Workers compensation is a defined benefit that pays certain benefits for work injuries regardless of fault. But when defined benefits aren’t well-defined, injured workers get short-changed when it comes to workers compensation disability benefits.
Underpayment of benefits is already baked into Nebraska workers’ compensation law for some workers. Nebraska usually does not take overtime pay into consideration when determining disability benefits. Nebraska also caps workers’ compensation benefits at a maximum rate.
Here is the how and why fuzzy math can lead injured workers can get underpaid benefits in Nebraska. I think you can break down the reasons that workers get underpaid into disputes over wage rates and the time periods they are entitled to benefits
Average weekly wage and abnormally low weeks
Permanent and temporary disability benefits are controlled by the average weekly wage under the Nebraska Workers Compensation Act. The average weekly wage is usually based on an average of the past 26 weeks of wages minus “abnormally low weeks”. What’s an abnormally low week? There isn’t a hard and fast rule. For the purposes of permanent disability Nebraska workers compensation law assumes a 40 hour work week. This assumption helps address underpayment issues for permanent disability.
But no such assumption exists for temporary disability under Nebraska workers compensation law. So insurers and claims administrators have wide latitude to underpay temporary benefits. This is particularly harmful as workers who are temporarily disabled are often entirety unable to work.
Workers who work evening and overnight shifts often get paid shift differential on top of base pay. Particularly if a worker works a combination of day and evening shifts, workers compensation benefits tend not to account for shift differential.
The gap between temporary and permanent disability
Nebraska law is unclear as to when temporary disability ends and when permanent disability ends. Not only does this mean injured workers can go months or weeks without benefits, it also means that workers can be underpaid benefits. Usually this underpayment is accomplished by shortening the period of temporary disability paid.
Neb. Rev. Stat. §48-119
Under Nebraska law, the first week of disability after a work injury is not compensated unless the disability lasts for more than six weeks. This tends to happen with injuries that don’t lead to quantifiable impairments. Sometimes, employees under pressure from employers, will be released to work too soon. Insurers and claims administrators view premature returns to work as an excuse to deny temporary disability because they employee is already at maximum medical improvement
The bottom line on underpayment of workers’ compensation benefits
If employees take these claims to court, they can often win back due benefits. These monetary amounts are meaningful for injured workers, but they may not always be cost-effective for an attorney to pursue.
In wage and hour cases under Nebraska and federal law successful claimants are awarded attorney fees that can be much greater than the lost wages collected. These fees encourage lawyers to take these cases.
But under Nebraska workers compensation law a successful claimant needs the court to find there was no reasonable controversy in law or fact for the court to award attorney fees and penalties under Neb. Rev. Stat. 48-125. This is a difficult standard. This difficult standard is made more difficult over disputes over average weekly wage because average weekly wage is a question of law and fact.
In short, Nebraska workers compensation law gives insurers and claims administrators wide latitude to underpay injured workers. But since under Nebraska law it is very difficult to win attorney fees in under Nebraska law, insurers and claims administrators have little to fear in the way of penalties and attorney fees if a court rules they underpaid benefits to an injured worker.
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