Tag Archives: loss of earning power

Does higher unemployment mean higher workers’ compensation benefits?

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Last fall, I wrote about my opinion that good economic conditions often lead workers to be underpaid for work injuries.

But will that conclusion change now that unemployment has increased to historic highs? Maybe, here is how I believe higher unemployment could affect the value of workers’ compensation cases.

Loss of earning power

Nebraska law pays back injuries, head injuries, mental injuries, burns, multiple body part injuries on how they impact your ability to work. Nebraska calls the impact of a work injury on your ability to work “loss of earning power” or “LOEP” for short.  A medical opinion about the harm, restrictions or loss of use caused by an injury is just starting point in deciding loss of earning power.

Courts consider social and economic factors along with physical restrictions in calculating loss of earning power. Those other factors include: education, age, where you live and transferable skills.

The competitive labor market

Where you live is important because it gives the court an idea of the jobs available to you. Oftentimes in workers’ compensation cases there is an argument about which cities or areas to include in a job market. But the mere availability of work in your area doesn’t determine your loss of earning power.

Under Nebraska law, loss of earning power is based on a competitive labor market. When times are good, the players in the workers’ compensation system ignore the idea of a competitive labor market.

But when unemployment rises, lawyers, judges and vocational counselors, (the experts who help decide LOEP) may remember the idea of a competitive labor market. In a competitive labor market, someone who lost a job due to a work injury is going to have difficulty finding a job. The same goes for workers with serious work restrictions.

Retail jobs, along with food service jobs, are considered by many to be an employer of last result. But when unemployment spiked in March, Wal-Mart has 1,000,000 applicants for 150,000 open jobs.  In comparison, Ivy League school Cornell University accepted 14.1 percent of applicants in this year. So I think it’s fair to say that the labor market is competitive. (I’ve noticed a lack of articles about the “skills gap” and “employee ghosting” since March)

No place like Nebraska?

Under Nebraska law, judges decide loss of earning power based on local economic conditions.. The good news/bad news for Nebraska workers is that Nebraska still has the lowest unemployment in the nation. Nebraskans may not see a major increase in permanent disability benefits due to economic conditions.

But workers who live outside of Nebraska can claim Nebraska workers compensation benefits. Generally they can claim benefits if they were hurt in Nebraska, hired in Nebraska or their employer is based in Nebraska. Residents of other states would have their loss of earning power or disability determined based on where they live. These workers may see increased permanent disability benefits.

The offices of Rehm, Bennett, Moore & Rehm, which also sponsors the Trucker Lawyers website, are located in Lincoln and Omaha, Nebraska. Five attorneys represent plaintiffs in workers’ compensation, personal injury, employment and Social Security disability claims. The firm’s lawyers have combined experience of more than 95 years of practice representing injured workers and truck drivers in Nebraska, Iowa and other states with Nebraska and Iowa jurisdiction. The lawyers regularly represent hurt truck drivers and often sue Crete Carrier Corporation, K&B Trucking, Werner Enterprises, UPS, and FedEx. Lawyers in the firm hold licenses in Nebraska and Iowa and are active in groups such as the College of Workers’ Compensation Lawyers, Workers' Injury Law & Advocacy Group (WILG), American Association for Justice (AAJ), the Nebraska Association of Trial Attorneys (NATA), and the American Board of Trial Advocates (ABOTA). We have the knowledge, experience and toughness to win rightful compensation for people who have been injured or mistreated.

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What is a Functional Capacity Evaluation and what does it mean for a workers’ compensation claim?

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A functional capacity evaluation, or FCE for short, is a test that is usually conducted by a physical therapist that tests your physical abilities. They are common in workers’ compensation claims that involve surgeries or extended courses of treatment. So why are injured workers asked to perform functional capacity evaluations:

Injured worker is done treating and medically stable: Usually a doctor will order a functional capacity when the injured worker is medically stable. Sometimes the term “maximum medical improvement” or MMI is used in conjunction with an order for an FCE. MMI is as much a legal determination as it a medical determination. But when an injured worker is at the point of an FCE, the insurer likely believes or would like to believe the claim is close to finished.

Determining restrictions for return to work, permanent disability and vocational rehabilitation. FCE results are given almost total deference by workers’ comp bureaucrats like adjusters and case managers. HR managers also rely on them to place injured workers back in employment. But the FCE is only an estimate. By law an employee can testify to the extent of their own restrictions and an employer has some reasonable obligation to work with those restrictions. A Judge can also rely on testimony from a worker about the extent of their own restrictions. The problems is that an employee may have to wait months before they can testify to their own restrictions and go without benefits and pay until then.

Restrictions from an FCE can also be used to determine permanent disability or vocational rehabilitation benefits. This should mean that at some point a vocational rehabilitation counselor should be involved in your case. Even if you have returned to work for the same employer, in many cases a counselor should be still he helping to determine your disability. Also even if you haven’t gone back to work and might have applied for or be receiving social security disability a counselor should be performing a loss of earning power evaluation in many cases. Often times an insurance company will attempt to close a case after an FCE.

Employers/Insurers may be trying to the validity of your work restrictions. FCEs are designed to see if an employee is giving full effort on the test. In many cases an FCE that is set up by employer/insurer harkens back to the old concept of “trial by ordeal” or “trial by battle” where success in a physical feat could prove guilt or innocence. In the case of a workers’ compensation claim success or failure in an FCE can go a long way towards determining the ultimate outcome of a workers’ compensation case.

Regardless of why an injured worker is being sent to an FCE, it is probably good idea for an injured worker to check-in with an experienced workers’ compensation attorney for a free consultation if they are scheduled for an FCE. The attorneys at our firm can help injured employees navigate the trial by battle that an employer-scheduled FCE can be. We can also let you know what to expect after an FCE and help you overcome the consequences of a bad FCE.

The offices of Rehm, Bennett, Moore & Rehm, which also sponsors the Trucker Lawyers website, are located in Lincoln and Omaha, Nebraska. Five attorneys represent plaintiffs in workers’ compensation, personal injury, employment and Social Security disability claims. The firm’s lawyers have combined experience of more than 95 years of practice representing injured workers and truck drivers in Nebraska, Iowa and other states with Nebraska and Iowa jurisdiction. The lawyers regularly represent hurt truck drivers and often sue Crete Carrier Corporation, K&B Trucking, Werner Enterprises, UPS, and FedEx. Lawyers in the firm hold licenses in Nebraska and Iowa and are active in groups such as the College of Workers’ Compensation Lawyers, Workers' Injury Law & Advocacy Group (WILG), American Association for Justice (AAJ), the Nebraska Association of Trial Attorneys (NATA), and the American Board of Trial Advocates (ABOTA). We have the knowledge, experience and toughness to win rightful compensation for people who have been injured or mistreated.

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