Wage loss cases are becoming the new workers’ compensation “jackpots” in Illinois.
Editor’s comment: Another change that occurred during the 2005 Amendments to the Act was raising the bar on wage loss claims. In a claim that used to follow the PPD maximum we saw, for reasons justified only by the forces of Illinois labor, wage loss differential limits raised to a level much higher than previously used. What happened is a “gold rush” of new wage loss claims at every level.
Commission observers will tell you that total and permanent disability claims remain tough for a claimant to obtain—the Commission still has something of a “hard-working Yankee” mentality when it comes to giving out lifetime benefits for those who claim they can do no work of any kind. However, wage loss differential claimants are working, albeit at lower wages. Arbitrators and Commissioners are much more likely to allow them “half-a-loaf” that allows claimant’s attorney to cash in if they can convince the carrier/TPA to provide a lump sum settlement.
At present, the weekly wage differential maximum is $912.56. This means that a worker seeking a maximum wage loss differential is entitled to as much as $47,453.12 tax-free on an annual basis for life. The undiscounted value of a maximum rate wage loss case for a 25-year-old worker is a chilling $2,372.656.00.
We are now starting to see claim after claim filed seeking to take advantage of the largesse afforded by Illinois law. The buzz-words needed are “permanent restrictions” from a treating physician. Once one has such restrictions or limitations, the key to big money awaits at the IWCC. We know of one truck terminal in the south suburbs of Chicago where every claimant is seeking wage loss benefits.
We recently saw a claim where a young worker suffered bilateral carpal tunnel syndrome. He was making about $30.00 per hour. Following surgery, his doctor gave him the new “lottery winner” diagnosis—he provided permanent work restrictions. The well-meaning employer brought the worker back to work at a lower-paid permanent light-duty position paying $15.00 per hour.
Following a hearing, the Arbitrator issued an award allowing the employee to collect a lifetime benefit that will be a tidy $790,000, if he lives to his full life-expectancy. We aren’t kidding—if you want a copy of the award, send a reply.
Present value of that award is just shy of $400,000. We are certain the forces of labor feel this is a solid outcome—the young man gets to keep a good job with benefits and cash a regular tax-free check for annual benefits or get a lump sum of about $400K. We assure our readers the forces of Illinois business are revolting at the very thought of such an award or payment, particularly to someone who can buy a new home or several cars and flout their new-found wealth at the plant or work site. The cost of paying for medical care, lost time and that much money for permanency will bankrupt some companies.
The problem for business in this state is what to do about it? Well, trying to reform wage loss claims will be a true challenge. The attorneys and claimants driving such claims will be heard in Springfield, claiming they are being abused if they don’t get such awards. We expect some businesses with high-risk jobs will have to consider moving to our sister states that don’t provide lottery-winner-type permanency benefits.
We need your thoughts. What do you think is the best method to insure someone keeps the same approximate level of income but that doesn’t wildly penalize the employer?
