from the principle place of business.  

c.    Offers of light duty work now need to be communicated in writing, as does a refusal by the employee.  This is a new section and should be reviewed in detail by all employers as it places a burden on the employee to properly communicate a refusal of light duty work, but likewise adds the ‘in writing’ provision by the employer.   

 4.    PPD Payments 

The start date for PPD payments is now what many of us have always practiced: you start payments once MMI occurs AND once you have an impairment rating.  Previously we would occasionally start them before we got the rating, and in the last year, in some cases we’d start them when the employee returned to work, even if they weren’t at MMI yet.  (This was due to a very bad case that was decided last year but this law overturns it.) 

5.    Shoulder now a scheduled member: 

This is obviously once of the most significant changes.  No longer is a shoulder injury considered a BAW injury.  As such, the claimant no longer get industrial disability benefits.  The max number of weeks is 400, which is still pretty high for a scheduled member, but still much lower than what it has always been. 

 6.    BAW claims 

Several significant changes to BAW claims have been made under this new section.  

a.    Impairment ratings and remaining work years are specifically mentioned as factors when evaluating industrial disability.  A new provision specifically states that when evaluating I.D. the court shall now take into account how long the claimant was expected to keep working.  This is undoubtedly aimed at older workers who in the past received very large I.D. awards even though they may only be expecting to work a few more years.  This could represent a significant reduction but as mentioned above, it’s a new section and may be one of the more disputed changes.   

b.    When employee returns to work:  under this newly added section, when an employee returns to work at the same wages, their compensation will be based only on their impairment rating, not their earning capacity/industrial disability.  Also a new section, this represents a huge change and essentially turns many BAW claims into scheduled member claims if the employee returns to work earning the same wages.  

 7.    Scheduled member compensation 

Another new section regarding compensation for scheduled member claims was likely added in response to a recent court case.  This section specifically states that scheduled member injuries shall ONLY be compensated based on an impairment rating, which is what we’d been doing for decades.  However, in a case last year the judge allowed the employee to submit testimony and other evidence to support his claim that he should get benefits in excess of the ratings, and the judge in fact did give him a higher award.  This new section shuts that down and essentially solidifies what we’d always been doing.  

 8.    No PPD and PTD at the same time 

This is a new section, and limited to rare situations where a claimant would be getting PPD benefits and is then later awarded PTD benefits.  The new section states that once your PTD starts, you no longer get the prior PPD benefits. 

 9.    No PTD if receiving unemployment 

This is also a new provision, and not very common, but if an employee is receiving unemployment benefits they cannot also get perm total disability benefits.  They can still get PPD.  

10. Credit for overpayment 

Any overpayment of indemnity benefits can now, officially, be applied to future weekly benefits for the same injury, TTD, TPD or PPD. In the past we would usually try to take a credit for overpayment and most claimant’s attorneys would not resist, though technically the law stated that you could only apply an overpayment against future PPD for a different/subsequent injury.  Now the law opens it up and says you can apply it to any indemnity for either the current injury or a subsequent injury with the same employer.  

 11. Compensation for pre-existing disabilities 

Language was added to formalize and clarify what case law had previously established but was often in dispute.  When an employee has successive injuries with the same employer, the employer is only responsible for compensating the employee for the disability resulting from the current injury.  If the employee was compensated for prior injuries with the same employer they do not get double recovery…the disability from prior injuries is not combined with the current injury.  

 12. Refusal to attend IME and benefits 

If an employee refuses to attend an IME they are not entitled to benefits during the period of refusal.  Previously you could ‘suspend’ their benefits, but once they went to the IME you’d have to pay them the previously withheld benefits.  It was viewed as a period of ‘suspended’ benefits.  Now those benefits are ‘forfeited’.  

 13. IME fee reimbursement 

Reimbursing the claimant’s attorney the cost of the IME is dependent on the claim being compensable.  If the claim goes to trial and the judge determines the claim is not compensable, the employee cannot recover the cost of the IME. 

 14. Commutation of benefits 

The section dealing with a Petition for Commutation of benefits has been changed to state that both parties must now consent to the requested commutation.  This appears to be a reversal of past practice in which a judge could still award the commutation when the employer objects to it as long as the employee demonstrated it was in his/her best interest…which was fairly easy to do.  

 15. Vocational rehabilitation 

This is a completely new section adding vocational rehabilitation services to employees who cannot return to work after a shoulder injury.  It’s apparently a trade-off for taking away industrial disability benefits.  This section will likely create a lot of confusion and uncertainty since it’s an entirely new benefit.  It appears to mandate an evaluation by the state workforce department to determine if the employee would benefit from vocational training.  If so, and if the employee chooses to enroll in the plan, the employer would have to pay for tuition and fees up to $15,000.  The agency has already indicated it’s in the process of reviewing all of these changes and I suspect this section is one which will get a lot of attention since it creates new obligations not just for the employer, but also for the state.    

 [These were the primary changes made to the workers’ compensation laws.  Some additional changes were made to a few procedures as well as rules regarding attorney fees, and further discussion of those issues and others will be provided as we continue to evaluate the new laws.  As you can see, there are a lot of very significant changes and as you might expect, claimant’s attorney have already been discussing their options for opposing and dealing with these changes.  We’ll continue to monitor new developments and provide updated evaluations when necessary, but please feel free to contact us to discuss any questions or concerns.]  

 

For additional information please contact: 

Bill Lamson – 402-397-0800       blamson@evans-dixon.com 

John Burns – 402-397-0800         jburns@evans-dixon.com

 

 

 

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