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New Work Comp Law: Increased Worker Benefits!

by | Apr 11, 2022 | Advisory Council, Injuries, Work Injury, Workers' Compensation - News

Governor Signs New Work Comp Law

In a win for Wisconsin’s injured workers and the entire work comp system, Governor Evers signed a new workers’ compensation bill that had been approved by the legislature and submitted from the Worker’s Compensation Advisory Council. The new law (2021 Wisconsin Act 232) is effective as of April 10, 2022 and provides for increased benefits for workers, along with some additional statutory changes.

Increased Permanency Benefits

The new law provides a substantial increase in permanent partial disability benefits for workers.  Permanent partial disability (or PPD) can occur when a doctor rates the severity of a worker’s injury body part by assigning a percentage. The PPD rate also applies to workers who receive loss of earning capacity awards.  Without pain and suffering damages in the world of work comp, PPD is often the only monetary compensation that is based on the long-term damage or impact from the work injury.

The increase is important for workers because PPD rates have been stagnant (at a $362/wk maximum) since 2016.  The new law increases the maximum PPD rate to $415/wk for injuries on/after April 10, 2022.  The maximum PPD rate rises to $430/wk for injuries on/after January 1, 2023.  This is a major–and necessary–increase for workers.

For example, if a worker injured in 2020 received a PPD rating of 20% to their shoulder, the total payout was $362/week for 100 weeks (totaling $36,200). With the new law, a worker hurt next week in 2022 with the same 20% PPD to the shoulder would receive $415/week for 100 weeks (totaling $41,500).

The example is more stark for a joint replacement.  For example, a knee replacement is “worth” 50% PPD.  In comparison to a worker with a total knee replacement in 2020 (215.50 weeks at $362, or $76,925 total), the worker with a knee injury next week that undergoes a knee replacement would get 212.50 weeks of PPD at the new $415/wk rate–totaling $88.187.50.

This increase in worker benefits is notable in an era of consistently declining work comp insurance rates for employers.

Change in Part-time Worker Laws

The other significant change impacts the calculation of the wage rate for a small subset of part-time workers.  Traditionally, if a part-time worker did not restrict their hours to part-time (or was not part of an employer’s documented “class” of part-time workers), the injured worker’s wages were expanded to a full-time 40 hour/week rate for work comp benefits.

With the new law, an injured part-time worker–who has worked more than one year for the employer–will have their hours restricted to the actual part-time wages for work comp benefit purposes.  However, a part-time worker that holds another job at the time of injury or has worked less than one year for the employer will still have the opportunity to expand their wages to the full-time rate.  This provision benefits employers that use long-term part-time workers.

Win for the Advisory Council

The passing of the Advisory Council bill–without any legislative changes–is a positive outcome after a number of recent legislative frustrations. The passage of the new law shows the viability of the Council and the need to make reasoned, well-informed, and vetted changes to the work comp law through the support of labor, management, and the insurance industry.  Kudos to the Council, the legislature, and the Governor in supporting these needed changes.

 

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